10-K

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                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                            ------------------------

                                   FORM 10-K
(MARK ONE)
[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934

                  FOR THE FISCAL YEAR ENDED SEPTEMBER 24, 2000
                        COMMISSION FILE NUMBER 000-27823

                                       OR

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

        FOR THE TRANSITION PERIOD FROM                TO

                       SPANISH BROADCASTING SYSTEM, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

                      SEE TABLE OF ADDITIONAL REGISTRANTS



                      DELAWARE                                                    13-3827791
                      --------                                                    ----------
                                                          
            (STATE OR OTHER JURISDICTION                                       (I.R.S. EMPLOYER
          OF INCORPORATION OR ORGANIZATION)                                   IDENTIFICATION NO.)


                           2601 SOUTH BAYSHORE DRIVE
                          COCONUT GROVE, FLORIDA 33133
             (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND ZIP CODE)

      REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:  (305) 441-6901

       SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:  NONE

          SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

                CLASS A COMMON STOCK, PAR VALUE $.0001 PER SHARE
                                (TITLE OF CLASS)

     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.  [ ]

     As of December 20, 2000, the aggregate market value of the Class A Common
Stock held by non-affiliates of the Company was approximately $172.7 million.
The aggregate market value of the Class B Common Stock held by non-affiliates of
the Company was approximately $0.3 million. (We have assumed that our shares of
Class B Common Stock would trade at the same price per share as our shares of
Class A Common Stock.) (For purposes of this paragraph, directors and executive
officers have been deemed affiliates.)

     As of December 20, 2000, 36,856,305 shares of Class A Common Stock, par
value $.0001 per share and 27,801,900 shares of Class B Common Stock, par value
$.0001 per share were outstanding.

                   DOCUMENTS INCORPORATED BY REFERENCE:  NONE
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                        TABLE OF ADDITIONAL REGISTRANTS



                                                                     PRIMARY STANDARD
                                                  STATE OR OTHER        INDUSTRIAL       I.R.S. EMPLOYER
                                                  JURISDICTION OF     CLASSIFICATION     IDENTIFICATION
NAME                                               INCORPORATION          NUMBER             NUMBER
- ----                                              ---------------    ----------------    ---------------
                                                                                
Spanish Broadcasting System of California,
  Inc. .........................................   California              4832            92-3952357
Spanish Broadcasting System Network, Inc........    New York               4899            13-3511101
SBS Promotions, Inc.............................    New York               7999            13-3456128
SBS Funding, Inc................................    Delaware               4832            52-6999475
Alarcon Holdings, Inc...........................    New York               6512            13-3475833
SBS of Greater New York, Inc....................    New York               4832            13-3888732
Spanish Broadcasting System of Florida, Inc.....     Florida               4832            58-1700848
Spanish Broadcasting System of Greater Miami,
  Inc...........................................    Delaware               4832            65-0774450
Spanish Broadcasting System of Puerto Rico,
  Inc. .........................................    Delaware               4832            52-2139546
Spanish Broadcasting System, Inc................   New Jersey              4832            13-3181941
Spanish Broadcasting System of Illinois, Inc....    Delaware               4832            36-4174296
Spanish Broadcasting System of San Antonio,
  Inc...........................................    Delaware               4832            65-0820776
Spanish Broadcasting System of Puerto Rico,
  Inc. .........................................   Puerto Rico             4832            66-0564244

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                               TABLE OF CONTENTS



                                                                        PAGE
                                                                        ----
                                                                  
PART I    ............................................................    1
ITEM 1.   BUSINESS....................................................    1
ITEM 2.   PROPERTIES..................................................   19
ITEM 3.   LEGAL PROCEEDINGS...........................................   19
ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.........   19
PART II   ............................................................   19
ITEM 5.   MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
          STOCKHOLDER MATTERS.........................................   19
ITEM 6.   SELECTED FINANCIAL DATA.....................................   21
ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
          AND RESULTS OF OPERATIONS...................................   24
ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
          RISK........................................................   30
ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.................   30
ITEM 9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
          AND FINANCIAL DISCLOSURE....................................   30
PART III  ............................................................   30
ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT..........   30
ITEM 11.  EXECUTIVE COMPENSATION......................................   32
ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT..................................................   39
ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS..............   40
PART IV   ............................................................   42
ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM
          8-K.........................................................   42


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                                     PART I

ITEM 1.  BUSINESS

     All references to "we", "us", "our", "SBS" or "our company" in this report
mean Spanish Broadcasting System, Inc., a Delaware corporation, and all entities
owned or controlled by Spanish Broadcasting System, Inc. and, if prior to 1994,
refer to our predecessor parent company Spanish Broadcasting System, Inc., a New
Jersey corporation. Our executive offices are located at 2601 South Bayshore
Drive, Coconut Grove, Florida 33133, and our telephone number is (305) 441-6901.

     SBS, founded in 1983 and incorporated in the State of Delaware in 1994, is
the second largest Spanish-language radio broadcasting company in the United
States. We currently own and operate 23 FM radio stations and one AM radio
station. We operate an additional AM radio station under a time brokerage
agreement. All 25 of our stations are located in eight of the largest Hispanic
markets in the United States, including Los Angeles, Puerto Rico, New York,
Miami, San Francisco, Chicago, San Antonio and Dallas. Our radio stations reach
over 61% of the U.S. Hispanic population. Our WSKQ-FM station in New York is
ranked in the Summer 2000 Arbitron(R) ratings as the number one station in its
target demographic group (Hispanic men and women ages 18-49).

     Our strategy is to maximize the profitability of our radio station
portfolio and to expand in our existing markets and into additional markets that
have a significant Hispanic population. We believe that the favorable
demographics of the U.S. Hispanic population and the rapid increase in
advertising targeting Hispanics provide us with significant opportunities for
growth. We also believe that we have competitive advantages in the radio
industry due to our focus on formats targeting U.S. Hispanic audiences and our
skill in programming and marketing to these audiences.

     Our Internet strategy is designed to complement our existing business and
to enable us to capitalize on our U.S. Hispanic market expertise. In 1999 we
purchased 80% of the issued and outstanding capital stock of JuJu Media, Inc.,
the owner of LaMusica.com, a bilingual Spanish-English Internet Web site and
on-line community that focuses on the U.S. Hispanic market. LaMusica.com is a
provider of original information and interactive content related to Latin music,
entertainment, news and culture. LaMusica.com provides our advertisers with an
additional means of reaching the U.S. Hispanic consumer markets and is a growing
revenue source for us.

     SBS is led by Mr. Raul Alarcon, Jr., who became our Chairman of the Board
of Directors when we completed our initial public offering on November 2, 1999
and has been Chief Executive Officer since June 1994, and President and a
director since October 1985. The Alarcon family has been involved in
Spanish-language radio broadcasting since the 1950's, when Mr. Raul Alarcon,
Sr., our Chairman Emeritus and a member of our board of directors, established
his first radio station in Camaguey, Cuba. Members of our senior management
team, on average, have over 15 years of experience in Spanish-language media and
radio broadcasting.

BUSINESS STRATEGY

     We focus on maximizing the profitability of our radio station portfolio by
strengthening the performance of our existing radio stations and making
additional strategic station acquisitions in both our existing markets and in
new markets that have a significant Hispanic population. In addition, we have
implemented an Internet strategy in order to develop new revenue sources.

OPERATING STRATEGY

     Our operating strategy focuses on maximizing our radio stations' appeal to
our audience and our advertisers while minimizing operating expenses in order to
increase revenue and cash flow. To achieve these goals, we focus on:

     Providing High-Quality Spanish-Language Programming.  We format the
programming of each of our stations to capture a significant share of the
Spanish-language audience. We use market research, including
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third party consultants and periodic music testing, to assess listener
preferences in each station's target demographic audience. We then refine our
programming to reflect the results of this research and testing. Because the
U.S. Hispanic population is so diverse, consisting of numerous identifiable
groups from many different countries of origin each with its own cultural and
musical heritage, we strive to make ourselves intimately familiar with the
musical tastes and the preferences of each of the various Hispanic ethnic groups
and we customize our programming accordingly.

     Retaining Strong Local Management Teams.  We employ local management teams
in each of our markets who are responsible for the day-to-day operations of our
radio stations. Our key local managers generally consist of a general station
manager, general sales manager and programming director. Stations are staffed
with managers who have experience and knowledge of the local radio market and
the local Hispanic market. Because of the cultural diversity of the Hispanic
population from region to region in the United States, most decisions regarding
day-to-day programming, sales and promotional efforts are made by local
managers. We believe this approach improves our flexibility and responsiveness
to changing conditions in each of the markets we serve.

     Utilizing Aggressive Sales Efforts.  Our sales force focuses on converting
audience share into advertising revenue. In order to encourage an aggressive and
focused sales force, we have developed compensation structures tied to
advertising revenue. We seek to maximize our sales to national advertisers
because national advertising generally commands a higher rate per advertising
spot than does local advertising. We have attracted key sales executives from
general market radio who have applied their expertise and relationships with the
advertising community to increase our share of advertising from leading general
market advertisers. We believe that our focused sales efforts are working to
increase media spending targeted at the U.S. Hispanic consumer market and will
enable us to continue to achieve significant revenue growth, and to narrow the
gap between the level of advertising currently targeted at U.S. Hispanics and
the potential buying power of the U.S. Hispanic population.

     Controlling Operating Costs.  By employing a disciplined approach to
operating our radio stations, we have been able to achieve operating margins
which we believe are among the highest in the radio broadcast industry. We
emphasize control of each station's operating costs through detailed budgeting,
tight control over staffing levels and frequent expense analysis. While local
management is responsible for the day-to-day operation of each station,
corporate management is responsible for long-range and strategic planning,
establishing policies and procedures, maximizing cost savings where centralized
activity is appropriate, allocating resources and maintaining overall control of
the stations.

     Making Effective Use of Promotions and Special Events.  We believe that
effective promotional efforts play a significant role in both adding new
listeners and increasing listener loyalty. Our promotional and marketing
campaigns focus on increasing Hispanic consumer awareness of advertisers'
products and services. Our goal is to use our expertise at marketing to the
Hispanic consumer in each of the markets in which we own and operate stations,
thereby attracting a large share of advertising revenue. We have organized
special promotional appearances, such as station van appearances at client
events, concerts and tie-ins to major events which form an important part of our
marketing strategy. Many of these events build advertiser loyalty because they
enable us to offer advertisers an additional means of reaching the Hispanic
consumer. In many instances, these events are co-sponsored by local television
and newspapers, allowing our advertisers to reach a larger combined audience.

     Maintaining Strong Community Involvement.  We have historically been, and
will continue to be, actively involved within the local communities that we
serve. Our radio stations participate in numerous community programs,
fund-raisers and activities benefitting the local community and Hispanics
abroad. Other examples of our community involvement include free public service
announcements, free equal-opportunity employment announcements, tours and
discussions held by radio station personalities with school and community groups
designed to limit drug and gang involvement, free concerts and events designed
to promote family values within the local Hispanic communities, and extended
coverage, when necessary, of significant events which have an impact on the U.S.
Hispanic population. Our stations and members of our management have received
numerous community service awards and acknowledgments from government entities
and

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community and philanthropic organizations for their service to the community. We
believe that this involvement helps to build and maintain station awareness and
listener loyalty.

ACQUISITION STRATEGY

     Our acquisition strategy is to acquire radio stations in the largest U.S.
Hispanic markets. We consider acquisitions of stations in our existing markets,
as well as acquisitions of stations in other markets with a large Hispanic
population, where we can maximize our revenues through aggressive sales to U.S.
Hispanic and general market advertisers. These acquisitions may include stations
which do not currently target the U.S. Hispanic market, but which we believe can
be successfully reformatted.

     In analyzing potential radio station acquisition candidates, we consider
many factors including:

     - the size of the Hispanic market;

     - anticipated growth, demographics, and other characteristics of the
       market;

     - the nature and number of competitive stations in the market;

     - the nature of other media competition in the station's market;

     - the probability of achieving operating synergies through multiple station
       ownership within the target market;

     - the existing or potential quality of the broadcast signal and
       transmission facility;

     - the station's ratings, revenue and operating cash flow; and

     - the price and terms of the purchase.

     We cannot, however, be assured that our acquisition strategy will be
successful. Our acquisition strategy is subject to a number of risks, including,
but not limited to: stations acquired by us may not increase our broadcast cash
flow or yield other anticipated benefits; required regulatory approvals may
result in unanticipated delays in completing acquisitions; we may have
difficulty managing our rapid growth; and we may be required to raise additional
financing in order to finance such acquisitions while our ability to do so is
limited by the terms of our debt instruments.

INTERNET STRATEGY

     Our Internet strategy is designed to complement our existing business and
to enable us to capitalize on our U.S. Hispanic market expertise. The core of
our strategy is LaMusica.com, an Internet Web site and on-line community focused
on the U.S. Hispanic market. This Web site offers some of our radio stations'
broadcasts through the use of audio streaming technology and provides our
advertisers with a complementary means of reaching their target audience.

TOP 10 HISPANIC RADIO MARKETS IN THE UNITED STATES

     The table below indicates the top 10 Hispanic radio markets in the United
States, including Puerto Rico. We currently own and operate radio stations in
Los Angeles, Puerto Rico, New York, Miami, San Francisco, Chicago, San Antonio
and Dallas. Population estimates are for 2000 and are based upon statistics
provided by the Strategy Research Corporation -- 2000 U.S. Hispanic Market
Report and the Strategy Research Corporation -- 2000 U.S. Latin America Market
Report.

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                                                                          % HISPANIC OF
                                                                              TOTAL         % OF TOTAL
HISPANIC                                                     HISPANIC     POPULATION IN    U.S. HISPANIC
RANK                          MARKET                        POPULATION     THE MARKET       POPULATION
- --------                      ------                        ----------    -------------    -------------
                                                              (000)
                                                                               
   1.      Los Angeles..................................      6,928.5         40.6%            18.3%
   2.      Puerto Rico..................................      3,884.4         99.6             10.3
   3.      New York.....................................      3,776.2         18.5             10.0
   4.      Miami........................................      1,522.1         38.8              4.0
   5.      San Francisco/San Jose.......................      1,423.9         20.1              3.8
   6.      Chicago......................................      1,354.0         14.2              3.6
   7.      Houston......................................      1,312.8         25.3              3.5
   8.      San Antonio..................................      1,167.9         55.0              3.1
   9.      Dallas/Ft. Worth.............................        927.8         15.7              2.5
  10.      McAllen/Brownsville (Texas)..................        874.1         89.5              2.3
                                                             --------         ----             ----
           Top 10 Hispanic Markets......................     23,171.7         32.7%            61.3%
                                                             ========         ====             ====


PROGRAMMING

     We format the programming of each of our stations to capture a substantial
share of the U.S. Hispanic audience. The U.S. Hispanic population is diverse,
consisting of numerous identifiable groups from many different countries of
origin, each with its own musical and cultural heritage. The music, culture,
customs and Spanish dialects vary from one radio market to another. We strive to
be very familiar with the musical tastes and preferences of each of the various
Hispanic ethnic groups and customize our programming to match the local
preferences of our target demographic audience in each market we serve. We have
an in-house research department in Miami of 14 employees who conduct extensive
radio market research on a daily, weekly, monthly and annual basis. By employing
listener study groups and telephone surveys modeled after Arbitron(R) written
survey methodology, but with even larger sample sizes than Arbitron(R), we are
able to assess listener preferences, track trends and gauge our success on a
daily basis, well before Arbitron(R) quarterly results are published. In this
manner, we can respond immediately to changing listener preferences and trends
by refining our programming to reflect the results of our research and testing.
Each of our programming formats is described below.

     - Spanish Tropical.  The Spanish Tropical format primarily consists of
       salsa, merengue and cumbia music. Salsa is dance music combining Latin
       Caribbean rhythms with jazz originating from Puerto Rico, Cuba and the
       Dominican Republic, which is popular with Hispanics living in New York
       and Miami. Merengue music is up-tempo dance music originating from the
       Dominican Republic. Cumbia is a festive, folkloric music which originated
       in Colombia.

     - Regional Mexican.  The Regional Mexican format consists of various types
       of music played in different regions of Mexico such as ranchera, nortena,
       banda and cumbia. Ranchera music, originating from Jalisco, Mexico, is a
       traditional folkloric sound commonly referred to as mariachi music.
       Mariachi music features acoustical instruments and is considered the
       music indigenous to Mexicans who live in 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 format from the state of Sinaloa, Mexico and is
       popular in California. Banda resembles up-tempo marching band music with
       synthesizers.

     - Tejano.  The Tejano format consists of music based on Mexican themes but
       which originated in Texas. Tejano music is a combination of contemporary
       rock, ranchera and country music, the lyrics of which are primarily sung
       in Spanish.

     - Spanish Adult Contemporary.  The Spanish Adult Contemporary format
       includes pop, Latin rock, and ballads. This format is similar to English
       Adult Contemporary featured on contemporary hit radio stations.

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     - American Contemporary Hits.  American Contemporary Hit Records format
       consists of popular music released within the last year. This format also
       tends to play a variety of music styles including Rock/Pop/Dance or
       R&B/Rap/Dance and is mostly rhythmic in nature.

     - American 80's Hits.  The American 80's Hits format consists of the top
       American chart hits from the 1980's charts.

     - Spanish Adult Top 40.  The Spanish Adult Top 40 format consists of a
       variety of Latin hit songs from the 1980's and 1990's.

     - Spanish Oldies.  The Spanish Oldies format includes a variety of Latin
       music mainly from the 1950's, 1960's and 1970's.

     - Dance.  The Dance format consists of upbeat dance and house rhythms,
       mainly from the 1980's and 1990's, that are played in dance clubs,
       including English-language music.

     The programming formats of our radio stations and the target demographic of
each station are as follows:



                                                             TARGET
                                                           DEMOGRAPHIC
MARKET         STATION               FORMAT                 (BY AGE)
- ------         -------               ------                -----------
                                                  
Los Angeles    KLAX-FM  Regional Mexican                    18-49
               KMJR-FM  Spanish Adult Contemporary          25-54
               KNJR-FM  Spanish Adult Contemporary          25-54
Puerto Rico    WMEG-FM  American Contemporary Hits          18-34
               WEGM-FM  American Contemporary Hits          18-34
               WCMA-FM  American 80's Hits                  18-49
               WIOA-FM  Spanish Adult Contemporary          18-49  (Women)
               WIOB-FM  Spanish Adult Contemporary          18-49  (Women)
               WIOC-FM  Spanish Adult Contemporary          18-49  (Women)
               WZNT-FM  Salsa                               18-49  (Men)
               WCTA-FM  Salsa                               18-49  (Men)
               WZMT-FM  Salsa                               18-49  (Men)
               WCOM-FM  American Contemporary Hits          18-24
               WOYE-FM  American Contemporary Hits          18-24
New York       WSKQ-FM  Spanish Tropical                    18-49
               WPAT-FM  Spanish Adult Contemporary          25-54
Miami          WXDJ-FM  Spanish Tropical                    18-34
               WCMQ-FM  Spanish Oldies                      35-54
               WRMA-FM  Spanish Adult Contemporary          25-54
San Francisco  KXJO-FM  Regional Mexican                    18-34
Chicago        WLEY-FM  Regional Mexican                    18-34
San Antonio    KLEY-FM  Regional Mexican                    18-49
               KSAH-AM  Regional Mexican                    18-49
Dallas         KTCY-FM  Regional Mexican                    18-34
               KXEB-AM  Time Brokerage Agreement             None


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RADIO STATION PORTFOLIO

     The following is a general description of each of our markets.

LOS ANGELES

     The Los Angeles market is the largest radio market in terms of advertising
revenues which are projected to be $851.0 million in 2000. In 2000, the Los
Angeles market had the largest U.S. Hispanic population, with approximately 6.9
million Hispanics, which is approximately 40.6% of the Los Angeles market's
total population. Los Angeles experienced annual radio revenue growth of 8.3%
between 1993 and 1998, and radio revenue in Los Angeles is expected to continue
growing at an annual rate of 9.2% between 1999 and 2003.

PUERTO RICO

     The Puerto Rico market is the twenty-seventh largest radio market in terms
of advertising revenues which are projected to be $115.8 million in 1999. In
2000, the Puerto Rico market had the second largest U.S. Hispanic population,
with approximately 3.9 million Hispanics, which we believe is approximately
99.6% of the Puerto Rico market's total population. Puerto Rico experienced
annual radio revenue growth of 5.4% between 1992 and 1998, and radio revenue in
Puerto Rico is expected to continue growing at an annual rate of 5.7% between
1999 and 2002.

NEW YORK

     The New York market is the second largest radio market in terms of
advertising revenues, which are projected to be $816.4 million in 2000. In 2000,
the New York market had the third largest U.S. Hispanic population, with
approximately 3.8 million Hispanics, which is approximately 18.5% of the New
York market's total population. We believe that we own the strongest franchise
in terms of audience share and number of Spanish-language radio stations in the
New York market, with two of the three FM Spanish-language radio stations. New
York experienced annual radio revenue growth of 10.8% between 1993 and 1998, and
radio revenue in New York is expected to continue growing at an annual rate of
10.0% between 1999 and 2003.

MIAMI

     The Miami market is the eleventh largest radio market in terms of
advertising revenues which are projected to be $277.6 million in 2000. In 2000,
the Miami market had the fourth largest U.S. Hispanic population, with
approximately 1.5 million Hispanics, which is approximately 38.8% of the Miami
market's total population. Miami experienced annual radio revenue growth of
12.4% between 1993 and 1998, and radio revenue in Miami is expected to continue
growing at an annual rate of 9.5% between 1999 and 2003.

SAN FRANCISCO

     The San Francisco market is the fourth largest radio market in terms of
advertising revenues which are projected to be $547 million in 2000. In 2000,
the San Francisco market had the fifth largest U.S. Hispanic population, with
approximately 1.4 million Hispanics, which is approximately 20.1% of the San
Francisco market's total population. San Francisco experienced annual radio
revenue growth of 12.0% between 1993 and 1998, and radio revenue in San
Francisco is expected to continue growing at an annual rate of 19.8% between
1999 and 2003.

CHICAGO

     The Chicago market is the third largest radio market in terms of
advertising revenues which are projected to be $633.2 million in 2000. In 2000,
the Chicago market had the sixth largest U.S. Hispanic population, with
approximately 1.4 million Hispanics, which is approximately 14.2% of the Chicago
market's total population. We believe that we own the strongest franchise in the
Chicago market with the number one ranked FM Spanish-language radio station.
Chicago experienced annual radio revenue growth of 9.3% between 1993 and 1998,
and radio revenue in Chicago is expected to continue growing at an annual rate
of 11.7% between 1999 and 2003.

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SAN ANTONIO

     The San Antonio market is the thirty-third largest radio market in terms of
advertising revenues which are projected to be $83.4 million in 2000. In 2000,
San Antonio had the eighth largest U.S. Hispanic population, with approximately
1.2 million Hispanics, which is approximately 55% of the San Antonio market's
total population. San Antonio experienced annual radio revenue growth of 8.3%
between 1993 and 1998, and radio revenue in San Antonio is expected to continue
growing at an annual rate of 4.5% between 1999 and 2003.

DALLAS

     The Dallas market is the fifth largest radio market in terms of advertising
revenues which are projected to be $381.8 million in 2000. In 2000, the Dallas
market had the ninth largest U.S. Hispanic population, with approximately
927,000 Hispanics, which is approximately 15.7% of the Dallas market's total
population. Dallas experienced annual radio revenue growth of 11.3% between 1993
and 1998, and radio revenue in Dallas is expected to continue growing at an
annual rate of 10.7% between 1999 and 2003.

LATIN MUSIC ON-LINE ("LAMUSICA.COM")

     LaMusica.com is a bilingual Spanish-English Internet Web site and on-line
community that focuses on the U.S. Hispanic market. LaMusica.com is a provider
of original information and interactive content related to Latin music,
entertainment, news and culture. We believe that LaMusica.com, together with our
radio station portfolio, enables our audience to enjoy additional targeted and
culturally-specific entertainment options, such as concert listings, CD reviews,
local entertainment calendars, and interactive content on popular Latin
recording artists and musicians. Similarly, LaMusica.com enables our advertisers
to cost-effectively reach their targeted Hispanic consumer through an
additional, dynamic and rapidly growing medium.

     LaMusica.com has links to the Web sites for some of our radio stations.
This network of Web sites permits our target audiences to listen to streaming
audio of live radio broadcasts from our radio stations from anywhere in the
United States and the world. In addition to our network of station Web sites and
our production of original interactive content relating to Latin music and
entertainment, we offer enhanced community features on LaMusica.com such as
branded e-mail, bulletin boards, fan clubs, chat rooms, personals and
horoscopes.

     LaMusica.com and our network of station Web sites generate revenues
primarily from two distinct sources: (1) advertising and sponsorship and (2)
electronic commerce opportunities, such as on-line music sales. We use our
stations' on-air marketing power to draw visitors to LaMusica.com. We continue
to conduct a nationwide advertising campaign on our radio stations in order to
increase audience awareness of LaMusica.com. We utilize our strong relationships
with advertisers and the music industry to develop banner advertising and
sponsorships. In May 2000, we signed a two-year three-way agreement with
LaMusica.com and America Online (AOL), whereby AOL provides LaMusica.com with a
co-branded Web site, with a guaranteed minimum number of impressions over a two
year period. We believe we can use these impressions to increase revenues. Under
the agreement, AOL also provides a programming plan enabling LaMusica.com to
create rich content for several AOL brands.

MANAGEMENT AND PERSONNEL

     As of December 20, 2000, we had 568 full-time employees, 14 of whom were
primarily involved in senior management, 249 in programming, 177 in sales, 112
in general administration and 16 in technical activities.

     To facilitate efficient management from our Coconut Grove, Florida
headquarters, we access and utilize computerized accounting systems, including
our recently purchased Oracle software, from our stations to provide timely
information to management on station operations and to assist in cost control
and the preparation of monthly financial statements. Corporate executives
regularly visit each station to monitor its operations and ensure that our
policies are properly followed.

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     Our business depends upon the efforts, abilities and expertise of our
executive officers and other key employees, including Raul Alarcon, Jr., our
Chairman of the Board of Directors, President and Chief Executive Officer. The
loss of any of these officers and key employees could have a material adverse
effect on our business. We do not maintain key man life insurance on any of our
personnel.

SEASONALITY

     Seasonal net broadcasting revenue fluctuations are common in the radio
broadcasting industry and are due primarily to fluctuations in advertising
expenditures by local and national advertisers. Our second fiscal quarter
(January through March) generally produces the lowest net broadcasting revenue
for the year because of normal post-holiday decreases in advertising
expenditures.

ADVERTISING

     Virtually all radio station revenue is derived from advertising. This
revenue is usually classified in one of two categories -- "national" or "local."
"National" generally refers to advertising that is solicited by a national
representative firm that represents the station and is paid commissions based on
collected net revenues. Our national sales representative is Caballero Spanish
Media, LLC, a division of Interep National Radio Sales, Inc. "Local" refers to
advertising purchased by advertisers and agencies in the local community served
by a particular station.

     We believe that radio is one of the most efficient and cost-effective means
for advertisers to reach targeted demographic groups. Advertising rates charged
by a radio station are based primarily on the station's ability to attract
listeners in a given market and on the attractiveness to advertisers of the
station's listener demographics. Rates vary depending upon a program's
popularity among the listeners an advertiser is seeking to attract, the number
of advertisers vying for available air time and the availability of alternative
media in the market. Radio advertising rates generally are highest during the
morning and afternoon drive-time hours which are the peak hours for radio
audience listening. We believe that having multiple stations in a market is
attractive to national advertisers, enabling the broadcaster to command higher
advertising rates. We believe that we will be able to increase our rates as new
and existing advertisers recognize the increasing desirability of targeting the
growing Hispanic population in the United States.

     Each station broadcasts a predetermined number of advertisements each hour
with the actual number depending upon the format of a particular station. We
determine the number of advertisements broadcast hourly that can maximize the
station's available revenue dollars without jeopardizing its audience listener
levels. While there may be shifts from time to time in the number of
advertisements broadcast during a particular time of the day, the total number
of advertisements broadcast on a particular station generally does not vary
significantly from year to year.

     As is customary in the radio industry, the majority of our advertising
contracts are short-term, generally running for less than three months. We have
long-term relationships with some of our advertisers. In each of our
broadcasting markets, we employ salespeople to obtain local advertising
revenues. We believe that our local sales force is crucial to maintaining
relationships with key local advertisers and agencies and identifying new
advertisers. We generally pay sales commissions to our local sales staff upon
the receipt from advertisers of the payments related to these sales. We offer
assistance to local advertisers by providing them with studio facilities to
produce commercials free of charge.

COMPETITION

     The success of each of our stations depends significantly upon its audience
ratings and its share of the overall advertising revenue within its market. The
radio broadcasting industry is a highly competitive business. Each of our radio
stations competes with both Spanish-language and English-language radio stations
in its market as well as with other advertising media such as newspapers,
broadcast television, cable television, the Internet, magazines, outdoor
advertising, transit advertising and direct mail marketing. Several of the
stations with which we compete are subsidiaries of large national or regional
companies that have substantially greater resources than we do. Factors which
are material to competitive position include management experience, the
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station's rank in its market, signal strength and frequency, and audience
demographics, including the nature of the Spanish-language market targeted by a
particular station.

     Although the radio broadcasting industry is highly competitive, some
barriers to entry exist. These barriers can be mitigated to some extent by
changing existing radio station formats and upgrading power, among other
actions. The operation of a radio station requires a license or other
authorization from the FCC, and the number of radio stations that can operate in
a given market is limited by the availability of FM and AM radio frequencies
allotted by the FCC to communities in that market. In addition, the FCC's
multiple ownership rules regulate the number of stations that may be owned and
controlled by a single entity in a given market. However, in recent years, these
rules have changed significantly. For a discussion of FCC regulation, see
"Federal Regulation of Radio Broadcasting."

     The radio industry is also subject to competition from new media
technologies that are being developed or introduced, such as the delivery of
audio programming by cable television systems, by satellite and by terrestrial
delivery of digital audio broadcasting (known as "DAB"). DAB may deliver to
nationwide and regional audiences, multi-channel, multi-format, digital radio
services with sound quality equivalent to that of compact discs. The FCC has
authorized spectrum for the use of a new technology, satellite digital audio
radio services (known as "SDARS"), to deliver audio programming. SDARS may
provide a medium for the delivery by satellite of multiple new audio programming
formats to local and national audiences. It is not known at this time whether
digital technology also may be used in the future by existing radio broadcast
stations either on existing or alternate broadcasting frequencies. The FCC also
has begun accepting applications for a new "low power" radio or
"microbroadcasting" service which could open up opportunities for low cost
neighborhood service on frequencies which would not interfere with existing
stations. No FCC action has been taken on these applications to date.

     The delivery of information through the presently unregulated Internet also
could create a new form of competition. The radio broadcasting industry
historically has grown despite the introduction of new technologies for the
delivery of entertainment and information, such as television broadcasting,
cable television, audio tapes and compact discs. A growing population and the
greater availability of radios, particularly car and portable radios, have
contributed to this growth. We cannot assure you, however, that the development
or introduction in the future of any new media technology will not have an
adverse effect on the radio broadcasting industry.

     We cannot predict what other matters might be considered in the future by
the FCC, nor can we assess in advance what impact, if any, the implementation of
any of these proposals or changes might have on our business. See "Federal
Regulation of Radio Broadcasting."

ANTITRUST

     An important part of our growth strategy is the acquisition of additional
radio stations. Since the passage of the Telecommunications Act of 1996, the
Justice Department has become more aggressive in reviewing proposed acquisitions
of radio stations and radio station networks. The Justice Department is
particularly aggressive when the proposed buyer already owns one or more radio
stations in the market of the station it is seeking to buy. Recently, the
Justice Department has challenged a number of radio broadcasting transactions.
Some of those challenges ultimately resulted in consent decrees requiring, among
other things, divestitures of certain stations. In general, the Justice
Department has more closely scrutinized radio broadcasting acquisitions that
result in local market shares in excess of 40% of radio advertising revenue.
Similarly, the FCC staff has announced new procedures to review proposed radio
broadcasting transactions even if the proposed acquisition otherwise complies
with the FCC's ownership limitations. In particular, the FCC may invite public
comment on proposed radio transactions that the FCC believes, based on its
initial analysis, may present ownership concentration concerns in a particular
local radio market.

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FEDERAL REGULATION OF RADIO BROADCASTING

     The radio broadcasting industry is subject to extensive and changing
regulation by the FCC of programming, technical operations, employment and other
business practices. The FCC regulates radio broadcast stations pursuant to the
Communications Act. The Communications Act permits the operation of radio
broadcast stations only in accordance with a license issued by the FCC upon a
finding that the grant of a license would serve the public interest, convenience
and necessity. The Communications Act provides for the FCC to exercise its
licensing authority to provide a fair, efficient and equitable distribution of
broadcast service throughout the United States. Among other things, the FCC:

     - assigns frequency bands for radio broadcasting;

     - determines the particular frequencies, locations and operating power of
       radio broadcast stations;

     - issues, renews, revokes and modifies radio broadcast station licenses;

     - establishes technical requirements for certain transmitting equipment
       used by radio broadcast stations;

     - adopts and implements regulations and policies that directly or
       indirectly affect the ownership, operation, program content and
       employment and business practices of radio broadcast stations; and

     - has the power to impose penalties, including monetary forfeitures, for
       violations of its rules and the Communications Act.

     The Communications Act prohibits the assignment of an FCC license, or other
transfer of control of an FCC licensee, without the prior approval of the FCC.
In determining whether to approve assignments or transfers, and in determining
whether to grant or renew a radio broadcast license, the FCC considers a number
of factors pertaining to the licensee (and any proposed licensee), including
restrictions on foreign ownership, compliance with FCC media ownership limits
and other FCC rules, licensee character and compliance with the Anti-Drug Abuse
Act of 1988.

     The following is a brief summary of certain provisions of the
Communications Act and specific FCC rules and policies. This summary does not
purport to be complete and is subject to the text of the Communications Act, the
FCC's rules and regulations, and the rulings of the FCC. You should refer to the
Communications Act and these FCC rules, regulations and rulings for further
information concerning the nature and extent of federal regulation of radio
broadcast stations.

     A licensee's failure to observe the requirements of the Communications Act
or FCC rules and policies may result in the imposition of various sanctions,
including admonishment, fines, the grant of renewal terms of less than eight
years, the grant of a license with conditions or, for particularly egregious
violations, the denial of a license renewal application, the revocation of an
FCC license or the denial of FCC consent to acquire additional broadcast
properties.

     Congress and the FCC have had under consideration, and may in the future
consider and adopt, new laws, regulations and policies regarding a wide variety
of matters that could, directly or indirectly, affect the operation, ownership
and profitability of SBS's radio stations, result in the loss of audience share
and advertising revenue for our radio broadcast stations or affect our ability
to acquire additional radio broadcast stations or finance these acquisitions.
Such matters may include:

     - changes to the license authorization and renewal process;

     - proposals to impose spectrum use or other fees on FCC licensees;

     - auction of new broadcast licenses;

     - changes to the FCC's equal employment opportunity regulations and other
       matters relating to involvement of minorities and women in the
       broadcasting industry;

     - proposals to change rules relating to political broadcasting including
       proposals to grant free air time to candidates, and other changes
       regarding program content;

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     - proposals to restrict or prohibit the advertising of beer, wine and other
       alcoholic beverages;

     - technical and frequency allocation matters;

     - the implementation of digital audio broadcasting on both a satellite and
       terrestrial basis;

     - changes in broadcast cross-interest, multiple ownership, foreign
       ownership, cross-ownership and ownership attribution policies;

     - proposals to allow telephone companies to deliver audio and video
       programming to homes in their service areas; and

     - proposals to alter provisions of the tax laws affecting broadcast
       operations and acquisitions.

     We cannot predict what changes, if any, might be adopted, nor can we
predict what other matters might be considered in the future, nor can we judge
in advance what impact, if any, the implementation of any particular proposals
or changes might have on our business.

FCC LICENSES

     The FCC licenses for the radio stations are or will be held by direct or
indirect wholly-owned subsidiaries of SBS.

     The Communications Act provides that a broadcast station license may be
granted to any applicant if the public interest, convenience and necessity will
be served thereby, subject to certain limitations. In making licensing
determinations, the FCC considers an applicant's legal, technical, financial and
other qualifications. The FCC grants radio broadcast station licenses for
specific periods of time and, upon application, may renew them for additional
terms. Under the Communications Act, radio broadcast station licenses may be
granted for a maximum term of eight years.

     Generally, the FCC renews radio broadcast licenses without a hearing upon a
finding that:

     - the radio station has served the public interest, convenience and
       necessity;

     - there have been no serious violations by the licensee of the
       Communications Act or FCC rules and regulations; and

     - there have been no other violations by the licensee of the Communications
       Act or FCC rules and regulations which, taken together, indicate a
       pattern of abuse.

After considering these factors, the FCC may grant the license renewal
application with or without conditions, including renewal for a term less than
the maximum term otherwise permitted by law, or hold an evidentiary hearing.

     In addition, the Communications Act authorizes the filing of petitions to
deny a license renewal application during specific periods of time after a
renewal application has been filed. Interested parties, including members of the
public, may use these petitions to raise issues concerning a renewal applicant's
qualifications. If a substantial and material question of fact concerning a
renewal application is raised by the FCC or other interested parties, or if for
any reason the FCC cannot determine that granting a renewal application would
serve the public interest, convenience and necessity, the FCC will hold an
evidentiary hearing on the application. If as a result of an evidentiary hearing
the FCC determines that the licensee has failed to meet the requirements
specified above and that no mitigating factors justify the imposition of a
lesser sanction, then the FCC may deny a license renewal application.
Historically, our licenses have been renewed without any conditions or sanctions
being imposed, but we cannot assure you that the licenses of each of our
stations will continue to be renewed or will continue to be renewed without
conditions or sanctions.

     The FCC classifies each AM and FM radio station. An AM radio station
operates on either a clear channel, regional channel or local channel. A clear
channel is one on which AM radio stations are assigned to serve wide areas,
particularly at night.

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     The minimum and maximum facilities requirements for an FM radio station are
determined by its class. Possible FM class designations depend upon the
geographic zone in which the transmitter of the FM radio station is located. In
general, commercial FM radio stations are classified as follows, in order of
increasing power and antenna height: Class A, B1, C3, B, C2, C1 or C radio
stations. The FCC recently has adopted rules to divide Class C stations into two
subclasses based on antenna height. Stations not meeting the minimum height
requirement within a three-year transition period would be downgraded
automatically to the new Class C0 category.

     Ownership Matters.  The Communications Act requires prior approval of the
FCC for the assignment of a broadcast license or the transfer of control of a
corporation or other entity holding a license. In determining whether to approve
an assignment of a radio broadcast license or a transfer of control of a
broadcast licensee, the FCC considers, among other things:

     - the financial and legal qualifications of the prospective assignee or
       transferee, including compliance with FCC restrictions on non-U.S.
       citizen or entity ownership and control;

     - compliance with FCC rules limiting the common ownership of attributable
       interests in broadcast and newspaper properties;

     - the history of compliance with FCC operating rules; and

     - the character qualifications of the transferee or assignee and the
       individuals or entities holding attributable interests in them.

Applications to the FCC for assignments and transfers are subject to petitions
in favor of denying the assignment or transfer by interested parties.

     To obtain the FCC's prior consent to assign or transfer a broadcast
license, appropriate applications must be filed with the FCC. The application
must be placed on public notice for a period of 30 days during which petitions
to deny the application may be filed by interested parties, including members of
the public. Informal objections may be filed any time up until the FCC acts upon
the application. If the FCC grants an assignment or transfer application,
interested parties have 30 days from public notice of the grant to seek
reconsideration of that grant. The FCC usually has an additional ten days to set
aside such grant on its own motion. When ruling on an assignment or transfer
application, the FCC is prohibited from considering whether the public interest
might be served by an assignment or transfer to any party other than the
assignee or transferee specified in the application.

     Under the Communications Act, a broadcast license may not be granted to or
held by any corporation that has more than 20% of its capital stock owned or
voted by non-U.S. citizens or entities or their representatives, by foreign
governments or their representatives, or by non-U.S. corporations. Furthermore,
the Communications Act provides that no FCC broadcast license may be granted to
or held by any corporation directly or indirectly controlled by any other
corporation of which more than 25% of its capital stock is owned of record or
voted by non-U.S. citizens or entities or their representatives, or foreign
governments or their representatives or by non-U.S. corporations, if the FCC
finds the public interest will be served by the refusal or revocation of such
license. These restrictions apply in modified form to other forms of business
organizations, including partnerships and limited liability companies. Thus, the
licenses for our stations could be revoked if more than 25% of our outstanding
capital stock is issued to or for the benefit of non-U.S. citizens.

     The FCC generally applies its other broadcast ownership limits to
"attributable" interests held by an individual, corporation, partnership or
other association or entity, including limited liability companies. In the case
of a corporation holding broadcast licenses, the interests of officers,
directors and those who, directly or indirectly, have the right to vote five
percent or more of the stock of a licensee corporation are generally deemed
attributable interests, as are positions as an officer or director of a
corporate parent of a broadcasting licensee. The FCC treats all partnership
interests as attributable, except for those limited partnership interests that
under FCC policies are considered insulated from material involvement in the
management or operation of the media-related activities of the partnership. The
FCC currently treats limited liability companies like

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limited partnerships for purposes of attribution. Stock interests held by
insurance companies, mutual funds, bank trust departments and certain other
passive investors that hold stock for investment purposes only become
attributable with the ownership of ten percent or more of the voting stock of
the corporation holding broadcast licenses.

     To assess whether a voting stock interest in a direct or an indirect parent
corporation of a broadcast licensee is attributable, the FCC uses a "multiplier"
analysis in which non-controlling voting stock interests are deemed
proportionally reduced at each non-controlling link in a multi-corporation
ownership chain. A time brokerage agreement with another radio station in the
same market creates an attributable interest in the brokered radio station as
well for purposes of the FCC's local radio station ownership rules, if the
agreement affects more than 15% of the brokered radio station's weekly broadcast
hours.

     Debt instruments, non-voting stock, options and warrants for voting stock
that have not yet been exercised, insulated limited partnership interests where
the limited partner is not materially involved in the media-related activities
of the partnership, and minority voting stock interests in corporations where
there is a single holder of more than 50% of the outstanding voting stock whose
vote is sufficient to affirmatively direct the affairs of the corporation,
generally do not subject their holders to attribution. However, the FCC's rules
also specify other exceptions to these general principles for attribution. The
FCC is currently evaluating whether to:

     - raise the benchmark for voting stock from five to ten percent;

     - raise the benchmark for passive investors holding voting stock from ten
       to twenty percent;

     - continue the single 50% stockholder exception; and/or

     - attribute non-voting stock or perhaps only when combined with other
       rights such as voting shares or contractual relationships.

More recently, the FCC has solicited comment on proposed rules that would:

     - treat an otherwise non-attributable ownership equity or debt interest in
       a licensee as an attributable interest where the interest holder is a
       program supplier or the owner of a broadcast station in the same market
       and the equity and/or debt holding is greater than a specified benchmark;
       and

     - in some circumstances, treat the licensee of a broadcast station that
       sells advertising time of another station in the same market pursuant to
       a joint sales agreement as having an attributable interest in the station
       whose advertising is being sold.

     Communications Act and FCC rules generally restrict ownership, operation or
control of, or the common holding of attributable interests in:

     - radio broadcast stations above certain limits servicing the same local
       market;

     - a radio broadcast station and a television broadcast station servicing
       the same local market; and

     - a radio broadcast station and a daily newspaper serving the same local
       market.

These rules include specific signal contour overlap standards to determine
compliance, and the FCC defined market will not necessarily be the same market
used by Arbitron(R) or other surveys, or for purposes of the HSR Act. Under
these "cross-ownership" rules, we, absent waivers, would not be permitted to own
a radio broadcast station and acquire an attributable interest in any daily
newspaper or television broadcast station, other than a low-powered television
station, in the same market where we then owned any radio broadcast station. Our
stockholders, officers or directors, absent a waiver, may not hold an
attributable interest in a daily newspaper or television broadcast station in
those same markets.

     The FCC is currently reviewing the ban on common ownership of a radio
station and a daily newspaper in the same market. The FCC's rules provide for
the liberal grant of a waiver of the rule prohibiting common ownership of radio
and television stations in the same geographic market in the top 25 television
markets if specific conditions are satisfied, and the FCC will consider waivers
in other markets under more restrictive

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standards. The FCC is reviewing its ban on the common ownership of a radio
station and a television station or newspaper including extending the policy of
liberal waivers of common ownership of radio and television stations to the top
50 television markets.

     Although current FCC nationwide radio broadcast ownership rules allow one
entity to own, control or hold attributable interests in an unlimited number of
FM radio stations and AM radio stations nationwide, the Communications Act and
the FCC's rules limit the number of radio broadcast stations in local markets in
which a single entity may own an attributable interest as follows:

     - In a radio market with 45 or more commercial radio stations, a party may
       own, operate or control up to eight commercial radio stations, not more
       than five of which are in the same service (AM or FM).

     - In a radio market with between 30 and 44 (inclusive) commercial radio
       stations, a party may own, operate or control up to seven commercial
       radio stations, not more than four of which are in the same service (AM
       or FM).

     - In a radio market with between 15 and 29 (inclusive) commercial radio
       stations, a party may own, operate or control up to six commercial radio
       stations, not more than four of which are in the same service (AM or FM).

     - In a radio market with 14 or fewer commercial radio stations, a party may
       own, operate or control up to five commercial radio stations, not more
       than three of which are in the same service (AM or FM), except that a
       party may not own, operate, or control more than 50 percent of the radio
       stations in such market.

     Because of these multiple and cross-ownership rules, if a stockholder,
officer or director of SBS holds an attributable interest in SBS, such
stockholder, officer or director may violate the FCC's rules if such person or
entity also holds or acquires an attributable interest in other television
stations, radio stations or daily newspapers, depending on their number and
location. If an attributable stockholder, officer or director of SBS violates
any of these ownership rules, we may be unable to obtain from the FCC one or
more authorizations needed to conduct our radio station business and may be
unable to obtain FCC consents for future acquisitions. As long as one person or
entity holds more than 50% of the voting power of the common stock of SBS where
the vote of such person or entity is sufficient to affirmatively direct the
affairs of SBS, another stockholder, unless serving as an officer and/or
director, generally would not hold an attributable interest in SBS. However, as
described above, the FCC is currently evaluating whether to continue the
exception for a single majority stockholder of more than 50% of a licensee's
voting stock. As of December 19, 2000, Raul Alarcon, Jr. held more than 50% of
the total voting power of our common stock.

     Under its cross-interest policy, the FCC considers meaningful relationships
among competing media outlets that serve substantially the same area, even if
the ownership rules do not specifically prohibit the relationship. Under this
policy, the FCC may consider whether to prohibit one party from holding an
attributable interest and a substantial non-attributable interest (including
non-voting stock, limited partnership and limited liability company interests)
in a media outlet in the same market, or from entering into a joint venture or
having common key employees with competitors. The cross-interest policy does not
necessarily prohibit all of these interests, but requires that the FCC consider
whether, in a particular market, the meaningful relationships between
competitors could have a significant adverse effect upon economic competition
and program diversity. In a rule making proceeding concerning the attribution
rules, the FCC has sought comment on, among other things, (1) whether the
cross-interest policy should be applied only in smaller markets, and (2) whether
non-equity financial relationships, such as debt, when combined with multiple
business relationships, such as local marketing agreements or joint sales
arrangements, raise concerns under the cross-interest policy.

     Programming and Operations.  The Communications Act requires broadcasters
to serve the public interest. A broadcast licensee is required to present
programming in response to community problems, needs and interests and to
maintain certain records demonstrating its responsiveness. The FCC will consider
complaints from listeners about a broadcast station's programming when it
evaluates the licensee's renewal application, but listeners' complaints also may
be filed and considered at any time. Stations also must pay
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regulatory and application fees, and follow various FCC rules that regulate,
among other things, political advertising, the broadcast of obscene or indecent
programming, sponsorship identification, the broadcast of contests and lotteries
and technical operation.

     The FCC requires that licensees not discriminate in hiring practices,
develop and implement programs designed to promote equal employment
opportunities and submit reports to the FCC on these matters annually and in
connection with each license renewal application.

     The FCC rules also prohibit a broadcast licensee from simulcasting more
than 25% of its programming on another radio station in the same broadcast
service (that is, AM/AM or FM/FM). The simulcasting restriction applies if the
licensee owns both radio broadcast stations or owns one and programs the other
through a local marketing agreement, provided that the contours of the radio
stations overlap in a certain manner.

     Local Marketing Agreements.  Often radio stations enter into LMAs or time
brokerage agreements. These agreements take various forms. Separately owned and
licensed radio stations may agree to function cooperatively in programming,
advertising sales and other matters, subject to compliance with the antitrust
laws and the FCC's rules and policies, including the requirement that the
licensee of each radio station maintain independent control over the programming
and other operations of its own radio station.

     Joint Sales Agreements.  Over the past few years, a number of radio
stations have entered into cooperative arrangements commonly known as joint
sales agreements or JSAs. The FCC has determined that issues of joint
advertising sales should be left to enforcement by antitrust authorities, and
therefore does not generally regulate joint sales practices between stations.
Currently, stations for which another licensee sells time under a JSA are not
deemed by the FCC to be an attributable interest of that licensee. However, in
connection with its ongoing rulemaking proceedings concerning the attribution
rules, the FCC is considering whether JSAs should be considered attributable
interests or within the scope of the FCC's cross-interest policy, particularly
when JSAs contain provisions for the supply of programming services and/or other
elements typically associated with local marketing agreements.

     RF Radiation.  In 1985, the FCC adopted rules based on a 1982 American
National Standards Institute (ANSI) standard regarding human exposure to levels
of radio frequency (RF) radiation. These rules require applicants for renewal of
broadcast licenses or modification of existing licenses to inform the FCC at the
time of filing such applications whether an existing broadcast facility would
expose people to RF radiation in excess of certain limits. In 1992, ANSI adopted
a new standard for RF exposure that, in some respects, was more restrictive in
the amount of environmental RF exposure permitted. The FCC has since adopted
more restrictive radiation limits which became effective October 15, 1997, and
which are based in part on the revised ANSI standard.

     Digital Audio Radio Service.  The FCC has allocated spectrum to a new
technology, digital audio radio service (DARS), to deliver satellite-based audio
programming to a national or regional audience and issued regulations for a DARS
service in early 1997. The nationwide reach of satellite DARS could allow niche
programming aimed at diverse communities that SBS is targeting. The licensees
will be permitted to sell advertising and lease channels in these media. The
FCC's rules require that these licensees launch and begin operating at least one
space station by 2001 and be fully operational by 2003.

     Low Power Radio Broadcast Service.  The FCC recently adopted rules
establishing two classes of a low power radio service, both of which will
operate in the existing FM radio band: a primary class with a maximum operating
power of 100 watts and a secondary class with a maximum power of 10 watts. These
low power radio stations will have limited service areas of 3.5 miles and 1 to 2
miles, respectively. Implementation of a low power radio service or
microbroadcasting will provide an additional audio programming service that
could compete with SBS's radio stations for listeners, but we cannot predict the
effect upon SBS.

ENVIRONMENTAL MATTERS

     In connection with our sale of WXLX-AM in 1997, we assigned the lease of
the transmitter for WXLX-AM in Lyndhurst, New Jersey, to the purchaser of the
station. The transmitter is located on a former
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landfill which ceased operations in the late 1960's. Although WXLX-AM has been
sold, we retain potential exposure to possible environmental liabilities
relating to the transmitter site. Because the lessee of the property is under a
long-term lease, we may become liable for costs associated with remediation of
the site. We are unable to assess the likelihood that any claim for remediation
of this site will arise, and no amounts have been accrued in the consolidated
financial statements relating to this contingent liability.

     On September 28, 1999, we received notice from the purchaser of KXMG-AM, a
station located in Los Angeles that we sold in December 1997, that it would make
a claim against us for indemnification under the asset purchase agreement,
pursuant to which it purchased the station, for the removal of an underground
fuel storage tank. The notice did not specify the amount of the indemnification
claim. We do not have sufficient information to assess our potential exposure to
liability, and no amounts have been accrued in the consolidated financial
statements relating to this contingent liability.

RECENT DEVELOPMENTS

     Initial Public Offering and Related Transactions.  On November 2, 1999, we
closed our initial public offering of 25,055,510 shares of Class A Common Stock,
raising $389.4 million in net proceeds to SBS, including proceeds from the
exercise of the over-allotment option granted to the underwriters. Selling
shareholders who participated in the offering raised an aggregate of $80.4
million in net proceeds. The shares of Class A Common Stock were offered at an
initial offering price of $20.00 per share. Our shares began trading on the
Nasdaq National Market on October 28, 1999.

     On November 2, 1999, we also closed our offering of $235.0 million of
9 5/8% Senior Subordinated Notes due 2009, raising $228.0 million in net
proceeds to SBS.

     On September 30, 1999, we commenced tender offers and the solicitation of
consents to adopt amendments to the indentures governing our then outstanding
senior notes to eliminate substantially all of the restrictive covenants and
default provisions contained in the indentures, other than the covenants
relating to the payment of interest on the principal of the notes. On November
3, 1999, we accepted for payment consent solicitations and tender offers for two
series of our then outstanding senior notes totaling $176,559,000 in aggregate
principal amount. The first series, aggregate principal amount $101,559,000 of
outstanding 12 1/2% Senior Notes due 2002, was redeemed at $1,142.86 per each
validly tendered $1,000 12 1/2% Note. We received consents and tenders from
99.7% of our 12 1/2% Notes. As of December 20, 2000, there is an aggregate
principal amount of $100,000 of our 12 1/2% Notes that remains outstanding. The
second series, aggregate principal amount $75.0 million of outstanding 11%
Senior Notes due 2004, Series B was purchased by us at $1,108.04 per each
validly tendered $1,000 11% Note. We received consents and tenders from 100% of
the holders of our 11% Notes.

     On November 2, 1999, we gave notice of redemption of all of our outstanding
14 1/4% Senior Exchangeable Preferred Stock at 105% of the liquidation
preference of each share at an aggregate cost to us of approximately $265.6
million. We completed the redemption on December 2, 1999.

     Reclassification and Stock Split of Common Stock.  On September 29, 1999,
we filed a third amended and restated certificate of incorporation to reclassify
all of our then outstanding shares of Class A Common Stock, par value $.01 per
share, into shares of Class B Common Stock, par value $.0001 per share and
effect a 50-to-1 stock split of the new shares of Class B Common Stock. Each
share of Class A Common Stock entitles its holder to one vote and each share of
Class B Common Stock entitles its holder to ten votes.

     Purchase of Additional Puerto Rico Stations.  On September 22, 1999,
Spanish Broadcasting System of Puerto Rico, Inc., a Delaware corporation and
wholly owned subsidiary of SBS, entered into a stock purchase agreement to
purchase all of the outstanding capital stock of the following nine subsidiaries
of AMFM Operating Inc., a Delaware corporation (formerly known as Chancellor
Media Corporation of Los Angeles) ("AMFM"): Primedia Broadcast Group, Inc., WIO,
Inc., Cadena Estereotempo, Inc., Portorican American Broadcasting, Inc., WLDI,
Inc., WRPC, Inc., WOYE, Inc., WZNT, Inc., WOQI, Inc. (the "Primedia Station
Group"). The Primedia Station Group owns and operates eight radio stations in
Puerto Rico: WIOA-FM, WIOB-FM, WIOC-FM, WCOM-FM, WZMT-FM, WZNT-FM, WOYE-FM, and

                                       16
   20

WCTA-FM. On January 14, 2000, we completed the purchase from AMFM of all of the
outstanding capital stock of the Primedia Station Group for total cash
consideration of $90.8 million (net of $1.0 million cash acquired), including a
$10.0 million deposit that was made on September 22, 1999 and closing costs of
$0.7 million. The acquisition was financed from cash on hand.

     Sale of Florida Keys Stations.  On February 2, 2000, SBS completed the sale
of WVMQ-FM in Key West, Florida and WZMQ-FM in Key Largo, Florida to South
Broadcasting System, Inc., a company owned by Mr. Pablo Raul Alarcon, Sr., our
Chairman Emeritus and a member of our board of directors, for total cash
consideration of $0.7 million.

     Shelf Registration.  On March 13, 2000, in fulfillment of our obligation
pursuant to registration rights agreements dated June 29, 1994 and March 15,
1997, respectively, we filed a registration statement on Form S-3 through which
certain selling stockholders are offering for sale from time to time up to an
aggregate of 7,387,750 shares of our Class A Common Stock, which shares were
originally issued to the selling stockholders as shares of Class B Common Stock
pursuant to 1994 and 1997 warrants. On May 8, 2000, the SEC declared the
registration statement on Form S-3 effective. The selling stockholders may sell
the shares of Class A Common Stock from time to time on the over-the-counter
market in regular brokerage transactions or in privately negotiated
transactions. We will not receive any portion of the proceeds from the sale of
these shares by the selling stockholders.

     Senior Credit Facility.  On July 6, 2000, we entered into a credit
agreement with Lehman Commercial Paper, Inc. as administrative agent and the
several banks and other financial institutions or entities from time to time a
party to the credit agreement. The senior credit facility includes a six year
$25.0 million revolving credit facility and $125.0 million multi-draw term loan
facility.

     Purchase of Dallas, San Francisco, and Additional Los Angeles and San
Antonio Stations.  On May 8, 2000, we entered into a stock purchase agreement
with Rodriguez Communications, Inc., a Delaware corporation ("RCI") and the
stockholders of RCI to acquire all of the outstanding capital stock of RCI which
owns and operates radio stations KMJR-FM (formerly KFOX-FM) and KNJR-FM
(formerly KREA-FM) serving the Los Angeles, California market, KXJO-FM serving
the San Francisco, California market and KSAH-AM serving the San Antonio, Texas
market. On May 8, 2000 we also entered into an asset purchase agreement with New
World Broadcasters Corp. ("New World"), a Texas corporation and an affiliate of
RCI, to acquire radio station KTCY-FM serving the Dallas, Texas market, and a
stock purchase agreement with New World and 910 Broadcasting Corp., a Texas
corporation and wholly-owned subsidiary of New World, to acquire all of the
outstanding capital stock of 910 Broadcasting Corp. which owns and operates
radio station KXEB-AM serving the Dallas, Texas market.

     On November 10, 2000, we completed the purchase of all the outstanding
capital stock of RCI and the purchase of radio station KTCY-FM for total
consideration of $164.3 million, consisting of 4,441,545 shares of SBS Class A
Common Stock valued at $42.6 million and $121.7 million in cash. We financed the
purchase of all the outstanding capital stock of RCI and the purchase of radio
station KTCY-FM with previously unissued shares of our Class A Common Stock,
cash on hand and borrowings under our credit agreement dated July 6, 2000 with
Lehman Commercial Paper, Inc. as administrative agent, and the several banks and
other financial institutions or entities from time to time party to the credit
agreement. From May 8, 2000 to November 10, 2000, we operated radio station
KTCY-FM under a time brokerage agreement with New World. From May 23, 2000 to
November 10, 2000, we operated radio station KSAH-AM under a time brokerage
agreement with RCI. From July 6, 2000 to November 10, 2000, we operated radio
stations KMJR-FM and KNJR-FM under a time brokerage agreement with RCI. From
August 23, 2000 to November 10, 2000, we operated radio station KXJO-FM under a
time brokerage agreement with RCI.

     We have not yet closed the purchase of all the outstanding capital stock of
910 Broadcasting Corp., the owner and operator of radio station KXEB-AM because
FCC approval is still pending for this transaction. We cannot assure you that
this acquisition will occur. We began operating radio station KXEB-AM on May 8,
2000 under a time brokerage agreement with New World and 910 Broadcasting Corp.,
which will continue until the closing of the purchase of all the outstanding
capital stock of 910 Broadcasting Corp.

                                       17
   21

     Purchase of Additional Los Angeles Station.  On November 2, 2000, we
entered into an asset purchase agreement with International Church of the Four
Square Gospel to purchase radio station KFSG-FM in Los Angeles, California at a
purchase price of $250,000,000. In connection with this acquisition, we made an
initial deposit of $5,000,000 toward the purchase price. The agreement contains
customary representations and warranties, and the closing of our acquisition is
subject to the satisfaction of certain customary conditions, including receipt
of regulatory approval from the FCC. The agreement may be terminated by us or by
the seller if the closing does not occur by December 31, 2001.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     This report contains forward-looking statements, including statements under
the captions "Management's Discussion and Analysis of Financial Condition and
Results of Operations," "Business" and elsewhere in this report, concerning our
expectations of future sales; gross profits; research and development expenses;
selling, general and administrative expenses; product introductions and cash
requirements. Forward-looking statements often include words or phrases such as
"will likely result", "expect", "will continue", "anticipate", "estimate",
"intend", "plan", "project", "outlook" or similar expressions. The statements
are not guarantees of future performance and are subject to certain risks,
uncertainties and other factors, some of which are beyond our control, are
difficult to predict and could cause actual results to differ materially from
those expressed in the forward-looking statements. Factors which could cause
actual results to differ from expectations include those in the "Risk Factors"
section of our registration statement on Form S-1, as amended (Registration No.
333-85499) and our registration statement on Form S-3, as amended (Registration
No. 333-32240). We cannot assure you that our results of operations will not be
adversely affected by one or more of these factors. We caution you not to place
undue reliance on these forward-looking statements, which reflect our
management's view only as of the date of this report. We are not obligated to
update these statements or publicly release the results of any revisions to them
to reflect events or circumstances occurring after the date of this report or to
reflect the occurrence of unanticipated events.

CERTAIN CONSIDERATIONS

     - Our substantial level of debt could limit our ability to grow and
       compete.

     - The terms of our debt restrict us from engaging in many activities and
       require us to satisfy various financial tests.

     - We have experienced net losses in the past and to the extent that we
       experience losses in the future, our ability to raise capital and the
       market prices of our securities could be adversely affected.

     - A large portion of our net broadcast revenue and broadcast cash flow
       comes from the New York and Miami markets.

     - Loss of key personnel could adversely affect our business, including Raul
       Alarcon, Jr., our Chairman of the Board of Directors, President and Chief
       Executive Officer.

     - We compete for advertising revenue with other radio groups as well as
       television and other media, many operators of which have greater
       resources than we do.

     - Our growth depends on successfully executing our acquisition strategy. We
       intend to grow by acquiring radio stations primarily in the largest U.S.
       Hispanic markets. We cannot assure you that our acquisition strategy will
       be successful.

     - Raul Alarcon, Jr., Chairman of the Board of Directors, Chief Executive
       Officer and President, has majority voting control.

     - We must be able to respond to rapidly changing technology, services and
       standards which characterize our industry in order to remain competitive.

                                       18
   22

     - Our business depends on maintaining our FCC licenses. We cannot assure
       you that we will be able to maintain these licenses.

     - We may face regulatory review for additional acquisitions in our existing
       markets and, potentially, new markets.

     - A national or regional recession could impair our revenues.

     - Future sales by existing stockholders could depress the market price of
       our Class A Common Stock.

ITEM 2.  PROPERTIES

     As of December 1, 2000, we relocated our corporate headquarters to Coconut
Grove, Florida to a building owned by Mr. Alarcon, Jr. We entered into a ten
year lease with Irradio Holding Limited, a Florida partnership. See "Item 13.
Certain Relationships and Related Transactions." The types of properties
required to support each of our radio stations include offices, broadcasting
studios and antenna towers where broadcasting transmitters and antenna equipment
are located. We own the building housing the office and studios in New York for
WSKQ-FM and WPAT-FM, and in Los Angeles for KLAX-FM. Additionally, we own a
separate building in Los Angeles that we previously used as the office for our
Los Angeles operations. We own the auxiliary transmitter site for KSAH-AM in
Universal City, Texas and we lease all of our other transmitter sites, with
lease terms that expire between 2000 and 2035, assuming all renewal options are
exercised. We also own a tower site in Signal Hill, California where we lease
space to a public broadcast station and other members of the telecommunications
industry. The studios and offices of our Miami and South Florida stations are
currently located in leased facilities with lease terms that expire in 2012. See
"Item 13. Certain Relationships and Related Transactions." We lease the office
and studio facilities for our stations in Chicago, Dallas, Oakland, San Antonio
and Puerto Rico.

     The transmitter sites for our stations are material to our overall
operations. Management believes that our properties are in good condition and
are suitable for our operations; however, we continually seek opportunities to
upgrade our properties. We own substantially all of the equipment used in our
radio broadcasting business. See "Item 1. Business -- Environmental Matters."

ITEM 3.  LEGAL PROCEEDINGS

     From time to time we are involved in litigation incidental to the conduct
of our business, such as contract matters and employee-related matters. We are
not currently a party to litigation which, in the opinion of management, is
likely to have a material adverse effect on our business. See "Item 1.
Business -- Environmental Matters."

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

     No matters were submitted to a vote of security holders during the fourth
quarter of fiscal year 2000.

                                    PART II

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

     Our shares of Class A Common Stock were not registered under the Securities
Act of 1933 or the Securities Exchange Act of 1934, as amended, until October
27, 1999. The principal market upon which our Class A Common Stock is traded is
the Nasdaq National Market. Our shares of Class A Common Stock began trading on
the Nasdaq National Market on October 28, 1999. For the period from October 28,
1999 to December 26, 1999, the high and low bids for our Class A Common Stock
were $39.88 and $25.25, respectively. For the period from December 27, 1999 to
March 26, 2000, the high and low bids for our Class A Common Stock were $42.00
and $17.25, respectively. For the period from March 27, 2000 to June 25, 2000,
the high and low bids for our Class A Common Stock were $25.50 and $13.94,
respectively. For the period from June 26, 2000 to September 24, 2000, the high
and low bids for our Class A Common Stock were $22.50

                                       19
   23

and $8.63, respectively. As of December 20, 2000, there were approximately 6,500
holders of our Class A Common Stock, par value $.0001 per share.

     There is no established trading market for our Class B Common Stock, par
value $.0001 per share. As of December 20, 2000, there were seven record holders
of our Class B Common Stock. This figure does not include an estimate of the
indeterminate number of beneficial holders whose shares may be held of record by
brokerage firms and clearing agencies.

DIVIDEND POLICY

     We intend to retain future earnings for use in our business and do not
anticipate declaring or paying any cash or stock dividends on shares of our
common stock in the foreseeable future. In addition, any determination to
declare and pay dividends will be made by our board of directors in light of our
earnings, financial position, capital requirements and other factors that our
board of directors deems relevant. Furthermore, the indenture governing our
9 5/8% senior subordinated notes offering contains restrictions on our ability
to pay dividends. We previously declared and paid an extraordinary dividend in
March 1998, pursuant to which some of our warrantholders elected to increase the
conversion rates of their warrants instead of receiving cash. We do not expect
to make payments of any similar dividends in the near future.

RECENT SALES OF UNREGISTERED SECURITIES

     On November 10, 2000, we issued an aggregate of 4,441,545 shares of our
Class A Common Stock to New World Broadcasters Corp., the shareholders of
Rodriguez Communications, Inc. ("RCI"), and to certain individuals as part of
the purchase price for radio station KTCY-FM and all the outstanding capital
stock of RCI (which owns and operates radio stations KFOX-FM, KREA-FM, KXJO-FM
and KSAH-FM). We relied on Section 4(2) of the Securities Act of 1933, as
amended, to claim exemption from registration for this issuance, as a
transaction not involving any public offering.

     Prior to June 30, 1999, we issued 182,303 shares to qualified institutional
buyers and accredited institutional investors who exercised warrants to purchase
shares of our Class A Common Stock. Our warrants were initially issued in 1994
as part of units that included our senior notes and in 1997 as part of units
that included our senior exchangeable preferred stock. The exercise price for
the warrants was $.01 per warrant. Holders exercising the 1997 warrants received
 .428 shares per warrant and holders exercising the 1994 warrants received one
share per warrant. On September 29, 1999, we filed our third amended and
restated certificate of incorporation to reclassify all of our then outstanding
shares of Class A Common Stock, par value $.01 per share, into shares of Class B
Common Stock, par value $.0001 per share and to effect a 50-to-1 stock split of
the new shares of Class B Common Stock. We relied on Sections 3(a)(9) and 4(2)
of the Securities Act of 1933, as amended, to claim exemption from registration
for this issuance, as a transaction not involving any public offering.

                                       20
   24

ITEM 6.  SELECTED FINANCIAL DATA

             SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
      (IN THOUSANDS EXCEPT RATIOS, SHARES OUTSTANDING AND PER SHARE DATA)

     The following table sets forth the historical financial information of our
business. The selected historical consolidated financial information presented
below under the caption "Statement of Operations Data" and "Balance Sheet Data,"
as of and for each of the fiscal years in the five-year period ended September
24, 2000 are derived from our historical consolidated financial statements,
which have been audited by KPMG LLP, independent certified public accountants.
Our selected historical consolidated financial data should be read in
conjunction with our historical consolidated financial statements as of
September 26, 1999 and September 24, 2000, and for each of the fiscal years in
the three-year period ended September 24, 2000, the related notes and
independent auditors' report included elsewhere in this report. For additional
information see the financials section of this report and "Management's
Discussion and Analysis of Financial Condition and Results of Operations."



                                                                     FISCAL YEAR ENDED
                                            -------------------------------------------------------------------
                                              9/29/96       9/28/97       9/27/98       9/26/99       9/24/00
                                            -----------   -----------   -----------   -----------   -----------
                                                                                     
STATEMENT OF OPERATIONS DATA:
Gross revenues............................  $    55,338   $    67,982   $    86,766   $   111,233   $   141,468
Less: agency commissions..................        6,703         7,972        10,623        13,882        18,800
                                            -----------   -----------   -----------   -----------   -----------
Net revenues..............................       48,635        60,010        76,143        97,351       122,668
Station operating expenses(1).............       27,876        31,041        39,520        44,620        57,555
Corporate expenses........................        3,748         5,595         6,893        10,636        20,730
Depreciation and amortization.............        4,556         7,619         8,877         9,906        13,126
                                            -----------   -----------   -----------   -----------   -----------
  Operating income........................       12,455        15,755        20,853        32,189        31,257
Interest expense, net(2)..................      (16,533)      (22,201)      (20,860)      (21,178)      (19,495)
Other income (expense), net(3)............       (1,574)         (791)         (213)         (749)         (302)
Gain on sale of AM stations...............           --        36,242            --            --            --
                                            -----------   -----------   -----------   -----------   -----------
  Income (loss) before income taxes and
    extraordinary item....................       (5,652)       (7,237)       36,022        10,262        11,460
Income tax expense (benefit)..............       (1,166)       (2,715)       15,624         4,445         4,915
                                            -----------   -----------   -----------   -----------   -----------
Income (loss) before extraordinary
  items...................................       (4,486)       (4,522)       20,398         5,817         6,545
Extraordinary (loss) net of income
  taxes(4)................................           --        (1,647)       (1,613)           --      ( 17,151)
                                            -----------   -----------   -----------   -----------   -----------
  Net income (loss).......................  $    (4,486)  $    (6,169)  $    18,785   $     5,817   $   (10,606)
                                            ===========   ===========   ===========   ===========   ===========
Dividends on preferred stock..............       (2,994)      (17,044)      (30,270)      (34,749)      (28,372)
                                            -----------   -----------   -----------   -----------   -----------
  Net income (loss) applicable to common
    stock.................................  $    (7,480)  $   (23,213)  $   (11,485)  $   (28,932)  $   (38,978)
                                            ===========   ===========   ===========   ===========   ===========
Dividends per share on common stock.......  $        --   $        --   $      0.11   $        --   $        --
                                            ===========   ===========   ===========   ===========   ===========
Earnings (loss) per common share:
  Basic (before extraordinary item).......  $     (0.25)  $     (0.71)  $     (0.33)  $     (0.86)        (0.38)
  Diluted (before extraordinary item).....        (0.25)        (0.71)        (0.33)        (0.86)        (0.38)
  Basic...................................        (0.25)        (0.77)        (0.38)        (0.86)        (0.67)
  Diluted.................................        (0.25)        (0.77)        (0.38)        (0.86)        (0.67)
Weighted average common shares
  outstanding(8):
  Basic...................................   30,333,400    30,333,400    30,333,400    33,584,576    58,162,671
  Diluted.................................   30,333,400    30,333,400    30,333,400    33,584,576    58,162,671


                                       21
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                                                                     FISCAL YEAR ENDED
                                            -------------------------------------------------------------------
                                              9/29/96       9/28/97       9/27/98       9/26/99       9/24/00
                                            -----------   -----------   -----------   -----------   -----------
                                                                                     
BALANCE SHEET DATA:
Cash and cash equivalents.................  $     5,468   $    12,288   $    37,642   $    16,975        59,559
Total assets..............................      176,860       334,367       351,034       365,681       634,691
Total debt (including current portion)....      135,914       183,013       171,126       172,486       304,664
Preferred stock...........................       35,939       171,262       201,368       235,918            --
Total stockholders' (deficiency) equity...       (3,569)      (32,047)      (46,193)      (75,122)      274,465
OTHER FINANCIAL DATA:
Broadcast cash flow(5)....................  $    20,759   $    28,969   $    36,623   $    52,731   $    65,113
Broadcast cash flow margin................         42.7%         48.3%         48.1%         54.2%         53.1%
EBITDA(6).................................       17,011        23,374        29,730        42,095        44,383
After-tax cash flow(7)....................           70         3,097         7,530        15,723        19,671
Capital expenditures......................        3,811         2,022         1,645         2,100         3,793
Net cash provided by operating
  activities..............................        8,813         6,386        10,923        20,782        28,672
Net cash provided by (used in) investing
  activities..............................      (90,195)     (144,358)       32,190       (38,384)     (205,050)
Net cash provided by (used in) financing
  activities..............................       69,034       144,792       (17,758)       (3,065)      218,962


                                       22
   26

        NOTES TO SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION

(1) Station operating expenses include engineering, programming, selling and
    general and administrative expenses.

(2) Interest expense includes non-cash interest, such as the accretion of
    principal, the amortization of discounts on debt and the amortization of
    deferred financing costs.

(3) During the 1996, 1997 and 1999 fiscal years, we wrote down the value of our
    land and building located on Sunset Boulevard in Los Angeles by $697,741,
    $487,973 and $451,048, respectively. The write-downs were based on current
    market values of real estate in the Los Angeles area. Financing costs are
    also included in other income (expenses).

(4) On June 29, 1994, we sold 107,059 units, each consisting of $1,000 principal
    amount, of our 12 1/2% notes and warrants to purchase one share of common
    stock per unit. The 12 1/2% notes were issued at a substantial discount from
    their principal amount. The sale of the 12 1/2% notes and warrants generated
    gross proceeds of $94,000,000 and proceeds to us of $87,774,002, net of
    financing costs of $6,225,998. Of the $94,000,000 of gross proceeds from the
    sale of the 12 1/2% notes and warrants, $88,603,000 was allocated to the
    12 1/2% notes and $5,397,000 was determined to be the value of the warrants.
    Of the net proceeds from the sale of the 12 1/2% notes and warrants,
    $83,000,000 was used to satisfy in full our obligations to our two former
    principal lenders and the balance was used to settle litigation with a
    former stockholder and for general corporate purposes.

    For the fiscal year ended September 28, 1997, we recorded an extraordinary
    loss resulting from the redemption of our 12 1/4% senior secured notes due
    2001 at par which was approximately $1.5 million in excess of their carrying
    value and from the write-off of the related unamortized deferred financing
    costs of approximately $1.3 million, net of the related tax benefit of
    approximately $1.1 million.

    For the fiscal year ended September 27, 1998, we recorded an extraordinary
    loss resulting from the repurchase of $13.2 million par value of 12 1/2%
    notes, at a premium of approximately $2.2 million in excess of their
    carrying value and from the write-off of the related unamortized deferred
    financing costs of approximately $0.5 million, net of the related tax
    benefit of approximately $1.1 million.

    For the fiscal year ended September 24, 2000, we recorded an extraordinary
    loss of $17.2 million related to the early retirement of our 11% and 12 1/2%
    notes at a premium of approximately $23.1 million in excess of their
    carrying value and from the write-off of the related unamortized deferred
    financing costs of approximately $5.5 million, net of the related tax
    benefit of approximately $11.4 million.

(5) The term "broadcast cash flow" means operating income before depreciation,
    amortization and corporate expenses. Broadcast cash flow should not be
    considered in isolation from, or as a substitute for, net income or cash
    flow and other consolidated income or cash flow statement data or as a
    measure of our profitability or liquidity. Although broadcast cash flow is
    not a measure of performance calculated in accordance with generally
    accepted accounting principles, broadcast cash flow is widely used in the
    broadcasting industry as a measure of a broadcasting company's operating
    performance. Broadcast cash flow may not be comparable to a similarly
    entitled item reported by other entities that do not define the term exactly
    as the Company defines it. The Company believes that broadcast cash flow is
    a useful indicator to investors of the cash flow generated by the operations
    of the Company's stations and permits investors to compare the Company's
    performance with respect to station operations with those of other radio
    broadcast companies. The Company believes that broadcast cash flow is
    particularly useful in analyzing acquisition opportunities.

(6) The term "EBITDA" means earnings before extraordinary items, gain on sale of
    AM stations, net interest expense, income taxes, depreciation, amortization
    and other income or expense. Although EBITDA is not a measure of performance
    calculated in accordance with generally accepted accounting principles,
    EBITDA is widely used in the broadcasting industry as a measure of a
    broadcasting company's operating performance. EBITDA may not be comparable
    to a similarly entitled item reported by other entities that do not define
    the term exactly as the Company defines it. The Company believes that

                                       23
   27

    EBITDA is a useful indicator to investors of the Company's capacity to incur
    and service debt. Many debt instruments, including the indenture governing
    the Company's 9 5/8% Senior Subordinated Notes, contain covenants which use
    formulas based on EBITDA calculations.

(7) The term "after-tax cash flow" means income before income tax benefit
    (expense) and extraordinary items, minus net gain on sale of AM stations
    (net of tax) and the current income tax provision, plus depreciation and
    amortization expense. Although after-tax cash flow is not a measure of
    performance calculated in accordance with generally accepted accounting
    principles, after-tax cash flow is widely used in the broadcasting industry
    as a measure of a broadcasting company's operating performance.

(8) On September 29, 1999, we filed a third amended and restated certificate of
    incorporation which resulted in (1) the redesignation of our previously
    outstanding shares of Class A Common Stock into shares of Class B Common
    Stock, (2) a 50-to-1 stock split of our Class B Common Stock and (3) a
    reduction in the par value of our Class A Common Stock and Class B Common
    Stock from $0.01 per share to $0.0001 per share. The financial information
    has been restated to reflect this redesignation, stock split and change in
    par value.

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

BACKGROUND

     We commenced operations with the purchase of our first radio station,
WXLX-AM (formerly WSKQ-AM) serving the New York metropolitan area in 1983. Since
1983 we have purchased 28 stations, including three additional AM stations, in
eight U.S. markets. Today, we are the second largest Spanish-language radio
broadcasting company in the United States, currently owning and operating a
total of 23 FM radio stations and one AM radio station. We operate an additional
AM radio station under a time brokerage agreement. Twenty-five of our stations
are located in eight of the largest Hispanic markets in the United States,
including Los Angeles, New York, Puerto Rico, Miami, San Francisco, Chicago, San
Antonio and Dallas. In total, our radio stations reach over 61% of the U.S.
Hispanic population.

     Our financial results depend on a number of factors, including the strength
of the national economy and the local economies served by our stations, total
advertising dollars dedicated to the markets served by our stations, advertising
dollars targeted to the Hispanic consumers in the markets served by our
stations, our stations' audience ratings, our ability to provide popular
programming, local market competition from other radio stations and other
advertising media, and government regulations and policies.

     We report our revenues and expenses on a broadcast month basis. "Broadcast
month basis" means a four or five week period ending on the last Sunday of each
calendar month. For fiscal years 1998, 1999 and 2000 we reported 52 weeks of
revenues and expenses.

     As is true of other radio groups, our performance is customarily measured
by our ability to generate broadcast cash flow, EBITDA and after-tax cash flow.
Broadcast cash flow consists of operating income before depreciation,
amortization and corporate expenses. EBITDA consists of earnings before
extraordinary items, gain on sale of AM stations, net interest expense, income
taxes, depreciation, amortization and other income or expenses. After-tax cash
flow consists of income before income tax benefit (expense) and extraordinary
items, minus net gain on sale of AM stations (net of tax) and the current income
tax provision, plus depreciation and amortization expense. Although broadcast
cash flow, EBITDA and after-tax cash flow are not measures of performance
calculated in accordance with generally accepted accounting principles, we
believe that broadcast cash flow, EBITDA and after-tax cash flow are useful in
evaluating us because these measures are accepted by the broadcasting industry
as generally recognized measures of performance and are used by securities
industry analysts who publish reports on the performance of broadcasting
companies. In addition, we have included information concerning broadcast cash
flow, EBITDA and after-tax cash flow in this report because it is used by some
investors as a measure of a company's ability to service its debt obligations
and it is also the basis for determining compliance with certain covenants
contained in the indentures governing our debt securities and in the certificate
of designation governing our preferred stock. Broadcast cash flow, EBITDA and
after-tax cash flow are not intended to be substitutes for operating income

                                       24
   28

as determined in accordance with generally accepted accounting principles, or
alternatives to cash flow from operating activities (as a measure of liquidity)
or net income.

REVENUES

     Our primary source of revenue is the sale of advertising time on our radio
stations to local and national advertisers. Our revenues are affected primarily
by the advertising rates that our radio stations are able to charge as well as
the overall demand for radio advertising time in a market. Advertising rates are
based primarily on (1) a radio station's audience share in the demographic
groups targeted by advertisers, as measured principally by periodic reports
developed by Arbitron(C), (2) the number of radio stations in the market
competing for the same demographic groups, and (3) the supply of and demand for
radio advertising time. Advertising rates fluctuate daily and are generally
highest during the morning and afternoon commuting hours. Seasonal net
broadcasting revenue fluctuations are common in the radio broadcasting industry
and are due primarily to fluctuations in advertising expenditures by local and
national advertisers. Our second fiscal quarter (January through March)
generally produces the lowest net broadcasting revenue for the year because of
normal post-holiday decreases in advertising expenditures.

FISCAL YEAR 2000 COMPARED TO FISCAL YEAR 1999

     Net Revenues.  Our net revenues were $122.7 million for fiscal year 2000,
compared to $97.4 million for fiscal year 1999, an increase of $25.3 million or
26.0%. The increase was primarily attributable to the inclusion of operating
results of certain of our Puerto Rico stations, which we purchased from AMFM in
January, that had not yet been acquired during the same period in fiscal year
1999. Additionally, our net revenues increased due to higher advertising rates,
as advertisers continue to be attracted to the Spanish-language market.

     Station Operating Expenses.  Total station operating expenses were $57.6
million for fiscal year 2000, compared to $44.6 million for fiscal year 1999, an
increase of $13.0 million or 29.1%. The increase was primarily attributable to
the inclusion of operating results of certain of our Puerto Rico stations, which
we purchased from AMFM in January, that had not yet been acquired during the
same period in fiscal year 1999 as well as the stations operated under time
brokerage agreements in connection with the Rodriguez Communications, Inc. and
related transactions. In addition, on a same station basis, we experienced
higher music license fees and commissions associated with increased sales.

     Broadcast Cash Flow.  Broadcast cash flow was $65.1 million for fiscal year
2000, compared to $52.7 million for fiscal year 1999, an increase of $12.4
million or 23.5%. Our broadcast cash flow margin decreased slightly to 53.1% for
fiscal year 2000 compared to 54.2% for fiscal year 1999. Excluding net Internet
broadcast cash flow of ($2.1) million for fiscal year 2000 and ($0.5) million
for fiscal year 1999, broadcast cash flow would have increased by $14.0 million
to $67.2 million, a 26.3% increase, and our broadcast cash flow margin would
have reached 54.9% for the fiscal year 2000.

     Corporate Expenses.  Total corporate expenses were $20.7 million for fiscal
year 2000, compared to $10.6 million for fiscal year 1999, an increase of $10.1
million or 95.3%. The increase in corporate expenses resulted mainly from a
non-recurring severance payment of $10.2 million related to the purchase of an
annuity for two of our retired executives.

     EBITDA.  EBITDA was $44.4 million for fiscal year 2000, compared to $42.1
million for fiscal year 1999, an increase of $2.3 million or 5.5%. The increase
in EBITDA was mostly attributable to the increase in broadcast cash flow,
partially offset by the non-recurring severance payment of $10.2 million.
Excluding the non-recurring severance payment, EBITDA was $54.6 million for the
fiscal year 2000, an increase of $12.5 million or 29.7%, and our EBITDA margin
was 44.5%.

     Depreciation and Amortization.  Depreciation and amortization expense was
$13.1 million for fiscal year 2000, compared to $9.9 million for fiscal year
1999, an increase of $3.2 million or 32.3%. The increase was related primarily
to an increase in amortization costs resulting from the purchase of the Puerto
Rico stations from AMFM.

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   29

     Operating Income.  Operating income was $31.3 million for fiscal year 2000,
compared to $32.2 million for fiscal year 1999, a decrease of $0.9 million or
2.8%. The decrease was due primarily to the non-recurring severance payment of
$10.2 million.

     Interest Expense, Net.  Interest expense was $19.5 million for fiscal year
2000, compared to $21.2 million for fiscal year 1999, a decrease of $1.7 million
or 8.0%. This decrease was due primarily to interest income earned on the unused
proceeds from the initial public offering, partially offset by interest on
additional debt related to the refinancing of the 12 1/2% and 11% notes.

     Other Expense, Net.  We had other expenses of $0.3 million for fiscal year
2000, compared to $0.7 million for fiscal year 1999, a decrease of $0.4 million
or 57.1%. The other expenses during fiscal year 2000 included a $0.3 million
write-off of costs related to a financing transaction that we abandoned.

     Extraordinary Loss.  The Company incurred an extraordinary loss of $17.2
million, net of an income tax benefit of $11.4 million, in fiscal year 2000
related to the early retirement of our 11% and 12 1/2% notes for an amount in
excess of our carrying value and the write-off of the related unamortized debt
issuance costs.

     Net Income (Loss).  Our net loss was $10.6 million for fiscal year 2000,
compared to net income of $5.8 million for fiscal year 1999. The loss was caused
primarily by the extraordinary loss and the non-recurring severance payment.

     After-Tax Cash Flow.  After-tax cash flow was $19.7 million for fiscal year
2000, compared to $15.7 million for fiscal year 1999, an increase of $4.0
million or 25.5%. This increase was primarily attributable to the increase in
broadcast cash flow that exceeded the non-recurring severance payment, net of
tax benefit. Excluding the net non-recurring severance payment, after-tax cash
flow was $25.5 million for fiscal year 2000, an increase of $9.8 million or
62.4% compared to fiscal year 1999.

FISCAL YEAR 1999 COMPARED TO FISCAL YEAR 1998

     Net Revenues.  Our net revenues were $97.4 million for fiscal year 1999,
compared to $76.1 million for fiscal year 1998, an increase of $21.3 million or
28.0%. The increase in net revenues, from a percentage standpoint, was mostly
attributable to the Chicago and New York market stations where our net revenues
increased 30.7% and 27.2%, respectively, due to high ratings, robust local
economies and increased advertising rates. All of the markets in which we
operate stations experienced strong increases in net revenues, including our Los
Angeles FM station where net revenue increased by 24.0%.

     Station Operating Expenses.  Total station operating expenses were $44.6
million for fiscal year 1999, compared to $39.5 million for fiscal year 1998, an
increase of $5.1 million or 12.9%. The higher station operating expenses were
caused mainly by the inclusion of the results of the recent acquisitions in San
Antonio and Puerto Rico as well as JuJu Media, Inc. accounting for $4.2 million
or 82.4% of the increase in station operating expenses. To a lesser extent, all
of our other radio stations experienced higher commissions and higher music
license fees associated with increased sales. Additionally, the New York market
had an increase in performance bonuses due to increased sales and broadcast cash
flow, and the Los Angeles market had an increase in salaries related to on-air
talent. This increase in operating expenses was offset by lower general and
administrative expenses due to improved collections.

     Broadcast Cash Flow.  Broadcast cash flow was $52.7 million for fiscal year
1999, compared to $36.6 million for fiscal year 1998, an increase of $16.1
million or 44.0%. This increase was attributable to strong revenue growth and
effective management of operating expenses. Our broadcast cash flow margin
increased to 54.2% for fiscal year 1999 compared to 48.1% for fiscal year 1998.

     Corporate Expenses.  Total corporate expenses were $10.6 million for fiscal
year 1999, compared to $6.9 million for fiscal year 1998, an increase of $3.7
million or 53.6%. The increase in corporate expenses resulted mainly from
performance bonuses paid to our executives, increases in the number of our
employees and increased travel and other corporate overhead expenses relating to
our expansion into new markets.

     EBITDA.  EBITDA was $42.1 million for fiscal year 1999, compared to $29.7
million for fiscal year 1998, an increase of $12.4 million or 41.8%. Our EBITDA
margin was 43.2% for fiscal year 1999, compared to
                                       26
   30

39.0% for fiscal year 1998. The increase in EBITDA and EBITDA margin was caused
by the increase in net revenues which was partially offset by the increase in
station operating expenses and corporate expenses.

     Depreciation and Amortization.  Depreciation and amortization expense was
$9.9 million for fiscal year 1999, compared to $8.9 million for fiscal year
1998, an increase of $1.0 million or 11.2%. The increase was related to an
increase in amortization costs as a result of the stations purchased in Puerto
Rico, WCMA-FM, WMEG-FM and WEGM-FM and the purchase of 80% of the stock of JuJu
Media, Inc.

     Operating Income.  Operating income was $32.2 million for fiscal year 1999,
compared to $20.9 million for fiscal year 1998, an increase of $11.3 million or
54.1%. The increase was due to the increase in net revenues, partially offset by
the increase in operating expenses.

     Interest Expense, Net.  Interest expense was $21.2 million for fiscal year
1999, compared to $20.9 million for fiscal year 1998, an increase of $0.3
million or 1.4%. This increase was caused by lower interest income in fiscal
year 1999 related to lower cash balances in fiscal year 1999.

     Other Income (Expense).  We had other expenses of $0.7 million for fiscal
year 1999, compared to other income of $36.0 million for fiscal year 1998. The
other expenses in 1999 resulted primarily from an additional write-down of owned
vacant real estate in the Los Angeles area and the Nuestra Telefonica
receivable. The other income in 1998 was the result of a gain on the sale of our
AM stations during fiscal year 1998.

     Net Income.  Our net income was $5.8 million for fiscal year 1999, compared
to $18.8 million for fiscal year 1998, a decrease of $13.0 million or 69.1%. The
decrease was caused by the absence of the gain on the sale of our AM stations.

     After-Tax Cash Flow.  After-tax cash flow was $15.7 million for fiscal year
1999, compared to $7.5 million for fiscal year 1998, an increase of $8.2 million
or 109.3%. This increase was primarily attributable to an increase in EBITDA,
offset by higher income taxes.

LIQUIDITY AND CAPITAL RESOURCES

     Our primary source of liquidity is cash on hand, cash provided by
operations and, to the extent necessary, undrawn commitments that are available
under the $150.0 million senior credit facility arranged by Lehman Brothers Inc.
in July 2000. The senior credit facility includes a six-year $25.0 million
revolving credit facility and $125.0 million multi-draw term loan facility.

     Our ability to increase our indebtedness is limited by the terms of the
credit agreement governing our senior credit facilities and the indenture
governing our senior subordinated notes. Additionally, the credit agreement and
indenture place restrictions on us with respect to the sale of assets, liens,
investments, dividends, debt repayments, capital expenditures, transactions with
affiliates and consolidations and mergers, among other things.

     Net cash flows provided by operating activities were $28.7 million, 20.8
million and $10.9 million for fiscal years 2000, 1999, and 1998, respectively.
Changes in our net cash flows from operating activities are primarily a result
of changes in advertising revenues and station operating expenses which are
affected by the acquisition and disposition of stations during those periods, as
well as changes in corporate expenses which included a non-recurring severance
payment of $10.2 million for the benefit of certain retiring executives in
fiscal year 2000.

     Net cash flows used in investing activities were $205.1 million and $38.4
million for fiscal years 2000 and 1999, respectively. Net cash flows provided by
investing activities was $41.5 million for fiscal year 1998. Changes in our net
cash flow from investing activities are primarily a result of the acquisition
and disposition of stations during those periods.

     Net cash flows provided by financing activities were $219.0 million, for
fiscal year 2000. Net cash flows used in financing activities were $3.1 million
and $17.8 million for fiscal years 1999 and 1998, respectively.

                                       27
   31

Changes in our net cash flows from financing are primarily a result of
redemption of and proceeds from notes and preferred stock and proceeds from our
initial public offering of Class A Common Stock and from senior credit
facilities.

     For fiscal year 2000, total capital expenditures were $3.8 million. These
expenditures were financed by funds from operations.

     Management believes that cash from operating activities, together with cash
on hand, should be sufficient to permit us to meet our obligations in the
foreseeable future, including: (1) required significant cash interest payments
pursuant to the terms of the senior subordinated notes due 2009, (2) operating
obligations and (3) capital expenditures. Assumptions (none of which can be
assured) that underlie management's belief, include:

     - the economic conditions within the radio broadcasting market and economic
       conditions in general will not deteriorate in any material respect;

     - we will continue to successfully implement our business strategy;

     - we will not incur any material unforeseen liabilities, including
       environmental liabilities; and

     - no future acquisitions will adversely affect our liquidity.

     We continuously review, and are currently reviewing, opportunities to
acquire additional radio stations, primarily in the largest Hispanic markets in
the United States. We engage in discussions regarding potential acquisitions
from time to time in the ordinary course of business. On November 10, 2000, we
completed the purchase of all the outstanding capital stock of Rodriguez
Communications, Inc. and the purchase of radio station KTCY-FM, serving the
Dallas, Texas market, from New World Broadcasters Corp. ("New World") for total
consideration of $164.3 million, consisting of $42.6 million of SBS Class A
Common Stock and $121.7 million in cash.

     The purchase of RCI includes the acquisition of the following radio
stations: KMJR-FM (formerly KFOX-FM) and KNJR-FM (formerly KREA-FM)
broadcasting, on a co-channeled basis, at 93.5 MHz serving the Los Angeles,
California market; KXJO-FM broadcasting at 92.7 MHz serving the San Francisco,
California market; and KSAH-AM broadcasting at 720 kHz serving the San Antonio,
Texas market.

     On May 8, 2000 we entered into a stock purchase agreement with New World
and 910 Broadcasting Corp., a wholly-owned subsidiary of New World, to acquire
all of the outstanding capital stock of 910 Broadcasting Corp. which owns and
operates radio station KXEB-AM serving the Dallas, Texas market. We have not yet
closed the purchase of all the outstanding capital stock of 910 Broadcasting
Corp. FCC approval is pending for this transaction, and we cannot assure you
that the acquisition will occur. We began operating radio station KXEB-AM on May
8, 2000 under a time brokerage agreement with New World and 910 Broadcasting
Corp., which will continue until the closing of the purchase of all the
outstanding capital stock of 910 Broadcasting Corp.

     On November 2, 2000 we entered into an asset purchase agreement with
International Church of the Four Square Gospel to purchase radio station KFSG-FM
in Los Angeles, California at a purchase price of $250.0 million. In connection
with this acquisition, we made an initial deposit of $5.0 million toward the
purchase price. The agreement contains customary representations and warranties,
and the closing of our acquisition is subject to the satisfaction of certain
customary conditions, including receipt of regulatory approval from the FCC. The
agreement may be terminated by us or by the seller if the closing does not occur
by December 31, 2001.

     We have no other written understandings, letters of intent or contracts to
acquire radio stations or other companies. We expect to fund the acquisition of
radio station KFSG-FM by increasing our senior credit facility, accessing the
high yield capital market and undertaking certain potential dispositions.
However, there can be no assurance that financing from any of these sources, if
available, can be obtained on favorable terms.

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YEAR 2000 ISSUE

     To date, no material interruptions to our operations have occurred as a
result of the year 2000 issue. The greatest threat to our ability to continue
broadcasting due to year 2000 issues comes from the utilities which we depend
on. To date, we are not aware of any external utility vendor with a year 2000
issue that has materially impacted our results of operations, liquidity, or
capital resources. While we believe our efforts provide reasonable assurance
that material disruptions will not occur due to internal or vendor failure, the
possibility of interruption still exists.

     In 1999 we performed various analysis of potential problems related to the
year 2000 issue. Internally, we bear some risks in the following areas: computer
hardware and software for our accounting and administrative functions,
computer-controlled programming of music and the transmission of our signals.
Externally, we are at risk, like most companies, of losing power and phone
lines. As of December 20, 2000 we spent $0.1 million to upgrade/replace
non-compliant systems and equipment.

NEW ACCOUNTING PRONOUNCEMENTS

     In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 133 "Accounting for Derivative
Instruments and Hedging Activities" (SFAS No. 133). SFAS No. 133 establishes
accounting and reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts and for hedging activities.
It requires an entity to recognize all derivatives as either assets or
liabilities in the balance sheet and measure those instruments at fair value.
SFAS No. 133, as amended by SFAS No. 137, is expected to be effective for our
fiscal year ending September 30, 2001. Management does not believe that the
adoption of SFAS No. 133 will have a significant impact on our consolidated
financial statements.

     In November 1999, the Emerging Issues Task Force ("EITF") of the FASB
issued EITF 99-17, "Accounting for Advertising Barter Transactions", which
provides guidance on barter transactions that involve nonmonetary exchanges of
advertising. EITF 99-17 requires an entity to account for barter advertising
revenues and expenses at the determinable fair value of the advertising
surrendered or received in the exchange, or at book value if the fair value can
not be determined within reasonable limits. The adoption of EITF 99-17 did not
have a significant impact on our consolidated financial statements.

     In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 101 (SAB 101), "Revenue Recognition", which provides
guidance on the recognition, presentation and disclosure of revenue in financial
statements filed with the SEC. SAB 101 outlines the basic criteria that must be
met in order to recognize revenue and provides guidance for disclosures related
to revenue recognition policies. In June 2000, the SEC issued SAB 101B, "Second
Amendment: Revenue Recognition in Financial Statements" which extends the
effective date of SAB 101 to the fourth fiscal quarter of fiscal years
commencing after December 15, 1999. At this time, management is still assessing
the impact of SAB 101 on our financial position and results of operations.

     In September 2000, the FASB issued SFAS No. 140, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities (A
Replacement of SFAS No. 125)". SFAS No. 140 provides guidance on accounting for
(1) securitization transactions involving financial assets; (2) sales of
financial assets (including loan participations); (3) factoring transactions;
(4) wash sales; (5) servicing assets and liabilities; (6) collateralized
borrowing arrangements; (7) securities lending transactions; (8) repurchase
agreements; and (9) extinguishment of liabilities. While most of the provisions
of SFAS No. 140 will become effective for transactions entered into after March
31, 2001, companies with calendar fiscal year ends that hold beneficial
interests from previous securitizations will be required to make additional
disclosures in their December 31, 2000 financial statements. Management does not
believe that the adoption of SFAS No. 140 will have a significant impact on our
consolidated financial statements.

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ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     We believe that inflation has not had a material impact on the results of
operations for each of our fiscal years in the three-year period ended September
24, 2000. However, there can be no assurance that future inflation would not
have an adverse impact on our operating results and financial condition.

     We are not subject to currency fluctuations since we do not have any
international operations other than Puerto Rico where the currency is the U.S.
dollar. We have limited market risk exposure since we do not have any
outstanding variable rate debt or derivative financial and commodity instruments
as of December 20, 2000. Our financial instruments outstanding at September 24,
2000 with market risk are our 9 5/8% Senior Subordinated Notes due 2009 and our
12 1/2% Senior Notes due 2002 of which only an aggregate principal amount of
$100,000 remains outstanding.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The information called for by this Item 8 is included in Item 14, under
"Financial Statements" and "Financial Statement Schedule" appearing at the end
of this annual report on Form 10-K.

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

     There have been no changes in or disagreements between us and our
accountants on accounting or financial disclosure during our two most recent
fiscal years or any subsequent interim period.

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The following table sets forth the names, ages and positions of the
directors, executive officers and certain key employees of SBS as of September
24, 2000. Each of our directors and officers serves until his successor is
elected and qualifies.



NAME                                   AGE                      POSITION WITH SBS
- ----                                   ---                      -----------------
                                        
Pablo Raul Alarcon, Sr. .............   74    Chairman Emeritus and Director
Raul Alarcon, Jr. ...................   44    Chairman of the Board of Directors, Chief Executive
                                              Officer and President
Jose Grimalt.........................   72    Secretary Emeritus and Director
Joseph A. Garcia.....................   55    Chief Financial Officer, Executive Vice President and
                                              Secretary
Luis Diaz-Albertini..................   49    Vice President/Group Sales
Jesus Salas..........................   25    Vice President of Programming
Roman Martinez IV....................   52    Director
Jason L. Shrinsky....................   63    Director
William Tanner.......................   56    Executive Vice President of Programming
Juan Garcia..........................   33    Vice President of Finance and Strategic Planning


     PABLO RAUL ALARCON, SR. was our Chairman of the Board of Directors from
March 1983 until November 2, 1999, when he became Chairman Emeritus. Mr.
Alarcon, Sr. continues to be a member of our board of directors. Mr. Alarcon,
Sr. has been involved in Spanish-language radio broadcasting for much of his
life. He started his broadcasting career in Cuba in the early 1950's when he
established a radio station chain in Camaguey, Cuba. Upon his arrival in the
United States, Mr. Alarcon, Sr. continued his career in radio broadcasting and
was an on-air personality for a New York radio station before being promoted to
programming director. Mr. Pablo Raul Alarcon, Sr. subsequently owned and
operated a recording studio and an advertising agency. In 1983, he purchased our
first radio station. Mr. Alarcon, Sr. is Raul Alarcon, Jr.'s father.

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   34

     RAUL ALARCON, JR. has been Chief Executive Officer, President and a
director since October 1985. On November 2, 1999, Mr. Alarcon, Jr. became
Chairman of the Board of Directors and continues as our Chief Executive Officer
and President. Mr. Alarcon, Jr. joined SBS as a sales manager in 1983. Mr.
Alarcon, Jr. is responsible for our long-range strategic planning and was
instrumental in the acquisition and financing of each of our radio stations as
well as our initial public offering. Mr. Alarcon, Jr. is the son of Mr. Alarcon,
Sr. and the son-in-law of Mr. Grimalt.

     JOSE GRIMALT has been a member of our board of directors since June 1994.
On November 2, 1999, Mr. Grimalt became Secretary Emeritus. From 1969 to 1986,
Mr. Grimalt owned and operated Spanish-language station WLVH-FM in Hartford,
Connecticut. In 1984, Mr. Grimalt became a stockholder and the President of
SBS's California subsidiary which operated KXMG-AM in Los Angeles. Mr. Grimalt
is Mr. Alarcon, Jr.'s father-in-law.

     JOSEPH A. GARCIA has been Chief Financial Officer since 1984, Executive
Vice President since 1996 and Secretary since November 2, 1999. Before joining
SBS in 1984, Mr. Garcia spent thirteen years in financial positions with Philip
Morris and Revlon, where he was Manager of Financial Planning for
Revlon -- Latin America.

     JESUS SALAS has been the Vice President of Programming since April 1998. He
joined SBS in March 1997 as the Programming Director for our Miami stations.
Prior to joining us he worked for New Age Broadcasting, Inc., where he began his
career in November 1993 as a disc jockey and was eventually promoted to
programming director.

     LUIS DIAZ-ALBERTINI has been the Vice President/Group Sales since September
1998. He began his employment with SBS as the General Manager of WLEY-FM in
Chicago in March 1997. Prior to joining us, Mr. Diaz-Albertini's experience
included being VP/General Manager of the four stations located in Miami for
Hispanic Broadcasting Corporation (formerly Heftel Broadcasting Corporation).
Mr. Diaz-Albertini has worked in the broadcasting industry for 27 years.

     ROMAN MARTINEZ IV became one of our directors on November 2, 1999. Mr.
Martinez is a Managing Director for the investment banking firm of Lehman
Brothers Inc. where he has held his title since 1978. Mr. Martinez has been an
investment banker advising corporations on financings, mergers and acquisitions
and related financial matters since 1971. Mr. Martinez sits on the Board of
Governors of New York Presbyterian Healthcare System, Inc. and on the Board of
Directors of the International Rescue Committee. Lehman Brothers Inc. acts and
has acted as financial advisor to us in connection with our financings and one
of our acquisitions in fiscal year 2000. An affiliate of Lehman Brothers Inc.,
Lehman Commercial Paper Inc., acted as administrative agent in connection with
the senior credit facilities. See "Item 13. Certain Relationships and Related
Transactions."

     JASON L. SHRINSKY became one of our directors on November 2, 1999. Mr.
Shrinsky is a partner of the law firm of Kaye, Scholer, Fierman, Hays & Handler,
LLP, where he has been a partner since 1986. Mr. Shrinsky has been a lawyer
counseling corporations and high net worth individuals on financings, mergers
and acquisitions, other related financial transactions and regulatory procedures
since 1964. Kaye, Scholer, Fierman, Hays & Handler, LLP has served as our
counsel for more than 16 years. The fees paid by us to Kaye, Scholer, Fierman,
Hays & Handler, LLP do not exceed five percent of such law firm's consolidated
gross revenues for its last full fiscal year. See "Item 13. Certain
Relationships and Related Transactions."

     JUAN GARCIA served as Vice President of Finance and Strategic Planning from
February 1, 2000 to November 24, 2000. Prior to joining us, Mr. Garcia worked as
an investment banker at Lehman Brothers, Inc. where he began as an associate in
September 1995 and became Vice President in 1999.

     WILLIAM TANNER has served as our Executive Vice President of Programming
since September 1, 2000. Prior to joining us Mr. Tanner was the Vice President
of Programming at Hispanic Broadcasting Corp. for six years.

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COMMITTEES OF THE BOARD OF DIRECTORS

     Our board of directors maintains an Audit Committee whose members are Roman
Martinez IV and Jason L. Shrinsky.

     Our board of directors also maintains a Compensation Committee, whose
members consist of Mr. Alarcon, Jr., Roman Martinez IV and Jason L. Shrinsky.
Mr. Alarcon, Jr. is our Chairman of the Board, Chief Executive Officer and
President. The Compensation Committee did not meet during fiscal year 2000. The
Compensation Committee met on November 13, 2000 to review compensation items for
fiscal years 2000 and 2001. See "Certain Relationships and Related
Transactions."

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

     Section 16(a) of the Exchange Act requires our officers and directors and
persons who own more than 10% of our common stock (collectively, "Reporting
Persons") to file reports of ownership and changes in ownership with the SEC.
Reporting Persons are required by SEC regulations to furnish SBS with copies of
all section 16(a) forms they file.

     Based solely on its review of the copies of such forms received or written
representations from the Reporting Persons, we believe that with respect to the
fiscal year ended September 24, 2000, all the Reporting Persons complied with
all applicable filing requirements, except that: 1) on November 4, 1999 Luis
Diaz-Albertini filed a Form 3 due on October 27, 1999 to report his holding of
options to purchase shares of the Company's common stock, and 2) on January 10,
2000, Mr. Albertini filed a Form 4 due on November 10, 1999 to report his
purchase of shares of our common stock.

ITEM 11.  EXECUTIVE COMPENSATION

     The following table sets forth all compensation awarded to, earned by or
paid for services rendered to SBS and its subsidiaries, in all capacities during
the fiscal years 2000, 1999 and 1998, by our Chief Executive Officer and
President and our next four highest paid executive officers at September 24,
2000, whose annual salary and bonus exceeded $100,000. On November 2, 1999,
Messrs. Alarcon, Sr. and Grimalt retired as salaried executives of SBS but
remain as members of our board of directors.

                           SUMMARY COMPENSATION TABLE



                                                                                                  LONG TERM
                                                                                                COMPENSATION
                                                                                                   AWARDS
                                                                                               ---------------
                                                                                                 SECURITIES
                                                                                OTHER ANNUAL     UNDERLYING
NAME                    PRINCIPAL POSITION    YEAR     SALARY        BONUS      COMPENSATION   OPTIONS/SARS(#)
- ----                    -------------------   ----   ----------    ----------   ------------   ---------------
                                                                             
Raul Alarcon, Jr......  Chief Executive       2000   $1,000,000(2) $1,000,000     $201,829(1)      100,000
                        Officer, President    1999    1,985,768(2)  1,265,857      202,452(1)
                        and Chairman of the   1998    1,633,743(2)    215,000       63,624(1)
                        Board of Directors
Joseph A. Garcia......  Executive Vice        2000      300,000       150,000             (3)      250,000
                        President, Chief      1999      296,298       385,000             (3)
                        Financial Officer     1998      266,346        27,500             (3)
                        and Secretary
Luis Diaz-Albertini...  Vice President/       2000      225,000        80,000             (8)       50,000
                        Group Sales           1999      225,053       210,000             (3)
                                              1998      200,000        25,000             (3)
William Tanner(4).....  Executive Vice        2000       30,000            --             (3)      218,552
                        President of          1999           --            --             (3)
                        Programming           1998           --            --             (3)
Juan A. Garcia(5).....  Vice President of     2000      136,500        70,000             (3)      100,000
                        Finance and           1999           --            --           --
                        Strategic Planning    1998           --            --           --


                                       32
   36



                                                                                                  LONG TERM
                                                                                                COMPENSATION
                                                                                                   AWARDS
                                                                                               ---------------
                                                                                                 SECURITIES
                                                                                OTHER ANNUAL     UNDERLYING
NAME                    PRINCIPAL POSITION    YEAR     SALARY        BONUS      COMPENSATION   OPTIONS/SARS(#)
- ----                    -------------------   ----   ----------    ----------   ------------   ---------------
                                                                             
Pablo Raul Alarcon,
  Sr. ................  Director (formerly    2000      124,923            --           --(3)           --
                        Chairman of the       1999      481,846(6)    362,368       59,291(7)
                        Board Of Directors)   1998      492,577        25,000       50,745(7)
Jose Grimalt..........  Director (formerly    2000       67,308            --             (3)           --
                        Secretary)            1999      250,000(6)     25,368             (3)
                                              1998      250,000        25,000             (3)


- ---------------
(1) Excludes amounts paid by us in connection with our lease of an apartment in
    Manhattan owned by Mr. Alarcon, Jr. which is used primarily by Mr. Alarcon,
    Jr. while on SBS business in New York. Mr. Alarcon, Jr. received personal
    benefits in addition to his salary and bonus, including use of automobiles.
    We paid an aggregate of $85,329, $96,512 and $62,691 in each of 2000, 1999
    and 1998, respectively, for automobiles used, including driver's salary, by
    Mr. Alarcon, Jr. In fiscal year 2000 Mr. Alarcon, Jr. received personal
    benefits estimated at $201,829, including the use of automobiles and drivers
    and an apartment in Key Biscayne, Florida. The lease for his apartment in
    Key Biscayne has been terminated as a consequence of Mr. Alarcon, Jr.'s
    relocation into his newly constructed home on December 20, 2000.

(2) Excludes the payment of a dividend to our stockholders, of which Mr.
    Alarcon, Jr. received $3.1 million. Excludes reimbursement of Mr. Alarcon,
    Jr.'s relocation expenses incurred in connection with the relocation of our
    headquarters. See "Certain Relationships and Related Transactions."

(3) Excludes perquisites and other personal benefits, securities or property
    which aggregate the lesser of $50,000 or 10% of the total of annual salary
    and bonus.

(4) William Tanner began his employment with SBS on September 1, 2000.

(5) Juan A. Garcia served as our Vice President of Finance and Strategic
    Planning from February 1, 2000 to November 24, 2000.

(6) Messrs. Alarcon, Sr. and Grimalt received compensation as officers of SBS
    through December 31, 1999. However, they continue to be entitled to
    reimbursement of their out-of-pocket expenses as members of the board of
    directors and are provided, at our expense, with the use of automobiles and,
    in the case of Mr. Alarcon, Sr., a driver. We purchased annuities for the
    retirement of Messrs. Alarcon, Sr. and Grimalt which became effective on
    January 2, 2000. See "Employment Agreements and Arrangements."

(7) In addition to his salary and bonus, Mr. Alarcon, Sr. received personal
    benefits including the use of automobiles. We paid an aggregate of $56,955,
    $57,451 and $49,812 in each of 2000, 1999 and 1998, respectively, for
    automobiles used by Mr. Alarcon, Sr., including driver's salary.

(8) Excludes a $50,000 loan made by SBS to Mr. Albertini for which Mr. Albertini
    signed a promissory note payable in two years, but which is subject to
    forgiveness if Mr. Albertini meets certain sales targets.

                                       33
   37

STOCK OPTIONS

     The following table sets forth information concerning the grant of stock
options to each of the named executive officers in fiscal year 2000:

                     OPTION/SAR GRANTS IN LAST FISCAL YEAR



                                                   INDIVIDUAL GRANTS                            POTENTIAL REALIZABLE
                            ----------------------------------------------------------------   VALUE AT ASSUMED ANNUAL
                              NUMBER OF     PERCENT OF TOTAL                                    RATES OF STOCK PRICE
                             SECURITIES       OPTIONS/SARS                                        APPRECIATION FOR
                             UNDERLYING        GRANTED TO      EXERCISE OR                           OPTION TERM
                            OPTIONS/SARS      EMPLOYEES IN     BASE PRICE                      -----------------------
NAME                        GRANTED(#)(1)   FISCAL YEAR 2000     ($/SH)      EXPIRATION DATE     5%($)        10%($)
- ----                        -------------   ----------------   -----------   ---------------   ----------   ----------
                                                                                          
Raul Alarcon, Jr..........     100,000(2)                       $  20.00                       $1,257,789   $3,187,485
Joseph A. Garcia..........     250,000                          $  20.00        10/27/09        3,144,473    7,968,712
Luis Diaz-Albertini.......      50,000                          $  20.00        10/27/09          628,895    1,593,742
William Tanner............     218,552(2)                       $  10.00        09/01/10        1,374,462    3,483,156
Juan A. Garcia(3).........     100,000(2)                       $20.8125        02/16/10        1,308,887    3,316,976
Pablo Raul Alarcon,
  Sr. ....................          --            --                  --              --               --           --
Jose Grimalt..............          --            --                  --              --               --           --


- ---------------
(1) Each option was granted under our 1999 Stock Option Plan and, other than
    noted in footnote (2), vests 20% immediately, and 20% on the anniversary
    date of the grant for the following four consecutive years. The options that
    are not otherwise exercisable prior to a change in control of the Company
    shall become exercisable on the date of a change in control of the Company
    and shall remain exercisable for the remainder of the term of the option, as
    discussed in the Company's 1999 Stock Option Plan.

(2) Raul Alarcon, Jr.'s options vested immediately and were exercisable upon
    consummation of the Company's IPO on November 2, 1999. Of Mr. Juan A.
    Garcia's options, 10,000 vested on February 16, 2000, and became immediately
    exercisable and the remainder terminated upon the termination of his
    employment with the Company on November 24, 2000. One-third of William
    Tanner's options vested and are exercisable as of August 31, 2000, one-third
    will vest and become exercisable on August 30, 2001 and one-third will vest
    and become exercisable on August 30, 2002. Mr. Tanner's employment agreement
    does not specify the term of exercisability of these options, and these
    options have not been granted under the 1999 Stock Option Plan, but we have
    assumed an exercisability term of ten years based on the maximum permitted
    term under our 1999 Stock Option Plan.

(3) Juan A. Garcia served as our Vice President of Finance and Strategic
    Planning from February 1, 2000 to November 24, 2000.

DIRECTOR COMPENSATION

     Directors who are officers or former officers do not receive any additional
compensation for serving on our board of directors. All directors are reimbursed
for their out-of-pocket expenses incurred in connection with their service as
directors. All of our non-employee directors are eligible to receive options
under our stock plans as described below. In connection with their election to
the board of directors on November 2, 1999, we granted each of Messrs. Roman
Martinez IV and Jason L. Shrinsky options for 50,000 shares of Class A Common
Stock exercisable at the public offering price, of which, options for 10,000
shares vested immediately with the rest vesting ratably over a period of four
years. Mr. Shrinsky holds his options for the benefit of his law firm, Kaye,
Scholer, Fierman, Hays & Handler, LLP. See "Stock Plans -- Non-Employee Director
Stock Option Plan."

     Arnold Sheiffer, who served as a director from 1996 until August 1999,
received a cash payment of $250,000, which was accrued in fiscal year 1999, and
has been granted options to purchase 250,000 shares of Class A Common Stock
exercisable at $20.00 per share, which vested on November 2, 1999, for his past
services as a director.

                                       34
   38

EMPLOYMENT AGREEMENTS AND ARRANGEMENTS

  Raul Alarcon, Jr.

     We have an employment agreement with Raul Alarcon, Jr. pursuant to which
Mr. Alarcon, Jr. serves as our Chairman of the Board of Directors, Chief
Executive Officer and President. The agreement became effective on November 2,
1999, expires on December 31, 2004 and renews for successive one-year periods
after December 31, 2004, unless notice of termination is delivered by either
party 90 days prior to the termination date. The agreement provides for a base
salary of not less than $1.0 million for each year of the employment term, which
may be increased by the board of directors. Under the terms of the agreement,
Mr. Alarcon, Jr. will be paid an annual cash performance bonus determined by the
board of directors based on annual same station broadcast cash flow growth. Mr.
Alarcon, Jr. will receive options to purchase 100,000 shares of Class A Common
Stock each year of employment. The initial grant of options to purchase 100,000
shares was made on October 27, 1999 and vested on November 2, 1999 at an
exercise price equal to $20.00 per share. The additional grants thereafter vest
on each anniversary of the effective date of the agreement at an exercise price
equal to the then fair market value of our Class A Common Stock. Mr. Alarcon,
Jr. is also entitled to participate in our employee benefit plans and to receive
other non-salary benefits, such as health insurance, life insurance,
reimbursement for business related expenses and reimbursement for personal tax
and accounting expenses. The agreement provides that Mr. Alarcon, Jr.'s
employment may be terminated at the election of the board of directors upon his
disability or for cause (as defined in the agreement). Pursuant to the
agreement, Mr. Alarcon, Jr. is entitled to the use of one automobile and driver
at our expense.

  Joseph A. Garcia

     During fiscal year 2000, we had an employment agreement with Joseph A.
Garcia pursuant to which Mr. Garcia served as our Chief Financial Officer,
Executive Vice President and Secretary. This employment agreement became
effective on November 2, 1999, was to terminate on September 30, 2002 and was to
automatically renew for successive one-year periods after September 30, 2002,
unless notice of termination was delivered by either party within 90 days prior
to the termination date or any succeeding September 30. Mr. Garcia received an
annual base salary of $300,000 which could be increased by the board of
directors. In addition, Mr. Garcia was entitled to receive (a) an annual cash
bonus to be determined by the board of directors, based on performance, and (b)
options to purchase 250,000 shares of Class A Common Stock for past performance.
The options were granted on October 27, 1999, with options to purchase 50,000
shares vesting on November 2, 1999 at an exercise price equal to $20.00 per
share and options to purchase 200,000 shares to vest ratably over a four-year
period. Mr. Garcia was also entitled to receive standard employee benefits
provided to all of our executives, such as health, life and long-term disability
insurance and reimbursement for business related expenses.

     On December 7, 2000, we entered into a new employment agreement with Mr.
Garcia pursuant to which he continues to serve as our Chief Financial Officer,
Executive Vice President and Secretary. This new employment agreement became
effective as of December 7, 2000 and has similar terms to his employment
agreement signed in fiscal year 2000 including a discretionary bonus, except
that the new employment agreement has a term expiring December 7, 2005 (with a
similar automatic renewal as the November 2, 1999 employment agreement) and
provides for an annual base salary of $400,000. Under his new agreement he is
entitled to receive options to purchase 100,000 shares of common stock at an
exercise price equal to the closing price on Nasdaq on December 7, 2000. Options
to purchase 20,000 shares vested on December 7, 2000 and the remaining options
will vest ratably over the next four years.

  Luis Diaz-Albertini

     We have an employment agreement with Luis Diaz-Albertini pursuant to which
Mr. Albertini serves as our Vice President/Group Sales. The employment agreement
became effective on November 2, 1999, terminates on November 2, 2002 and
automatically renews for successive one-year periods after November 2, 2002,
unless notice of termination is delivered by either party within 90 days prior
to the termination date or

                                       35
   39

any succeeding November 2. Mr. Albertini receives an annual salary of $225,000
which may be increased by the board of directors. In addition, Mr. Albertini is
entitled to receive (a) an annual cash bonus to be determined by the board of
directors, based on performance, and (b) options to purchase 50,000 shares of
Class A Common Stock for past performance. The options were granted on October
27, 1999, with options to purchase 10,000 shares vesting on November 2, 1999 at
an exercise price equal to $20.00 per share and options to purchase 40,000
shares to vest ratably over a four-year period. Mr. Albertini is also entitled
to receive standard employee benefits provided to all of our executives, such as
health, life and long-term disability insurance and reimbursement for business
related expenses.

  William Tanner

     We have an employment agreement with William Tanner pursuant to which Mr.
Tanner serves as our Executive Vice President of Programming. This employment
agreement became effective on August 31, 2000, terminates on August 31, 2005 and
can be extended by mutual agreement of SBS and Mr. Tanner. Mr. Tanner receives
an annual base salary of $475,000 plus an annual 10% increase over the prior
year's base salary and quarterly bonuses based on certain radio stations'
Arbitron(R) rankings. Mr. Tanner is also entitled to receive options, which have
not yet been granted, to purchase 75,000 shares of common stock at an exercise
price equal to the market price on the business day immediately preceding the
grant, with options to purchase 15,000 shares to be granted and to vest on
August 31, 2001 and on each of the next four anniversaries of August 31, 2001.
In addition, Mr. Tanner's employment agreement grants him options to purchase
218,552 shares of common stock at an exercise price equal to the closing stock
market price on September 1, 2000, vesting one-third on August 31, 2000,
one-third on August 30, 2001 and one-third on August 30, 2002. Mr. Tanner is
entitled to receive standard employee benefits provided to other similarly
situated SBS executives as well as business class travel, payment of power and
telephone bills for the Los Angeles residence, an automobile allowance of $2,000
per month, and the professional support of a shared administrative assistant.

  Juan A. Garcia

     We had an employment agreement with Juan Garcia during fiscal year 2000
pursuant to which Mr. Garcia served as our Vice President of Finance and
Strategic Planning. This employment agreement became effective on February 16,
2000, was to terminate on February 16, 2003 and automatically renew for
successive one-year periods after February 16, 2003, unless notice of
termination was delivered by either party within 90 days prior to the
termination date or any succeeding February 16. Mr. Garcia received an annual
base salary of $210,000 which could be increased by the board of directors. In
addition, Mr. Garcia was entitled to receive (a) an annual cash bonus based on
SBS meeting projected consolidated broadcast cash flow for each fiscal year, and
(b) options to purchase 100,000 shares of Class A Common Stock with an exercise
price of $20.8125 per share. The options were granted on February 16, 2000 with
options to purchase 10,000 shares vesting on February 16, 2000, options to
purchase 10,000 shares to vest on February 16, 2001 and options to purchase
20,000 shares to vest on each of the next four anniversaries of February 16,
2001. Mr. Garcia was also entitled to receive standard employee benefits
provided to all of our executives. Mr. Garcia's employment terminated on
November 24, 2000.

ANNUITY

     Upon the completion of our initial public offering, we purchased an annuity
from The Canada Life Assurance Company as a retirement vehicle for the benefit
of Messrs. Alarcon, Sr. and Grimalt for $10.2 million. Messrs. Alarcon, Sr. and
Grimalt will receive annual payments of approximately $700,000 and $300,000,
respectively, for the rest of their lives. Mr. Alarcon's wife and Mr. Grimalt's
wife are joint annuitants with their husbands. Should Mrs. Alarcon, Sr. or Mrs.
Grimalt survive their husbands, they would receive annual payments of $350,000
and $150,000.

                                       36
   40

STOCK PLANS

  1999 Stock Option Plan

     We have adopted an option plan to incentivize our present and future
executive, managerial and other employees through equity ownership. The option
plan provides for the granting of stock options to individuals selected by the
compensation committee of the board of directors (or by the board if such
committee is not appointed). An aggregate of 3,000,000 shares of Class A Common
Stock have been reserved for issuance under this option plan. The option plan
allows us to tailor incentive compensation for the retention of personnel, to
support corporate and business objectives, and to anticipate and respond to a
changing business environment and competitive compensation practices. As of
September 24, 2000, options to purchase 1,593,552 shares of Class A Common Stock
have been granted under this plan at exercise prices ranging from $10.00 to
$24.63 per share.

     The compensation committee, or such other committees as the board of
directors shall determine, has discretion to select the participants, to
determine the type, size and terms of each award, to modify the terms of awards,
to determine when awards will be granted and paid, and to make all other
determinations which it deems necessary or desirable in the interpretation and
administration of the option plan. The option plan terminates ten years from the
date that it was approved and adopted by the stockholders of SBS. Generally, a
participant's rights and interest under the option plan are not transferable
except by will or by the laws of descent and distribution.

     Options, which include non-qualified stock options and incentive stock
options, are rights to purchase a specified number of shares of Class A Common
Stock at a price fixed by the compensation committee. The option price may be
less than, equal to or greater than the fair market value of the underlying
shares of Class A Common Stock, but in no event will the exercise price of an
incentive stock option be less than the fair market value on the date of grant.

     Options will expire no later than ten years after the date on which they
are granted (five years in the case of incentive stock options granted to 10%
stockholders). Options will become exercisable at such times and in such
installments as the compensation committee or other designated committee shall
determine. Notwithstanding this, any nonexercisable options shall immediately
vest and become exercisable upon a change in control of SBS. Upon termination of
a participant's employment with SBS, options that are not exercisable will be
forfeited immediately and options that are exercisable will remain exercisable
for twelve months following any termination by reason of an optionholder's
death, disability or retirement. If termination is for any other reason other
than cause, exercisable options will remain exercisable for three months
following such termination. Payment of the option price must be made in full at
the time of exercise in such form (including, but not limited to, cash or common
stock of SBS) as the compensation committee may determine.

     In the event of a reorganization, recapitalization, stock split, stock
dividend, combination of shares, merger, consolidation, distribution of assets,
or any other change in the corporate structure of shares of SBS, the
compensation committee will have the discretion to make any adjustments it deems
appropriate in the number and kind of shares reserved for issuance upon the
exercise of options and vesting of grants under the option plan and in the
exercise price of outstanding options.

NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN

     We have also adopted a separate option plan for our non-employee directors.
The terms of the plan provide that the board of directors has the discretion to
grant stock options to any non-employee director. An aggregate of 300,000 shares
of Class A Common Stock have been reserved for issuance under this option plan.
The plan is administered by the board of directors. In connection with their
election as directors, on November 2, 1999, we granted each of Messrs. Shrinsky
and Martinez an option under this plan to purchase 50,000 shares of Class A
Common Stock exercisable at $20.00 per share. Of these options to purchase
50,000 shares, options to purchase 10,000 shares vested immediately and options
to purchase 10,000 shares vested on November 2, 2000. Options to purchase 10,000
shares vest each year over the next three years on the anniversary of the grant
so long as Messrs. Shrinsky and Martinez remain directors. Mr. Shrinsky holds
his

                                       37
   41

options for the benefit of his law firm, Kaye, Scholer, Fierman, Hays & Handler,
LLP. Any non-exercisable options shall immediately vest and become exercisable
upon a change in control of SBS. If a non-employee director's service as a
director is terminated for any reason, all options held by the non-employee
director which have not then vested shall terminate automatically.

401(k) PLAN

     We offer a tax-qualified employee savings and retirement plan (the "401(k)
Plan") covering our employees. Pursuant to the 401(k) Plan, an employee may
elect to reduce his annual salary by 1%-15%, not to exceed the statutorily
prescribed annual limit which is $10,500 for 2000, and have the amount of such
reduction contributed to the 401(k) Plan. We may, at our option and in our sole
discretion, make matching and/or profit sharing contributions to the 401(k) Plan
on behalf of all participants. The 401(k) Plan is intended to qualify under
Section 401(a) of the Internal Revenue Code so that contributions by employees
or by us to the 401(k) Plan and income earned on plan contributions are not
taxable to employees until distributed to them and contributions by us will be
deductible by us when, and if, made. The trustees under the 401(k) Plan, at the
direction of each participant, invest such participant's assets in the 401(k)
Plan in selected investment options.

LIMITATIONS ON DIRECTORS' AND OFFICERS' LIABILITY

     Our third amended and restated certificate of incorporation has a provision
which limits the liability of directors to us to the maximum extent permitted by
Delaware law. The third amended and restated certificate of incorporation
specifies that our directors will not be personally liable for monetary damages
for breach of fiduciary duty as a director. This limitation does not apply to
actions by a director or officer that do not meet the standards of conduct which
make it permissible under the Delaware General Corporation Law for SBS to
indemnify directors or officers.

     Our amended and restated by-laws provide for indemnification of directors
and officers (and others) in the manner, under the circumstances and to the
fullest extent permitted by the Delaware General Corporation Law, which
generally authorizes indemnification as to all expenses incurred or imposed as a
result of actions, suits or proceedings if the indemnified parties act in good
faith and in a manner they reasonably believe to be in or not opposed to the
best interests of SBS. Each director has entered into an indemnification
agreement with us that provides for indemnification to the fullest extent
provided by law. We believe that these provisions are necessary or useful to
attract and retain qualified persons as directors and officers.

     We have obtained insurance for the benefit of our directors and officers
that provides for coverage of up to $100.0 million.

     There is no pending litigation or proceeding involving a director or
officer as to which indemnification is being sought.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

     Our board of directors maintains a Compensation Committee, whose members
consist of Mr. Alarcon, Jr., Roman Martinez IV and Jason L. Shrinsky. Mr.
Alarcon, Jr. is our Chairman of the Board, Chief Executive Officer and
President. Roman Martinez IV and Jason L. Shrinsky are directors. The
Compensation Committee did not meet in fiscal year 2000. The Compensation
Committee met on November 13, 2000 to review compensation items for fiscal years
2000 and 2001. See "Item 13. Certain Relationships and Related Transactions."

                                       38
   42

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth information concerning the beneficial
ownership of our Class A Common Stock and our Class B Common Stock as of
December 20, 2000, by:

     - each person known by us to beneficially own more than 5% of any class of
       common stock; and

     - each director and each named executive officer.

Unless indicated below, each stockholder listed had sole voting and sole
investment power with respect to all shares beneficially owned, subject to
community property laws, if applicable.



                                                CLASS A SHARES            CLASS B SHARES
                                           ------------------------   -----------------------   PERCENT OF   PERCENT OF
                                                         PERCENT OF                PERCENT OF     TOTAL        TOTAL
                                           NUMBER OF      CLASS A     NUMBER OF     CLASS B      ECONOMIC      VOTING
NAME AND ADDRESS(1)(2)                       SHARES        SHARES       SHARES       SHARES      INTEREST      POWER
- ----------------------                     ----------    ----------   ----------   ----------   ----------   ----------
                                                                                           
Pablo Raul Alarcon, Sr...................          --          0%     1,070,000(16)    3.85%       1.65%         3.4%
Raul Alarcon, Jr.........................     200,000(3)       *      26,156,750      94.1%        40.5%        83.1%
Jose Grimalt.............................          --          0%        501,650       1.8%           *         1.59%
Joseph A. Garcia.........................     130,000(3)       *              --         *            *            *
Juan A. Garcia...........................      18,000(3)(4)       *           --         0%           *            *
William Tanner...........................     219,442          *              --         0%           *            *
Luis Diaz-Albertini......................      35,470(3)       *              --         0%           *            *
Roman Martinez IV........................      20,000(3)       *              --         0%           *            *
Jason L. Shrinsky........................      20,000(3)(5)       *           --         0%           *            *
All executive officers and directors as
  a group................................     642,912(3)     1.7%     27,728,400     99.75%        43.5%        88.2%
The Marcos and Sonya Rodriguez Family
  Trust(7)...............................   2,958,844        8.0%             --         0%        4.57%         1.0%
Massachusetts Financial Services
  Company(9)(14).........................   2,038,370(14)    5.53%            --         0%        3.15%           *
Janus Capital Corporation*(10)...........   1,478,600        4.0%             --         0%        2.28%           *
Putnam Investments, Inc.*(11)(13)........   3,695,000       11.4%             --         0%        5.91%        1.17%
TCW Group Inc. (12)(15)..................   2,496,800        6.8%             --         0%        3.86%           *
James L. Anderson(8).....................   3,445,586(6)     9.3%             --         0%        5.32%         1.1%


- ---------------
 *  Indicates less than 1%.

(1) The address of all directors and executive officers in this table, unless
    otherwise specified, is c/o Spanish Broadcasting System, Inc., 2601 South
    Bayshore Drive, Coconut Grove, Florida 33133.

(2) As used in this table, "beneficial ownership" means the sole or shared power
    to vote or direct the voting of a security, or the sole or shared power to
    dispose, or direct the disposition, of a security. A person is deemed as of
    any date to have beneficial ownership of any security that the person has
    the right to acquire within 60 days after that date. For purposes of
    computing the percentage of outstanding shares held by each person named
    above, any security that the person has the right to acquire within 60 days
    of the date of calculation is deemed to be outstanding, but is not deemed to
    be outstanding for purposes of computing the percentage ownership of any
    other person.

 (3) Includes Class A Common Stock issuable upon the exercise of options that
     the holder has the right to exercise within sixty days of the date of this
     report and does not include shares issuable upon exercise of options that
     have not yet vested.

 (4) Includes 4,500 shares owned indirectly through Fraga Incorporated Profit
     Sharing Plan (Mr. Garcia shares voting and investment power relating to
     such shares with his brother) and 750 shares owned indirectly through Mr.
     Juan Garcia's spouse (Mr. Garcia shares voting and investment power
     relating to such shares with his spouse).

                                       39
   43

 (5) Mr. Shrinsky holds his options for the benefit of his law firm, Kaye,
     Scholer, Fierman, Hays & Handler, LLP.

 (6) James L. Anderson has sole voting power with respect to 2,961,494 shares,
     shared voting power with respect to 484,092 shares and sole dispositive
     power with respect to 2,961,494 shares.

     The Marcos and Sonya Rodriguez Family Trust has the right to receive
     dividends relating to and the proceeds from the sale of 2,958,844 shares of
     the Company's Class A Common Stock for which Mr. Anderson has sole voting
     and dispositive power resulting from his serving as Trustee of such trust.

     A company of which Mr. Anderson is president has the right to receive
     dividends relating to and the proceeds from the sale of 484,092 shares of
     the Company's Class A Common Stock for which Mr. Anderson has shared voting
     power.

 (7) The address of The Marcos and Sonya Rodriguez Family Trust is 8828 North
     Stemmons Freeway, Suite 106, Dallas, Texas 75247.

 (8) The address of James L. Anderson is 8828 North Stemmons Freeway, Suite 106,
     Dallas, Texas 75247.

 (9) The address of the Massachusetts Financial Services Company is 500 Boylston
     Street, Boston, MA 02116.

(10) The address of the Janus Capital Corporation is 100 Fillmore Street,
     Denver, CO 80206-4923.

(11) The address of Putnam Investments, Inc. is One Post Office Square, Boston,
     MA 02109.

(12) The address of the TCW Group Inc. is 865 South Figueroa Street, Los
     Angeles, CA 90017.

(13) Putnam Investments, Inc. ("Putnam") is a wholly-owned subsidiary of Marsh &
     McLennan Companies, Inc. Putnam wholly owns two registered investment
     advisers: Putnam Investment Management, Inc., which is the investment
     adviser to the Putnam family of mutual funds and The Putnam Advisory
     Company, Inc., ("PAC"), which is the investment adviser to Putnam's
     institutional clients. Both subsidiaries have dispository power over the
     shares as investment managers, but each of the mutual fund's trustees have
     voting power over the shares held by each fund, and The Putnam Advisory
     Company, Inc. has shared voting power over the shares held by the
     institutional clients.

     Putnam and PAC have shared voting power with respect to 192,273 shares.

(14) The Massachusetts Financial Services Company has sole voting power with
     respect to 1,946,545 shares.

(15) We obtained this information from Form 13F Filed November 1, 2000.

(16) Mr. Pablo Raul Alarcon, Sr.'s shares are held in a Flint Trust with Mr.
     Alarcan, Sr. as sole beneficiary.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Upon the completion of our initial public offering, we purchased an annuity
for $10.2 million from The Canada Life Assurance Company as a retirement vehicle
for the benefit of Mr. Alarcon, Sr., our Chairman Emeritus and a member of our
board of directors, and Mr. Grimalt, our Secretary Emeritus and a member of our
board of directors. Messrs. Alarcon, Sr. and Grimalt will receive annual
payments of approximately $700,000 and $300,000, respectively.

     On February 2, 2000, SBS completed the sale of WVMQ-FM in Key West, Florida
and WZMQ-FM in Key Largo, Florida to South Broadcasting System, Inc., a company
owned by Mr. Pablo Raul Alarcon, Sr., our Chairman Emeritus and a member of our
board of directors, for total cash consideration of $0.7 million.

     We lease a two-bedroom furnished condominium apartment in midtown Manhattan
from Mr. Alarcon, Jr., our Chief Executive Officer, President and Chairman of
the Board of Directors, for a monthly rent of $9,000. The lease commenced in
August 1987 and will expire in August 2007. During fiscal years 1999 and 1998,
we renovated the apartment and incurred approximately $0.2 million in renovation
expenses. We made no renovations in fiscal year 2000. Generally, the apartment
is used by Mr. Alarcon, Jr. while on SBS business in New York. We believe that
the lease for this apartment is at the market rate.

                                       40
   44

     For the year ended September 26, 1999, SBS paid operating expenses
aggregating $0.1 million for a boat owned by CMQ Radio, an entity owned equally
by Messrs. Alarcon, Sr. and Alarcon, Jr. The boat was used by SBS for business
entertainment. For the year ended September 26, 1999, the amount paid by SBS for
our use of the boat owned by CMQ Radio was comparable to amounts we would have
paid had we leased the boat from an unaffiliated party. In November 1999, we
discontinued our arrangement with respect to this boat. We have not made any
further payments to CMQ Radio, Inc.

     Effective July 1993, Messrs. Alarcon, Sr. and Alarcon, Jr. executed
promissory notes to SBS for the principal amounts of $0.5 million and $1.6
million, respectively. These promissory notes evidenced loans made by SBS to
Messrs. Alarcon, Sr. and Alarcon, Jr. over several prior years. The notes were
to mature in 2001 and bore interest at the rate of 6% percent per annum until
July 19, 1994 and after that at the lesser of 9% percent per annum or the prime
rate charged by the Chase Manhattan Bank, N.A. Interest on the unpaid principal
amount of the notes was payable annually. In December 1995, SBS exchanged these
promissory notes for amended and restated notes in the principal amounts of $0.6
million and $1.9 million due from Messrs. Alarcon, Sr. and Alarcon, Jr.,
respectively. The amended and restated notes bore interest at the rate of 6.36%
per annum, and mature on December 30, 2025, and the interest was payable in 30
equal annual installments of $43,570 and $143,158, respectively, on December
30th of each year starting December 30, 1996. As of September 26, 1999, $0.6
million and $1.9 million, plus accrued and unpaid interest of $0.1 million and
$0.4 million to date, was outstanding, respectively, on these promissory notes.
Upon completion of our initial public offering, Messrs. Alarcon, Sr. and
Alarcon, Jr. paid all remaining amounts outstanding under these notes using
their portion of the proceeds they received as selling stockholders in our
initial public offering.

     In 1992, Messrs. Alarcon, Sr. and Alarcon, Jr. acquired a building in Coral
Gables, Florida, for the purpose of housing the studios of WCMQ-AM and WCMQ-FM.
In June 1992, Spanish Broadcasting System of Florida, Inc., a subsidiary of SBS,
entered into a 20-year net lease with Messrs. Alarcon, Sr. and Alarcon, Jr. for
the Coral Gables building which provides for a base monthly rent of $9,000.
Effective June 1, 1998, the lease on this building was assigned to SBS Realty
Corp., a realty management company owned by Messrs. Alarcon, Sr. and Alarcon,
Jr. This building currently houses the offices and studios of all of our Miami
stations. The lease on the stations' previous studios expired in October 1993,
was for less than half the space of the stations' present studios and had a
monthly rental of approximately $7,500. Based upon our prior lease for studio
space, we believe that the lease for the current studio is at market rates.

     In 1992, Mr. Alarcon, Jr. and other investors organized Nuestra Telefonica,
Inc., a New York corporation, to operate long distance telephone service in
Spanish aimed at the Hispanic population in the markets served by our radio
stations. In February 1993, Nuestra Telefonica entered into an access agreement
with a common carrier and commenced operations. Nuestra Telefonica advertised
its Spanish-language long distance telephone service on our radio stations in
Los Angeles and New York and purchased this air time at standard station rates.
Since early 1994, Nuestra Telefonica has not utilized any air time on our radio
stations. As of September 26, 1999 Nuestra Telefonica owed SBS $0.4 million
related to unpaid air time and $0.3 million related to certain expenses paid by
SBS on Nuestra Telefonica's behalf. The amounts due were recorded on our books
as a receivable and due from related party asset, respectively. Mr. Alarcon, Jr.
personally guaranteed the payment of $0.5 million of Nuestra Telefonica's
obligations to SBS. Mr. Alarcon, Jr. is Nuestra Telefonica's Chairman and
majority shareholder. Joseph A. Garcia, our Executive Vice President and Chief
Financial Officer and Secretary, is Nuestra Telefonica's President and a
minority shareholder. Nuestra Telefonica is no longer an operating entity and,
therefore, upon the completion of our initial public offering on November 2,
1999, we forgave the loans and canceled the guarantees described above. The
unreserved portion of these receivables was written-off by SBS at September 26,
1999 and is included in our financial statements under the line item "Other
income (expense), net".

     Mr. Grimalt's son is employed by SBS as an operations manager. He was paid
$129,419 and a bonus of $5,000 for the fiscal year ended September 24, 2000. As
part of his compensation we also paid the leasing costs for an automobile in the
amount of $8,028. Mr. Alarcon, Jr.'s uncle is currently employed by us as an
operations manager and his salary is $76,500.

                                       41
   45

     Roman Martinez IV, one of our directors, is a Managing Director for Lehman
Brothers Inc. which acts and acted as financial advisor to us in connection with
our financings and one of our acquisitions in fiscal year 2000. Jason L.
Shrinsky, one of our directors, is a partner of Kaye, Scholer, Fierman, Hays &
Handler, LLP, which firm has regularly represented us as our legal counsel and
will continue to do so. See "Item 10. Directors and Executive Officers of the
Registrant -- Committees of the Board of Directors." and "Item 12. Security
Ownership of Certain Beneficial Owners and Management."

     On November 30, 2000, we loaned Luiz Diaz-Albertini, our Vice
President/Group Sales, $50,000 for which he signed a promissory note payable in
two years, but which is subject to forgiveness if Mr. Albertini meets certain
sales targets.

     Our new corporate headquarters is located on the top floor of a 26-story
office building owned by Irradio Limited Partnership, a Florida partnership, for
which the general partner is Irradio Investment, Inc., a company wholly-owned by
Mr. Alarcon, Jr. As of December 1, 2000, we are leasing our office space under a
10-year lease, with the right to renew for two consecutive five-year terms. We
believe the monthly rent we pay for our new office space is below market value.

                                    PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

  (a)1. Financial Statements

     The following financial statements have been filed as required by Item 8 of
this report:

        Independent Auditors' Report

        Consolidated Balance Sheets as of September 26, 1999 and September 24,
        2000

        Consolidated Statements of Operations for each of the fiscal years in
        the three-year period ended September 24, 2000

        Consolidated Statements of Changes in Stockholders' Equity (Deficiency)
        for each of the fiscal years in the three-year period ended September
        24, 2000

        Consolidated Statements of Cash Flows for each of the fiscal years in
        the three-year period ended September 24, 2000

        Notes to Consolidated Financial Statements

     2. Financial Statement Schedule

     The following financial statement schedule has been filed as required by
Item 8 of this report:

        Financial Statement Schedule -- Valuation and Qualifying Accounts

                                       42
   46

                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



                                                              PAGE
                                                              ----
                                                           
Independent Auditors' Report................................  F-2
Consolidated Balance Sheets as of September 26, 1999 and
  September 24, 2000........................................  F-3
Consolidated Statements of Operations for each of the fiscal
  years in the three-year period ended September 24, 2000...  F-4
Consolidated Statements of Changes in Stockholders' Equity
  (Deficiency) for each of the fiscal years in the
  three-year period ended September 24, 2000................  F-5
Consolidated Statements of Cash Flows for each of the fiscal
  years in the three-year period ended September 24, 2000...  F-6
Notes to Consolidated Financial Statements..................  F-8
Financial Statement Schedule -- Valuation and Qualifying
  Accounts..................................................  F-31


                                       F-1
   47

                          INDEPENDENT AUDITORS' REPORT

The Board of Directors and Stockholders
Spanish Broadcasting System, Inc.:

We have audited the consolidated financial statements of Spanish Broadcasting
System, Inc. and subsidiaries as listed in the accompanying index. In connection
with our audits of the consolidated financial statements, we have also audited
the financial statement schedule as listed in the accompanying index. 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 Spanish Broadcasting
System, Inc. and subsidiaries as of September 26, 1999 and September 24, 2000,
and the results of their operations and their cash flows for each of the fiscal
years in the three-year period ended September 24, 2000, 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.

/s/  KPMG LLP

Miami, Florida
December 8, 2000

                                       F-2
   48

                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

                          CONSOLIDATED BALANCE SHEETS
                   SEPTEMBER 26, 1999 AND SEPTEMBER 24, 2000



                                                              SEPTEMBER 26,    SEPTEMBER 24,
                                                                  1999             2000
                                                              -------------    -------------
                                                                         
ASSETS
Current assets:
  Cash and cash equivalents.................................  $ 16,974,650       59,558,929
  Receivables:
    Trade...................................................    26,006,007       30,986,110
    Barter..................................................     2,260,217        2,360,184
                                                              ------------     ------------
                                                                28,266,224       33,346,294
Less allowance for doubtful accounts........................     6,365,959        8,082,275
                                                              ------------     ------------
      Net receivables.......................................    21,900,265       25,264,019
Other current assets........................................     2,194,387        3,862,182
                                                              ------------     ------------
        Total current assets................................    41,069,302       88,685,130
Property and equipment, net.................................    14,777,703       21,675,239
Intangible assets, net of accumulated amortization of
  $35,654,956 in 1999 and $46,280,239 in 2000...............   301,454,059      513,357,655
Deferred financing costs, net of accumulated amortization of
  $5,815,931 in 1999 and $910,897 in 2000...................     6,228,716       10,794,733
Deferred offering costs.....................................     1,965,551               --
Other assets................................................       185,190          178,066
                                                              ------------     ------------
                                                              $365,680,521      634,690,823
                                                              ============     ============
LIABILITIES AND STOCKHOLDERS' (DEFICIENCY) EQUITY
Current liabilities:
  Current portion of other long-term debt...................  $  1,800,572          171,262
  Accounts payable and accrued expenses.....................    11,831,145       13,984,267
  Accrued interest..........................................     3,941,088       11,032,889
  Deferred commitment fee...................................     2,348,931        2,158,850
  Dividends payable.........................................     1,323,018               --
                                                              ------------     ------------
        Total current liabilities...........................    21,244,754       27,347,268
12 1/2% Senior unsecured notes due 2002, net of unamortized
  discount of $1,630,076 in 1999 and $0 in 2000.............    92,262,924          100,000
11% Senior unsecured notes due 2004.........................    75,000,000               --
9 5/8% Senior subordinated notes due 2009...................            --      235,000,000
Senior credit facilities term loan due 2006.................            --       65,000,000
Other long-term debt, less current portion..................     3,422,341        4,392,302
Deferred income taxes.......................................    12,954,515       28,386,169
Redeemable Preferred Stock:
  14 1/4% Series A Senior Exchangeable Preferred Stock, $.01
    par value. Authorized 1,000,000 shares, issued and
    outstanding 245,815 shares (liquidation value
    $245,815,000) in 1999 and none outstanding in 2000......   235,918,055               --
Stockholders' (deficiency) equity:
  Class A common stock, $.0001 par value. Authorized
    100,000,000 shares; none issued and outstanding in 1999;
    32,399,760 shares issued and outstanding in 2000........            --            3,240
  Class B common stock, $.0001 par value. Authorized
    50,000,000 shares; issued and outstanding 39,448,550
    shares in 1999 and 27,816,900 shares in 2000............         3,945            2,782
  Additional paid-in capital................................     6,869,241      392,972,851
  Accumulated deficit.......................................   (79,535,846)    (118,513,789)
                                                              ------------     ------------
                                                               (72,662,660)     274,465,084
  Less loans receivable from stockholders...................    (2,459,408)              --
                                                              ------------     ------------
        Total stockholders' (deficiency) equity.............   (75,122,068)     274,465,084
                                                              ------------     ------------
Commitments and contingencies (notes 14, 15, 18 and 19)
                                                              $365,680,521      634,690,823
                                                              ============     ============


          See accompanying notes to consolidated financial statements.
                                       F-3
   49

                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     FISCAL YEARS ENDED SEPTEMBER 27, 1998,
                   SEPTEMBER 26, 1999 AND SEPTEMBER 24, 2000



                                                                    FISCAL YEARS
                                                     -------------------------------------------
                                                         1998            1999           2000
                                                     ------------    ------------    -----------
                                                                            
Gross revenues.....................................  $ 86,766,158    111,233,463     141,468,330
Less agency commissions............................    10,623,062     13,882,877      18,799,915
                                                     ------------    -----------     -----------
       Net revenues................................    76,143,096     97,350,586     122,668,415
                                                     ------------    -----------     -----------
Operating expenses:
  Engineering......................................     1,924,744      2,222,605       2,509,325
  Programming......................................     8,462,258     10,120,338      14,982,656
  Selling..........................................    18,574,529     22,015,346      25,829,058
  General and administrative.......................    10,558,965     10,260,931      14,234,399
  Corporate expenses...............................     6,892,705     10,636,435      20,730,382
  Depreciation and amortization....................     8,876,876      9,905,574      13,125,734
                                                     ------------    -----------     -----------
                                                       55,290,077     65,161,229      91,411,554
                                                     ------------    -----------     -----------
     Operating income..............................    20,853,019     32,189,357      31,256,861
Other income (expense):
  Interest expense, net............................   (20,860,210)   (21,178,164)    (19,495,083)
  Other, net.......................................      (213,239)      (748,898)       (356,894)
  Gain on sale of stations.........................    36,241,947             --          54,963
                                                     ------------    -----------     -----------
     Income before income taxes and extraordinary
       item........................................    36,021,517     10,262,295      11,459,847
Income tax expense.................................    15,624,032      4,444,919       4,914,479
                                                     ------------    -----------     -----------
Income before extraordinary item...................    20,397,485      5,817,376       6,545,368
Extraordinary item -- loss on extinguishment of
  debt, net of income taxes of $1,075,149 in 1998
  and $11,433,945 in 2000..........................    (1,612,723)            --     (17,150,918)
                                                     ------------    -----------     -----------
       Net income (loss)...........................  $ 18,784,762      5,817,376     (10,605,550)
                                                     ============    ===========     ===========
Net loss applicable to common stockholders [note
  2(n)]............................................  $(11,484,845)   (28,931,410)    (38,977,943)
                                                     ============    ===========     ===========
Basic and diluted loss per common share:
  Net loss per common share before extraordinary
     item..........................................  $      (0.33)         (0.86)          (0.38)
  Net loss per common share for extraordinary
     item..........................................         (0.05)            --           (0.29)
                                                     ------------    -----------     -----------
  Net loss per common share........................  $      (0.38)         (0.86)          (0.67)
                                                     ============    ===========     ===========
  Weighted average common shares outstanding (basic
     and diluted)..................................    30,333,400     33,584,576      58,162,671
                                                     ============    ===========     ===========


          See accompanying notes to consolidated financial statements.
                                       F-4
   50

                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

    CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIENCY) EQUITY
                     FISCAL YEARS ENDED SEPTEMBER 27, 1998,
                   SEPTEMBER 26, 1999 AND SEPTEMBER 24, 2000


                                                                CLASS A                CLASS B
                                                              COMMON STOCK          COMMON STOCK
                                                          --------------------   -------------------   ADDITIONAL
                                                            NUMBER       PAR       NUMBER      PAR       PAID-IN     ACCUMULATED
                                                          OF SHARES     VALUE    OF SHARES    VALUE      CAPITAL       DEFICIT
                                                          ----------   -------   ----------   ------   -----------   ------------
                                                                                                   
Balance at September 28, 1997...........................          --   $   --    30,333,400   $3,033     6,593,506    (35,119,184)
Preferred stock dividends...............................          --       --            --       --            --    (27,717,142)
Accretion of preferred stock............................          --       --            --       --            --     (2,552,465)
Decrease in loans receivable from stockholders..........          --       --            --       --            --             --
Cash dividends on common stock..........................          --       --            --       --            --     (3,726,579)
Issuance of warrants as dividends.......................          --       --            --       --       273,828       (273,828)
Net income..............................................          --       --            --       --            --     18,784,762
                                                          ----------   ------    ----------   ------   -----------   ------------
Balance at September 27, 1998...........................          --       --    30,333,400    3,033     6,867,334    (50,604,436)
Preferred stock dividends...............................          --       --            --       --            --    (31,755,475)
Accretion of preferred stock............................          --       --            --       --            --     (2,993,311)
Exercised warrants for common stock.....................          --       --     9,115,150      912         1,907             --
Net income..............................................          --       --            --       --            --      5,817,376
                                                          ----------   ------    ----------   ------   -----------   ------------
Balance at September 26, 1999...........................          --       --    39,448,550    3,945     6,869,241    (79,535,846)
                                                          ----------   ------    ----------   ------   -----------   ------------
Issuance of common stock for initial public offering,
  net of expenses.......................................  25,731,210    2,573    (4,963,100)    (496)  386,103,610             --
Conversion of Class B common stock to Class A common
  stock.................................................   6,668,550      667    (6,668,550)    (667)           --             --
Preferred stock dividends...............................          --       --            --       --            --    (18,475,448)
Accretion of preferred stock............................          --       --            --       --            --     (9,896,945)
Repayment of stockholder note receivable................          --       --            --       --            --             --
Net loss................................................          --       --            --       --            --    (10,605,550)
                                                          ----------   ------    ----------   ------   -----------   ------------
Balance at September 24, 2000...........................  32,399,760   $3,240    27,816,900   $2,782   392,972,851   (118,513,789)
                                                          ==========   ======    ==========   ======   ===========   ============



                                                          LESS: LOANS
                                                           RECEIVABLE        TOTAL
                                                              FROM       STOCKHOLDERS'
                                                          STOCKHOLDERS    DEFICIENCY
                                                          ------------   -------------
                                                                   
Balance at September 28, 1997...........................   (3,524,466)    (32,047,111)
Preferred stock dividends...............................           --     (27,717,142)
Accretion of preferred stock............................           --      (2,552,465)
Decrease in loans receivable from stockholders..........       14,827          14,827
Cash dividends on common stock..........................    1,050,231      (2,676,348)
Issuance of warrants as dividends.......................           --              --
Net income..............................................           --      18,784,762
                                                           ----------     -----------
Balance at September 27, 1998...........................   (2,459,408)    (46,193,477)
Preferred stock dividends...............................           --     (31,755,475)
Accretion of preferred stock............................           --      (2,993,311)
Exercised warrants for common stock.....................           --           2,819
Net income..............................................           --       5,817,376
                                                           ----------     -----------
Balance at September 26, 1999...........................   (2,459,408)    (75,122,068)
                                                           ----------     -----------
Issuance of common stock for initial public offering,
  net of expenses.......................................           --     386,105,687
Conversion of Class B common stock to Class A common
  stock.................................................           --              --
Preferred stock dividends...............................           --     (18,475,448)
Accretion of preferred stock............................           --      (9,896,945)
Repayment of stockholder note receivable................    2,459,408       2,459,408
Net loss................................................           --     (10,605,550)
                                                           ----------     -----------
Balance at September 24, 2000...........................           --     274,465,084
                                                           ==========     ===========


          See accompanying notes to consolidated financial statements.

                                       F-5
   51

                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                     FISCAL YEARS ENDED SEPTEMBER 27, 1998,
                   SEPTEMBER 26, 1999 AND SEPTEMBER 24, 2000



                                                                   FISCAL YEARS
                                                    -------------------------------------------
                                                        1998           1999            2000
                                                    ------------    -----------    ------------
                                                                          
Cash flows from operating activities:
  Net income (loss)...............................  $ 18,784,762      5,817,376     (10,605,550)
                                                    ------------    -----------    ------------
  Adjustments to reconcile net income (loss) to
     net cash provided by operating activities:
     Loss on extinguishment of debt...............     2,687,872             --      28,584,863
     Gain on sale of radio stations...............   (36,241,947)            --         (54,963)
     Depreciation and amortization................     8,876,876      9,905,574      13,125,734
     Provision for doubtful accounts..............     2,634,509      1,670,438       4,077,047
     Amortization of debt discount................       658,297        594,459          61,295
     Amortization of deferred financing costs.....     1,555,016      1,601,594       1,068,912
     Write-down of fixed assets...................            --        451,048              --
     Write-off of amounts due from related
       party......................................            --        289,869              --
     Accretion of interest to principal on other
       long-term debt.............................       307,200        313,037         151,440
     Deferred income taxes........................    12,748,883      3,879,919      (6,769,466)
     Changes in operating assets and liabilities:
       Increase in receivables....................    (4,112,373)    (6,980,861)     (4,940,801)
       Increase in other current assets...........      (412,678)      (371,803)     (2,796,795)
       Decrease in other assets...................        80,483         24,111           7,124
       Increase (decrease) in accounts payable and
          accrued expenses........................     3,361,411      3,042,312        (138,448)
       (Decrease) increase in accrued interest....      (595,539)            --       7,091,801
       Increase (decrease) in deferred commitment
          fee.....................................       590,201        544,548        (190,081)
                                                    ------------    -----------    ------------
          Total adjustments.......................    (7,861,789)    14,964,245      39,277,662
                                                    ------------    -----------    ------------
          Net cash provided by operating
            activities............................    10,922,973     20,781,621      28,672,112
                                                    ------------    -----------    ------------
Cash flows from investing activities:
  Proceeds from sale of radio stations, net of
     disposal costs of $838,167 in 1998 and $9,696
     in 2000......................................    43,161,833             --         690,304
  Additions to property and equipment.............    (1,644,533)    (2,099,507)     (3,792,828)
  Acquisition of radio stations, net of cash
     acquired of $1,047,739 in 2000...............    (9,327,713)   (26,284,504)    (80,826,429)
  Advances on purchase price of radio stations....            --    (10,000,000)   (121,121,260)
                                                    ------------    -----------    ------------
          Net cash provided by (used in) investing
            activities............................    32,189,587    (38,384,011)   (205,050,213)
                                                    ------------    -----------    ------------


          See accompanying notes to consolidated financial statements.
                                       F-6
   52

                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                     FISCAL YEARS ENDED SEPTEMBER 27, 1998,
                   SEPTEMBER 26, 1999 AND SEPTEMBER 24, 2000



                                                                   FISCAL YEARS
                                                    -------------------------------------------
                                                        1998           1999            2000
                                                    ------------    -----------    ------------
                                                                          
Cash flows from financing activities:
  Dividends on common stock.......................  $ (2,676,348)            --              --
  Retirement of Senior unsecured notes............   (15,055,055)            --    (190,295,268)
  Retirement of Series A senior exchangable
     preferred stock..............................            --             --    (265,613,466)
  Proceeds from Class A common stock..............            --             --     388,071,238
  Exercise of warrants............................            --          2,819              --
  Repayments of debt, including accrued
     interest.....................................       (41,521)      (548,125)     (4,510,790)
  Proceeds from senior notes, net of financing
     costs of $8,503,260..........................            --             --     227,051,070
  Proceeds from senior credit facilities, net of
     financing costs of $3,199,812................            --             --      61,800,188
  Increase in deferred financing costs............            --       (554,330)             --
  Increase in deferred offering costs.............            --     (1,965,551)             --
  Repayments of loans receivable from
     stockholders.................................        14,827             --       2,459,408
                                                    ------------    -----------    ------------
       Net cash (used in) provided by financing
          activities..............................   (17,758,097)    (3,065,187)    218,962,380
                                                    ------------    -----------    ------------
       Net increase (decrease) in cash and cash
          equivalents.............................    25,354,463    (20,667,577)     42,584,279
Cash and cash equivalents at beginning of
  period..........................................    12,287,764     37,642,227      16,974,650
                                                    ------------    -----------    ------------
Cash and cash equivalents at end of period........  $ 37,642,227     16,974,650      59,558,929
                                                    ============    ===========    ============
Supplemental cash flow information:
  Interest paid during the period.................  $ 20,561,613     20,540,882      17,407,591
                                                    ============    ===========    ============
  Income taxes paid during the period.............  $  1,787,191      1,166,846       2,407,797
                                                    ============    ===========    ============
Noncash investing and financing activities:
  Dividends declared on preferred stock...........  $ 27,717,142     31,755,475              --
                                                    ============    ===========    ============
  Issuance of preferred stock as payment of
     preferred stock dividends....................  $(27,553,543)   (31,556,817)             --
                                                    ============    ===========    ============
  Issuance of warrants as payment of dividends....  $    273,828             --              --
                                                    ============    ===========    ============
  Issuance of note as payment towards purchase
     price of JuJu Media, Inc.....................  $         --      1,000,000              --
                                                    ============    ===========    ============
  Issuance of note as payment towards purchase
     price of building............................  $         --             --       3,700,000
                                                    ============    ===========    ============
  Deferred tax liability recorded for difference
     in assigned values and tax bases of radio
     stations acquired............................  $         --             --      22,201,120
                                                    ============    ===========    ============
  Repayment of stockholder loan and accrued
     interest through dividend withholding........  $  1,098,368             --              --
                                                    ============    ===========    ============


          See accompanying notes to consolidated financial statements.
                                       F-7
   53

                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   SEPTEMBER 26, 1999 AND SEPTEMBER 24, 2000

(1) ORGANIZATION AND NATURE OF BUSINESS

     Spanish Broadcasting System, Inc., a Delaware corporation, and subsidiaries
(the "Company") owns and operates nineteen Spanish-language radio stations
serving the New York, Puerto Rico, Miami, Chicago, San Antonio and Los Angeles
markets through its subsidiaries, SBS of Greater New York, Inc., Spanish
Broadcasting System of Florida, Inc., Spanish Broadcasting System of California,
Inc., Spanish Broadcasting System of Greater Miami, Inc., Spanish Broadcasting
System of San Antonio, Inc., Spanish Broadcasting System of Illinois, Inc. and
Spanish Broadcasting System of Puerto Rico, Inc., a Puerto Rico corporation.
Additionally, the Company's other subsidiaries include Spanish Broadcasting
System, Inc., a New Jersey corporation, Spanish Broadcasting System of Puerto
Rico, Inc., a Delaware corporation, SBS Funding, Inc., a Delaware corporation,
JuJu Media, Inc., a New York corporation, Alarcon Holdings, Inc. ("Alarcon"),
Spanish Broadcasting System Network, Inc. ("SBS Network") and SBS Promotions,
Inc. ("SBS Promotions"). Alarcon owns and operates the building where the
Company's New York offices are located. SBS Network and SBS Promotions are
currently dormant. SBS Network was formerly the Company's exclusive agency
representative for national advertising sales. SBS Promotions formerly performed
promotional services for the Company's radio stations.

     Additionally, the Company operates six Spanish-language radio stations
serving the Dallas, San Antonio, Los Angeles, and San Francisco markets under
various time brokerage agreements (see note 3).

     The domestic broadcasting industry is subject to extensive federal
regulation which, among other things, requires approval by the Federal
Communications Commission ("FCC") for the issuance, renewal, transfer and
assignment of broadcasting station operating licenses and limits the number of
broadcasting properties the Company may acquire. The Company operates in the
domestic radio broadcasting industry which is subject to extensive and changing
regulation by the FCC.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS

  (a) Basis of Presentation

     The consolidated financial statements include the accounts of the Company
and its subsidiaries. All significant intercompany balances and transactions
have been eliminated in consolidation.

     Certain of the Company's subsidiaries (hereinafter referred to in this
paragraph collectively as "Subsidiary Guarantors") have guaranteed the Company's
senior notes referred to in note 8 on a joint and several basis. The Company has
not included separate financial statements of the Subsidiary Guarantors because
(i) all of the Subsidiary Guarantors are wholly owned subsidiaries of the
Company, and (ii) the guarantees issued by the Subsidiary Guarantors are full
and unconditional. The Company has not included separate parent-only financial
statements since the parent is a holding company with no independent assets or

                                       F-8
   54
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

operations other than its investments in its subsidiaries. Condensed
consolidating unaudited financial information for the Company and its guarantor
and non-guarantor subsidiaries is as follows:



                                        PARENT AND
                                        GUARANTOR      NON-GUARANTOR
CONDENSED CONSOLIDATING BALANCE SHEET  SUBSIDIARIES    SUBSIDIARIES     ELIMINATIONS        TOTAL
- -------------------------------------  ------------    -------------    ------------    -------------
                                                          AS OF SEPTEMBER 24, 2000
                                       --------------------------------------------------------------
                                                                            
Cash and cash equivalents..........    $ 59,237,041         321,888               --       59,558,929
Receivables, net...................      23,718,499       1,545,520               --       25,264,019
Other current assets...............       3,315,263         546,919               --        3,862,182
                                       ------------    ------------     ------------    -------------
     Current assets................      86,270,803       2,414,327               --       88,685,130
Property and equipment, net........      14,183,896       7,491,343               --       21,675,239
Intangible assets, net.............     401,347,908     112,009,747               --      513,357,655
Deferred financing costs, net......      10,792,176           2,557               --       10,794,733
Investment in subsidiaries
  and intercompany.................      97,597,926      (2,905,659)     (94,692,267)              --
Other assets.......................         178,683            (617)              --          178,066
                                       ------------    ------------     ------------    -------------
     Total assets..................    $610,371,392     119,011,698      (94,692,267)     634,690,823
                                       ============    ============     ============    =============
Current portion of long-term debt...         53,805         117,457               --          171,262
Accounts payable and accrued
  expenses.........................      11,624,801       2,359,466               --       13,984,267
Accrued interest...................      11,032,889              --               --       11,032,889
Deferred commitment fee............       2,158,850              --               --        2,158,850
                                       ------------    ------------     ------------    -------------
  Current liabilities..............      24,870,345       2,476,923               --       27,347,268
Long-term debt.....................     300,937,384       3,554,918               --      304,492,302
Deferred income taxes..............       6,185,049      22,201,120               --       28,386,169
                                       ------------    ------------     ------------    -------------
     Total liabilities.............     331,993,898      28,231,841               --      360,225,739
Common stock.......................           6,022           1,000           (1,000)           6,022
Additional paid-in capital.........     392,972,851      94,691,267      (94,691,267)     392,972,851
Accumulated deficit................    (114,601,379)     (3,912,410)              --     (118,513,789)
                                       ------------    ------------     ------------    -------------
     Stockholders' equity..........     278,377,494      90,779,857      (94,692,267)     274,465,084
                                       ------------    ------------     ------------    -------------
     Total liabilities and
       stockholders' equity........    $610,371,392     119,011,698      (94,692,267)     634,690,823
                                       ============    ============     ============    =============


                                       F-9
   55
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



                                                  PARENT AND
                                                   GUARANTOR     NON-GUARANTOR
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS  SUBSIDIARIES    SUBSIDIARIES    ELIMINATIONS      TOTAL
- -----------------------------------------------  -------------   -------------   ------------   ------------
                                                        FOR THE FISCAL YEAR ENDED SEPTEMBER 24, 2000
                                                 -----------------------------------------------------------
                                                                                    
Net broadcasting revenues...................     $ 113,882,012     8,786,403         --          122,668,415
Station operating expenses..................        48,683,056     8,872,382         --           57,555,438
Corporate expenses..........................        20,730,382            --         --           20,730,382
Depreciation and amortization...............        10,138,825     2,986,909         --           13,125,734
                                                 -------------    ----------          --        ------------
     Operating income.......................        34,330,109    (3,072,248)        --           31,256,861
Interest income (expense), net..............       (19,433,521)      (61,562)        --          (19,495,083)
Other income (expense), net.................          (184,871)     (117,060)        --             (301,931)
Income tax expense (benefit)................         4,859,281        55,198         --            4,914,479
Extraordinary item, net of income taxes.....       (17,150,918)           --         --          (17,150,918)
                                                 -------------    ----------          --        ------------
     Net income (loss)......................     $  (7,298,482)   (3,307,068)        --          (10,605,550)
                                                 =============    ==========          ==        ============




                                                  PARENT AND
                                                   GUARANTOR     NON-GUARANTOR
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS  SUBSIDIARIES    SUBSIDIARIES    ELIMINATIONS      TOTAL
- -----------------------------------------------  -------------   -------------   ------------   ------------
                                                        FOR THE FISCAL YEAR ENDED SEPTEMBER 24, 2000
                                                 -----------------------------------------------------------
                                                                                    
Cash flows from operating activities........     $  26,750,856     1,921,256         --           28,672,112
                                                 =============    ==========          ==        ============
Cash flows from investing activities........     $(203,058,672)   (1,991,541)        --         (205,050,213)
                                                 =============    ==========          ==        ============
Cash flows from financing activities........     $ 218,122,649       839,731         --          218,962,380
                                                 =============    ==========          ==        ============


     The Company's fiscal year is the 52-week or 53-week period which ends on
the last Sunday of September.

  (b) Revenue Recognition

     Revenues are recognized when advertisements are aired.

  (c) Property and Equipment

     Property and equipment are stated at cost. The Company depreciates the cost
of its property and equipment using the straight-line method over the respective
estimated useful lives. Leasehold improvements are amortized on a straight-line
basis over the shorter of the remaining life of the lease or the useful life of
the improvements.

  (d) Long-Lived Assets

     The Company follows the provisions of Statement of Financial Accounting
Standards ("SFAS") No. 121, "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to be Disposed of." SFAS No. 121 requires that
long-lived assets and certain identifiable intangibles to be held and used or
disposed of by an entity be reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount of an asset may not be
recoverable. See note 6 for impairment losses related to fixed assets.

                                      F-10
   56
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  (e) Intangible Assets

     Intangible assets primarily represent the portion of the purchase price of
station acquisitions allocated to FCC licenses of those stations and are
amortized on a straight-line basis over 40 years, based on the industry practice
of renewing FCC licenses periodically, and other intangible assets, including
goodwill, which are being amortized on a straight-line basis over the respective
estimated useful lives. The Company periodically assesses the recoverability of
the carrying amount of intangible assets, including goodwill, 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 consists of the projection of undiscounted cash flows for each of the
Company's radio stations over the remaining amortization periods of the related
intangible assets. If such projections indicate that undiscounted cash flows are
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. At this time, the Company believes that no
significant impairment of its intangible assets, including goodwill, has
occurred and that no reduction of the estimated useful lives is warranted. This
assessment will be impacted if such projections are not achieved.

  (f) Deferred Financing Costs

     Deferred financing costs relate to the refinancing of the Company's debt in
October 1999 (see note 8) and additional debt financing obtained in July 2000
(see note 10).

     Deferred financing costs are being amortized using a method which
approximates the effective-interest method over the respective lives of the
related indebtedness.

  (g) Barter Transactions

     Barter transactions represent advertising time exchanged for promotional
items, advertising, supplies, equipment and services. Revenues from barter
transactions are recognized as income when advertisements are broadcast.
Expenses are recognized when goods or services are received or used. The Company
records barter transactions at the fair value of goods or services received or
advertising surrendered, whichever is more readily determinable.

     During fiscal 2000, the Company entered into a barter transaction with an
Internet Service Provider ("ISP") whereby the ISP will provide a guaranteed
minimum of impressions to the Company on the ISP's networks over a two-year
period in exchange for advertising time on certain of the Company's stations,
with an aggregate fair value of $19.7 million at the date of the transaction.

     Unearned revenue related to this transaction consists of the excess of the
aggregate fair value of impressions delivered by the ISP, over the aggregate
fair value of advertising time delivered by the Company. The total amount of
unearned revenue related to this transaction at September 24, 2000 is $0.2
million, and is included in accounts payable and accrued expenses in the
accompanying consolidated balance sheets.

  (h) Cash Equivalents

     Cash equivalents, consisting primarily of interest-bearing money market
accounts and certificates of deposits which have an original maturity date of
less than three months, totaled approximately $17.0 million and $59.6 million at
September 26, 1999 and September 24, 2000, respectively.

  (i) Income Taxes

     The Company files a consolidated federal income tax return with its
subsidiaries. The Company accounts for income taxes under the asset and
liability method. Deferred tax assets and liabilities are recognized for the

                                      F-11
   57
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

future tax consequences attributable to temporary 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 income in the
period that includes the enactment date.

  (j) Advertising Costs

     The Company incurs various marketing and promotional costs to add and
maintain listenership. These costs are charged to expense in the period
incurred.

  (k) Deferred Commitment Fee

     On December 30, 1996, the Company entered into an agreement with a national
advertising agency (the "Agency") whereby the Agency would serve as the
Company's exclusive sales representative for all national sales for a seven-year
period. Pursuant to this agreement, the Agency agreed to pay a commitment fee of
$5.1 million to the Company, of which $1.0 million was paid upon execution of
the agreement and $4.1 million was to be remitted on a monthly basis over a
three-year period, through January 2000. During fiscal year 2000, the Agency
revised its agreement with the Company to reduce the total commitment fee to
$5.0 million. The commitment fee is recognized on a straight-line basis over the
seven-year contractual term of the arrangement as a reduction of Agency
commissions. Deferred commitment fee represents the excess of payments received
from the Agency over the amount recognized.

  (l) Use of Estimates

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities, and
disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

  (m) Concentration of Risk

     All of the Company's business is conducted in the New York, Florida,
California, Illinois, Texas, and Puerto Rico markets. Net revenue earned from
radio stations in these markets as a percentage of total revenue for the fiscal
years ended September 27, 1998, September 26, 1999 and September 24, 2000 is as
follows:



                                                          1998    1999    2000
                                                          ----    ----    ----
                                                                 
New York................................................   44%     44%     40%
Florida.................................................   28%     24%     21%
California..............................................   17%     17%     12%
Illinois................................................   11%     11%     12%
Texas...................................................   --       2%      4%
Puerto Rico.............................................   --       2%     11%
                                                          ---     ---     ---
                                                          100%    100%    100%
                                                          ===     ===     ===


     The increase in market concentration risk in Puerto Rico in fiscal 2000
results from the acquisitions of WCMA, WMEG, and WEGM in fiscal 1999 and
WIOA-FM, WIOB-FM, WIOC-FM, WCOM-FM, WZMT-FM, WZNT-FM, WOYE-FM, and WCTA-FM in
fiscal 2000 as discussed in note 3.

                                      F-12
   58
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  (n) Basic and Diluted Net Loss Per Common Share

     The Company has presented net loss per common share pursuant to SFAS No.
128, "Earnings Per Share," and the Securities and Exchange Commission Staff
Accounting Bulletin No. 98.

     In accordance with Securities and Exchange Commission ("SEC") Staff
Accounting Bulletin No. 98, certain common stock and common stock equivalents
issued for nominal consideration prior to the initial filing of a registration
statement relating to an initial public offering are treated as outstanding for
the entire period. The Company had no nominal issuances during this period.

     Basic net loss per common share was computed by dividing net loss by the
weighted average number of shares of common stock outstanding for each period
presented. Diluted net loss per common share is computed by giving effect to
common stock equivalents as if they were outstanding for the entire period.
Common stock equivalents were not considered for the years presented since their
effect would be antidilutive. Common stock equivalents of 8,798,612 and 220,123
in fiscal 1998 and 2000, respectively, related to warrants outstanding (see note
9) and outstanding stock options (see note 13), respectively. There were no
common stock equivalents outstanding at September 26, 1999.



                                                 1998           1999           2000
                                             ------------    -----------    -----------
                                                                   
Income (loss) before extraordinary item....  $ 20,397,485      5,817,376      6,545,368
Less accretion of preferred stock..........     2,552,465      2,993,311      9,896,945
Less dividends on preferred stock..........    27,717,142     31,755,475     18,475,448
                                             ------------    -----------    -----------
Loss before extraordinary item.............    (9,872,122)   (28,931,410)   (21,827,025)
Extraordinary item.........................    (1,612,723)            --    (17,150,918)
                                             ------------    -----------    -----------
Net loss applicable to common
  Stockholders.............................  $(11,484,845)   (28,931,410)   (38,977,943)
                                             ============    ===========    ===========
Weighted average common shares outstanding
  (basic and diluted)......................    30,333,400     33,584,576     58,162,671
                                             ============    ===========    ===========
Basic and diluted loss per common share
Net loss per common share before
  extraordinary item.......................  $      (0.33)         (0.86)         (0.38)
Net loss per common share for extraordinary
  item.....................................         (0.05)            --          (0.29)
                                             ------------    -----------    -----------
Net loss per common share..................  $      (0.38)         (0.86)         (0.67)
                                             ============    ===========    ===========


  (o) Fair Value of Financial Instruments

     SFAS No. 107, "Disclosures About Fair Value of Financial Instruments,"
requires disclosure of fair value of certain financial instruments. Cash and
cash equivalents, receivables, other current assets and due from related party,
as well as accounts payable, accrued expenses and other current liabilities, as
reflected in the consolidated financial statements, approximate fair value
because of the short-term maturity of these instruments. The estimated fair
value of the Company's other long-term debt instruments approximate the carrying
amount as the interest rates approximate the Company's current borrowing rate
for similar debt instruments of comparable maturity.

     Fair value estimates are made at a specific point in time, based on
relevant market information and information about the financial instrument.
These estimates are subjective in nature and involve uncertainties and matters
of significant judgment and therefore cannot be determined with precision.
Changes in assumptions could significantly affect the estimates.

                                      F-13
   59
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The estimated fair value of the Company's senior notes and preferred stock
is as follows (in millions):



                                                         1999                 2000
                                                   -----------------    -----------------
                                                   CARRYING    FAIR     CARRYING    FAIR
                                                    AMOUNT     VALUE     AMOUNT     VALUE
                                                   --------    -----    --------    -----
                                                                        
12 1/2% Senior unsecured notes...................   $ 92.3     102.5       0.1        0.1
11% Senior unsecured notes.......................     75.0      81.4        --         --
14 1/4% Series A senior exchangeable preferred
  stock..........................................    235.9     258.4        --         --
9 5/8% Senior subordinated notes.................       --        --     235.0      233.2


     The fair value estimates of the senior notes and preferred stock were based
upon quotes from major financial institutions taking into consideration current
rates offered to the Company for debt instruments of the same remaining
maturities.

  (p) Redeemable Preferred Stock

     Redeemable preferred stock is stated at redemption value less the
unamortized discount. The discount is accreted into the carrying value of the
preferred stock through the date at which the preferred stock is mandatorily
redeemable with a charge to accumulated deficit using the effective-interest
method. During fiscal year 2000, the Company redeemed its redeemable preferred
stock and accreted the remaining original issue discount with a charge to
accumulated deficit (see note 8).

  (q) Stock Option Plans

     The Company accounts for its stock option plans in accordance with the
provisions of Accounting Principles Board ("APB") Opinion No. 25, "Accounting
for Stock Issued to Employees," and related interpretations. As such,
compensation expense would be recorded on the date of grant only if the current
market price of the underlying stock exceeded the exercise price. SFAS No. 123,
"Accounting for Stock-based Compensation," permits entities to recognize as
expense over the vesting period the fair value of all stock-based awards on the
date of grant. Alternatively, SFAS No. 123 also allows entities to continue to
apply the provisions of APB Opinion No. 25 and provide pro forma net loss and
pro forma net loss per share disclosures for employee stock option grants made
as if the fair-value-based method defined in SFAS No. 123 had been applied. The
Company has elected to apply the provisions of APB Opinion No. 25 and provide
the pro forma disclosures of SFAS No. 123.

  (r) Reclassification

     Certain prior year amounts have been reclassified to conform with the
current year presentation.

  (s) Segment Reporting

     SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
Information," establishes standards for the way public business enterprises
report information about operating segments in annual financial statements and
requires those enterprises to report selected information about operating
segments in interim financial reports issued to shareholders. SFAS No. 131 is
effective for financial statements for periods beginning after December 15,
1997. The adoption of SFAS No. 131 did not have a significant impact on the
Company's financial reporting as of and for each of the fiscal years in the
three-year period ended September 24, 2000, since the Company believes it has
only one reportable segment.

                                      F-14
   60
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(3) ACQUISITIONS

     On May 13, 1998, the Company acquired the FCC broadcast license and
substantially all of the assets used or useful in the operation of radio station
KRIO-FM serving the San Antonio area for $9.2 million, plus closing costs of
$0.1 million. The Company financed this purchase from cash on hand and from
operations. The Company subsequently changed the call letters to KLEY-FM. The
aforementioned acquisition was not deemed material in fiscal 1998 for financial
pro forma presentation purposes.

     On December 1, 1998, the Company acquired from Pan Caribbean Broadcasting
Corporation the FCC broadcast license and substantially all of the assets of
WCMA-FM (formerly WDOY-FM) in Puerto Rico for $8.3 million. The acquisition of
WCMA-FM was financed from cash on hand and cash from operations.

     On April 26, 1999, the Company acquired 80 percent of the issued and
outstanding capital stock of JuJu Media, Inc., the owner and operator of
LaMusica.com, an Internet web site and "portal" targeting the U.S. hispanic
market, for $2.0 million in cash and the issuance of a promissory note for $1.0
million.

     On April 30, 1999, the Company acquired the FCC broadcast licenses and
substantially all of the assets used or useful in the operation of WMEG-FM and
WEGM-FM, in Puerto Rico for $16.0 million. The Company financed this purchase
from cash on hand and cash from operations.

     On September 22, 1999, Spanish Broadcasting System of Puerto Rico, Inc., a
Delaware corporation, a wholly owned subsidiary of the Company, entered into a
stock purchase agreement to purchase all of the outstanding capital stock of the
following nine subsidiaries of AMFM Operating Inc., a Delaware corporation
(formerly known as Chancellor Media Corporation of Los Angeles) ("AMFM"):
Primedia Broadcast Group, Inc., WIO, Inc., Cadena Estereotempo, Inc., Portorican
American Broadcasting, Inc., WLDI, Inc., WRPC, Inc., WOYE, Inc., WZNT, Inc.,
WOQI, Inc. (the "Primedia Station Group"). The Primedia Station Group owns and
operates eight radio stations in Puerto Rico: WIOA-FM, WIOB-FM, WIOC-FM,
WCOM-FM, WZMT-FM, WZNT-FM, WOYE-FM, and WCTA-FM. On January 14, 2000, the
Company completed the purchase from AMFM of all of the outstanding capital stock
of the Primedia Station Group for total cash consideration of $90.8 million (net
of $1.0 million cash acquired), including a $10.0 million deposit that was made
on September 22, 1999 and closing costs of $0.7 million. This acquisition was
financed from cash on hand.

     The allocation of the purchase price for the Primedia Station Group was
based on the relative fair values of the assets and liabilities acquired on
January 14, 2000, as follows:

                                                           
Account receivable..........................................     2,500,000
Prepaid expenses and other..................................       150,000
Property and equipment......................................     2,200,000
FCC licenses................................................    89,546,999
Goodwill....................................................    22,201,120
Accounts payable and accrued expenses.......................    (2,291,570)
Income taxes payable........................................    (1,279,000)
Deferred taxes payable......................................   (22,201,120)
                                                              ------------
                                                              $ 90,826,429
                                                              ============



     The following unaudited pro forma summary presents the consolidated results
of operations as if the acquisition of the Primedia Station Group had occurred
as of the beginning of fiscal 1999 and 2000, respectively after giving effect to
certain adjustments, including amortization of intangible assets. These pro
forma results have been prepared for comparative purposes only and do not
purport to be indicative of what

                                      F-15
   61
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

would have occurred had the acquisitions been made as of those dates or of
results which may occur in the future.



                                                 YEAR ENDED            YEAR ENDED
PRO FORMA DISCLOSURES                        SEPTEMBER 26, 1999    SEPTEMBER 24, 2000
- ---------------------                        ------------------    ------------------
                                                (UNAUDITED)           (UNAUDITED)
                                                             
Net revenues...............................     $111,725,000          $126,589,000
Income before extraordinary item...........        3,499,000             6,813,000
Net loss applicable to common
  stockholders.............................      (31,249,000)          (38,820,000)
Net loss per common share..................            (0.93)                (0.67)


     On May 8, 2000, the Company entered into agreements to acquire all of the
outstanding capital stock of Rodriguez Communications, Inc. ("RCI") and certain
holdings of its affiliate, New World Broadcasters Corp. ("New World"), for total
consideration of $165.2 million, consisting of $43.5 million of the Company's
Class A common stock and $121.7 million in cash, subject to certain conditions
and adjustments. The Company has made advances of approximately $121.1 million
(including closing costs of $2.1 million) on the purchase price of these
acquisitions as of September 24, 2000, which is included in intangible assets in
the accompanying consolidated balance sheets.

     The purchase of RCI includes the rights to acquire the following radio
stations -- KFOX-FM and KREA-FM serving the Los Angeles market; KXJO-FM serving
the San Francisco market; and KSAH-AM serving the San Antonio market. The
Company intends to acquire from New World the Dallas radio stations KTCY-FM and
KXEB-AM. Until closing, the Company is broadcasting programming on these
stations under various time brokerage agreements that commenced in May through
September, 2000. Each of these transactions were subject to numerous conditions
and approvals, including receipt of regulatory approvals under the federal
communications laws and review by federal antitrust authorities. The
acquisitions of KFOX-FM, KREA-FM, KXJO-FM, KSAH-AM, and KTCY-FM closed on
November 10, 2000. The Company expects the acquisition of KXEB-AM to close by
the second quarter of fiscal 2001. However, there can be no assurances that this
acquisition can be completed during the expected time frame or at all.

     The Company's consolidated results of operations include the results of
KLEY-FM, WCMA-FM, WMEG-FM, WEGM-FM, WIOA-FM, WIOB-FM, WIOC-FM, WCOM-FM, WZMT-FM,
WZNT-FM, WOYE-FM, and WCTA-FM and JuJu Media, Inc. from the respective dates of
acquisition. These acquisitions have been accounted for under the purchase
method of accounting. The purchase price has been allocated to the assets
acquired, principally FCC licenses.

(4) SALE OF STATIONS

     On July 2, 1997, the Company entered into an agreement for the sale of the
assets and FCC licenses of radio stations WXLX-AM, serving the New York
metropolitan area, KXMG-AM, serving the Los Angeles metropolitan area, and
WCMQ-AM, serving the Miami metropolitan area. Pursuant to this agreement, on
September 29, 1997, the Company sold the assets and FCC licenses of WXLX-AM and
WCMQ-AM for a sales price of $26.0 million and recorded a gain of $18.6 million.
On December 2, 1997, the Company consummated the sale of the assets and FCC
license of KXMG-AM for a sales price of $18.0 million and recorded a gain of
$17.6 million. These transactions are classified under other income as gain on
sale of stations in the accompanying consolidated statements of operations.

     On February 2, 2000, the Company completed the sale of WVMQ-FM in Key West
and WZMQ-FM in Key Largo to South Broadcasting System, Inc., a company owned by
the Chairman Emeritus of the Company, for total cash consideration of $0.7
million and recorded a gain of $0.1 million. This amount has

                                      F-16
   62
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

been classified under other income as gain on sale of stations in the
accompanying consolidated statements of operations.

(5) INTANGIBLE ASSETS

     Intangible assets consist of the following at September 26, 1999 and
September 24, 2000:



                                                                              ESTIMATED
                                                  1999           2000        USEFUL LIVES
                                              ------------    -----------    ------------
                                                                    
FCC licenses................................  $334,098,344    534,420,103       40 years
Goodwill and other..........................     3,010,671     25,217,791     5-40 years
                                              ------------    -----------
                                               337,109,015    559,637,894
Less accumulated amortization...............    35,654,956     46,280,239
                                              ------------    -----------
                                              $301,454,059    513,357,655
                                              ============    ===========


(6) PROPERTY AND EQUIPMENT

     Property and equipment consist of the following at September 26, 1999 and
September 24, 2000:



                                                                              ESTIMATED
                                                   1999           2000       USEFUL LIVES
                                                -----------    ----------    ------------
                                                                    
Land..........................................  $ 1,000,000     2,586,774             --
Building and building improvements............   14,995,440    19,301,182       20 years
Tower and antenna systems.....................    2,257,814     2,359,909     7-15 years
Studio and technical equipment................    5,564,258     6,184,061       10 years
Furniture and fixtures........................    2,072,817     2,412,195     3-10 years
Transmitter equipment.........................    1,220,225     2,416,038     7-10 years
Leasehold improvements........................    1,873,609     1,905,072     5-13 years
Computer equipment and software...............    1,739,392     2,493,320        5 years
Other.........................................      629,997       784,663        5 years
                                                -----------    ----------
                                                 31,353,552    40,443,214
Less accumulated depreciation and
  amortization................................   16,575,849    18,767,975
                                                -----------    ----------
                                                $14,777,703    21,675,238
                                                ===========    ==========


     During fiscal 1999, the Company wrote down the value of one of its
properties in Los Angeles (which was part of the assets acquired in the purchase
of the Los Angeles AM radio station) by $0.5 million. The write-down was based
on current market values of real estate in the Los Angeles area. This amount is
included in other, net in the accompanying consolidated statements of
operations.

     During fiscal 2000, the Company acquired a building and land in Puerto Rico
for $5.3 million. The Company funded the acquisition using cash on hand and
proceeds from a bank loan of $3.7 million (see note 11).

                                      F-17
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                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(7) ACCOUNT PAYABLE AND ACCRUED EXPENSES

     Accounts payable and accrued expenses at September 26, 1999 and September
24, 2000 consists of the following:



                                                        1999           2000
                                                     -----------    ----------
                                                              
Accounts payable -- trade..........................  $ 1,371,933     1,281,942
Accounts payable -- barter.........................      347,106       808,519
Accrued compensation and commissions...............    5,537,663     5,364,205
Accrued professional fees..........................    2,107,266     2,854,418
Accrued music license fees.........................      741,269       701,126
Other accrued expenses.............................    1,725,908     2,974,057
                                                     -----------    ----------
                                                     $11,831,145    13,984,267
                                                     ===========    ==========


(8) SENIOR NOTES AND PREFERRED STOCK

  12 1/2% Senior Unsecured Notes

     On June 29, 1994, the Company, through a private placement offering (the
"Offering") completed the sale of 107,059 units (the "Units"), each consisting
of $1,000 principal amount of 12 1/2% Senior Notes (the "12 1/2% Notes") due
2002 and warrants to purchase 5,352,950 shares of Class B common stock. The
12 1/2% Notes and warrants are separately transferable. The 12 1/2% Notes were
issued at a discount and generated proceeds to the Company of $87.8 million, net
of financing costs of $6.2 million. Of the $94.0 million of gross proceeds,
$88.6 million was allocated to the 12 1/2% Notes and $5.4 million was determined
to be the value of the warrants.

     Pursuant to the 12 1/2% Notes, the Company was required to use the greater
of $25.0 million or 50 percent of the net proceeds from any disposition of
certain asset sales (including the FCC broadcast licenses of the AM stations
referred to in note 4) to make offers to purchase the 12 1/2% Notes at 110
percent of the principal value thereof.

     On October 17, 1997, the Company made a tender offer to purchase for cash
any and all of the 12 1/2% Notes up to $22.7 million plus accrued interest up
to, but not including the payment date. The amount payable by the Company was
110 percent of the principal amount of the 12 1/2% Notes. The Company paid $6.3
million to the noteholders who responded to the tender offer and purchased $5.5
million in principal amount of 12 1/2% Notes for $6.0 million plus accrued
interest of $0.3 million in November 1997. The Company also repurchased $7.7
million in principal amount of 12 1/2% Notes for $9.0 million plus accrued
interest of $0.4 million in November 1997. The Company recognized a loss on the
tender offer and repurchased notes of $1.6 million, net of income tax benefit of
$1.1 million, due to the premium paid for the 12 1/2% Notes and the subsequent
write-off of the deferred financing costs and original issue discounts related
to the 12 1/2% Notes purchased. This amount has been classified as an
extraordinary item in the accompanying consolidated statements of operations.

     On November 2, 1999, the Company repurchased $101.5 million in principal
amount of 12 1/2% Notes. In connection with this repurchase, the Company
realized a loss on the early extinguishment of debt of approximately $9.5
million, net of income taxes of approximately $7.4 million. This loss relates to
the premium paid on the repurchase of the 12 1/2% Notes, the write-off of
related deferred financing costs, and the amortization of the remaining original
issue discount on the 12 1/2% Notes, and is classified as an extraordinary item
in the accompanying consolidated statements of operations.

                                      F-18
   64
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  14 1/4% Series A Senior Exchangeable Preferred Stock and 11% Senior Unsecured
Notes

     On March 27, 1997, the Company financed the purchase of radio stations
WYSY-FM (renamed WLEY-FM by the Company), WRMA-FM and WXDJ-FM with proceeds from
the sale through a private placement of 175,000 shares of the Company's 14 1/4%
Series A Senior Exchangeable Preferred Stock ("Series A Preferred Stock") and
warrants to purchase 3,745,000 shares of the Company's Class B common stock. The
Series A Preferred Stock and the warrants are separately transferable. The gross
proceeds from the issuance of the Series A Preferred Stock and warrants,
amounted to $175.0 million. The value of the warrants was determined to be $16.6
million. The Company also issued $75.0 million aggregate principal amount of the
Company's 11% Senior Unsecured Notes (the "11% Senior Notes") due 2004. In
connection with this transaction, the Company capitalized financing costs of
$5.7 million related to the 11% Senior Notes and charged issuance costs of $9.0
million related to the Series A Preferred Stock and warrants to paid-in capital.

     On November 2, 1999, the Company repurchased $75.0 million in principal
amount of 11% Senior Notes. In connection with this repurchase, the Company
realized a loss on the early extinguishment of debt of approximately $6.6
million, net of income taxes of approximately $5.1 million. This loss relates to
the premium paid on the repurchase of the 11% Senior Notes and the write-off of
related deferred financing costs, and is classified as an extraordinary item in
the accompanying consolidated statements of operations.

     On December 2, 1999, the Company redeemed in full the Series A Preferred
Stock. In connection with this redemption, the Company recorded total additional
dividends of approximately $28.4 million, on the Series A Preferred Stock, which
reduced the income available to common stockholders in the accompanying fiscal
2000 consolidated statement of operations. These additional dividends relate to
the premium on the redemption, and the accretion of the remaining original issue
discount on the Series A Preferred Stock.

  9 5/8% Senior Subordinated Notes

     On October 28, 1999, concurrently with the Company's initial public
offering ("IPO") of Class A common stock (see note 13), the Company sold $235.0
million aggregate principal amount of 9 5/8% senior subordinated notes due 2009
(the "1999 Notes"), from which the Company received proceeds of $228.0 million
after payment of underwriter commissions. In connection with this transaction,
the Company capitalized financing costs of $8.5 million related to the 1999
Notes.

(9) WARRANTS

     Warrants consist of the following:



                                                          NUMBER OF CLASS B COMMON SHARES
                                                        REPRESENTED BY OUTSTANDING WARRANTS
                                                       -------------------------------------
                                                          1998          1999         2000
                                                       -----------    ---------    ---------
                                                                          
Issued in connection with:
12 1/2% Senior Notes(a)..............................   2,469,950           --           --
14 1/4% Series A Senior Exchangeable Preferred
  Stock(b)...........................................   3,745,000           --           --
Replacement warrants(a)..............................   2,910,450           --           --
                                                        ---------      -------      -------
     Total...........................................   9,125,400           --           --
                                                        =========      =======      =======


          (a) In 1994, in conjunction with the issuance of 12 1/2% Senior Notes,
     the Company issued warrants exercisable for 5,352,950 shares of Class B
     common stock at an exercise price of $.01 per warrant share which are
     subject to adjustment upon the occurrence of certain events, as defined in
     the warrant agreement. In connection with the declaration of a cash
     dividend on common stock, in March 1998, holders of these warrants were
     given the option to participate in such dividends in lieu of maintaining

                                      F-19
   65
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     their antidilution rights with respect to such dividends. Holders of
     warrants representing 2,910,450 shares of Class B common stock exercised
     this option and received cash dividends of $0.326 million and replacement
     warrants representing 2,910,450 shares of Class B common stock which have
     an exercise price of $.01 per share. The remaining warrant holders had
     their underlying shares adjusted upward resulting in an increase to
     additional paid-in capital and a charge to accumulated deficit of $0.274
     million. The remaining warrant holders exercised the warrants during the
     nine-month period ended June 27, 1999. During the fiscal year ended
     September 26, 1999, replacement warrants were exercised for 2,900,950
     shares of Class B common stock. The remaining replacement warrants expired
     on June 30, 1999, representing 9,500 shares of common stock.

          (b) In 1997, in conjunction with the issuance of the 14 1/4% Series A
     Senior Exchangeable Preferred Stock, the Company issued warrants that
     entitle the holder to acquire 21.4 shares of Class B common stock or
     3,745,000 shares at a price equal to $0.01 per 21.4 shares, subject to
     adjustment from time to time upon the occurrence of certain changes of
     common stock, certain common stock distributions, certain issuances of
     options or convertible securities, certain dividends and distributions and
     certain other increases in the number of shares or common stock. During the
     fiscal year ended September 26, 1999, warrants were exercised for 3,744,250
     shares of Class B common stock. The remaining warrants expired on June 30,
     1999, representing 750 shares of common stock.

(10) SENIOR CREDIT FACILITY

     On July 6, 2000, the Company entered into a $150.0 million senior secured
credit facility (the "Senior Facility"). The Senior Facility includes a six-year
$25.0 million revolving credit line and $125.0 million of term loans. At
September 24, 2000, the Company had term loans outstanding of $65.0 million. In
connection with this transaction, the Company capitalized financing costs of
$3.2 million related to the Senior Facility.

(11) OTHER LONG-TERM DEBT

     Other long-term debt consists of the following at September 26, 1999 and
September 24, 2000:



                                                                 1999         2000
                                                              ----------    ---------
                                                                      
Obligation under capital lease with related party payable in
  monthly installments of $9,000, including interest at
  6.25%, commencing June 1992 (see note 14).................  $  941,761      891,189
Note payable, including interest at an annual rate of
  three-month LIBOR plus 450 basis points; paid in full in
  December 1999 -- see note below...........................   3,281,152           --
Note payable due on April 26, 2000 including interest at an
  annual rate of 6%; paid in full in September 2000 -- see
  note below................................................   1,000,000           --
Note payable due in monthly installments of $39,196,
  including interest at 9.75%, commencing August 2000, with
  balance due on June 2005 (see note 6).....................          --    3,672,375
                                                              ----------    ---------
                                                               5,222,913    4,563,564
Less current portion........................................   1,800,572      171,262
                                                              ----------    ---------
                                                              $3,422,341    4,392,302
                                                              ==========    =========


                                      F-20
   66
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The scheduled maturities of other long-term debt are as follows at
September 24, 2000:



FISCAL YEAR ENDING SEPTEMBER                         AMOUNT
- ----------------------------                       ----------
                                                
2001.............................................  $  171,262
2002.............................................     186,722
2003.............................................     202,729
2004.............................................     222,074
2005.............................................   3,195,276
Thereafter.......................................     585,501
                                                   ----------
                                                   $4,563,564
                                                   ==========


     On December 2, 1999, the Company repaid in full the note payable to the
seller of WLEY-FM (formerly WYSY-FM) of approximately $3.3 million, plus accrued
interest of approximately $0.1 million. Additionally, on August 9, 2000, the
Company repaid in full the note payable to the sellers of JuJu Media, Inc. of
approximately $1.0 million, plus accrued interest of approximately $0.1 million.

(12) LOANS RECEIVABLE FROM STOCKHOLDERS AND RELATED-PARTY TRANSACTIONS

     Loans receivable from stockholders were comprised of loans receivable from
the Company's Chief Executive Officer ("CEO") and Chairman of the Board of
Directors ("Chairman"). Loans receivable have been classified as an increase in
stockholders' deficiency in the accompanying consolidated balance sheets as of
September 26, 1999. Interest receivable of $0.4 million at September 26, 1999,
is included in other current assets. On November 2, 1999, the loans receivable
from stockholders plus interest were repaid with the shareholders' proceeds from
the IPO.

     At September 26, 1999, the Company had advances totaling $0.3 million due
from a party related through common ownership. During fiscal 1999, the Company
agreed to forgive these advances and wrote off the amount due from the related
party. Additionally, at September 26, 1999, the Company had trade receivables
totaling $0.4 million due from this related party which were fully reserved as
being uncollectible.

     During each of fiscal years 1998 and 1999, the Company paid operating
expenses of approximately $0.1 million for a boat owned by a related party
through common ownership which was used by the Company for business
entertainment purposes.

     The Company leases an apartment from its CEO for annual rentals of $0.1
million through August 2007. Certain renovation expenses were paid for by the
Company totaling $0.2 million during 1998 and 1999. In addition, the Company
occupies a building under a capital lease agreement with certain stockholders
(see note 14). The building lease expires in 2012 and calls for an annual base
rent of approximately $0.1 million.

     In connection with the relocation of offices from the New York metropolitan
area to the Miami metropolitan area, the Company advanced the CEO an aggregate
of $1.1 million to pay for various expenses. On July 16, 1997, the CEO executed
a promissory note to the Company for the principal amount of $1.1 million to
evidence these advances. The note was payable on demand and bore interest at a
rate of 7 percent per annum. The Company declared and paid a dividend in 1998
and applied a portion of the proceeds of such dividend which were otherwise
payable to the CEO to the repayment in full of this promissory note.

     On September 24, 1999, the Company entered into letters of understanding
with its then Chairman and Secretary. These letters outlined the mutual
intentions of the Company and these individuals in connection

                                      F-21
   67
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

with the Company's IPO, and were contingent upon the completion of the IPO (see
note 13). These letters provided for the following:

     - The sale by these individuals of $14.0 million of their Class B common
       stock in the IPO (see note 13);

     - The purchase by the Company of annuities providing aggregate annual
       retirement compensation of $1.0 million to these individuals. These
       annuities were purchased by the Company for $10.2 million in November
       1999;

     - The retention of these individuals as members of the Company's Board of
       Directors, with titles of "Chairman Emeritus" and "Secretary Emeritus",
       respectively;

     - An agreement to sell, to the Chairman, the Company's two radio stations
       located in the Florida Keys for $0.7 million (see note 4).

     - The repayment by the Chairman of a stockholder loan for approximately
       $0.6 million, plus accrued interest of approximately $0.1 million. This
       stockholder loan and the related accrued interest was repaid in full by
       the Chairman in November 1999;

     - An agreement by the Chairman to assume responsibility for a boat leased
       by the Company during fiscal 1998 and 1999. Responsibility for this boat
       was assumed by the Chairman in November 1999; and

     - The use by the Chairman of a car and driver, and by the Secretary of a
       car, to be provided by the Company.

(13) STOCKHOLDERS' (DEFICIENCY) EQUITY

  (a) Stock Split

     On September 29, 1999, the Company amended and restated its Certificate of
Incorporation, resulting in a conversion of all existing shares of Class A
common stock into shares of Class B common stock equal to the number of shares
representing a 50 to 1 stock split for each share. The number of authorized
shares of capital stock was increased to 151 million comprised of 100 million
shares of Class A common stock, 50 million shares of Class B common stock and 1
million shares of Preferred Stock, and the par values of both the Class A common
stock and Class B common stock were changed from $.01 per share to $.0001 per
share. In addition, Class B common stockholders are entitled to ten votes per
share and Class A common stockholders are entitled to one vote per share. Upon
transfer or sale of stock by Class B common stockholders to non-affiliate
parties, such shares automatically convert to shares of Class A common stock.

     The accompanying consolidated financial statements have been retroactively
restated to reflect these actions.

     The rights of the holders of shares of Class A common stock and Class B
common stock are identical except for voting rights and conversion provisions.
Holders of each class of common stock are entitled to receive dividends and upon
liquidation or dissolution are entitled to receive all assets available for
distribution to stockholders. The holders of each class have no preemptive or
other subscription rights and there are no redemption or sinking fund provisions
with respect to such shares. Each class of common stock is subordinate to the
Series A Preferred Stock with respect to dividend rights and rights on
liquidation, winding up and dissolution of the Company.

  (b) Initial Public Offering

     On October 27, 1999, the Company and selling shareholders sold 25,055,510
shares of Class A common stock in an IPO, from which the Company received
proceeds of $389.4 million after payment of underwriter

                                      F-22
   68
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

commissions. Concurrently with this IPO, on October 28, 1999, the Company sold
$235.0 million aggregate principal amount of 1999 Notes (see note 8).

     In connection with these offerings, in October 1999 the Company amended its
employment agreement with its CEO and entered into employment agreements with
two other executive officers of the Company. In addition, the CEO repaid a
shareholder loan for approximately $1.9 million, plus accrued interest of
approximately $0.4 million, in November 1999.

     In connection with the IPO, the Company also granted an aggregate of
100,000 options to non-employee directors, 250,000 options to a former director,
and an aggregate of 300,000 options to executives of the Company, in November
1999. These options were granted at an exercise price per share equal to the IPO
price per share, with vesting periods ranging from zero to four years.

  (c) Stock Option Plans

     The Company maintains a stock option plan pursuant to which the Company has
reserved up to 1,337,500 shares of Class A common stock for issuance upon the
exercise of options granted under the plan. The plan covers all regular salaried
employees of the Company and its subsidiaries. As of September 24, 2000, no
options have been granted under this plan.

     In September 1999, the Company adopted an employee incentive stock option
plan ("the 1999 ISO Plan") and a nonemployee director stock option plan ("the
1999 NQ Plan"). Options granted under the 1999 ISO Plan will vest according to
terms to be determined by the Compensation Committee of the Company's Board of
Directors, and will have a contractual life of five to ten years from date of
grant. Options granted under the 1999 NQ Plan will vest 20 percent upon grant,
and 20 percent each year for the first four years from grant. All options
granted under the 1999 ISO Plan and the 1999 NQ Plan vest immediately upon a
change in control of the Company, as defined. A total of 3,000,000 shares and
300,000 shares of Class A common stock have been reserved for issuance under the
1999 ISO Plan and the 1999 NQ Plan, respectively.

     A summary of the status of the Company's stock option plans, as of
September 24, 2000, and changes during the year then ended, is presented below:



                                                                      WEIGHTED-
                                                                       AVERAGE
                                                                      EXERCISE
                                                          SHARES        PRICE
                                                         ---------    ---------
                                                                
Outstanding at beginning of year.......................         --     $   --
Granted................................................  1,593,552      18.69
Exercised..............................................         --         --
Forfeited..............................................    (40,000)     20.00
                                                         ---------
Outstanding at end of year.............................  1,553,552     $18.66
                                                         =========
Options exercisable at end of year.....................    512,851
Weighted average fair value of options exercisable
  during the year......................................                $14.35


                                      F-23
   69
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The following table summarizes information about stock options outstanding
and exercisable at September 24, 2000:



                          OPTIONS OUTSTANDING
                 --------------------------------------     OPTIONS EXERCISABLE
                                WEIGHTED-                 -----------------------
                                 AVERAGE      WEIGHTED-                 WEIGHTED-
                                REMAINING      AVERAGE                   AVERAGE
RANGE OF           NUMBER      CONTRACTUAL    EXERCISE      NUMBER      EXERCISE
EXERCISE PRICES  OUTSTANDING   LIFE (YEARS)     PRICE     EXERCISABLE     PRICE
- ---------------  -----------   ------------   ---------   -----------   ---------
                                                         
$10 to $15          218,552        9.92        $10.00        72,851      $10.00
$16 to $20        1,230,000        9.02         20.00       430,000       20.00
$21 to $25          105,000        9.62         20.99        10,000       20.81
                  ---------                                 -------
                  1,553,552        9.19        $18.66       512,851      $18.60
                  =========                                 =======


     The Company applies APB Opinion No. 25 and related interpretations in
accounting for its stock option plans. The fair value of each option granted to
employees is estimated on the date of grant using the Black-Scholes option
pricing model with the following assumptions:

                                                           
Expected life...............................................  5 years
Dividends...................................................     None
Risk-free interest rate.....................................     5.65%
Expected volatility.........................................      100%



     Had compensation expense for the Company's plans been determined consistent
with FASB Statement No. 123, the Company's net loss applicable to common
stockholders and net loss per common share would have been increased to pro
forma amounts indicated below:

                                                           
Net loss applicable to common stockholders:
  As reported...............................................  $(38,977,943)
  Pro forma.................................................  $(48,744,622)
Net loss per common share:
  As reported...............................................  $      (0.67)
  Pro forma.................................................  $      (0.84)



(14) COMMITMENTS

  (a) Leases

     The Company occupies a building under a capital lease agreement with
certain stockholders of the Company expiring in June 2012. The amount
capitalized under this lease agreement and included in property and equipment at
September 26, 1999 and September 24, 2000 is as follows:



                                                          1999         2000
                                                       ----------    ---------
                                                               
Building under capital lease.........................  $1,230,440    1,230,440
Less: Accumulated depreciation.......................    (451,055)    (512,577)
                                                       ----------    ---------
                                                       $  779,385      717,863
                                                       ==========    =========


     The Company leases office space and facilities and certain equipment under
operating leases, one of which is with a related party (see note 12), that
expire at various dates through 2035. Certain leases provide for base rental
payments plus escalation charges for real estate taxes and operating expenses.

                                      F-24
   70
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     At September 24, 2000, future minimum lease payments under such leases are
as follows:



                                                               CAPITAL      OPERATING
FISCAL YEAR ENDING SEPTEMBER                                    LEASE        LEASES
- ----------------------------                                  ----------    ---------
                                                                      
2001........................................................  $  149,000    1,014,900
2002........................................................     149,000      946,500
2003........................................................     149,000      908,400
2004........................................................     149,000      770,900
2005........................................................     149,000      587,300
Thereafter..................................................     989,637    2,669,100
                                                              ----------    ---------
Total minimum lease payments................................   1,734,637    6,897,100
                                                                            =========
  Less executory costs......................................    (478,360)
                                                              ----------
                                                               1,256,277
  Less interest at 6.25%....................................    (365,088)
                                                              ----------
Present value of minimum lease payments.....................  $  891,189
                                                              ==========


     Total rent expense for the fiscal years ended September 27, 1998, September
26, 1999 and September 24, 2000 amounted to $1.1 million, $1.4 million and $1.5
million, respectively.

     The Company has agreements to sublease its radio frequencies and portions
of its tower sites. Such agreements provide for payments through 2004. The
future minimum rental income to be received under these agreements as of
September 24, 2000 is as follows:



FISCAL YEAR ENDING SEPTEMBER                         AMOUNT
- ----------------------------                       ----------
                                                
2001...........................................    $  710,246
2002...........................................       589,374
2003...........................................       492,044
2004...........................................       306,044
                                                   ----------
                                                   $2,097,708
                                                   ==========


  (b) Employment Agreements

     At September 24, 2000, the Company is committed to employment contracts for
certain executives, on-air talent and general managers expiring through 2005.
Future payments under such contracts are as follows:



FISCAL YEAR ENDING SEPTEMBER                        AMOUNT
- ----------------------------                      -----------
                                               
2001..........................................    $ 5,143,450
2002..........................................      4,453,354
2003..........................................      3,457,582
2004..........................................      2,292,911
2005..........................................        887,494
                                                  -----------
                                                  $16,234,790
                                                  ===========


     Included in the future payments schedule above is a five-year employment
agreement with the CEO. The agreement provides for an annual base salary of not
less than $1.0 million, and a cash bonus equal to 7.5 percent of the dollar
increase in same station broadcast cash flow for any fiscal year, including
acquired

                                      F-25
   71
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

stations on a pro forma basis. Under the terms of the agreement, the CEO's
annual base salary and cash bonus may be increased by the board of directors in
its sole discretion. The total cash bonus earned by the CEO for fiscal 2000 was
$1.0 million, of which $0.8 million was paid in fiscal 2000 and $0.2 million is
included in accounts payable and accrued expenses in the accompanying
consolidated balance sheets.

     Certain employees' contracts provide for additional amounts to be paid if
station ratings or cash flow targets are met.

  (c) 401(k) Profit Sharing

     In September 1999, the Company adopted a tax-qualified employee savings and
retirement plan ("the 401(k) Plan"). The 401(k) Plan provides for Company
contributions to match 25 percent of an eligible employee's contributions, up to
5 percent of the employee's base monthly earnings. All employees over the age of
21 that have completed at least 500 hours of service are eligible to participate
in the 401(k) Plan. There were no contributions associated with this plan to
date.

(15) CONTINGENCIES

     In connection with the sale of WXLX-AM (see note 4), the Company assigned a
lease for a transmitter site which is located on a former landfill which ceased
operations in the late 1960s. As part of the sales agreement, the Company
retained potential exposure relating to possible environmental liabilities
relating to this site. Management is unable to assess the likelihood that any
claim for remediation of this site will arise and no amounts have been accrued
in the consolidated financial statements relating to this contingent liability.

     On September 28, 1999, the Company received notice from the purchaser of
KXMG-AM (see note 4) that it would make a claim against the Company for
indemnification under the agreement pursuant to which KXMG-AM was sold, for the
removal of an underground fuel storage tank located on the site of KXMG-AM's
transmitter. The notice did not specify the amount involved in the
indemnification claim. The Company does not have sufficient information to
assess the potential exposure related to this matter, and no amounts have been
accrued in the consolidated financial statements relating to this contingent
liability.

(16) NEW ACCOUNTING PRONOUNCEMENTS

     In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 establishes accounting and
reporting standards for derivative instruments, including certain derivative
instruments embedded in other contracts and for hedging activities. It requires
an entity to recognize all derivatives as either assets or liabilities in the
balance sheet and measure those instruments at fair value. SFAS No. 133, as
amended by SFAS No. 137, is expected to be effective for the Company's fiscal
year ending September 30, 2001. Management does not believe that the adoption of
SFAS No. 133 will have a significant impact on the Company's consolidated
financial statements.

     In November 1999, the Emerging Issues Task Force ("EITF") of the FASB
issued EITF 99-17, "Accounting for Advertising Barter Transactions", which
provides guidance on barter transactions that involve nonmonetary exchanges of
advertising. EITF 99-17 requires an entity to account for barter advertising
revenues and expenses at the determinable fair value of the advertising
surrendered or received in the exchange, or at book value if the fair value can
not be determined within reasonable limits. The adoption of EITF 99-17 did not
have a significant impact on the Company's consolidated financial statements.

     In December 1999, the Securities and Exchange Commission (SEC) issued Staff
Accounting Bulletin No. 101 (SAB 101), "Revenue Recognition", which provides
guidance on the recognition, presentation and disclosure of revenue in financial
statements filed with the SEC. SAB 101 outlines the basic criteria that must be
met in order to recognize revenue and provides guidance for disclosures related
to revenue recognition
                                      F-26
   72
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

policies. In June 2000, the SEC issued SAB 101B, "Second Amendment: Revenue
Recognition in Financial Statements" which extends the effective date of SAB 101
to the fourth fiscal quarter of fiscal years commencing after December 15, 1999.
At this time, management is still assessing the impact of SAB 101 on the
Company's financial position and results of operations.

     In September 2000, the FASB issued SFAS No. 140, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities (A
Replacement of SFAS No. 125)". SFAS No. 140 provides guidance on accounting for
(1) securitization transactions involving financial assets; (2) sales of
financial assets (including loan participations); (3) factoring transactions;
(4) wash sales; (5) servicing assets and liabilities; (6) collateralized
borrowing arrangements; (7) securities lending transactions; (8) repurchase
agreements; and (9) extinguishment of liabilities. While most of the provisions
of SFAS No. 140 will become effective for transactions entered into after March
31, 2001, companies with calendar fiscal year ends that hold beneficial
interests from previous securitizations will be required to make additional
disclosures in their December 31, 2000 financial statements. Management does not
believe that the adoption of SFAS No. 140 will have a significant impact on the
Company's consolidated financial statements.

(17) INCOME TAXES

     Income tax expense (benefit) for the fiscal years ended September 27, 1998,
September 26, 1999 and September 24, 2000 consists of the following and was
allocated as follows:



                                                             1998
                                      --------------------------------------------------
                                      CURRENT-
                                      STATE AND    CURRENT     DEFERRED
                                        LOCAL      FEDERAL      FEDERAL         TOTAL
                                      ---------    -------    -----------    -----------
                                                                 
Income from operations..............  $950,000     850,000     13,824,032     15,624,032
Extraordinary item -- loss on
  extinguishment of debt............        --          --     (1,075,149)    (1,075,149)
                                      --------     -------    -----------    -----------
                                      $950,000     850,000     12,748,883     14,548,883
                                      ========     =======    ===========    ===========




                                                             1999
                                      --------------------------------------------------
                                      CURRENT-
                                      STATE AND    CURRENT     DEFERRED
                                        LOCAL      FEDERAL      FEDERAL         TOTAL
                                      ---------    -------    -----------    -----------
                                                                 
Income from operations..............  $550,000      15,000      3,879,919      4,444,919
                                                   =======    ===========    ===========
                                      ========




                                                             2000
                                      --------------------------------------------------
                                      CURRENT-                 DEFERRED
                                      STATE AND    CURRENT    FEDERAL AND
                                        LOCAL      FEDERAL       STATE          TOTAL
                                      ---------    -------    -----------    -----------
                                                                 
Income from operations..............  $250,000          --      4,664,479      4,914,479
Extraordinary item -- loss on
  extinguishment of debt............        --          --    (11,433,945)   (11,433,945)
                                      --------     -------    -----------    -----------
                                      $250,000          --     (6,769,466)    (6,519,466)
                                      ========     =======    ===========    ===========


     During fiscal 1998 and 1999, the Company utilized net operating loss
carryforwards of approximately $38.8 million and $0.2 million, respectively. For
fiscal 2000, no net operating losses were utilized.

                                      F-27
   73
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The tax effect of temporary differences and carryforwards that give rise to
deferred tax assets and deferred tax liabilities at September 27, 1998,
September 26, 1999 and September 24, 2000 is as follows:



                                                 1998           1999           2000
                                             ------------    -----------    -----------
                                                                   
Deferred tax assets:
  Net operating loss carryforwards.........  $ 16,919,249     16,849,019     30,222,128
  Foreign net operating loss
     carryforwards.........................            --             --        819,738
  Deferred interest........................     6,080,278      6,458,459             --
  Allowance for doubtful accounts..........     3,108,024      2,546,384      4,270,372
  Fixed assets.............................       474,286        474,286        474,286
  Unearned revenue.........................       856,582      1,074,402        863,540
  AMT credit...............................       850,000        865,000        865,000
                                             ------------    -----------    -----------
     Total gross deferred tax assets.......    28,288,419     28,267,550     37,515,064
Less valuation allowance...................   (17,396,470)   (17,396,470)   (17,396,470)
                                             ------------    -----------    -----------
     Total net deferred tax assets.........    10,891,949     10,871,080     20,118,594
                                             ------------    -----------    -----------
Deferred tax liabilities:
  Depreciation and amortization............    14,463,595     18,322,645     20,800,693
  Intangible assets........................     5,502,950      5,502,950     27,704,070
                                             ------------    -----------    -----------
  Total gross deferred tax liabilities.....    19,966,545     23,825,595     48,504,763
                                             ------------    -----------    -----------
     Net deferred tax asset (liability)....  $ (9,074,596)   (12,954,515)   (28,386,169)
                                             ============    ===========    ===========


     Total income tax expense (benefit) differed from the amounts computed by
applying the U.S. Federal income tax rate of 35 percent for fiscal years 1998,
1999 and 2000 as a result of the following:



                                                              1998    1999    2000
                                                              ----    ----    -----
                                                                     
Computed "expected" tax expense (benefit)...................  35.0%   35.0%   (35.0)%
State income taxes, net of federal income tax benefit.......   6.5%    5.5%    (4.6)%
Nondeductible expenses......................................   0.4%    0.4%     1.0%
Other.......................................................   1.8%    2.7%     0.6%
                                                              ----    ----    -----
                                                              43.7%   43.6%   (38.0)%


     The valuation allowance for deferred tax assets as of September 27, 1998,
September 26, 1999 and September 24, 2000 was $17,396,470. In assessing the
realizability of deferred tax assets, management considers whether it is more
likely than not that some portion or all of the deferred tax assets will not be
realized. The ultimate realization of deferred tax assets is dependent upon the
generation of future taxable income during the periods in which those temporary
differences become deductible. Management considers the scheduled reversal of
deferred tax liabilities, projected future taxable income, and tax planning
strategies in making this assessment.

     Based upon the level of historical taxable income and projections for
future taxable income over the periods which the deferred tax assets are
deductible, management believes it is more likely than not the Company will
realize the benefits of these deductible differences, net of the existing
valuation allowances. The amount of the deferred tax asset considered
realizable, however, could be reduced in the near term if estimates of future
taxable income during the carryforward period are reduced.

                                      F-28
   74
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     At September 24, 2000, the Company has domestic net operating loss
carryforwards available to offset future taxable income expiring as follows:



                                                NET OPERATING
EXPIRING IN SEPTEMBER                         LOSS CARRYFORWARDS
- ---------------------                         ------------------
                                           
2007........................................     $ 5,597,000
2008........................................      12,213,000
2009........................................      11,445,000
2010........................................      12,868,000
2011........................................      33,432,000
                                                 -----------
                                                 $75,555,000
                                                 ===========


     Additionally at September 24, 2000, the Company has foreign net operating
loss carryforwards of $2,050,000 available to offset future taxable income
expiring in September 2007.

(18) LITIGATION

     The Company is the defendant in a number of lawsuits and claims incidental
in its ordinary course of business, certain of which have been brought by former
employees. The litigation which is probable to result in an unfavorable outcome
and can be reasonably estimated amounts to $0.3 million which the Company has
accrued. The Company does not believe the outcome of any litigation, current or
pending, would have a material adverse impact on the financial position or the
results of operations of the Company.

     Additionally, the Company is the defendant in a lawsuit where on October
12, 2000, the plaintiff obtained a $1.9 million final default judgment. The
Company believes that the default judgment was improperly entered because, among
other reasons, (1) plaintiff's counsel failed to contact the Company counsel
prior to seeking the default judgment, (2) the Company can demonstrate excusable
neglect and a bona fide defense to the complaint, and (3) the plaintiff did not
name a proper corporate entity. The Company does not have sufficient information
to assess the outcome of this litigation, and no amounts have been accrued in
the consolidated financial statements relating to this contingent liability.

(19) SUBSEQUENT EVENTS

  (a) Acquisition of Stations

     On November 3, 2000, the Company entered into an agreement to acquire the
assets of KFSG-FM broadcasting, serving the Los Angeles, California market, from
International Church of the Foursquare Gospel, for total cash consideration of
$250.0 million. In connection with this acquisition, the Company made a $5.0
million nonrefundable deposit on the purchase price into escrow. The closing of
this acquisition is subject to numerous conditions and approvals, including
receipt of regulatory approvals under the Federal communications laws and review
by Federal antitrust authorities. The Company expects to fund this transaction
by increasing its senior credit facility, accessing the high yield capital
markets and undertaking certain potential asset dispositions. The Company
expects to close the acquisition by December 31, 2001. However, there can be no
assurances that this acquisition can be completed during the expected time frame
or at all, or that the Company will be able to obtain additional financing or
dispose of certain assets at terms favorable to the Company or at all.

                                      F-29
   75
                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     On November 10, 2000, the Company closed on all stations acquired from RCI
and New World (see note 3), except for KXEB-AM, for total consideration of
$164.3 million, consisting of $42.6 million of the Company's Class A common
stock and $121.7 million in cash. The Company expects to complete the
acquisition of KXEB-AM in the second quarter of fiscal 2001. However, there can
be no assurances that the acquisition of KXEB-AM can be completed during the
expected time frame or at all.

  (b) Commitment

     On December 1, 2000, the Company entered into a lease for its new corporate
headquarters with a Florida limited partnership for which the general partner is
a company wholly-owned by the Company's CEO. The Company is leasing the office
space under a 10-year operating lease with rental payments of approximately $0.4
million per year, with the right to renew for two consecutive five-year terms.

                                      F-30
   76

                       SPANISH BROADCASTING SYSTEM, INC.
                                AND SUBSIDIARIES

       FINANCIAL STATEMENT SCHEDULE -- VALUATION AND QUALIFYING ACCOUNTS
FISCAL YEARS ENDED SEPTEMBER 27, 1998, SEPTEMBER 26, 1999 AND SEPTEMBER 24, 2000



                                                  COLUMN C ADDITIONS
                                  COLUMN B     ------------------------                     COLUMN E
                                  BALANCE      CHARGED TO    CHARGED TO                      BALANCE
COLUMN A                         BEGINNING      COST AND       OTHER         COLUMN D        AT END
DESCRIPTION                      OF PERIOD      EXPENSE       ACCOUNTS     DEDUCTIONS(1)    OF PERIOD
- -----------                      ----------    ----------    ----------    -------------    ---------
                                                                             
Fiscal year 1998:
  Allowance for doubtful
     accounts..................  $5,405,095    2,634,509        --             269,544      7,770,060
Fiscal year 1999:
  Allowance for doubtful
     accounts..................  $7,770,060    1,670,438        --           3,074,539      6,365,959
Fiscal year 2000:
  Allowance for doubtful
     accounts..................  $6,365,959    4,077,047        --           2,360,731      8,082,275


- ---------------
(1) Write-offs, net of recoveries.

                                      F-31
   77

  (a) 2. Financial Statement Schedules

     See end of financial statements above for Schedule of Valuation and
Qualifying Accounts.

  (a) 3. Exhibits

      
 3.1   --   Third Amended and Restated Certificate of Incorporation of
            the Company, dated September 29, 1999 (incorporated by
            reference to the Company's 1999 Registration Statement on
            Form S-1 (Commission File No. 333-85499) (the "1999
            Registration Statement")) (Exhibit A to this exhibit 3.1 is
            incorporated by reference to the Company's Current Report on
            Form 8-K, dated March 25, 1996 (the "1996 Current Report")).
 3.2   --   Certificate of Amendment to the Third Amended and Restated
            Certificate of Incorporation of the Company, dated September
            29, 1999 (incorporated by reference to the Company's 1999
            Registration Statement).
 3.3   --   Amended and Restated By-Laws of the Company (incorporated by
            reference to the Company's 1999 Registration Statement).
 4.1   --   Article V of the Third Amended and Restated Certificate of
            Incorporation of the Company, dated September 29, 1999
            (incorporated by reference to the Company's 1999
            Registration Statement) (see Exhibit 3.1).
 4.2   --   Certificate of Designation filed as Exhibit A to the Third
            Amended and Restated Certificate of Incorporation of the
            Company, dated September 29, 1999 (incorporated by reference
            to the Company's 1999 Registration Statement) (see Exhibit
            3.1).
 4.3   --   Indenture dated June 29, 1994 among the Company, IBJ
            Schroder Bank & Trust Company, as Trustee, the Guarantors
            named therein and the Purchasers named therein (incorporated
            by reference to Exhibit 4.1 of the Company's 1994
            Registration Statement on Form S-4, the "1994 Registration
            Statement").
 4.4   --   First Supplemental Indenture dated as of March 25, 1996 to
            the Indenture dated as of June 29, 1994 among the Company,
            the Guarantors named therein and IBJ Schroder Bank & Trust
            Company, as Trustee (incorporated by reference to the 1996
            Current Report).
 4.5   --   Second Supplemental Indenture dated as of March 21, 1997 to
            the Indenture dated as of June 29, 1994 among the Company,
            the Guarantors named therein and IBJ Schroder Bank & Trust
            Company, as Trustee (incorporated by reference to the 1996
            Current Report).
 4.6   --   Supplemental Indenture dated as of October 21, 1999 to the
            Indenture dated as of June 29, 1994 among the Company, the
            Guarantors named therein and IBJ Schroder Bank & Trust
            Company, as Trustee (incorporated by reference to the
            Company's 1999 Registration Statement).
 4.7   --   Indenture with respect to 9 5/8% Senior Subordinated Notes
            due 2009 with The Bank of New York as Trustee, dated
            November 2, 1999 (incorporated by reference to the Current
            Report on Form 8-K dated November 2, 1999 (the "1999 Current
            Report")).
 4.8   --   Form of stock certificate for the Class A Common Stock of
            the Company (incorporated by reference to the Company's 1999
            Registration Statement).
10.1   --   Warrant Agreement dated as of March 15, 1997 among the
            Company and IBJ Schroder Bank & Trust Company, as Warrant
            Agent (incorporated by reference to the 1996 Current
            Report).
10.2   --   National Radio Sales Representation Agreement dated as of
            February 3, 1997 between Caballero Spanish Media, L.L.C. and
            the Company (incorporated by reference to the 1996 Current
            Report).
10.3   --   Common Stock Registration Rights and Stockholders Agreement
            dated as of June 29, 1994 among the Company, certain
            Management Stockholders named therein (incorporated by
            reference to the 1994 Registration Statement).



                                       43
   78
      
10.4   --   Amended and Restated Employment Agreement dated as of
            October 25, 1999, by and between the Company and Raul
            Alarcon, Jr. (incorporated by reference to the Company's
            1999 Registration Statement).
10.5   --   Employment Agreement dated February 5, 1997 between Carey
            Davis and the Company (incorporated by reference to the
            Company's 1999 Registration Statement).
10.6   --   Employment Agreement dated as of October 25, 1999, by and
            between the Company and Joseph A. Garcia (incorporated by
            reference to the Company's 1999 Registration Statement).
10.7   --   Employment Agreement dated as of October 25, 1999, by and
            between the Company and Luis Diaz-Albertini (incorporated by
            reference to the Company's 1999 Registration Statement).
10.8   --   Employment Agreement, dated April 1, 1999, between Spanish
            Broadcasting System of Greater Miami, Inc. and Jesus Salas
            (incorporated by reference to the Company's 1999
            Registration Statement).
10.9   --   Letter Agreement dated January 13, 1997 between the Company
            and Caballero Spanish Media, LLC (incorporated by reference
            to the Current Report).
10.10  --   1994 Stock Option Plan of the Company (incorporated by
            reference to Exhibit 10.4 of the 1994 Registration
            Statement).
10.11  --   Ground Lease dated December 18, 1995 between Louis Viola
            Company and SBS-J (incorporated by reference to the 1996
            Current Report).
10.12  --   Ground Lease dated December 18, 1995 between Frank F. Viola
            and Estate of Thomas C. Viola and SBS-NJ (incorporated by
            reference to the 1996 Current Report).
10.13  --   Lease and License Agreement dated February 1, 1991 between
            Empire State Building Company, as landlord, and SBS-NY, as
            tenant (incorporated by reference to Exhibit 10.15.1 of the
            1994 Registration Statement).
10.14  --   Modification of Lease and License dated June 30, 1992
            between Empire State Building Company and SBS-NY related to
            WSKQ-FM (incorporated by reference to Exhibit 10.15.2 of the
            1994 Registration Statement).
10.15  --   Lease and License Modification and Extension Agreement dated
            as of June 30, 1992 between Empire State Building Company,
            as landlord, and SBS-NY as tenant (incorporated by reference
            to Exhibit 10.15.3 of the 1994 Registration Statement).
10.16  --   Promissory Note, dated as of December 31, 1995 of Raul
            Alarcon, Sr. to SBS-NJ in the principal amount of $577,323
            (incorporated by reference to Exhibit 10.26 to the Company's
            1995 Annual Report on Form 10-K).
10.17  --   Promissory Note, dated as of December 31, 1995 of Raul
            Alarcon, Jr. to SBS-NJ in the principal amount of $1,896,913
            (incorporated by reference to Exhibit 10.27 to the Company's
            1995 Annual Report on Form 10-K).
10.18  --   Lease Agreement dated June 1, 1992 among Raul Alarcon, Sr.,
            Raul Alarcon, Jr., and SBS-Fla (incorporated by reference to
            Exhibit 10.30 of the 1994 Registration Statement).
10.19  --   Indenture dated October 12, 1988 between Alarcon Holdings,
            Inc. and SBS-NJ related to the studio located at 26 West
            56th Street, NY, NY (incorporated by reference to Exhibit
            10.32 of the 1994 Registration Statement).
10.20  --   Agreement of Lease dated as of March 1, 1996. No.
            WT-174-A119 1067 between The Port Authority of New Jersey
            and SBS-GNY as assignee of Park Radio (incorporated by
            reference to the 1996 Current Report).
10.21  --   Asset Purchase Agreement dated as of July 2, 1997, by and
            between Spanish Broadcasting System, Inc. (New Jersey),
            Spanish Broadcasting System of California, Inc., Spanish
            Broadcasting System of Florida, Inc., Spanish Broadcasting
            System, Inc., and One-on-One Sports, Inc. (incorporated by
            reference to Exhibit 10.62 of the Company's Registration
            Statement on Form S-4 (Commission File No. 333-26295)).



                                       44
   79
      
10.22  --   Amendment No. 1 dated as of September 29, 1997 to the Asset
            Purchase Agreement dated as of July 2, 1997, by and between
            Spanish Broadcasting System, Inc. (New Jersey), Spanish
            Broadcasting System of California, Inc., Spanish
            Broadcasting System of Florida, Inc., Spanish Broadcasting
            System, Inc., and One-on-One Sports, Inc. (incorporated by
            reference to the Company's Registration Statement on Form
            S-1, dated January 21, 1999 (Commission File No.
            333-29449)).
10.23  --   Promissory Note dated July 16, 1997 of Raul Alarcon, Jr. to
            the Company in the principal amount of $1,050,229.63
            (incorporated by reference to Exhibit 10.63 of the Company's
            Registration Statement on Form S-4 (Commission File No.
            333-26295)).
10.24  --   Asset Purchase Agreement dated January 28, 1998 by and
            between Spanish Broadcasting System of San Antonio, Inc. and
            Radio KRIO, Ltd. (incorporated by reference to the Company's
            Form 10-Q dated February 12, 1998).
10.25  --   Asset Purchase Agreement dated June 16, 1998 by and between
            Spanish Broadcasting System of Puerto Rico, Inc. and Pan
            Caribbean Broadcasting Corporation (incorporated by
            reference to the Company's Form 10-Q dated July 12, 1998).
10.26  --   Extension of lease of a Condominium Unit (Metropolitan Tower
            Condominium) between Raul Alarcon, Jr. ("Landlord") and
            Spanish Broadcasting System, Inc. ("Tenant") (incorporated
            by reference to the Company's 1998 Annual Report on Form
            10-K).
10.27  --   Asset Purchase Agreement dated January 8, 1999 by and
            between Spanish Broadcasting System of Puerto Rico, Inc. and
            Guayama Broadcasting Company, Inc. and LaMega Estacion, Inc.
            (incorporated by reference to the Company's Registration
            Statement on Form S-1, dated January 21, 1999).
10.28  --   Stock Purchase Agreement among JuJu Media, Inc., each of the
            individual sellers, and Spanish Broadcasting System, Inc.,
            dated April 26, 1999 (incorporated by reference to the
            Company's 1999 Registration Statement).
10.29  --   Asset Purchase Agreement, dated as of October 25, 1999, by
            and between Spanish Broadcasting System of Florida, Inc.,
            and Pablo Raul Alarcon, Sr. (incorporated by reference to
            the Company's 1999 Registration Statement).
10.30  --   Indemnification Agreement with Raul Alarcon, Jr. dated as of
            November 2, 1999 (incorporated by reference to the 1999
            Current Report).
10.31  --   Indemnification Agreement with Roman Martinez IV dated as of
            November 2, 1999 (incorporated by reference to the 1999
            Current Report).
10.32  --   Indemnification Agreement with Jason L. Shrinsky dated as of
            November 2, 1999 (incorporated by reference to the 1999
            Current Report).
10.33  --   Spanish Broadcasting System 1999 Stock Option Plan
            (incorporated by reference to the Company's 1999
            Registration Statement).
10.34  --   Spanish Broadcasting System 1999 Company Stock Option Plan
            for Nonemployee Directors (incorporated by reference to the
            Company's 1999 Registration Statement).
10.35  --   Time Brokerage Agreement, dated as of October 25, 1999, by
            and between Spanish Broadcasting System of Florida, Inc. and
            Pablo Raul Alarcon, Sr. (incorporated by reference to the
            Company's 1999 Registration Statement).
10.36  --   Form of Lock-Up Letter Agreement (incorporated by reference
            in the Company's 1999 Registration Statement).
10.37  --   Form of Option Grant not under Stock Option Plans
            (incorporated by reference to the Company's 1999
            Registration Statement).
10.38  --   Option Grant not under the Stock Option Plans with Arnold
            Sheiffer, dated October 27, 1999 (incorporated by reference
            to the 1999 Current Report).



                                       45
   80

                
    10.39  --         Stock Purchase Agreement, dated as of May 8, 2000, by and among Rodriguez Communications, Inc., a
                      Delaware corporation, each of the Stockholders identified therein and Spanish Broadcasting System, Inc.,
                      a Delaware corporation (incorporated by reference to Exhibit 10.1 of the Company's Amended Quarterly
                      Report on Form 10-Q/A, dated August 11, 2000 (the "Company's Amended Quarterly Report")).
    10.40  --         Asset Purchase Agreement, dated as of May 8, 2000, by and between New World Broadcasters Corp., a Texas
                      corporation, and Spanish Broadcasting System, Inc., a Delaware corporation (incorporated by reference to
                      Exhibit 10.2 of the Company's Amended Quarterly Report).
    10.41  --         Stock Purchase Agreement, dated as of May 8, 2000, by and between New World Broadcasters Corp., a Texas
                      corporation, 910 Broadcasting Corp., a Texas corporation, and Spanish Broadcasting System, Inc., a
                      Delaware corporation (incorporated by reference to Exhibit 10.2 of the Company's Amended Quarterly
                      Report).
    10.42  --         Time Brokerage Agreement, dated May 8, 2000, by and among, New World Broadcasters Corp., a Texas
                      corporation, 910 Broadcasting Corp., a Texas corporation, and Spanish Broadcasting System of San
                      Antonio, Inc., a Delaware corporation and Spanish Broadcasting System, Inc., a Delaware corporation
                      (incorporated by reference to Exhibit 10.5 of the Company's Quarterly Report on Form 10-Q, dated August
                      9, 2000 (the "Company's 2000 Quarterly Report")).
    10.43  --         Credit Agreement, dated as of May 8, 2000, by and among, New World Broadcasters Corp., a Texas
                      corporation, Rodriguez Communications, Inc., a Delaware corporation, RCI (Alameda) Acquisition, Inc., a
                      Delaware corporation, the Guarantors named therein and Spanish Broadcasting System, Inc., a Delaware
                      corporation (incorporated by reference to Exhibit 10.6 of the Company's Quarterly Report).
    10.44  --         Credit Agreement, dated as of July 6, 2000, among Spanish Broadcasting System, Inc., a Delaware
                      corporation, the several banks and other financial institutions or entities from time to time party to
                      the Credit Agreement and Lehman Commercial Paper, Inc., as administrative agent.
    10.45  --         Guarantee and Collateral Agreement made by Spanish Broadcasting System, Inc. and certain of its
                      subsidiaries in favor of Lehman Commercial Paper, Inc. as Administrative Agent, dated as of July 6,
                      2000.
    10.46  --         Employment Agreement dated December 7, 2000, between Joseph Garcia and the Company.
    10.47  --         Employment Agreement dated August 31, 2000, between William Tanner and the Company.
    10.48  --         Employment Agreement dated February 16, 2000, between Juan A. Garcia and the Company.
    10.49  --         Deed of Constitution of Mortgage, Cadera Estereotempo, Inc., as Mortgagor, and Banco Bilbao Vizcaya
                      Puerto Rico, as Mortgagee.
    10.50  --         Lease Agreement by and between the Company and Irradio Holdings, Ltd. made as of December 14, 2000.
    10.51  --         First Addendum to Lease between the Company and Irradio Holdings, Ltd. as of December 14, 2000
    10.52  --         Asset Purchase Agreement dated as of November 2, 2000 by and between International Church of the
                      Foursquare Gospel and the Company.
    21.1   --         List of Subsidiaries of the Company.
    27.1   --         Financial Data Schedule.



                                       46
   81

  (b) Reports on Form 8-K.

     The Company filed a report on Form 8-K dated November 27, 2000, which
reported that:

          (1) On May 8, 2000, the Company entered into a stock purchase
     agreement, by and among Rodriguez Communications, Inc. ("RCI"), each of the
     stockholders of RCI identified on Annex I thereto, and the Company, to
     purchase all of the outstanding capital stock of RCI; and an Asset Purchase
     Agreement, by and between New World Broadcasters Corp. ("New World"), to
     purchase radio station KTCY-FM in Texas (the "KTCY").

          (2) On November 10, 2000, the Company completed the purchase of KTCY
     and all of the outstanding capital stock of RCI; in consideration for which
     SBS paid to RCI, the shareholders of RCI and New World, total consideration
     of $165.2 million, consisting of $43.5 million of SBS's Class A common
     stock and $121.7 million in cash.

     The Company filed a report on Form 8-K dated December 8, 2000, which
reported that:

          (1) The annual meeting of the shareholders (the "Meeting") of the
     Company, is to be held on February 9, 2001. Shareholder proposals to be
     presented at the Meeting are required to be received by the Company no
     later than December 29, 2000 to be included in the Company's Proxy
     Statement for the Meeting.

          (2) If the Company is not notified of a stockholder proposal by
     December 29, 2000, then the management proxies may have discretion to vote
     against such stockholder proposal, even though such proposal is not
     discussed in the proxy statement.

                                       47
   82

                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, on the 26th day of December, 2000.

                                          SPANISH BROADCASTING SYSTEM, INC.

                                          By: /s/   RAUL ALARCON, JR.
                                            ------------------------------------
                                          Name: Raul Alarcon, Jr.
                                          Title: Chairman of the Board of
                                                 Directors,
                                             Chief Executive Officer and
                                             President

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of SBS in the
capacities indicated on the 26th day of December, 2000.



                     SIGNATURE
                     ---------
                                                  
               /s/ RAUL ALARCON, JR.                 Chairman of the Board of Directors, Chief
- ---------------------------------------------------    Executive Officer and President (principal
                 Raul Alarcon, Jr.                     executive officer)

               /s/ JOSEPH A. GARCIA                  Executive Vice President, Chief Financial
- ---------------------------------------------------    Officer, and Secretary (principal financial and
                 Joseph A. Garcia                      accounting officer)

            /s/ PABLO RAUL ALARCON, SR.              Director
- ---------------------------------------------------
              Pablo Raul Alarcon, Sr.

                 /s/ JOSE GRIMALT                    Director
- ---------------------------------------------------
                   Jose Grimalt

               /s/ ROMAN MARTINEZ IV                 Director
- ---------------------------------------------------
                 Roman Martinez IV

               /s/ JASON L. SHRINSKY                 Director
- ---------------------------------------------------
                 Jason L. Shrinsky


                                       48
   83

                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, each
of the additional registrants has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized, on the 26th day of
December, 2000.

                                          EACH OF THE ADDITIONAL
                                          REGISTRANTS LISTED
                                          ON THE TABLE OF
                                          ADDITIONAL REGISTRANTS

                                          By: /s/   RAUL ALARCON, JR.
                                            ------------------------------------
                                          Name: Raul Alarcon, Jr.
                                          Title: Chief Executive Officer and
                                                 President

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of SBS in the
capacities indicated on the 26th day of December, 2000.



                     SIGNATURE
                     ---------
                                                  
               /s/ RAUL ALARCON, JR.                 Chairman of the Board of Directors, Chief
- ---------------------------------------------------    Executive Officer and President (principal
                 Raul Alarcon, Jr.                     executive officer)

               /s/ JOSEPH A. GARCIA                  Executive Vice President, Chief Financial Officer
- ---------------------------------------------------    and Secretary (principal financial and
                 Joseph A. Garcia                      accounting officer), and a director


                                       49
   84

                                 EXHIBIT INDEX



EXHIBIT
NUMBER                                 DESCRIPTION                           PAGE
- -------                                -----------                           ----
                                                                    
     3.1  --   Third Amended and Restated Certificate of Incorporation of
               the Company, dated September 29, 1999 (incorporated by
               reference to the Company's 1999 Registration Statement on
               Form S-1 (Commission File No. 333-85499) (the "1999
               Registration Statement")) (Exhibit A to this exhibit 3.1 is
               incorporated by reference to the Company's Current Report on
               Form 8-K, dated March 25, 1996 (the "1996 Current Report")).
     3.2  --   Certificate of Amendment to the Third Amended and Restated
               Certificate of Incorporation of the Company, dated September
               29, 1999 (incorporated by reference to the Company's 1999
               Registration Statement).
     3.3  --   Amended and Restated By-Laws of the Company (incorporated by
               reference to the Company's 1999 Registration Statement).
     4.1  --   Article V of the Third Amended and Restated Certificate of
               Incorporation of the Company, dated September 29, 1999
               (incorporated by reference to the Company's 1999
               Registration Statement) (see Exhibit 3.1).
     4.2  --   Certificate of Designation filed as Exhibit A to the Third
               Amended and Restated Certificate of Incorporation of the
               Company, dated September 29, 1999 (incorporated by reference
               to the Company's 1999 Registration Statement) (see Exhibit
               3.1).
     4.3  --   Indenture dated June 29, 1994 among the Company, IBJ
               Schroder Bank & Trust Company, as Trustee, the Guarantors
               named therein and the Purchasers named therein (incorporated
               by reference to Exhibit 4.1 of the Company's 1994
               Registration Statement on Form S-4, the "1994 Registration
               Statement").
     4.4  --   First Supplemental Indenture dated as of March 25, 1996 to
               the Indenture dated as of June 29, 1994 among the Company,
               the Guarantors named therein and IBJ Schroder Bank & Trust
               Company, as Trustee (incorporated by reference to the 1996
               Current Report).
     4.5  --   Second Supplemental Indenture dated as of March 21, 1997 to
               the Indenture dated as of June 29, 1994 among the Company,
               the Guarantors named therein and IBJ Schroder Bank & Trust
               Company, as Trustee (incorporated by reference to the 1996
               Current Report).
     4.6  --   Supplemental Indenture dated as of October 21, 1999 to the
               Indenture dated as of June 29, 1994 among the Company, the
               Guarantors named therein and IBJ Schroder Bank & Trust
               Company, as Trustee (incorporated by reference to the
               Company's 1999 Registration Statement).
     4.7  --   Indenture with respect to 9 5/8% Senior Subordinated Notes
               due 2009 with The Bank of New York as Trustee, dated
               November 2, 1999 (incorporated by reference to the Current
               Report on Form 8-K dated November 2, 1999 (the "1999 Current
               Report")).
     4.8  --   Form of stock certificate for the Class A Common Stock of
               the Company (incorporated by reference to the Company's 1999
               Registration Statement).
    10.1  --   Warrant Agreement dated as of March 15, 1997 among the
               Company and IBJ Schroder Bank & Trust Company, as Warrant
               Agent (incorporated by reference to the 1996 Current
               Report).
    10.2  --   National Radio Sales Representation Agreement dated as of
               February 3, 1997 between Caballero Spanish Media, L.L.C. and
               the Company (incorporated by reference to the 1996 Current
               Report).

   85



EXHIBIT
NUMBER                                 DESCRIPTION                           PAGE
- -------                                -----------                           ----
                                                                    
    10.3  --   Common Stock Registration Rights and Stockholders Agreement
               dated as of June 29, 1994 among the Company, certain
               Management Stockholders named therein (incorporated by
               reference to the 1994 Registration Statement).
    10.4  --   Amended and Restated Employment Agreement dated as of
               October 25, 1999, by and between the Company and Raul
               Alarcon, Jr. (incorporated by reference to the Company's
               1999 Registration Statement).
    10.5  --   Employment Agreement dated February 5, 1997 between Carey
               Davis and the Company (incorporated by reference to the
               Company's 1999 Registration Statement).
    10.6  --   Employment Agreement dated as of October 25, 1999, by and
               between the Company and Joseph A. Garcia (incorporated by
               reference to the Company's 1999 Registration Statement).
    10.7  --   Employment Agreement dated as of October 25, 1999, by and
               between the Company and Luis Diaz-Albertini (incorporated by
               reference to the Company's 1999 Registration Statement).
    10.8  --   Employment Agreement, dated April 1, 1999, between Spanish
               Broadcasting System of Greater Miami, Inc. and Jesus Salas
               (incorporated by reference to the Company's 1999
               Registration Statement).
    10.9  --   Letter Agreement dated January 13, 1997 between the Company
               and Caballero Spanish Media, LLC (incorporated by reference
               to the Current Report).
    10.10 --   1994 Stock Option Plan of the Company (incorporated by
               reference to Exhibit 10.4 of the 1994 Registration
               Statement).
    10.11 --   Ground Lease dated December 18, 1995 between Louis Viola
               Company and SBS-J (incorporated by reference to the 1996
               Current Report).
    10.12 --   Ground Lease dated December 18, 1995 between Frank F. Viola
               and Estate of Thomas C. Viola and SBS-NJ (incorporated by
               reference to the 1996 Current Report).
    10.13 --   Lease and License Agreement dated February 1, 1991 between
               Empire State Building Company, as landlord, and SBS-NY, as
               tenant (incorporated by reference to Exhibit 10.15.1 of the
               1994 Registration Statement).
    10.14 --   Modification of Lease and License dated June 30, 1992
               between Empire State Building Company and SBS-NY related to
               WSKQ-FM (incorporated by reference to Exhibit 10.15.2 of the
               1994 Registration Statement).
    11.15 --   Lease and License Modification and Extension Agreement dated
               as of June 30, 1992 between Empire State Building Company,
               as landlord, and SBS-NY as tenant (incorporated by reference
               to Exhibit 10.15.3 of the 1994 Registration Statement).
    10.16 --   Promissory Note, dated as of December 31, 1995 of Raul
               Alarcon, Sr. to SBS-NJ in the principal amount of $577,323
               (incorporated by reference to Exhibit 10.26 to the Company's
               1995 Annual Report on Form 10-K).
    10.17 --   Promissory Note, dated as of December 31, 1995 of Raul
               Alarcon, Jr. to SBS-NJ in the principal amount of $1,896,913
               (incorporated by reference to Exhibit 10.27 to the Company's
               1995 Annual Report on Form 10-K).
    10.18 --   Lease Agreement dated June 1, 1992 among Raul Alarcon, Sr.,
               Raul Alarcon, Jr., and SBS-Fla (incorporated by reference to
               Exhibit 10.30 of the 1994 Registration Statement).
    10.19 --   Indenture dated October 12, 1988 between Alarcon Holdings,
               Inc. and SBS-NJ related to the studio located at 26 West
               56th Street, NY, NY (incorporated by reference to Exhibit
               10.32 of the 1994 Registration Statement).

   86



EXHIBIT
NUMBER                                 DESCRIPTION                           PAGE
- -------                                -----------                           ----
                                                                    
    10.20 --   Agreement of Lease dated as of March 1, 1996. No.
               WT-174-A119 1067 between The Port Authority of New Jersey
               and SBS-GNY as assignee of Park Radio (incorporated by
               reference to the 1996 Current Report).
    10.21 --   Asset Purchase Agreement dated as of July 2, 1997, by and
               between Spanish Broadcasting System, Inc. (New Jersey),
               Spanish Broadcasting System of California, Inc., Spanish
               Broadcasting System of Florida, Inc., Spanish Broadcasting
               System, Inc., and One-on-One Sports, Inc. (incorporated by
               reference to Exhibit 10.62 of the Company's Registration
               Statement on Form S-4 (Commission File No. 333-26295)).
    10.22 --   Amendment No. 1 dated as of September 29, 1997 to the Asset
               Purchase Agreement dated as of July 2, 1997, by and between
               Spanish Broadcasting System, Inc. (New Jersey), Spanish
               Broadcasting System of California, Inc., Spanish
               Broadcasting System of Florida, Inc., Spanish Broadcasting
               System, Inc., and One-on-One Sports, Inc. (incorporated by
               reference to the Company's Registration Statement on Form
               S-1, dated January 21, 1999 (Commission File No.
               333-29449)).
    10.23 --   Promissory Note dated July 16, 1997 of Raul Alarcon, Jr. to
               the Company in the principal amount of $1,050,229.63
               (incorporated by reference to Exhibit 10.63 of the Company's
               Registration Statement on Form S-4 (Commission File No.
               333-26295)).
    10.24 --   Asset Purchase Agreement dated January 28, 1998 by and
               between Spanish Broadcasting System of San Antonio, Inc. and
               Radio KRIO, Ltd. (incorporated by reference to the Company's
               Form 10-Q dated February 12, 1998).
    10.25 --   Asset Purchase Agreement dated June 16, 1998 by and between
               Spanish Broadcasting System of Puerto Rico, Inc. and Pan
               Caribbean Broadcasting Corporation (incorporated by
               reference to the Company's Form 10-Q dated July 12, 1998).
    10.26 --   Extension of lease of a Condominium Unit (Metropolitan Tower
               Condominium) between Raul Alarcon, Jr. ("Landlord") and
               Spanish Broadcasting System, Inc. ("Tenant") (incorporated
               by reference to the Company's 1998 Annual Report on Form
               10-K).
    10.27 --   Asset Purchase Agreement dated January 8, 1999 by and
               between Spanish Broadcasting System of Puerto Rico, Inc. and
               Guayama Broadcasting Company, Inc. and LaMega Estacion, Inc.
               (incorporated by reference to the Company's Registration
               Statement on Form S-1, dated January 21, 1999).
    10.28 --   Stock Purchase Agreement among JuJu Media, Inc., each of the
               individual sellers, and Spanish Broadcasting System, Inc.,
               dated April 26, 1999 (incorporated by reference to the
               Company's 1999 Registration Statement).
    10.29 --   Asset Purchase Agreement, dated as of October 25, 1999, by
               and between Spanish Broadcasting System of Florida, Inc.,
               and Pablo Raul Alarcon, Sr. (incorporated by reference to
               the Company's 1999 Registration Statement).
    10.30 --   Indemnification Agreement with Raul Alarcon, Jr. dated as of
               November 2, 1999 (incorporated by reference to the 1999
               Current Report).
    10.31 --   Indemnification Agreement with Roman Martinez IV dated as of
               November 2, 1999 (incorporated by reference to the 1999
               Current Report).
    10.32 --   Indemnification Agreement with Jason L. Shrinsky dated as of
               November 2, 1999 (incorporated by reference to the 1999
               Current Report).
    10.33 --   Spanish Broadcasting System 1999 Stock Option Plan
               (incorporated by reference to the Company's 1999
               Registration Statement).
    10.34 --   Spanish Broadcasting System 1999 Company Stock Option Plan
               for Nonemployee Directors (incorporated by reference to the
               Company's 1999 Registration Statement).

   87



EXHIBIT
NUMBER                                 DESCRIPTION                           PAGE
- -------                                -----------                           ----
                                                                    
    10.35 --   Time Brokerage Agreement, dated as of October 25, 1999, by
               and between Spanish Broadcasting System of Florida, Inc. and
               Pablo Raul Alarcon, Sr. (incorporated by reference to the
               Company's 1999 Registration Statement).
    10.36 --   Form of Lock-Up Letter Agreement (incorporated by reference
               in the Company's 1999 Registration Statement).
    10.37 --   Form of Option Grant not under Stock Option Plans
               (incorporated by reference to the Company's 1999
               Registration Statement).
    10.38 --   Option Grant not under the Stock Option Plans with Arnold
               Sheiffer, dated October 27, 1999 (incorporated by reference
               to the 1999 Current Report).
    10.39 --   Stock Purchase Agreement, dated as of May 8, 2000, by and
               among Rodriguez Communications, Inc., a Delaware
               corporation, each of the Stockholders identified therein and
               Spanish Broadcasting System, Inc., a Delaware corporation
               (incorporated by reference to Exhibit 10.1 of the Company's
               Amended Quarterly Report on Form 10-Q/ A, dated August 11,
               2000 (the "Company's Amended Quarterly Report")).
    10.40 --   Asset Purchase Agreement, dated as of May 8, 2000, by and
               between New World Broadcasters Corp., a Texas corporation,
               and Spanish Broadcasting System, Inc., a Delaware
               corporation (incorporated by reference to Exhibit 10.2 of
               the Company's Amended Quarterly Report).
    10.41 --   Stock Purchase Agreement, dated as of May 8, 2000, by and
               between New World Broadcasters Corp., a Texas corporation,
               910 Broadcasting Corp., a Texas corporation, and Spanish
               Broadcasting System, Inc., a Delaware corporation
               (incorporated by reference to Exhibit 10.2 of the Company's
               Amended Quarterly Report).
    10.42 --   Time Brokerage Agreement, dated May 8, 2000, by and among,
               New World Broadcasters Corp., a Texas corporation, 910
               Broadcasting Corp., a Texas corporation, and Spanish
               Broadcasting System of San Antonio, Inc., a Delaware
               corporation and Spanish Broadcasting System, Inc., a
               Delaware corporation (incorporated by reference to Exhibit
               10.5 of the Company's Quarterly Report on Form 10-Q, dated
               August 9, 2000 (the "Company's 2000 Quarterly Report")).
    10.43 --   Credit Agreement, dated as of May 8, 2000, by and among, New
               World Broadcasters Corp., a Texas corporation, Rodriguez
               Communications, Inc., a Delaware corporation, RCI (Alameda)
               Acquisition, Inc., a Delaware corporation, the Guarantors
               named therein and Spanish Broadcasting System, Inc., a
               Delaware corporation (incorporated by reference to Exhibit
               10.6 of the Company's Quarterly Report).
    10.44 --   Credit Agreement, dated as of July 6, 2000, among Spanish
               Broadcasting System, Inc., a Delaware corporation, the
               several banks and other financial institutions or entities
               from time to time party to the Credit Agreement and Lehman
               Commercial Paper, Inc., as administrative agent.
    10.45 --   Guarantee and Collateral Agreement made by Spanish
               Broadcasting System, Inc. and certain of its subsidiaries in
               favor of Lehman Commercial Paper, Inc. as Administrative
               Agent, dated as of July 6, 2000.
    10.46 --   Employment Agreement dated December 7, 2000, between Joseph
               Garcia and the Company.
    10.47 --   Employment Agreement dated August 31, 2000, between William
               Tanner and the Company.
    10.48 --   Employment Agreement dated February 16, 2000, between Juan
               A. Garcia and the Company.

   88



EXHIBIT
NUMBER                                 DESCRIPTION                           PAGE
- -------                                -----------                           ----
                                                                    
    10.49 --   Deed of Constitution of Mortgage, Cadera Estereotempo, Inc.,
               as Mortgagor, and Banco Bilbao Vizcaya Puerto Rico, as
               Mortgagee.
    10.50 --   Lease Agreement by and between the Company and Irradio
               Holdings, Ltd. made as of December 14, 2000.
    10.51 --   First Addendum to Lease between the Company and Irradio
               Holdings, Ltd. as of December 14, 2000.
    10.52 --   Asset Purchase Agreement dated as of November 2, 2000 by and
               between International Church of the Foursquare Gospel and
               the Company.
    21.1  --   List of Subsidiaries of the Company.
    27.1  --   Financial Data Schedule.

EX-10.44

   1


                                                                   EXHIBIT 10.44





================================================================================



                                  $150,000,000


                                CREDIT AGREEMENT

                                      AMONG



                       SPANISH BROADCASTING SYSTEM, INC.,
                                  AS BORROWER,

                                   THE LENDERS
                         FROM TIME TO TIME PARTY HERETO,


                                       AND


                          LEHMAN COMMERCIAL PAPER INC.,
                             AS ADMINISTRATIVE AGENT


                            DATED AS OF JULY 6, 2000



================================================================================



                                 LEHMAN BROTHERS
                   SOLE LEAD ARRANGER AND BOOK RUNNING MANAGER


   2


                                TABLE OF CONTENTS



                                                                                                               Page

                                                                                                           
SECTION 1..DEFINITIONS............................................................................................1

     1.1. Defined Terms...........................................................................................1
     1.2. Other Definitional Provisions..........................................................................30

SECTION 2..AMOUNT AND TERMS OF COMMITMENTS.......................................................................31

     2.1. Term Loan Commitments..................................................................................31
     2.2. Procedure for Term Loan Borrowing......................................................................31
     2.3. Repayment of Term Loans................................................................................31
     2.4. Revolving Credit Commitments...........................................................................32
     2.5. Procedure for Revolving Credit Borrowing...............................................................33
     2.6. Swing Line Commitment..................................................................................33
     2.7. Procedure for Swing Line Borrowing; Refunding of Swing Line Loans......................................34
     2.8. Repayment of Loans; Evidence of Indebtedness...........................................................35
     2.9. Commitment Fees, etc...................................................................................36
     2.10. Termination or Reduction of Revolving Credit Commitments..............................................37
     2.11. Optional Prepayments..................................................................................37
     2.12. Mandatory Prepayments and Commitment Reductions.......................................................37
     2.13. Conversion and Continuation Options...................................................................39
     2.14. Minimum Amounts and Maximum Number of Eurodollar Tranches.............................................39
     2.15. Interest Rates and Payment Dates......................................................................40
     2.16. Computation of Interest and Fees......................................................................40
     2.17. Inability to Determine Interest Rate..................................................................41
     2.18. Pro Rata Treatment and Payments.......................................................................41
     2.19. Requirements of Law...................................................................................43
     2.20. Taxes.44
     2.21. Indemnity.............................................................................................46
     2.22. Illegality............................................................................................46
     2.23. Change of Lending Office..............................................................................47
     2.24. Replacement of Lenders under Certain Circumstances....................................................47

SECTION 3..LETTERS OF CREDIT.....................................................................................48

     3.1. L/C Commitment.........................................................................................48
     3.2. Procedure for Issuance of Letter of Credit.............................................................48
     3.3. Fees and Other Charges.................................................................................48
     3.4. L/C Participations.....................................................................................49
     3.5. Reimbursement Obligation of the Borrower...............................................................50
     3.6. Obligations Absolute...................................................................................50
     3.7. Letter of Credit Payments..............................................................................51
     3.8. Applications...........................................................................................51



                                        i


   3


                                                                                                           
SECTION 4..REPRESENTATIONS AND WARRANTIES........................................................................51

     4.1. Financial Condition....................................................................................51
     4.2. No Change..............................................................................................52
     4.3. Corporate Existence; Compliance with Law...............................................................52
     4.4. Corporate Power; Authorization; Enforceable Obligations................................................52
     4.5. No Legal Bar...........................................................................................53
     4.6. No Material Litigation.................................................................................53
     4.7. No Default.............................................................................................53
     4.8. Ownership of Property; Liens...........................................................................53
     4.9. Intellectual Property..................................................................................53
     4.10.Taxes..................................................................................................53
     4.11. Federal Regulations...................................................................................54
     4.12. Labor Matters.........................................................................................54
     4.13. ERISA.................................................................................................54
     4.14. Investment Company Act; Other Regulations.............................................................55
     4.15. Subsidiaries..........................................................................................55
     4.16. Use of Proceeds.......................................................................................55
     4.17. Environmental Matters.................................................................................55
     4.18. Accuracy of Information, etc..........................................................................56
     4.19. Security Documents....................................................................................57
     4.20. Solvency..............................................................................................58
     4.21. Senior Indebtedness...................................................................................58
     4.22. Insurance.............................................................................................58
     4.23. Permits and Licenses..................................................................................58

SECTION 5..CONDITIONS PRECEDENT..................................................................................60

     5.1. Conditions to Initial Extension of Credit..............................................................60
     5.2. Conditions to Each Extension of Credit.................................................................62

SECTION 6..AFFIRMATIVE COVENANTS.................................................................................63

     6.1. Financial Statements...................................................................................63
     6.2. Certificates; Other Information........................................................................64
     6.3. Payment of Obligations.................................................................................66
     6.4. Conduct of Business and Maintenance of Existence, FCC Licenses, etc....................................66
     6.5. Maintenance of Property; Insurance.....................................................................67
     6.6. Inspection of Property; Books and Records; Discussions.................................................67
     6.7. Notices................................................................................................68
     6.8. Environmental Laws.....................................................................................68
     6.9. Broadcast License Subsidiaries.........................................................................69
     6.10. Additional Collateral, etc............................................................................70
     6.11. Use of Proceeds.......................................................................................72
     6.12. Further Assurances....................................................................................72
     6.13. Corporate Structure...................................................................................72




                                       ii


   4


                                                                                                           
SECTION 7..NEGATIVE COVENANTS....................................................................................72

     7.1. Financial Condition Covenants..........................................................................72
     7.2. Limitation on Indebtedness.............................................................................75
     7.3. Limitation on Liens....................................................................................76
     7.4. Limitation on Fundamental Changes......................................................................78
     7.5. Limitation on Disposition of Property..................................................................78
     7.6. Limitation on Restricted Payments......................................................................79
     7.7. Limitation on Capital Expenditures.....................................................................79
     7.8. Limitation on Investments..............................................................................80
     7.9. Limitation on Subordinated Indebtedness................................................................81
     7.10. Limitation on Transactions with Affiliates............................................................81
     7.11. Limitation on Sales and Leasebacks....................................................................82
     7.12. Limitation on Changes in Fiscal Periods...............................................................82
     7.13. Limitation on Negative Pledge Clauses.................................................................82
     7.14. Limitation on Restrictions on Subsidiary Distributions, etc...........................................82
     7.15. Limitation on Lines of Business.......................................................................83
     7.16. Broadcast License Subsidiaries........................................................................83
     7.17. Amendment of Certain Documents........................................................................83

SECTION 8..EVENTS OF DEFAULT.....................................................................................83


SECTION 9..THE AGENTS AND ARRANGER...............................................................................87

     9.1. Appointment............................................................................................87
     9.2. Delegation of Duties...................................................................................88
     9.3. Exculpatory Provisions.................................................................................88
     9.4. Reliance by Agents.....................................................................................88
     9.5. Notice of Default......................................................................................89
     9.6. Non-Reliance on Agents and Other Lenders...............................................................89
     9.7. Indemnification........................................................................................90
     9.8. Arranger and Agents in Their Individual Capacities.....................................................90
     9.9. Successor Administrative Agent.........................................................................90
     9.10. Authorization to Release Liens........................................................................91
     9.11. The Arranger, Syndication Agent and Documentation Agent...............................................91

SECTION 10..MISCELLANEOUS........................................................................................91

     10.1. Amendments and Waivers................................................................................91
     10.2. Notices...............................................................................................92
     10.3. No Waiver; Cumulative Remedies........................................................................94
     10.4. Survival of Representations and Warranties............................................................94
     10.5. Payment of Expenses...................................................................................94
     10.6. Successors and Assigns; Participations and Assignments................................................95
     10.7. Adjustments; Set-off..................................................................................98
     10.8. Counterparts..........................................................................................98
     10.9. Severability..........................................................................................99




                                       iii


   5


                                                                                                           
     10.10. Integration..........................................................................................99
     10.11. GOVERNING LAW........................................................................................99
     10.12. Submission To Jurisdiction; Waivers..................................................................99
     10.13. Acknowledgments.....................................................................................100
     10.14. Confidentiality.....................................................................................100
     10.15. Release of Collateral and Guarantee Obligations.....................................................100
     10.16. Accounting Changes..................................................................................101
     10.17. Delivery of Lender Addenda..........................................................................101
     10.18. Construction........................................................................................101
     10.19. WAIVERS OF JURY TRIAL...............................................................................101








                                       iv


   6


                                 
ANNEXES:

A                                       Pricing Grid



SCHEDULES:

4.10                                    Certain Existing Liens
4.15                                    Subsidiaries
4.19(a)                                 UCC Filing Jurisdictions - Collateral
4.19(b)                                 UCC Filing Jurisdictions - Intellectual Property Collateral
7.2(d)                                  Existing Indebtedness
7.3(f)                                  Existing Liens
7.8(g)                                  Existing Investments
7.10                                    Existing Affiliate Transactions
7.13                                    Existing Agreements with Negative Pledge Clauses
8(g)(i)                                 Required Payments to Employee Welfare Benefit Plans
8(g)(ii)                                Required Payments to Multiemployer Plans


EXHIBITS

A                                       Form of Compliance Certificate
B                                       Form of Guarantee and Collateral Agreement
C                                       Form of Lender Addendum
D                                       Form of Notice of Borrowing
E                                       Form of Solvency Certificate
F-1                                     Form of Term Note
F-2                                     Form of Revolving Credit Note
F-3                                     Form of Swing Line Note
G                                       Form of Exemption Certificate
H                                       Form of Closing Certificate
I                                       Form of Legal Opinion of Kaye, Scholer, Fierman, Hays & Handler LLP
J                                       Form of Assignment and Acceptance




                                        v


   7


              CREDIT AGREEMENT, dated as of July 6, 2000, among SPANISH
BROADCASTING SYSTEM, INC., a Delaware corporation (the "Borrower"), the several
banks and other financial institutions or entities from time to time party to
this Agreement (the "Lenders") and LEHMAN COMMERCIAL PAPER INC., as
administrative agent (in such capacity, the "Administrative Agent").



                              W I T N E S S E T H:

              WHEREAS, the Borrower has requested that the Lenders make a term
loan credit facility available to the Borrower in order to finance certain
Permitted Acquisitions and to make a revolving credit facility available to the
Borrower for the working capital needs and general corporate purposes of the
Borrower; and

              WHEREAS, the Lenders are willing to make such credit facilities
available upon and subject to the terms and conditions hereinafter set forth.

              NOW, THEREFORE, in consideration of the premises and the
agreements hereinafter set forth, the parties hereto hereby agree as follows:

                             SECTION 1. DEFINITIONS

              1.1.   Defined Terms. As used in this Agreement, the terms listed
in this Section 1.1 shall have the respective meanings set forth in this Section
1.1.

              "Acquired Business": as defined in the definition of "Acquisition"
       set forth in this Section 1.1.

              "Acquisition": any acquisition, consisting of a single transaction
       or a series of related transactions, by the Borrower or any one or more
       of its Wholly Owned Subsidiaries of any Capital Stock of, or all or a
       substantial part of the assets of, or of a business unit or division of,
       any Person engaged in a Permitted Business that is organized under the
       laws of the United States or any state or territory thereof (such Person,
       assets, business unit or division, the "Acquired Business").

              "Acquisition Documentation": the agreements governing or relating
       to any Permitted Acquisition and all schedules, exhibits, annexes and
       amendments thereto and all side letters and agreements affecting the
       terms thereof or entered into in connection therewith, in each case, as
       amended supplemented, replaced or otherwise modified from time to time.

              "Adjusted EBITDA": for any period, the Consolidated EBITDA of the
       Borrower and its Subsidiaries for such period adjusted on a pro forma
       basis (i) to reflect the Consolidated EBITDA of each Adjustment-Eligible
       Business acquired in any Acquisition consummated in such period as though
       such Acquisition had been consummated on the first day of such period and
       (ii) to reflect the add-back of Cost Savings, to the extent the


   8


       Consolidated EBITDA of such Adjustment-Eligible Business was reduced by
       charges reflecting costs to be eliminated in such Cost Savings.

              "Adjustment-Eligible Business": in respect of any period, any
       Acquired Business (i) that either (A) is engaged in the Spanish-language
       broadcast radio business in the United States or Puerto Rico, to the
       extent it is engaged in such business, or (B) is the Acquired Business
       that is the subject of the Pipeline Acquisition, and (ii) in respect of
       which the consolidated balance sheet of such Acquired Business as at the
       end of the period preceding the Acquisition of such Acquired Business and
       the related consolidated statements of income and stockholders' equity
       and of cash flows for the period in respect of which Adjusted EBITDA is
       to be calculated (x) have been previously provided to the Administrative
       Agent and the Lenders and (y) either (1) have been reported on without a
       qualification arising out of the scope of the audit by independent
       certified public accountants of nationally recognized standing or (2)
       have been found acceptable by the Administrative Agent.

              "Administrative Agent": as defined in the preamble hereto.

              "Affiliate": as to any Person, any other Person which, directly or
       indirectly, is in control of, is controlled by, or is under common
       control with, such Person. For purposes of this definition, "control" of
       a Person means the power, directly or indirectly, either to (a) vote 10%
       or more of the securities having ordinary voting power for the election
       of directors (or persons performing similar functions) of such Person or
       (b) direct or cause the direction of the management and policies of such
       Person, whether by contract or otherwise.

              "Agents": the collective reference to the Administrative Agent,
       the Syndication Agent and the Documentation Agent.

              "Aggregate Exposure": with respect to any Lender at any time, an
       amount equal to (a) prior to termination of the Term Loan Commitments,
       the aggregate amount of such Lender's Commitments then in effect and the
       principal amount of such Lender's Term Loans then outstanding and (b)
       thereafter, the sum of (i) the principal amount of such Lender's Term
       Loans then outstanding and (ii) the amount of such Lender's Revolving
       Credit Commitment then in effect or, if the Revolving Credit Commitments
       have terminated, the principal amount of such Lender's Revolving
       Extensions of Credit then outstanding.

              "Aggregate Exposure Percentage" with respect to any Lender at any
       time, the ratio (expressed as a percentage) of such Lender's Aggregate
       Exposure at such time to the Aggregate Exposure of all Lenders at such
       time.

              "Agreement": this Credit Agreement, as amended, supplemented,
       replaced or otherwise modified from time to time.


                                        2


   9


              "Applicable Margin": for each Type of Loan, the rate per annum set
       forth under the relevant column heading below:



                                                                      Base Rate Loans       Eurodollar Loans
                                                                      ---------------       ----------------

                                                                                            
                 Term Loans, Revolving Credit                              1.75%                  2.75%
                 Loans and Swing Line Loans



       provided, that on and after the Grid Effective Date, the Applicable
       Margin with respect to Revolving Credit Loans, Swing Line Loans and Term
       Loans will be determined pursuant to the Pricing Grid.

              "Application": an application, in such form as the Issuing Lender
       may specify from time to time, requesting the Issuing Lender to open a
       Letter of Credit.

              "Arranger": as defined in Section 9.11.

              "Asset Sale": any Disposition of Property or series of related
       Dispositions of Property (excluding any such Disposition permitted by
       clause (a), (b), (c) or (d) of Section 7.5) which yields gross proceeds
       to the Borrower or any of its Subsidiaries (valued at the initial
       principal amount thereof in the case of non-cash proceeds consisting of
       notes or other debt securities and valued at fair market value in the
       case of other non-cash proceeds) in excess of $250,000.

              "Assignee": as defined in Section 10.6(c).

              "Assignor": as defined in Section 10.6(c).

              "Available Revolving Credit Commitment": as to any Revolving
       Credit Lender at any time, an amount equal to the excess, if any, of (a)
       such Lender's Revolving Credit Commitment then in effect over (b) such
       Lender's Revolving Extensions of Credit then outstanding; provided, that
       in calculating any Lender's Revolving Extensions of Credit for the
       purpose of determining such Lender's Available Revolving Credit
       Commitment pursuant to Section 2.9(a), the aggregate principal amount of
       Swing Line Loans then outstanding shall be deemed to be zero.

              "Base Rate": for any day, a rate per annum (rounded upwards, if
       necessary, to the next 1/100 of 1%) equal to the greatest of (a) the
       Prime Rate in effect on such day, (b) the Base CD Rate in effect on such
       day plus 1% and (c) the Federal Funds Effective Rate in effect on such
       day plus 1/2 of 1%. For purposes hereof: "Prime Rate" shall mean the rate
       of interest per annum publicly announced from time to time by the
       Reference Lender as its prime or base rate in effect at its principal
       office in New York City (the Prime Rate not being intended to be the
       lowest rate of interest charged by the Reference Lender in connection
       with extensions of credit to debtors); "Base CD Rate" shall mean the sum
       of


                                        3


   10


       (a) the product of (i) the Three-Month Secondary CD Rate and (ii) a
       fraction, the numerator of which is one and the denominator of which is
       one minus the C/D Reserve Percentage and (b) the C/D Assessment Rate; and
       "Three-Month Secondary CD Rate" shall mean, for any day, the secondary
       market rate for three-month certificates of deposit reported as being in
       effect on such day (or, if such day shall not be a Business Day, the next
       preceding Business Day) by the Board through the public information
       telephone line of the Federal Reserve Bank of New York (which rate will,
       under the current practices of the Board, be published in Federal Reserve
       Statistical Release H.15(519) during the week following such day), or, if
       such rate shall not be so reported on such day or such next preceding
       Business Day, the average of the secondary market quotations for
       three-month certificates of deposit of major money center banks in New
       York City received at approximately 10:00 A.M., New York City time, on
       such day (or, if such day shall not be a Business Day, on the next
       preceding Business Day) by the Reference Lender from three New York City
       negotiable certificate of deposit dealers of recognized standing selected
       by it. Any change in the Base Rate due to a change in the Prime Rate, the
       Three-Month Secondary CD Rate or the Federal Funds Effective Rate shall
       be effective as of the opening of business on the effective day of such
       change in the Prime Rate, the Three-Month Secondary CD Rate or the
       Federal Funds Effective Rate, respectively.

              "Base Rate Loans": Loans for which the applicable rate of interest
       is based upon the Base Rate.

              "Benefited Lender": as defined in Section 10.7.

              "Board": the Board of Governors of the Federal Reserve System of
       the United States (or any successor).

              "Borrower": as defined in the preamble hereto.

              "Borrowing Date": any Business Day specified by the Borrower as a
       date on which the Borrower requests the relevant Lender(s) to make Loans
       hereunder.

              "Broadcast License Subsidiary": a Wholly Owned Subsidiary of the
       Borrower that owns no material assets other than FCC Licenses and related
       rights and has no liabilities other than (i) liabilities arising under
       the Guarantee and Collateral Agreement and (ii) trade payables incurred
       in the ordinary course of business and tax liabilities incidental to
       ownership of such rights.

              "Business Day": (i) for all purposes other than as covered by
       clause (ii) below, 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 and (ii) with respect to all notices and determinations in
       connection with, and payments of principal and interest on, Eurodollar
       Loans, any day which is a Business Day described in clause (i) and which
       is also a day for trading by and between banks in Dollar deposits in the
       interbank eurodollar market.


                                        4


   11


              "Capital Expenditures": for any period, with respect to any
       Person, the aggregate of all expenditures (other than those made in
       payment of purchase consideration for Permitted Acquisitions) by such
       Person and its Subsidiaries for the acquisition or leasing (pursuant to a
       capital lease) of fixed or capital assets or additions to equipment
       (including replacements, capitalized repairs and improvements during such
       period) which should be capitalized in conformity with GAAP on a
       consolidated balance sheet of such Person and its Subsidiaries.

              "Capital Lease Obligations": as to any Person, the obligations of
       such Person to pay rent or other amounts under any lease of (or other
       arrangement conveying the right to use) real or personal property, or a
       combination thereof, which obligations are required to be classified and
       accounted for as capital leases on a balance sheet of such Person in
       conformity with GAAP, and, for the purposes of this Agreement, the amount
       of such obligations at any time shall be the capitalized amount thereof
       at such time determined in conformity with GAAP.

              "Capital Stock": any and all shares, interests, participations or
       other equivalents (however designated) of capital stock of a corporation,
       any and all equivalent ownership or profit interests in a Person (other
       than a corporation) and any and all warrants, rights or options to
       purchase any of the foregoing.

              "Cash Equivalents": (a) marketable direct obligations issued by,
       or unconditionally guaranteed by, the United States Government or issued
       by any agency thereof and backed by the full faith and credit of the
       United States, in each case maturing within one year from the date of
       acquisition; (b) certificates of deposit, time deposits, eurodollar time
       deposits or overnight bank deposits having maturities of six months or
       less from the date of acquisition issued by any Lender or by any
       commercial bank organized under the laws of the United States of America
       or any state thereof having combined capital and surplus of not less than
       $500,000,000; (c) commercial paper of an issuer rated at least A-1 by
       Standard & Poor's Ratings Services ("S&P") or P-1 by Moody's Investors
       Service, Inc. ("Moody's"), or carrying an equivalent rating by a
       nationally recognized rating agency, if both of the two named rating
       agencies cease publishing ratings of commercial paper issuers generally,
       and maturing within six months from the date of acquisition; (d)
       repurchase obligations of any Lender or of any commercial bank satisfying
       the requirements of clause (b) of this definition, having a term of not
       more than 30 days with respect to securities issued or fully guaranteed
       or insured by the United States government; (e) securities with
       maturities of one year or less from the date of acquisition issued or
       fully guaranteed by any state, commonwealth or territory of the United
       States, by any political subdivision or taxing authority of any such
       state, commonwealth or territory or by any foreign government, the
       securities of which state, commonwealth, territory, political
       subdivision, taxing authority or foreign government (as the case may be)
       are rated at least A by S&P or A by Moody's; (f) securities with
       maturities of six months or less from the date of acquisition backed by
       standby letters of credit issued by any Lender or any commercial bank
       satisfying the requirements of clause (b) of this definition; or (g)
       shares of money market mutual or


                                        5


   12


       similar funds which invest exclusively in assets satisfying the
       requirements of clauses (a) through (f) of this definition.

              "C/D Assessment Rate": for any day as applied to any Base Rate
       Loan, the annual assessment rate in effect on such day that is payable by
       a member of the Bank Insurance Fund maintained by the Federal Deposit
       Insurance Corporation (the "FDIC") classified as well-capitalized and
       within supervisory subgroup "B" (or a comparable successor assessment
       risk classification) within the meaning of 12 C.F.R. Section 327.4 (or
       any successor provision) to the FDIC (or any successor) for the FDIC's
       (or such successor's) insuring time deposits at offices of such
       institution in the United States.

              "C/D Reserve Percentage": for any day as applied to any Base Rate
       Loan, that percentage (expressed as a decimal) which is in effect on such
       day, as prescribed by the Board, for determining the maximum reserve
       requirement for a Depositary Institution (as defined in Regulation D of
       the Board as in effect from time to time) in respect of new non-personal
       time deposits in Dollars having a maturity of 30 days or more.

              "Closing Date": July 6, 2000.

              "Code": the Internal Revenue Code of 1986, as amended from time to
       time.

              "Collateral": all Property of the Loan Parties, now owned or
       hereafter acquired, upon which a Lien is purported to be created by any
       Security Document, including the Intellectual Property Collateral.

              "Commitment": as to any Lender, the sum of the Term Loan
       Commitment and the Revolving Credit Commitment of such Lender.

              "Commitment Fee Rate": (i) with respect to any Revolving Credit
       Commitment, the rate of 0.5% per annum and (ii) with respect to any Term
       Loan Commitment, the rate of (a) 0.75% per annum for each day on which
       the aggregate outstanding and unfunded amount of the Term Loan
       Commitments is greater than $83,333,333, (b) 0.625% per annum for each
       day on which the aggregate outstanding and unfunded amount of the Term
       Loan Commitments is $83,333,333 or less but greater than $41,666,667 or
       (c) 0.5% per annum for each day on which the aggregate outstanding and
       unfunded amount of the Term Loan Commitments is less than $41,666,667.

              "Commonly Controlled Entity": an entity, whether or not
       incorporated, which is under common control with the Borrower within the
       meaning of Section 4001 of ERISA or is part of a group that includes the
       Borrower and that is treated as a single employer under Section 414 of
       the Code.

              "Compliance Certificate": a certificate duly executed by a
       Responsible Officer substantially in the form of Exhibit A.


                                        6


   13


              "Confidential Information Memorandum": the information memorandum
       furnished to the Persons invited in the syndication of the Facilities to
       become Lenders.

              "Consolidated Current Assets": at any date, all amounts (other
       than cash and Cash Equivalents) which would, in conformity with GAAP, be
       set forth opposite the caption "total current assets" (or any like
       caption) on a consolidated balance sheet of the Borrower and its
       Subsidiaries at such date.

              "Consolidated Current Liabilities": at any date, all amounts that
       would, in conformity with GAAP, be set forth opposite the caption "total
       current liabilities" (or any like caption) on a consolidated balance
       sheet of the Borrower and its Subsidiaries at such date, but excluding
       (a) the current portion of any Funded Debt of the Borrower and its
       Subsidiaries and (b) without duplication of clause (a) above, all
       Indebtedness consisting of Revolving Credit Loans or Swing Line Loans to
       the extent otherwise included therein.

              "Consolidated EBITDA": of any Person for any period, Consolidated
       Net Income of such Person and its Subsidiaries for such period plus,
       without duplication and to the extent reflected as a charge in the
       statement of such Consolidated Net Income for such period, the sum of (a)
       income tax expense, (b) Consolidated Interest Expense of such Person and
       its Subsidiaries, amortization or write-off of debt discount and debt
       issuance costs and commissions, discounts and other fees and charges
       associated with Indebtedness (including, in the case of the Borrower, the
       Loans and Letters of Credit), (c) depreciation and amortization expense,
       (d) amortization of intangibles (including goodwill) and organization
       costs, (e) any extraordinary, unusual or non-recurring expenses or losses
       (including, whether or not otherwise includable as a separate item in the
       statement of such Consolidated Net Income for such period, losses on
       sales of assets outside of the ordinary course of business) and (f) any
       other non-cash charges, and minus, to the extent included in the
       statement of such Consolidated Net Income for such period, the sum of (a)
       interest income (except to the extent deducted in determining
       Consolidated Interest Expense), (b) any extraordinary, unusual or
       non-recurring income or gains (including, whether or not otherwise
       includable as a separate item in the statement of such Consolidated Net
       Income for such period, gains on the sales of assets outside of the
       ordinary course of business) and (c) any other non-cash income, all as
       determined on a consolidated basis; provided that for purposes of
       calculating Consolidated EBITDA of the Borrower and its Subsidiaries for
       any period, the Consolidated EBITDA of any Person Disposed of by the
       Borrower or its Subsidiaries during such period shall be excluded for
       such period (assuming the consummation of such Disposition and the
       repayment of any Indebtedness in connection therewith occurred on the
       first day of such period).

              "Consolidated Fixed Charge Coverage Ratio": for any period, the
       ratio of (a) Consolidated EBITDA of the Borrower and its Subsidiaries for
       such period minus the aggregate amount actually paid by the Borrower and
       its Subsidiaries in cash during such period on account of Capital
       Expenditures (but not including any Capital Expenditures made with the
       proceeds of any Reinvestment Deferred Amount or from 50% of the Net


                                        7


   14


       Cash Proceeds of an issuance and sale of Capital Stock as set forth in
       clause (x) of Section 7.7) to (b) Consolidated Fixed Charges for such
       period.

              "Consolidated Fixed Charges": for any period, the sum (without
       duplication) of (a) Consolidated Interest Expense of the Borrower and its
       Subsidiaries for such period, (b) provision for cash income taxes made by
       the Borrower or any of its Subsidiaries on a consolidated basis in
       respect of such period and (c) scheduled payments made during such period
       on account of principal of Indebtedness of the Borrower or any of its
       Subsidiaries (including scheduled principal payments in respect of the
       Term Loans).

              "Consolidated Interest Coverage Ratio": for any period, the ratio
       of (a) Consolidated EBITDA of the Borrower and its Subsidiaries for such
       period to (b) Consolidated Interest Expense of the Borrower and its
       Subsidiaries for such period.

              "Consolidated Interest Expense": of any Person for any period,
       total cash interest expense (including that attributable to Capital Lease
       Obligations) of such Person and its Subsidiaries for such period on a
       consolidated basis with respect to all outstanding Indebtedness of such
       Person and its Subsidiaries (including all commissions, discounts and
       other fees and charges owed by such Person with respect to letters of
       credit and bankers' acceptance financing and net costs of such Person
       under Hedge Agreements in respect of interest rates to the extent such
       net costs are allocable to such period in accordance with GAAP), net of
       the interest income of such Person and its Subsidiaries for such period
       on a consolidated basis.

              "Consolidated Leverage Ratio": as at the last day of any period of
       four consecutive fiscal quarters, the ratio of (a) Consolidated Total
       Debt on such day to (b) Adjusted EBITDA for such period.

              "Consolidated Net Income": of any Person for any period, the
       consolidated net income (or loss) of such Person and its Subsidiaries for
       such period, determined on a consolidated basis in accordance with GAAP;
       provided, that in calculating Consolidated Net Income of the Borrower and
       its consolidated Subsidiaries for any Period, there shall be excluded (a)
       the income (or deficit) of any Person accrued prior to the date it
       becomes a Subsidiary of the Borrower or is merged into or consolidated
       with the Borrower or any of its Subsidiaries, (b) the income (or deficit)
       of any Person (other than a Subsidiary of the Borrower) in which the
       Borrower or any of its Subsidiaries has an ownership interest, except to
       the extent that any such income is actually received by the Borrower or
       such Subsidiary in the form of dividends or similar distributions and (c)
       the undistributed earnings of any Subsidiary of the Borrower to the
       extent that the declaration or payment of dividends or similar
       distributions by such Subsidiary is not at the time permitted by the
       terms of any Contractual Obligation (other than under any Loan Document)
       or Requirement of Law applicable to such Subsidiary.

              "Consolidated Senior Debt": all Consolidated Total Debt other than
       Subordinated Debt.


                                        8


   15


              "Consolidated Senior Debt Ratio": as of the last day of any period
       of four consecutive fiscal quarters, the ratio of (a) Consolidated Senior
       Debt on such day to (b) Adjusted EBITDA for such period.

              "Consolidated Total Debt": at any date, the aggregate principal
       amount of all Funded Debt of the Borrower and its Subsidiaries at such
       date, required to be reported on a consolidated balance sheet prepared in
       accordance with GAAP.

              "Consolidated Working Capital": at any date, the excess of
       Consolidated Current Assets on such date over Consolidated Current
       Liabilities on such date.

              "Continuing Directors": as to any Person, the directors of such
       Person on the Closing Date and each other director of such Person whose
       nomination for election to the board of directors of such Person is
       recommended by at least a majority of the then Continuing Directors or
       who received the vote of each of the shareholders of such Person on the
       Closing Date in his or her election by the shareholders of such Person.

              "Contractual Obligation": as to any Person, any provision of any
       security issued by such Person or of any agreement, instrument or other
       undertaking to which such Person is a party or by which it or any of its
       Property is bound.

              "Control Agreement": each Control Agreement to be executed and
       delivered by each Loan Party party thereto, substantially in the form of
       Exhibit C, Exhibit D or Exhibit E, as the case may be, to the Guarantee
       and Collateral Agreement, as the same may be amended, supplemented,
       replaced or otherwise modified from time to time in accordance with this
       Agreement.

              "Control Investment Affiliate": as to any Person, any other Person
       that (a) directly or indirectly, is in control of, is controlled by, or
       is under common control with, such Person and (b) is organized by such
       Person primarily for the purpose of making equity or debt investments in
       one or more companies. For purposes of this definition, "control" of a
       Person means the power, directly or indirectly, to direct or cause the
       direction of the management and policies of such Person whether by
       contract or otherwise.

              "Cost Savings": for any period, cost savings attributable to such
       period in conjunction with the Acquisition of an Adjustment-Eligible
       Business which result from employee terminations, termination or
       renegotiation of contracts, facilities consolidations and closings,
       standardization of employee benefits and compensation practices,
       consolidation of property, casualty and other insurance coverage and
       policies, standardization of sales representation commissions and other
       contract rates, reductions in taxes other than income taxes, and other
       similar cost savings attributable to such Acquisition, which cost savings
       the Borrower reasonably believes in good faith would have been achieved
       during such period as a result of such Acquisition (regardless of whether
       such cost savings could then be reflected in pro forma financial
       statements under GAAP); provided that (a) such cost savings and cost
       savings measures were identified


                                        9


   16


       and such cost savings were quantified in a certificate of a Responsible
       Officer of the Borrower delivered to the Administrative Agent at the time
       of the consummation of such Acquisition (it being understood that such
       certificate may be amended by the Borrower from time to time within 90
       days thereafter by furnishing a revised certificate of a Responsible
       Officer as to the matters set forth in this clause (a)) and (b) if such
       Acquisition was completed more than 90 days before the last day of such
       period, actions were commenced or initiated by the Borrower or its
       Subsidiaries within 90 days of such Acquisition to effect the cost
       savings measures identified in such officer's certificate (whether or not
       the corresponding cost savings were ultimately achieved).

              "Dallas AM Station": radio station KXEB-AM (Sherman, Texas).

              "Dallas FM Station": radio station KTCY-FM (Pilot Point, Texas).

              "Default": any of the events specified in Section 8, whether or
       not any requirement set forth therein for the giving of notice, the lapse
       of time, or both, has been satisfied.

              "Derivatives Counterparty": as defined in Section 7.6.

              "Disposition": with respect to any Property, any sale, lease, sale
       and leaseback, assignment, conveyance, transfer or other disposition
       thereof, but not including the issuance of Capital Stock by the Borrower;
       and the terms "Dispose" and "Disposed of" shall have correlative
       meanings.

              "Disqualified Stock": any Capital Stock of the Borrower or any of
       its Subsidiaries that any of them is or, upon the passage of time or the
       occurrence of any event, may become obligated to redeem, purchase,
       retire, defease or otherwise make any payment in respect of (except
       payments consisting of Capital Stock that does not constitute
       Disqualified Stock) at any time prior to the first anniversary of the
       Scheduled Revolving Credit Termination Date.

              "Documentation Agent": as defined in Section 9.11

              "Dollars" and "$": dollars in lawful currency of the United States
       of America.

              "Domestic Subsidiary": any Subsidiary of the Borrower organized
       under the laws of the District of Columbia or any state within the United
       States of America.

              "Environmental Laws": any and all laws, rules, orders,
       regulations, statutes, ordinances, codes, decrees, or other legally
       enforceable requirements (including common law) of any international
       authority, foreign government, the United States, or any state, local,
       municipal or other governmental authority, regulating, relating to or
       imposing liability or standards of conduct concerning protection of the
       environment or of human health, as has been, is now, or may at any time
       hereafter be, in effect.


                                       10


   17


              "Environmental Permits": any and all permits, licenses, approvals,
       registrations, notifications, exemptions and any other authorization
       required under any Environmental Law.

              "ERISA": the Employee Retirement Income Security Act of 1974, as
       amended from time to time.

              "Eurocurrency Reserve Requirements": for any day as applied to a
       Eurodollar Loan, the aggregate (without duplication) of the maximum rates
       (expressed as a decimal fraction) of reserve requirements in effect on
       such day (including basic, supplemental, marginal and emergency reserves
       under any regulations of the Board or other Governmental Authority having
       jurisdiction with respect thereto) dealing with reserve requirements
       prescribed for eurocurrency funding (currently referred to as
       "Eurocurrency Liabilities" in Regulation D of the Board) maintained by a
       member bank of the Federal Reserve System. Eurodollar Loans shall be
       deemed to constitute Eurocurrency Liabilities and to be subject to such
       reserve requirements without benefit or credit for proration, exceptions
       or offsets which may be available from time to time to any Lender under
       Regulation D.

              "Eurodollar Base Rate": with respect to each day during each
       Interest Period pertaining to a Eurodollar Loan, the rate per annum
       determined on the basis of the rate for deposits in Dollars for a period
       equal to such Interest Period commencing on the first day of such
       Interest Period appearing on Page 3750 of the Telerate screen as of 11:00
       A.M., London time, two Business Days prior to the beginning of such
       Interest Period. In the event that such rate does not appear on Page 3750
       of the Telerate screen (or otherwise on such screen), the "Eurodollar
       Base Rate" for purposes of this definition shall be determined by
       reference to such other comparable publicly available service for
       displaying eurodollar rates as may be selected by the Administrative
       Agent.

              "Eurodollar Loans": Loans the rate of interest applicable to which
       is based upon the Eurodollar Rate.

              "Eurodollar Rate": with respect to each day during each Interest
       Period pertaining to a Eurodollar Loan, a rate per annum determined for
       such day in accordance with the following formula (rounded upward to the
       nearest 1/100th of 1%):

                              Eurodollar Base Rate
                       -----------------------------------
                    1.00 - Eurocurrency Reserve Requirements

              "Eurodollar Tranche": the collective reference to Eurodollar Loans
       the then current Interest Periods with respect to all of which begin on
       the same date and end on the same later date (whether or not such Loans
       shall originally have been made on the same day).


                                       11


   18


              "Event of Default": any of the events specified in Section 8,
       provided that any requirement set forth therein for the giving of notice,
       the lapse of time, or both, has been satisfied.

              "Excluded Assets": collectively, (a) FCC Licenses, but only if and
       to the extent that, and only for as long as, the grant of a security
       interest therein is prohibited (notwithstanding the intention of the
       holder to grant such security interest to the fullest extent lawful)
       under the laws of the United States and (b) any Lease, any intellectual
       property license agreement under which any Grantor is the licensee, and
       any other agreement under which any Grantor is entitled to the
       performance of any obligation other than the payment of money, to the
       extent that, and so long as, the grant by such Grantor of a security
       interest pursuant to the Guarantee and Collateral Agreement in its right,
       title and interest therein (i) is prohibited by the terms of such Lease,
       license agreement or other agreement without the consent of any other
       party thereto (other than the Borrower or any of its Subsidiaries), (ii)
       would give any other party (other than the Borrower or any of its
       Subsidiaries) to such Lease, license agreement or other agreement the
       right to terminate its obligations thereunder, or (iii) is permitted only
       upon obtaining consents from the other parties thereto (other than the
       Borrower and any of its Subsidiaries) which have not been obtained;
       provided, that no Receivable (as defined in the Guarantee and Collateral
       Agreement), no money or other amounts due or to become due under any
       Lease, license agreement or other agreement described in clause (b) of
       this definition, and no Proceeds from any Disposition of any Property
       described in this definition, shall be an Excluded Asset.

              "Excluded Foreign Subsidiary": any Foreign Subsidiary in respect
       of which either (i) the pledge of all of the Capital Stock of such
       Subsidiary as Collateral or (ii) the guaranteeing by such Subsidiary of
       the Obligations, would, in the good faith judgment of the Borrower,
       result in adverse tax consequences to the Loan Parties, taken as a whole;
       provided, however, that (a) a Foreign Subsidiary that is treated as a
       pass-through entity for United States federal income tax purposes shall
       not be an Excluded Foreign Subsidiary while so treated and (b) no Foreign
       Subsidiary that has guaranteed any obligation in respect of the Senior
       Subordinated Notes shall be an Excluded Foreign Subsidiary.

              "Facility": each of (a) the Term Loan Commitments and the Term
       Loans made thereunder (the "Term Loan Facility") and (b) the Revolving
       Credit Commitments and the extensions of credit made thereunder (the
       "Revolving Credit Facility").

              "FCC": the Federal Communications Commission (or any successor).

              "FCC Licenses": any licenses, permits and authorizations issued by
       the FCC for the operation of stations.

              "Federal Funds Effective Rate": for any day, the weighted average
       of the rates on overnight federal funds transactions with members of the
       Federal Reserve System


                                       12


   19


       arranged by federal funds brokers, as published on the next succeeding
       Business Day by the Federal Reserve Bank of New York, or, if such rate is
       not so published for any day which is a Business Day, the average of the
       quotations for the day of such transactions received by the Reference
       Lender from three federal funds brokers of recognized standing selected
       by it.

              "Fee Letter": the Credit Facilities Fee Letter, dated July 6, 2000
       among the Borrower, the Administrative Agent and the Arranger, as the
       same may be amended, supplemented, replaced or otherwise modified from
       time to time in accordance with this Agreement.

              "Foreign Subsidiary": any Subsidiary of the Borrower that is not a
       Domestic Subsidiary.

              "FQ1", "FQ2", "FQ3", and "FQ4": when used with a numerical year
       designation, means the first, second, third or fourth fiscal quarters,
       respectively, of such fiscal year of the Borrower (e.g., "FQ1 in 2001"
       means the first fiscal quarter, ending on or about December 31, 2000, of
       the Borrower's fiscal year 2001, which ends on or about September 30,
       2001).

              "Funded Debt": as to any Person, all Indebtedness of such Person
       required under GAAP to be shown as or reflected in the liabilities on its
       balance sheet, to the extent required under GAAP to be shown as or
       reflected in such liabilities, that matures more than one year from the
       date of its creation or matures within one year from such date but is
       renewable or extendible, at the option of such Person, to a date more
       than one year from such date or arises under a revolving credit or
       similar agreement that obligates the lender or lenders to extend credit
       during a period of more than one year from such date, including all
       current maturities and current sinking fund payments in respect of such
       Indebtedness whether or not required to be paid within one year from the
       date of its creation and, in the case of the Borrower, Indebtedness in
       respect of the Loans.

              "Funding Office": the office specified from time to time by the
       Administrative Agent as its funding office by notice to the Borrower and
       the Lenders.

              "GAAP": generally accepted accounting principles in the United
       States of America as in effect from time to time, except that for
       purposes of Section 7.1, GAAP shall be determined on the basis of such
       principles in effect on the date hereof and consistent with those used in
       the preparation of the most recent audited financial statements delivered
       pursuant to Section 4.1(b).

              "Governing Documents": collectively, as to any Person, the
       articles or certificate of incorporation and bylaws, any shareholders
       agreement, certificate of formation, limited liability company agreement,
       partnership agreement or other formation or constituent documents of such
       Person.


                                       13


   20


              "Governmental Authority": any nation or government, any state or
       other political subdivision thereof and any entity exercising executive,
       legislative, judicial, regulatory or administrative functions of or
       pertaining to government.

              "Grantor": each signatory to the Guarantee and Collateral
       Agreement (together with any other entity that may become a party to the
       Guarantee and Collateral Agreement as provided therein).

              "Grid Effective Date": the date that is the later of (a) the six
       month anniversary of the Closing Date and (b) the date of delivery to the
       Administrative Agent of the Borrower's financial statements for the first
       two fiscal quarters following the Closing Date.

              "Guarantee and Collateral Agreement": the Guarantee and Collateral
       Agreement to be executed and delivered by the Borrower and each
       Subsidiary Guarantor, substantially in the form of Exhibit B, as the same
       may be amended, supplemented, replaced or otherwise modified from time to
       time in accordance with this Agreement.

              "Guarantee Obligation": as to any Person (the "guaranteeing
       person"), any obligation of (a) the guaranteeing person or (b) another
       Person (including any bank under any letter of credit) to induce the
       creation of which the guaranteeing person has issued a reimbursement,
       counterindemnity or similar obligation, in either case guaranteeing or in
       effect guaranteeing any Indebtedness, leases, dividends or other
       obligations (the "primary obligations") of any other third Person (the
       "primary obligor") in any manner, whether directly or indirectly,
       including any obligation of the guaranteeing person, whether or not
       contingent, (i) to purchase any such primary obligation or any Property
       constituting direct or indirect security therefor, (ii) to advance or
       supply funds (1) for the purchase or payment of any such primary
       obligation or (2) to maintain working capital or equity capital of the
       primary obligor or otherwise to maintain the net worth or solvency of the
       primary obligor, (iii) to purchase Property, securities or services
       primarily for the purpose of assuring the owner of any such primary
       obligation of the ability of the primary obligor to make payment of such
       primary obligation or (iv) otherwise to assure or hold harmless the owner
       of any such primary obligation against loss in respect thereof; provided,
       however, that the term "Guarantee Obligation" shall not include
       endorsements of instruments for deposit or collection in the ordinary
       course of business. The amount of any Guarantee Obligation of any
       guaranteeing person shall be deemed to be the lower of (a) an amount
       equal to the stated or determinable amount of the primary obligation in
       respect of which such Guarantee Obligation is made and (b) the maximum
       amount for which such guaranteeing person may be liable pursuant to the
       terms of the instrument embodying such Guarantee Obligation, unless such
       primary obligation and the maximum amount for which such guaranteeing
       person may be liable are not stated or determinable, in which case the
       amount of such Guarantee Obligation shall be such guaranteeing person's
       maximum reasonably anticipated liability in respect thereof as determined
       by the Borrower in good faith.


                                       14


   21


              "Hedge Agreements": all interest rate swaps, caps or collar
       agreements or similar arrangements entered into by the Borrower or any of
       its Subsidiaries providing for protection against fluctuations in
       interest rates or currency exchange rates or the exchange of nominal
       interest obligations, either generally or under specific contingencies,
       as each may be amended, supplemented, replaced or otherwise modified from
       time to time in accordance with this Agreement.

              "Indebtedness": of any Person at any date, without duplication,
       (a) all indebtedness of such Person for borrowed money, (b) all
       obligations of such Person, whether or not contingent, for the deferred
       purchase price of Property or services (other than trade payables
       incurred in the ordinary course of such Person's business), (c) all
       obligations of such Person evidenced by notes, bonds, debentures or other
       similar instruments, (d) all indebtedness created or arising under any
       conditional sale or other title retention agreement with respect to
       Property acquired by such Person (even though the rights and remedies of
       the seller or lender under such agreement in the event of default are
       limited to repossession or sale of such Property), (e) all Capital Lease
       Obligations of such Person, (f) all obligations of such Person,
       contingent or otherwise, as an account party under acceptance, letter of
       credit or similar facilities, (g) all obligations of such Person,
       contingent or otherwise, to purchase, redeem, retire or otherwise acquire
       for value any Capital Stock of such Person, (h) all Guarantee Obligations
       of such Person in respect of obligations of the kind referred to in
       clauses (a) through (g) above; (i) all obligations of the kind referred
       to in clauses (a) through (h) above secured by (or for which the holder
       of such obligation has an existing right, contingent or otherwise, to be
       secured by) any Lien on Property (including accounts and contract rights)
       owned by such Person, whether or not such Person has assumed or become
       liable for the payment of such obligation, but if any such obligation is
       non-recourse to such Person, then the amount of such obligation shall be
       deemed to be the lesser of the fair market value of such Property and the
       amount of the obligation so secured, (j) for the purposes of Section 8(e)
       only, all obligations of such Person in respect of Hedge Agreements and
       (k) the liquidation value of any redeemable preferred Capital Stock of
       such Person or its Subsidiaries (other than any such preferred Capital
       Stock that is not, in any contingency, redeemable until a date that is no
       earlier than the first anniversary of the Scheduled Revolving Credit
       Termination Date) held by any Person other than such Person and its
       Wholly Owned Subsidiaries.

              "Indemnified Liabilities": as defined in Section 10.5.

              "Indemnitee": as defined in Section 10.5.

              "Insolvency": with respect to any Multiemployer Plan, the
       condition that such Multiemployer Plan is insolvent within the meaning of
       Section 4245 of ERISA.

              "Insolvent": pertaining to a condition of Insolvency.

              "Insurance Requirements": all material terms of any insurance
       policy required pursuant to this Agreement or any Security Document.


                                       15


   22


              "Intellectual Property": the collective reference to all rights,
       priorities and privileges relating to intellectual property, whether
       arising under United States, state, multinational or foreign laws or
       otherwise, including copyrights, patents, trademarks, service-marks,
       technology, know-how and processes, recipes, formulas, trade secrets, or
       licenses (under which the applicable Person is licensor or licensee)
       relating to any of the foregoing and all rights to sue at law or in
       equity for any infringement or other impairment thereof, including the
       right to receive all proceeds and damages therefrom.

              "Intellectual Property Collateral": all Intellectual Property of
       the Loan Parties, now owned or hereafter acquired, upon which a Lien is
       purported to be created by the Intellectual Property Security Agreement
       or the Guarantee and Collateral Agreement.

              "Intellectual Property Security Agreement": the Intellectual
       Property Security Agreement to be executed and delivered by each Loan
       Party, substantially in the form of Exhibit C to the Guarantee and
       Collateral Agreement, as the same may be amended, supplemented, replaced
       or otherwise modified from time to time in accordance with this
       Agreement.

              "Interest Payment Date" (a) as to any Base Rate Loan, the last day
       of each March, June, September and December to occur while such Loan is
       outstanding and the final maturity date of such Loan, (b) as to any
       Eurodollar Loan having an Interest Period of three months or less, the
       last day of such Interest Period, (c) as to any Eurodollar Loan having an
       Interest Period longer than three months, each day which is three months,
       or a whole multiple thereof, after the first day of such Interest Period
       and the last day of such Interest Period and (d) as to any Loan (other
       than any Revolving Credit Loan that is a Base Rate Loan (unless all
       Revolving Credit Loans are being repaid in full in immediately available
       funds and the Revolving Credit Commitments terminated) and any Swing Line
       Loan), the date of any repayment or prepayment made in respect thereof.

              "Interest Period": as to any Eurodollar Loan, (a) initially, the
       period commencing on the borrowing or conversion date, as the case may
       be, with respect to such Eurodollar Loan and ending one, two, three or
       six months thereafter, as selected by the Borrower in its Notice of
       Borrowing or notice of conversion, as the case may be, given with respect
       thereto; and (b) thereafter, each period commencing on the last day of
       the next preceding Interest Period applicable to such Eurodollar Loan and
       ending one, two, three or six months thereafter, as selected by the
       Borrower by irrevocable notice to the Administrative Agent not less than
       three Business Days prior to the last day of the then current Interest
       Period with respect thereto; provided that, all of the foregoing
       provisions relating to Interest Periods are subject to the following:

              (i)           if any Interest Period would otherwise end on a day
       that is not a Business Day, such Interest Period shall be extended to the
       next succeeding Business Day unless the result of such extension would be
       to carry such Interest Period into another calendar month in which event
       such Interest Period shall end on the immediately preceding Business Day;


                                       16


   23


              (ii)          any Interest Period that would otherwise extend
       beyond the Scheduled Revolving Credit Termination Date or beyond the date
       final payment is due on the Term Loans shall end on the Revolving Credit
       Termination Date or such due date, as applicable;

              (iii)         any Interest Period that begins on the last Business
       Day of a calendar month (or on a day for which there is no numerically
       corresponding day in the calendar month at the end of such Interest
       Period) shall end on the last Business Day of a calendar month; and

              (iv)          the Borrower shall select Interest Periods so as not
       to require a payment or prepayment of any Eurodollar Loan during an
       Interest Period for such Loan.

              "Investments": as defined in Section 7.8.

              "Issuing Lender": any Lender that is appointed by the Borrower,
       with the consent of the Administrative Agent, to act as Issuing Lender
       under this Agreement, if such Lender is willing to act as such and has
       confirmed in writing its acceptance of such appointment.

              "LA Stations": collectively, radio stations KFOX-FM (Redondo
       Beach, California) and KREA-FM (Ontario, California).

              "L/C Commitment": at any time, the lesser of (a) $10,000,000 and
       (b) the Total Revolving Credit Commitments at such time.

              "L/C Fee Payment Date": the last day of each March, June,
       September and December and the last day of the Revolving Credit
       Commitment Period.

              "L/C Obligations": at any time, an amount equal to the sum of (a)
       the aggregate then undrawn and unexpired amount of the then outstanding
       Letters of Credit and (b) the aggregate amount of drawings under Letters
       of Credit that have not then been reimbursed pursuant to Section 3.5.

              "L/C Participants": the collective reference to all the Revolving
       Credit Lenders other than the Issuing Lender.

              "Lease": any lease of real or personal property under which any
       Grantor is the lessee.

              "Lehman Entity": any of Lehman Commercial Paper Inc. or any of its
       affiliates (including Syndicated Loan Funding Trust).

              "Lender Addendum": with respect to any initial Lender, a Lender
       Addendum, substantially in the form of Exhibit C, to be executed and
       delivered by such Lender on the Closing Date as provided in Section
       10.17.


                                       17


   24


              "Lenders": as defined in the preamble hereto and includes the
       Issuing Lender.

              "Letters of Credit": as defined in Section 3.1(a).

              "Lien": any mortgage, pledge, hypothecation, assignment, deposit
       arrangement, encumbrance, lien (statutory or other), charge or other
       security interest or any preference, priority or other security agreement
       or preferential arrangement of any kind or nature whatsoever (including
       any conditional sale or other title retention agreement and any capital
       lease having substantially the same economic effect as any of the
       foregoing).

              "Loan": any loan made by any Lender pursuant to this Agreement.

              "Loan Documents": this Agreement, the Security Documents, the Fee
       Letter, the Applications and the Notes.

              "Loan Parties": the Borrower and each Subsidiary of the Borrower
       which is a party to a Loan Document (including pursuant to Section 6.10).

              "Majority Facility Lenders": with respect to any Facility, the
       holders of more than 50% of (a) the aggregate unfunded Commitments in
       respect of such Facility and (b) the aggregate unpaid principal amount of
       the Loans or, in the case of the Revolving Credit Facility, Total
       Revolving Extensions of Credit outstanding under such Facility.

              "Management Equity": common stock, or options or warrants to
       acquire common stock, of the Borrower, granted to any present or former
       director, officer or employee of the Borrower pursuant to an employee
       stock incentive program approved by the Board of Directors of the
       Borrower.

              "Material Action": as to any Broadcast License Subsidiary, (i) to
       consolidate or merge such Broadcast License Subsidiary with or into any
       Person, or sell all or substantially all of the assets of such Broadcast
       License Subsidiary, or to institute proceedings to have such Broadcast
       License Subsidiary be adjudicated bankrupt or insolvent, or consent to
       the institution of bankruptcy or insolvency proceedings against such
       Broadcast License Subsidiary or file a petition seeking, or consent to,
       reorganization or relief with respect to such Broadcast License
       Subsidiary under any applicable federal or state law relating to
       bankruptcy, or consent to the appointment of a receiver, liquidator,
       assignee, trustee, sequestrator (or other similar official) of such
       Broadcast License Subsidiary or a substantial part of its property, or
       make any assignment for the benefit of creditors of such Broadcast
       License Subsidiary, or admit in writing such Broadcast License
       Subsidiary's inability to pay its debts generally as they become due, or,
       to the fullest extent permitted by law, take action in furtherance of any
       such action, or dissolve or liquidate such Broadcast License Subsidiary,
       or (ii) to take any other action that would cause or permit the
       dissolution of such Broadcast License Subsidiary whether pursuant to the
       Governing Documents of such Broadcast License Subsidiary, judicial
       dissolution, applicable law or otherwise.


                                       18


   25


              "Material Adverse Effect": a material adverse effect on or
       affecting (a) the business, assets, property, condition (financial or
       otherwise) or prospects of the Loan Parties taken as a whole, (b) the
       validity or enforceability of this Agreement or any of the other Loan
       Documents, (c) the validity, enforceability or priority of the Liens
       purported to be created by the Security Documents or (d) the rights or
       remedies of any Secured Party hereunder or under any of the other Loan
       Documents.

              "Material Environmental Amount": an amount or amounts payable by
       the Borrower and/or any of its Subsidiaries, in the aggregate in excess
       of $5,000,000, for: costs to comply with any Environmental Law; costs of
       any investigation, and any remediation, of any Material of Environmental
       Concern; and compensatory damages (including, without limitation damages
       to natural resources), punitive damages, fines, and penalties pursuant to
       any Environmental Law.

              "Materials of Environmental Concern": any gasoline or petroleum
       (including crude oil or any fraction thereof) or petroleum products,
       polychlorinated biphenyls, urea-formaldehyde insulation, asbestos,
       pollutants, contaminants, radioactivity, and any other substances or
       forces of any kind, whether or not any such substance or force is defined
       as hazardous or toxic under any Environmental Law, that is regulated
       pursuant to or could give rise to liability under any Environmental Law.

              "Multiemployer Plan": a Plan that is a multiemployer plan as
       defined in Section 3(37) or 4001(a)(3) of ERISA.

              "Net Cash Proceeds": (a) in connection with any Asset Sale or any
       Recovery Event, the proceeds thereof in the form of cash and Cash
       Equivalents (including any such proceeds received by way of deferred
       payment of principal pursuant to a note or installment receivable or
       purchase price adjustment receivable or otherwise, but only as and when
       received) of such Asset Sale or Recovery Event, net of reasonable and
       customary attorneys' fees, accountants' fees, investment banking fees,
       amounts required to be applied to the repayment of Indebtedness secured
       by a Lien expressly permitted hereunder on any asset which is the subject
       of such Asset Sale or Recovery Event (other than any Lien pursuant to a
       Security Document) and other reasonable and customary fees, commissions
       and expenses (including severance costs), in each case, to the extent
       actually incurred in connection therewith and net of taxes paid or
       reasonably estimated to be payable as a result thereof (after taking into
       account any available tax credits or deductions and any tax sharing
       arrangements) and (b) in connection with any issuance or sale of equity
       securities or debt securities or instruments or the incurrence of loans,
       the cash proceeds received from such issuance or incurrence, net of
       reasonable and customary attorneys' fees, investment banking fees,
       accountants' fees, underwriting discounts and commissions and other
       reasonable and customary fees and expenses, in each case, to the extent
       actually incurred in connection therewith.

              "Non-Excluded Taxes": as defined in Section 2.20(a).


                                       19


   26


              "Non-U.S. Lender": as defined in Section 2.20(f).

              "Notes": the collective reference to the Revolving Credit Notes,
       the Term Notes and the Swing Line Notes, if any, evidencing Loans.

              "Notice of Borrowing": a certificate duly executed by a
       Responsible Officer of the Borrower substantially in the form of Exhibit
       D.

              "Obligations": the unpaid principal of and interest on (including
       interest accruing after the maturity of the Loans and Reimbursement
       Obligations and interest accruing after the filing of any petition in
       bankruptcy, or the commencement of any insolvency, reorganization or like
       proceeding, relating to any Loan Party, whether or not a claim for
       post-filing or post-petition interest is allowed in such proceeding) the
       Loans and all other obligations and liabilities of the Loan Parties to
       the Arranger, to any Agent, to any Lender (or, in the case of Specified
       Hedge Agreements, any affiliate of any Lender) or to any Indemnitee,
       whether direct or indirect, absolute or contingent, due or to become due,
       or now existing or hereafter incurred, which may arise under, out of, or
       in connection with, this Agreement, any other Loan Document, the Letters
       of Credit, any Specified Hedge Agreement or any other document made,
       delivered or given in connection herewith or therewith, whether on
       account of principal, interest, reimbursement obligations, fees,
       indemnities, costs, expenses (including all fees, charges and
       disbursements of counsel to the Arranger, to any Agent or to any Lender
       that are required to be paid by any Loan Party pursuant hereto or to any
       other Loan Document) or otherwise; provided, that (i) Obligations of the
       Borrower or any other Loan Party under any Specified Hedge Agreement
       shall be secured and guaranteed pursuant to the Security Documents only
       to the extent that, and for so long as, the other Obligations are so
       secured and guaranteed and (ii) any release of Collateral or Subsidiary
       Guarantors effected in the manner permitted by this Agreement shall
       require the consent only of the Lenders as set forth in Section 10.1.

              "Other Taxes": any and all present or future stamp or documentary
       taxes or any other excise or property taxes, charges or similar levies
       arising from any payment made hereunder or from the execution, delivery
       or enforcement of, or otherwise with respect to, this Agreement or any
       other Loan Document.

              "Participant": as defined in Section 10.6(b).

              "Payment Amount": as defined in Section 3.5.

              "Payment Office": the office of the Administrative Agent specified
       in Section 10.2 or as otherwise specified from time to time by the
       Administrative Agent as its payment office by notice to the Borrower and
       the Lenders.

              "PBGC": the Pension Benefit Guaranty Corporation established
       pursuant to Subtitle A of Title IV of ERISA (or any successor).


                                       20


   27


              "Permits": the collective reference to (i) Environmental Permits,
       and (ii) any and all other franchises, licenses, leases, permits,
       approvals, notifications, certifications, registrations, authorizations,
       exemptions, qualifications, easements, rights of way, Liens and other
       rights, privileges and approvals required under any Requirement of Law.

              "Permitted Acquisitions": (i) the Rodriguez Acquisitions, or (ii)
       any other Acquisition of a Permitted Business that meets the following
       requirements at the time such Acquisition is consummated:

                     (a)    no Default exists or would exist after giving effect
              to such Acquisition and each representation and warranty made by
              any Loan Party in or pursuant to the Loan Documents shall be true
              and correct on and as of such date as if made on and as of such
              date and immediately after giving effect to such Acquisition;

                     (b)    the Borrower has delivered to the Administrative
              Agent a certificate of a Responsible Officer stating that, on a
              pro forma basis, after giving effect to such Acquisition and any
              incurrence or assumption of Indebtedness in connection therewith
              and the application of the proceeds thereof as if they had
              occurred on the first day of the 12-month period ending on the
              last day of the fiscal quarter of the Borrower then most recently
              ended, the Borrower would have been in compliance, as of the last
              day of such fiscal quarter, with each of the financial condition
              covenants set forth in Section 7.1, accompanied by (A) historic
              financial statements for the Acquired Business in such Acquisition
              that either are audited by an accounting firm of recognized
              standing or reasonably satisfactory to the Administrative Agent
              covering such 12-month period and, if available, the preceding two
              years, and (B) an analysis showing the calculations of such pro
              forma financial covenant compliance in reasonable detail;

                     (c)    the Borrower delivers to the Administrative Agent,
              promptly after consummation of such Acquisition, a signed
              counterpart of each legal opinion, if any, delivered in connection
              with such Acquisition, accompanied by a reliance letter in favor
              of the Administrative Agent and the Lenders;

                     (d)    if such Acquisition is the Pipeline Acquisition or
              if the Acquired Business in such Acquisition consists of or
              includes any business other than the Spanish language radio
              broadcast business in the United States or Puerto Rico, (i) the
              Administrative Agent and Lenders have been provided, at least 10
              Business Days prior to the consummation of such Acquisition, (A)
              written notice of such Acquisition, (B) copies of all Acquisition
              Documentation for such Acquisition, and (C) such financial
              statements, information, documents and materials as the
              Administrative Agent or Required Lenders may request in order to
              conduct and complete a business, financial and legal due diligence
              review satisfactory to the Administrative Agent and Required
              Lenders of such Acquisition, of the Acquired Business in such
              Acquisition and of the terms and conditions of the Acquisition


                                       21


   28


              Documentation for such Acquisition, (ii) the Borrower has not been
              notified, within 10 Business Days after all financial statements,
              information, documents and materials so requested were provided,
              that the Administrative Agent or Required Lenders are not
              satisfied with the results of their diligence review, and (iii)
              the Pipeline Acquisition is consummated on the terms set forth in
              the agreements so provided, upon satisfaction of the conditions
              therein set forth and without any waiver thereof or change therein
              as to which the conditions in clauses (i) and (ii) of this
              paragraph (d) have not been satisfied; and

                     (e)    either:

                            (i)    both (A) the Borrower has delivered to the
                     Administrative Agent a certificate of a Responsible Officer
                     stating that, on a pro forma basis, after giving effect to
                     such Acquisition and any incurrence or assumption of
                     Indebtedness in connection therewith and the application of
                     the proceeds thereof as if they had occurred on the first
                     day of the 12-month period ending on the last day of the
                     fiscal quarter of the Borrower then most recently ended, as
                     of the last day of such fiscal quarter the Consolidated
                     Leverage Ratio was not greater than 6:1 and the
                     Consolidated Senior Debt Ratio was not greater than 2.25:1,
                     and (B) after giving effect to all Loans funded or to be
                     funded to pay purchase consideration for such Acquisition,
                     the Total Revolving Extensions of Credit shall be at least
                     $5,000,000 less than the Total Revolving Credit
                     Commitments; or

                            (ii)   the purchase consideration for such
                     acquisition consists solely of Capital Stock (other than
                     Disqualified Stock) of the Borrower issued to the seller;
                     or

                            (iii)  the Borrower has obtained written consent for
                     such Acquisition from the Required Lenders.

              "Permitted Business": the media business and any business
       reasonably similar, complementary, ancillary or related thereto,
       including the operation of Latin music websites and internet portals, and
       any activity reasonably incidental thereto.

              "Permitted Investors": in any combination, Raul Alarcon, Jr. and
       his spouse and members of his immediate family and any corporation,
       trust, partnership, company or other entity more than 50% of the
       beneficial interests in which are owned, in any combination, by Raul
       Alarcon, Jr. or his spouse or the members of his immediate family.

              "Person": an individual, partnership, corporation, limited
       liability company, business trust, joint stock company, trust,
       unincorporated association, joint venture, Governmental Authority or
       other entity of whatever nature.


                                       22


   29


              "Pipeline Acquisition": the Acquisition that, prior to the Closing
       Date, was identified by the Borrower to the Administrative Agent as the
       "Pipeline Acquisition".

              "Plan": at a particular time, any employee benefit plan that is
       covered by ERISA and which the Borrower or any Commonly Controlled Entity
       maintains, administers, contributes to or is required to contribute to or
       under which the Borrower or any Commonly Controlled Entity could incur
       any liability.

              "Pricing Grid": the pricing grid attached hereto as Annex A.

              "Proceeds": all "proceeds" as such term is defined in Section
       9-306(1) of the Uniform Commercial Code in effect in the State of New
       York on the date hereof and, in any event, shall include all dividends or
       other income from the Pledged Securities (as defined in the Guarantee and
       Collateral Agreement), collections thereon or distributions or payments
       with respect thereto.

              "Pro Forma Balance Sheet": as defined in Section 4.1(a).

              "Projections": as defined in Section 6.2(c).

              "Property": any right or interest in or to property of any kind
       whatsoever, whether real, personal or mixed and whether tangible or
       intangible, including Capital Stock.

              "Puerto Rico Intercompany Debt": Indebtedness that (a) was
       incurred or assumed by Spanish Broadcasting System of Puerto Rico, Inc.,
       a Delaware corporation, or any of its Subsidiaries and (b) is outstanding
       to the Borrower or a Wholly Owned Subsidiary Guarantor.

              "Recovery Event": any settlement of or payment in respect of any
       property or casualty insurance claim or any condemnation proceeding
       relating to any asset of the Borrower or any of its Subsidiaries.

              "Reference Lender": Deutsche Bank, New York Office.

              "Refunded Swing Line Loans": as defined in Section 2.7(b).

              "Refunding Date": as defined in Section 2.7(c).

              "Register": as defined in Section 10.6(d).

              "Regulation D": Regulation D of the Board as in effect from time
       to time (and any successor to all or a portion thereof).

              "Regulation H": Regulation H of the Board as in effect from time
       to time (and any successor to all or a portion thereof).


                                       23


   30


              "Regulation T": Regulation T of the Board as in effect from time
       to time (and any successor to all or a portion thereof).

              "Regulation U": Regulation U of the Board as in effect from time
       to time (and any successor to all or a portion thereof).

              "Regulation X": Regulation X of the Board as in effect from time
       to time (and any successor to all or a portion thereof).

              "Reimbursement Obligation": the obligation of the Borrower to
       reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn
       under Letters of Credit.

              "Reinvestment Deferred Amount": with respect to any Reinvestment
       Event, the aggregate Net Cash Proceeds received by the Borrower or any of
       its Subsidiaries in connection therewith that are not applied to prepay
       the Term Loans or reduce the Revolving Credit Commitments pursuant to
       Section 2.12(b) as a result of the delivery of a Reinvestment Notice.

              "Reinvestment Event": any Asset Sale or Recovery Event in respect
       of which the Borrower has delivered a Reinvestment Notice.

              "Reinvestment Notice": a written notice executed by a Responsible
       Officer stating that no Default has occurred and is continuing and that
       the Borrower (directly or indirectly through a Wholly Owned Subsidiary)
       intends and expects to use all or a specified portion of the Net Cash
       Proceeds of an Asset Sale or Recovery Event to acquire assets (including
       the acquisition of Capital Stock or assets pursuant to a Permitted
       Acquisition) useful in its business or, in the case of a Recovery Event,
       repair assets to which such Recovery Event relates.

              "Reinvestment Prepayment Amount": with respect to any Reinvestment
       Event, the Reinvestment Deferred Amount relating thereto less any amount
       expended prior to the relevant Reinvestment Prepayment Date to acquire
       assets (including the acquisition of Capital Stock or assets pursuant to
       a Permitted Acquisition) useful in the Borrower's business or, in the
       case of a Recovery Event, repair assets to which such Recovery Event
       relates.

              "Reinvestment Prepayment Date": with respect to any Reinvestment
       Event, the earlier of (a) the date occurring twelve months after such
       Reinvestment Event and (b) the date on which the Borrower shall have
       determined not to, or shall have otherwise ceased to, acquire assets
       (including the acquisition of Capital Stock or assets pursuant to a
       Permitted Acquisition) useful in the Borrower's business or, in the case
       of a Recovery Event, repair assets to which such Recovery Event relates,
       in any such case with all or any portion of the relevant Reinvestment
       Deferred Amount.


                                       24


   31


              "Related Person": as to each of the Arranger, the Agents and the
       Lenders, each of its officers, directors, stockholders, members,
       partners, employees, agents, attorneys and other advisors, controlling
       persons and Affiliates.

              "Reorganization": with respect to any Multiemployer Plan, the
       condition that such plan is in reorganization within the meaning of
       Section 4241 of ERISA.

              "Reportable Event": any of the events set forth in Section 4043(c)
       of ERISA, other than those events as to which the thirty day notice
       period is waived under subsections .27, .28, .29, .30, .31, .32, .34 or
       .35 of PBGC Reg. Section 4043.

              "Required Lenders": at any time, the holders of more than 50% of
       (a) until the Closing Date, the Commitments and (b) thereafter, the sum
       of (i) the aggregate unpaid principal amount of the Term Loans then
       outstanding and (ii) the Total Revolving Credit Commitments then in
       effect or, if the Revolving Credit Commitments have terminated, the Total
       Revolving Extensions of Credit then outstanding.

              "Required Prepayment Lenders": the Majority Facility Lenders in
       respect of each Facility.

              "Requirement of Law": as to any Person, the Governing Documents of
       such Person, and any law, treaty, rule or regulation or determination of
       an arbitrator or a court or other Governmental Authority, in each case
       applicable to or binding upon such Person or any of its Property or to
       which such Person or any of its Property is subject.

              "Responsible Officer": as to any Person, the chief executive
       officer, president, chief financial officer or treasurer of such Person,
       but in any event, with respect to financial matters, the chief financial
       officer or treasurer of such Person. Unless otherwise qualified, all
       references to a "Responsible Officer" shall refer to a Responsible
       Officer of the Borrower.

              "Restricted Payments": as defined in Section 7.6.

              "Revolving Credit Commitment": as to any Lender, the obligation of
       such Lender, if any, to make Revolving Credit Loans and/or participate in
       Swing Line Loans and Letters of Credit, in an aggregate principal and/or
       face amount not to exceed the amount set forth under the heading
       "Revolving Credit Commitment" opposite such Lender's name on Schedule 1
       to the Lender Addendum delivered by such Lender, or, as the case may be,
       in the Assignment and Acceptance pursuant to which such Lender became a
       party hereto, as the same may be changed from time to time pursuant to
       the terms hereof. The original aggregate principal amount of the
       Revolving Credit Commitments is $25,000,000.

              "Revolving Credit Commitment Period": the period from and
       including the Closing Date to the Revolving Credit Termination Date.


                                       25


   32


              "Revolving Credit Lender": each Lender that has a Revolving Credit
       Commitment or that is the holder of Revolving Credit Loans.

              "Revolving Credit Loans": as defined in Section 2.4(a).

              "Revolving Credit Notes": as defined in Section 2.8(e).

              "Revolving Credit Percentage": as to any Revolving Credit Lender
       at any time, the percentage which such Lender's Revolving Credit
       Commitment then constitutes of the Total Revolving Credit Commitments
       (or, at any time after the Revolving Credit Commitments have terminated,
       the percentage which the aggregate principal amount of such Lender's
       Revolving Credit Extensions of Credit then outstanding constitutes of the
       aggregate principal amount of the Total Revolving Extensions of Credit
       then outstanding).

              "Revolving Credit Termination Date": the earlier of (a) the
       Scheduled Revolving Credit Termination Date and (b) the date on which the
       Term Loans shall be paid in full.

              "Revolving Extensions of Credit": as to any Revolving Credit
       Lender at any time, an amount equal to the sum of (a) the aggregate
       principal amount of all Revolving Credit Loans then outstanding to such
       Lender, (b) such Lender's Revolving Credit Percentage of the L/C
       Obligations then outstanding and (c) such Lender's Revolving Credit
       Percentage of the aggregate principal amount of Swing Line Loans then
       outstanding.

              "Rodriguez Acquisition": the acquisition of any of the Rodriquez
       Stations on the terms and subject to the conditions set forth in the
       Rodriguez Purchase Agreements.

              "Rodriguez Bridge Loans": the loans made or required to be made by
       the Borrower under the Rodriguez Bridge Loan Agreement.

              "Rodriguez Bridge Loan Agreement": the Credit Agreement dated as
       of May 8, 2000 among New World Broadcasters Corp., Rodriguez
       Communications, Inc., RCI (Alameda) Acquisition, Inc., the Guarantors
       named therein and the Borrower, and each of the other "Loan Documents,"
       as defined in such Credit Agreement, in each case as modified by the
       waiver letter dated July 5, 2000 and as set forth in an e-mail
       confirmation dated July 6, 2000 and as further amended, replaced,
       supplemented or otherwise modified from time to time in accordance with
       this Agreement.

              "Rodriguez Purchase Agreements": (a) the Stock Purchase Agreement
       dated as of May 8, 2000 by and among Rodriguez Communications, Inc, each
       of its stockholders and the Borrower, (b) the Stock Purchase Agreement
       dated as of May 8, 2000 by and between New World Broadcasters Corp. and
       the Borrower, (c) the Asset Purchase Agreement dated as of May 8, 2000 by
       and between New World Broadcasters Corp. and the Borrower and (d) any
       stock purchase agreement entered into by and among RC (Alameda)
       Acquisition, Inc. and/or its stockholders and the Borrower in connection
       with the Borrower's acquisition of the SF Station, as contemplated in the
       Stock Purchase


                                       26


   33


       Agreement referred to in clause (a) above, in each case as modified by
       the waiver letter dated July 5, 2000 and as set forth in an e-mail
       confirmation dated July 6, 2000 and as further amended, supplemented,
       replaced or otherwise modified from time to time in accordance with this
       Agreement.

              "Rodriguez Stations": collectively, the LA Stations, the SA
       Station, the SF Stations and the Dallas Stations.

              "SA Station": radio station KSAH-AM (Universal City, Texas).

              "Scheduled Revolving Credit Termination Date": June 30, 2006.

              "SEC": the Securities and Exchange Commission (or successors
       thereto or an analogous Governmental Authority).

              "Secured Parties": collectively, the Arranger, the Agents, the
       Lenders and, with respect to any Specified Hedge Agreement, any affiliate
       of any Lender party thereto that has agreed to be bound by the provisions
       of Section 7.2 of the Guarantee and Collateral Agreement as if it were a
       party thereto and by the provisions of Section 9 hereof as if it were a
       Lender party hereto and each Indemnitee.

              "Security Documents": the collective reference to the Guarantee
       and Collateral Agreement, the Intellectual Property Security Agreement,
       the Control Agreements and all other pledge and security documents
       hereafter delivered to the Administrative Agent granting a Lien on any
       Property of any Person to secure the obligations and liabilities of any
       Loan Party under any Loan Document.

              "Seller Indebtedness": (a) Indebtedness incurred by the Borrower
       issued as purchase consideration to the seller in a Permitted
       Acquisition, provided that such Indebtedness shall (i) be in an aggregate
       principal amount which, when taken together with the aggregate principal
       amount of all other outstanding Seller Indebtedness, does not exceed
       $15,000,000 at any one time outstanding, (ii) be issued and payable and
       subordinated to the Obligations on terms acceptable to the Administrative
       Agent, (iii) in respect of which no payments of principal are due
       (including sinking fund payments, redemption or defeasance deposits or
       any required purchase) earlier than the first anniversary of the
       Scheduled Revolving Credit Termination Date and (iv) not bear interest
       payable in cash during the continuance of an Event of Default, and (b)
       any other Indebtedness incurred by the Borrower or any Subsidiary in
       connection with a Permitted Acquisition, if the amount and terms of such
       Indebtedness have been approved in writing by the Required Lenders.

              "Senior Subordinated Notes": the unsecured Senior Subordinated
       Notes due 2009 issued and outstanding under the Senior Subordinated Note
       Indenture.

              "Senior Subordinated Note Indenture": the Indenture dated as of
       November 2, 1999 between the Borrower and The Bank of New York, as
       Trustee, in connection with


                                       27


   34


       the Senior Subordinated Notes, as the same may be amended, supplemented,
       replaced or otherwise modified from time to time in accordance with this
       Agreement.

              "SF Station": radio station KXJO-FM (Alameda, California).

              "Single Employer Plan": any Plan that is covered by Title IV of
       ERISA, but which is not a Multiemployer Plan.

              "Solvency Certificate": the Solvency Certificate to be executed
       and delivered by the chief financial officer of the Borrower,
       substantially in the form of Exhibit E.

              "Solvent": when used with respect to any Person, as of any date of
       determination, (a) the amount of the "present fair saleable value" of the
       assets of such Person will, as of such date, exceed the amount of all
       "liabilities of such Person, contingent or otherwise", as of such date,
       as such quoted terms are determined in accordance with applicable federal
       and state laws governing determinations of the insolvency of debtors, (b)
       the present fair saleable value of the assets of such Person will, as of
       such date, be greater than the amount that will be required to pay the
       liability of such Person on its debts as such debts become absolute and
       matured, (c) such Person will not have, as of such date, an unreasonably
       small amount of capital with which to conduct its business and (d) such
       Person will be able to pay its debts as they mature. For purposes of this
       definition, (i) "debt" means liability on a "claim", and (ii) "claim"
       means any (x) right to payment, whether or not such a right is reduced to
       judgment, liquidated, unliquidated, fixed, contingent, matured,
       unmatured, disputed, undisputed, legal, equitable, secured or unsecured
       or (y) right to an equitable remedy for breach of performance if such
       breach gives rise to a right to payment, whether or not such right to an
       equitable remedy is reduced to judgment, fixed, contingent, matured or
       unmatured, disputed, undisputed, secured or unsecured.

              "Specified Change of Control": a "change of control" or similar
       event (howsoever defined) as defined in the Senior Subordinated Note
       Indenture.

              "Specified Hedge Agreement": any Hedge Agreement (a) entered into
       by (i) the Borrower or any of its Subsidiaries for the purpose of hedging
       the interest rate exposure in connection with indebtedness permitted
       under this Agreement and (ii) any Lender or any affiliate thereof, as
       counterparty and (b) which has been designated by such Lender and the
       Borrower, by notice to the Administrative Agent not later than 90 days
       after the execution and delivery thereof by the Borrower or such
       Subsidiary, as a Specified Hedge Agreement; provided that the designation
       of any Hedge Agreement as a Specified Hedge Agreement shall not create in
       favor of any Lender or affiliate thereof that is a party thereto any
       rights in connection with the management or release of any Collateral or
       of the obligations of any Guarantor under the Guarantee and Collateral
       Agreement.

              "Subordinated Debt": any Indebtedness of the Borrower (i) that is
       not guaranteed by any Subsidiary of the Borrower and not secured by any
       Lien upon any Property of the Borrower or any of its Subsidiaries, (ii)
       that is issued and payable and subordinated to the


                                       28


   35


       Obligations on terms acceptable to the Administrative Agent and (iii) in
       respect of which no payments of principal are due (including sinking fund
       payments, redemption or defeasance deposits or any required purchase)
       prior to the first anniversary of the Scheduled Revolving Credit
       Termination Date.

              "Subsidiary": as to any Person, a corporation, partnership,
       limited liability company or other entity of which shares of stock or
       other ownership interests having ordinary voting power (other than stock
       or such other ownership interests having such power only by reason of the
       happening of a contingency) to elect a majority of the board of directors
       or other managers of such corporation, partnership or other entity are at
       the time owned, or the management of which is otherwise controlled,
       directly or indirectly through one or more intermediaries, or both, by
       such Person. Unless otherwise qualified, all references to a "Subsidiary"
       or to "Subsidiaries" in this Agreement shall refer to a Subsidiary or
       Subsidiaries of the Borrower.

              "Subsidiary Guarantor": each Subsidiary of the Borrower other than
       (i) any Excluded Foreign Subsidiary and (ii) JuJu Media, Inc.

              "Swing Line Commitment": at any time, the lesser of (a) $3,000,000
       and (b) the aggregate amount of the Revolving Credit Commitments at such
       time.

              "Swing Line Lender": Lehman Commercial Paper Inc., in its capacity
       as the lender of Swing Line Loans.

              "Swing Line Loans": as defined in Section 2.6(a).

              "Swing Line Notes": as defined in Section 2.8(e).

              "Swing Line Participation Amount": as defined in Section 2.7(c).

              "Syndication Agent": as defined in Section 9.11.

              "Term Loan": as defined in Section 2.1(a).

              "Term Loan Commitment": as to any Term Loan Lender, the obligation
       of such Lender, if any, to make a Term Loan to the Borrower hereunder in
       a principal amount not to exceed the amount set forth under the heading
       "Term Loan Commitment" opposite such Lender's name on Schedule 1 to the
       Lender Addendum delivered by such Lender, or, as the case may be, in the
       Assignment and Acceptance pursuant to which such Lender became a party
       hereto, as the same may be changed from time to time pursuant to the
       terms hereof. The original aggregate amount of the Term Loan Commitments
       is $125,000,000.

              "Term Loan Commitment Period": the period that begins on the
       Closing Date and ends on December 29, 2000.


                                       29


   36


              "Term Loan Funding Date": any date during the Term Loan Commitment
       Period upon which Term Loans are funded or upon which funding of Term
       Loans is requested by the Borrower in a notice given as set forth in
       Section 2.2.

              "Term Loan Lender": each Lender that has a Term Loan Commitment or
       is the holder a Term Loan.

              "Term Loan Percentage": as to any Term Loan Lender at any time,
       the percentage which such Lender's Term Loan Commitment bears to the
       aggregate Term Loan Commitments at such time.

              "Term Notes": as defined in Section 2.8(e).

              "Total Revolving Credit Commitments": at any time, the aggregate
       amount of the Revolving Credit Commitments then in effect; provided that
       the amount of the Total Revolving Credit Commitments on the Closing Date
       shall be $25,000,000.

              "Total Revolving Extensions of Credit": at any time, the aggregate
       amount of the Revolving Extensions of Credit of the Revolving Credit
       Lenders outstanding at such time.

              "Transferee": as defined in Section 10.14.

              "Type": as to any Loan, its nature as a Base Rate Loan or a
       Eurodollar Loan.

              "Wholly Owned Subsidiary": as to any Person, any other Person all
       of the Capital Stock of which (other than directors' qualifying shares
       required by law) is owned by such Person directly and/or through other
       Wholly Owned Subsidiaries.

              "Wholly Owned Subsidiary Guarantor": any Subsidiary Guarantor that
       is a Wholly Owned Subsidiary of the Borrower.

              1.2. Other Definitional Provisions.

              (a)    Unless otherwise specified therein, all terms defined in
this Agreement shall have the defined meanings when used in the other Loan
Documents or any certificate or other document made or delivered pursuant hereto
or thereto.

              (b)    As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or thereto,
accounting terms relating to the Borrower and its Subsidiaries not defined in
Section 1.1 and accounting terms partly defined in Section 1.1, to the extent
not defined, shall have the respective meanings given to them under GAAP.

              (c)    The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular


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provision of this Agreement, and Section, Schedule and Exhibit references are to
this Agreement unless otherwise specified.

              (d)    The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.

              (e)    The expressions "payment in full," "paid in full" and any
other similar terms or phrases when used herein with respect to the Obligations
shall mean the payment in full, in immediately available funds, of all of the
Obligations.

              (f)    The term "including" is not limiting and means "including
without limitation."

                   SECTION 2. AMOUNT AND TERMS OF COMMITMENTS

              2.1. Term Loan Commitments.

              (a)    Subject to the terms and conditions hereof, each Term Loan
Lender severally agrees to make term loans (each a "Term Loan") to the Borrower
in one or more fundings during the Term Loan Commitment Period in an aggregate
amount not to exceed the amount of the Term Loan Commitment of such Lender.

              (b)    The Term Loan Commitments shall terminate on the last day
of the Term Loan Commitment Period. Term Loans that are repaid may not be
reborrowed.

              2.2. Procedure for Term Loan Borrowing. The Borrower shall give
the Administrative Agent irrevocable notice (which notice must be received by
the Administrative Agent prior to 10:00 A.M., New York City time, one Business
Day prior to the anticipated Term Loan Funding Date if the Term Loans are funded
as Base Rate Loans or three Business Days prior to the anticipated Term Loan
Funding Date if the Term Loans are funded as Eurodollar Loans) requesting that
the Term Loan Lenders make the Term Loans on such anticipated Term Loan Funding
Date and specifying the amount to be borrowed. Each borrowing under the Term
Loan Commitments shall be in an amount equal to (x) in the case of Base Rate
Loans, $1,000,000 or a whole multiple thereof (or, if the then aggregate Term
Loan Commitments are less than $1,000,000, such lesser amount) and (y) in the
case of Eurodollar Loans, $5,000,000 or a whole multiple of $1,000,000 in excess
thereof. Upon receipt of such notice the Administrative Agent shall promptly
notify each Term Loan Lender thereof. Not later than 12:00 Noon, New York City
time, on such anticipated Closing Date each Term Loan Lender shall make
available to the Administrative Agent at the Funding Office an amount in
immediately available funds equal to the Term Loan or Term Loans to be made by
such Lender.

              2.3. Repayment of Term Loans. The Borrower shall pay the principal
amount of the Term Loans in sixteen (16) consecutive quarterly installments
commencing on September 30, 2001 and continuing on the last day of each
December, March, June and September of each year thereafter through June 30,
2006, and the amount of the quarterly installment due on each such


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payment date shall be determined by applying the payment percentage set forth
next to such payment date below to the amount of the Term Loans funded on the
Closing Date:



                 Payment Date                                          Payment Percentage
                 ------------                                          ------------------

                                                                        
                 September 30, 2001                                           1.25%
                 December 31, 2001                                            1.25%
                 March 31, 2002                                               1.25%
                 June 30, 2002                                                1.25%
                 September 30, 2002                                           3.75%
                 December 31, 2002                                            3.75%
                 March 31, 2003                                               3.75%
                 June 30, 2003                                                3.75%
                 September 30, 2003                                           5.00%
                 December 31, 2003                                            5.00%
                 March 31, 2004                                               5.00%
                 June 30, 2004                                                5.00%
                 September 30, 2004                                           6.25%
                 December 31, 2004                                            6.25%
                 March 31, 2005                                               6.25%
                 June 30, 2005                                                6.25%
                 September 30, 2005                                           8.75%
                 December 31, 2005                                            8.75%
                 March 31, 2006                                               8.75%
                 June 30, 2006                                                8.75%


Notwithstanding the foregoing, the aggregate outstanding principal balance of
the Term Loans shall be due and payable in full in immediately available funds
on June 30, 2006, if not sooner paid in full.

              2.4. Revolving Credit Commitments.

              (a)    Subject to the terms and conditions hereof, each Revolving
Credit Lender severally agrees to make revolving credit loans (each a "Revolving
Credit Loan") to the Borrower in one or more fundings during the Revolving
Credit Commitment Period in an aggregate principal amount at any one time
outstanding which, when added to such Lender's Revolving Credit Percentage of
the sum of (i) the L/C Obligations then outstanding and (ii) the aggregate
principal amount of the Swing Line Loans then outstanding, does not exceed the
amount of such Lender's Revolving Credit Commitment. During the Revolving Credit
Commitment Period the Borrower may use the Revolving Credit Commitments by
borrowing, prepaying the Revolving Credit Loans in whole or in part, and
reborrowing, all in accordance with the terms and conditions hereof. The
Revolving Credit Commitments shall terminate on the Revolving Credit Termination
Date. The Revolving Credit Loans may from time to time be Eurodollar Loans or
Base Rate Loans, as determined by the Borrower and notified to the
Administrative Agent in accordance with Sections 2.5 and 2.13, provided that no
Revolving


                                       32


   39


Credit Loan shall be made as a Eurodollar Loan after the day that is one month
prior to the Revolving Credit Termination Date.

              (b)    The Borrower shall repay all outstanding Revolving Credit
Loans on the Revolving Credit Termination Date.

              2.5. Procedure for Revolving Credit Borrowing. The Borrower may
borrow under the Revolving Credit Commitments during the Revolving Credit
Commitment Period on any Business Day, provided that the Borrower shall give the
Administrative Agent irrevocable notice in a Notice of Borrowing (which Notice
of Borrowing must be received by the Administrative Agent prior to 12:00 Noon,
New York City time, (a) three Business Days prior to the requested Borrowing
Date, in the case of Eurodollar Loans, or (b) one Business Day prior to the
requested Borrowing Date, in the case of Base Rate Loans), specifying (i) the
amount and Type of Revolving Credit Loans to be borrowed, (ii) the requested
Borrowing Date and (iii) in the case of Eurodollar Loans, the length of the
initial Interest Period therefor. Any Revolving Credit Loans made on the Closing
Date shall initially be Base Rate Loans, and no Revolving Credit Loan may be
made as, converted into or continued as a Eurodollar Loan having an Interest
Period in excess of one month prior to the date which is 60 days after the
Closing Date. Each borrowing under the Revolving Credit Commitments shall be in
an amount equal to (x) in the case of Base Rate Loans, $1,000,000 or a whole
multiple thereof (or, if the then aggregate Available Revolving Credit
Commitments are less than $1,000,000, such lesser amount) and (y) in the case of
Eurodollar Loans, $5,000,000 or a whole multiple of $1,000,000 in excess
thereof; provided, that the Swing Line Lender may request, on behalf of the
Borrower, borrowings under the Revolving Credit Commitments which are Base Rate
Loans in other amounts pursuant to Section 2.7. Upon receipt of any such Notice
of Borrowing from the Borrower, the Administrative Agent shall promptly notify
each Revolving Credit Lender thereof. Each Revolving Credit Lender will make the
amount of its pro rata share of each borrowing available to the Administrative
Agent for the account of the Borrower at the Funding Office prior to 12:00 Noon,
New York City time, on the Borrowing Date requested by the Borrower in funds
immediately available to the Administrative Agent. Such borrowing will then be
made available to the Borrower by the Administrative Agent in like funds as
received by the Administrative Agent.

              2.6. Swing Line Commitment.

              (a)    Subject to the terms and conditions hereof, the Swing Line
Lender agrees to make a portion of the credit otherwise available to the
Borrower under the Revolving Credit Commitments from time to time during the
Revolving Credit Commitment Period by making swing line loans ("Swing Line
Loans") to the Borrower; provided that (i) the aggregate principal amount of
Swing Line Loans outstanding at any time shall not exceed the Swing Line
Commitment then in effect (notwithstanding that the Swing Line Loans outstanding
at any time, when aggregated with the Swing Line Lender's other outstanding
Revolving Credit Loans hereunder, may exceed the Swing Line Commitment then in
effect) and (ii) the Borrower shall not request, and the Swing Line Lender shall
not make, any Swing Line Loan if, after giving effect to the making of such
Swing Line Loan, the aggregate amount of the Available Revolving


                                       33


   40


Credit Commitments would be less than zero. During the Revolving Credit
Commitment Period, the Borrower may use the Swing Line Commitment by borrowing,
repaying and reborrowing, all in accordance with the terms and conditions
hereof. Swing Line Loans shall be Base Rate Loans only.

              (b)    The Borrower shall repay all outstanding Swing Line Loans
on the Revolving Credit Termination Date.

              2.7. Procedure for Swing Line Borrowing; Refunding of Swing Line
Loans.

              (a)    Whenever the Borrower desires that the Swing Line Lender
make Swing Line Loans it shall give the Swing Line Lender irrevocable telephonic
notice confirmed promptly in writing (which telephonic notice must be received
by the Swing Line Lender not later than 1:00 P.M., New York City time, on the
proposed Borrowing Date), specifying (i) the amount to be borrowed and (ii) the
requested Borrowing Date (which shall be a Business Day during the Revolving
Credit Commitment Period). Each borrowing under the Swing Line Commitment shall
be in an amount equal to $500,000 or a whole multiple of $100,000 in excess
thereof. Not later than 3:00 P.M., New York City time, on the Borrowing Date
specified in a notice in respect of Swing Line Loans, the Swing Line Lender
shall make available to the Administrative Agent at the Funding Office an amount
in immediately available funds equal to the amount of the Swing Line Loan to be
made by the Swing Line Lender. The Administrative Agent shall make the proceeds
of such Swing Line Loan available to the Borrower on such Borrowing Date in
immediately available funds.

              (b)    The Swing Line Lender, at any time and from time to time in
its sole and absolute discretion may, on behalf of the Borrower (which hereby
irrevocably directs the Swing Line Lender to act on its behalf), on one Business
Day's notice given by the Swing Line Lender no later than 12:00 Noon, New York
City time, request each Revolving Credit Lender to make, and each Revolving
Credit Lender hereby agrees to make, a Revolving Credit Loan, in an amount equal
to such Revolving Credit Lender's Revolving Credit Percentage of the aggregate
amount of the Swing Line Loans (the "Refunded Swing Line Loans") outstanding on
the date of such notice, to repay the Swing Line Lender. Each Revolving Credit
Lender shall make the amount of such Revolving Credit Loan available to the
Administrative Agent at the Funding Office in immediately available funds, not
later than 12:00 Noon, New York City time, one Business Day after the date of
such notice. The proceeds of such Revolving Credit Loans shall be immediately
made available by the Administrative Agent to the Swing Line Lender for
application by the Swing Line Lender to the repayment of the Refunded Swing Line
Loans. The Borrower irrevocably authorizes the Swing Line Lender to charge the
Borrower's accounts with the Administrative Agent (up to the amount available in
each such account) in order to immediately pay the amount of such Refunded Swing
Line Loans to the extent amounts received from the Revolving Credit Lenders are
not sufficient to repay in full such Refunded Swing Line Loans.

              (c)    If prior to the time a Revolving Credit Loan would have
otherwise been made pursuant to Section 2.7(b), one of the events described in
Section 8(f) shall have occurred and be continuing with respect to the Borrower
or if for any other reason, as determined by the


                                       34


   41


Swing Line Lender in its sole discretion, Revolving Credit Loans may not be made
as contemplated by Section 2.7(b), each Revolving Credit Lender shall, on the
first Business Day following demand by the Swing Line Lender therefor (the
"Refunding Date"), purchase for cash an undivided participating interest in the
then outstanding Swing Line Loans by paying to the Swing Line Lender an amount
(the "Swing Line Participation Amount") equal to (i) such Revolving Credit
Lender's Revolving Credit Percentage times (ii) the sum of the aggregate
principal amount of Swing Line Loans then outstanding.

              (d)    Whenever, at any time after the Swing Line Lender has
received from any Revolving Credit Lender such Lender's Swing Line Participation
Amount, the Swing Line Lender receives any payment on account of the Swing Line
Loans, the Swing Line Lender will distribute to such Revolving Credit Lender its
Swing Line Participation Amount (appropriately adjusted, in the case of interest
payments, to reflect the period of time during which such Revolving Credit
Lender's participating interest was outstanding and funded and, in the case of
principal and interest payments, to reflect such Revolving Credit Lender's pro
rata portion of such payment if such payment is not sufficient to pay the
principal of and interest on all Swing Line Loans then due); provided, however,
that in the event that such payment received by the Swing Line Lender is
required to be returned, such Revolving Credit Lender will return to the Swing
Line Lender any portion thereof previously distributed to it by the Swing Line
Lender.

              (e)    Each Revolving Credit Lender's obligation to make the Loans
referred to in Section 2.7(b) and to purchase participating interests pursuant
to Section 2.7(c) shall be absolute and unconditional and shall not be affected
by any circumstance, including (i) any setoff, counterclaim, recoupment, defense
or other right which such Revolving Credit Lender or the Borrower may have
against the Swing Line Lender, the Borrower or any other Person for any reason
whatsoever; (ii) the occurrence or continuation of any Default or the failure to
satisfy any of the other conditions precedent specified in Section 5; (iii) any
adverse change in the condition (financial or otherwise) of the Borrower; (iv)
any breach of this Agreement or any other Loan Document by the Borrower, any
other Loan Party or any other Revolving Credit Lender; or (v) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing.

              2.8. Repayment of Loans; Evidence of Indebtedness.

              (a)    The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of the appropriate Lender (i) the then
unpaid principal amount of each Revolving Credit Loan on the Revolving Credit
Termination Date (or such earlier date on which the Loans become due and payable
pursuant to Section 8), (ii) the then unpaid principal amount of each Swing Line
Loan on the Revolving Credit Termination Date (or such earlier date on which the
Loans become due and payable pursuant to Section 8) and (iii) the principal
amount of each Term Loan in installments according to the amortization schedule
set forth in Section 2.3 (or on such earlier date on which the Loans become due
and payable pursuant to Section 8). The Borrower hereby further agrees to pay
interest on the unpaid principal amount of the Loans from time to time
outstanding from the date hereof until payment in full thereof at the rates per
annum, and on the dates, set forth in Section 2.15.


                                       35


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              (b)    Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of the Borrower to such
Lender resulting from each Loan of such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Agreement.

              (c)    The Administrative Agent, on behalf of the Borrower, shall
maintain the Register pursuant to Section 10.6(e), and a subaccount therein for
each Lender, in which shall be recorded (i) the amount of each Loan made
hereunder and any Note evidencing such Loan, the Type thereof and each Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) both the amount of any sum received by the Administrative Agent
hereunder from the Borrower and each Lender's share thereof.

              (d)    The entries made in the Register and the accounts of each
Lender maintained pursuant to Section 2.8(b) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to
the Borrower by such Lender in accordance with the terms of this Agreement.

              (e)    The Borrower agrees that, upon the request to the
Administrative Agent by any Lender, the Borrower will execute and deliver to
such Lender a promissory note of the Borrower evidencing any Term Loans,
Revolving Credit Loans or Swing Line Loans, as the case may be, of such Lender,
substantially in the forms of Exhibits F-1, F-2 or F-3, respectively, with
appropriate insertions as to date and principal amount (such notes,
respectively, "Term Notes", "Revolving Credit Notes" and "Swing Line Notes").

              2.9. Commitment Fees, etc.

              (a)    The Borrower agrees to pay to the Administrative Agent (i)
for the account of each Revolving Credit Lender, a commitment fee for the period
from and including the Closing Date to the last day of the Revolving Credit
Commitment Period, computed at the Commitment Fee Rate determined from day to
day on the average daily amount of the Available Revolving Credit Commitment of
such Lender during the period for which payment is made, payable quarterly in
arrears on the last day of each March, June, September and December and on the
Revolving Credit Termination Date, commencing on the first of such dates to
occur after the date hereof and (ii) for the account of each Term Lender a
commitment fee for the period from and including the Closing Date to the last
day of the Term Loan Commitment Period, computed at the Commitment Fee Rate
determined from day to day on the average daily amount of the Term Loan
Commitment of such Lender during the period for which payment is made, payable
quarterly in arrears on the last day of each March, June, September and December
and on the last day of the Term Loan Commitment Period, commencing on the first
of such dates to occur after the date hereof.


                                       36


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              (b)    The Borrower agrees to pay to the Arranger and the
Administrative Agent the fees in the amounts and on the dates from time to time
agreed to in writing by the Borrower including pursuant to the Fee Letter.

              2.10. Termination or Reduction of Revolving Credit Commitments.
The Borrower shall have the right, upon not less than three Business Days'
notice to the Administrative Agent, to terminate the Revolving Credit
Commitments or, from time to time, to reduce the amount of the Revolving Credit
Commitments; provided that no such termination or reduction of Revolving Credit
Commitments shall be permitted if, after giving effect thereto and to any
prepayments of the Revolving Credit Loans and Swing Line Loans made on the
effective date thereof, the Total Revolving Extensions of Credit would exceed
the Total Revolving Credit Commitments. Any such reduction shall be in an amount
equal to $1,000,000, or a whole multiple thereof, and shall reduce permanently
the Revolving Credit Commitments then in effect.

              2.11. Optional Prepayments. The Borrower may at any time and from
time to time prepay the Loans, in whole or in part, without premium or penalty,
upon irrevocable notice delivered to the Administrative Agent at least three
Business Days prior thereto in the case of Eurodollar Loans and at least one
Business Day prior thereto in the case of Base Rate Loans, which notice shall
(i) designate whether the Borrower is prepaying Revolving Credit Loans, Term
Loans or both and (ii) specify the date and amount of prepayment and whether the
prepayment is of Eurodollar Loans or Base Rate Loans; provided, that if a
Eurodollar Loan is prepaid on any day other than the last day of the Interest
Period applicable thereto, the Borrower shall also pay any amounts owing
pursuant to Section 2.21. Upon receipt of any such notice the Administrative
Agent shall promptly notify each relevant Lender thereof. If any such notice is
given, the amount specified in such notice shall be due and payable on the date
specified therein, together with (except in the case of Revolving Credit Loans
(unless all Revolving Credit Loans are being repaid and the Revolving Credit
Commitments terminated) that are Base Rate Loans and Swing Line Loans) accrued
interest to such date on the amount prepaid. Partial prepayments of Term Loans
and Revolving Credit Loans shall be in an aggregate principal amount of
$1,000,000 or a whole multiple thereof. Partial prepayments of Swing Line Loans
shall be in an aggregate principal amount of $100,000 or a whole multiple
thereof.

              2.12. Mandatory Prepayments and Commitment Reductions.

              (a)    Unless the Required Prepayment Lenders shall otherwise
agree:

                     (i)    if the Borrower or any of its Subsidiaries incurs
       any Indebtedness (except any incurrence of Indebtedness permitted under
       Section 7.2 as in effect on the date of this Agreement) or if any
       Subsidiary issues any Capital Stock (except any issuance of Capital Stock
       by JuJu Media, Inc., any issuance of Management Equity and any issuance
       of Capital Stock to the Borrower or a Wholly Owned Subsidiary of the
       Borrower) an amount equal to 100% of all Net Cash Proceeds of such
       incurrence or issuance shall be applied within one Business Day of such
       issuance or incurrence toward the prepayment of the Term Loans and the
       reduction of the Revolving Credit Commitments as set forth in Section
       2.12(c); and


                                       37


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                     (ii)   if the Borrower issues any Capital Stock not
       constituting Indebtedness and if on the date of such issuance the
       Consolidated Senior Debt Ratio (computed on a pro forma basis as if
       Revolving Extensions of Credit were then outstanding in an amount equal
       to the then Total Revolving Credit Commitments) is greater than 2.5:1, an
       amount equal to 50% of the Net Cash Proceeds of such issuance shall be
       applied within one Business Day of such issuance toward the prepayment of
       the Term Loans and the reduction of the Revolving Credit Commitments as
       set forth in Section 2.12(c).

              (b)    Unless the Required Prepayment Lenders shall otherwise
agree, if on any date the Borrower or any of its Subsidiaries shall receive Net
Cash Proceeds from any Asset Sale or Recovery Event then, unless a Reinvestment
Notice shall be delivered in respect thereof, such Net Cash Proceeds shall be
applied on such date toward the prepayment of the Term Loans and the reduction
of the Revolving Credit Commitments as set forth in Section 2.12(c); provided,
that, notwithstanding the foregoing, (i) the aggregate Net Cash Proceeds of
Asset Sales that may be excluded from the foregoing requirement pursuant to a
Reinvestment Notice shall not, when added to all amounts previously excluded
pursuant to a Reinvestment Notice and not yet reinvested in assets useful in the
Borrower's business, exceed $5,000,000 and (ii) on each Reinvestment Prepayment
Date, an amount equal to the Reinvestment Prepayment Amount with respect to the
relevant Reinvestment Event shall be applied toward the prepayment of the Term
Loans and the reduction of the Revolving Credit Commitments as set forth in
Section 2.12(c).

              (c)    Amounts to be applied in connection with prepayments and
Commitment reductions made pursuant to this Section 2.12 shall be applied,
first, to the prepayment of the Term Loans, second, to reduce permanently any
portion of the Term Loan Commitments that then remain unfunded, third, to reduce
permanently the Revolving Credit Commitments and, fourth, to the Borrower or
such other Person as shall be lawfully entitled thereto. Any such reduction of
the Revolving Credit Commitments shall be accompanied by prepayment of the
Revolving Credit Loans and/or Swing Line Loans to the extent, if any, that the
Total Revolving Extensions of Credit exceed the amount of the Total Revolving
Credit Commitments as so reduced, provided that if the aggregate principal
amount of Revolving Credit Loans and Swing Line Loans then outstanding is less
than the amount of the Total Revolving Credit Commitments as so reduced (because
L/C Obligations constitute a portion thereof), the Borrower shall, to the extent
of the balance of such excess, replace outstanding Letters of Credit and/or
deposit an amount in immediately available funds in a cash collateral account
established with the Administrative Agent for the benefit of the Secured Parties
on terms and conditions satisfactory to the Administrative Agent (and the
Borrower hereby grants to the Administrative Agent, for the ratable benefit of
the Secured Parties, a continuing security interest in all amounts at any time
on deposit in such cash collateral account to secure all L/C Obligations from
time to time outstanding and all other Obligations). If at any time the
Administrative Agent determines that any funds held in such cash collateral
account are subject to any right or claim of any Person other than the
Administrative Agent and the Secured Parties or that the total amount of such
funds is less than the amount of such excess, the Borrower shall, forthwith upon
demand by the Administrative Agent, pay to the Administrative Agent, as
additional funds to be deposited and held in such cash collateral account, an
amount equal to the excess of (a) the amount of such


                                       38


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excess over (b) the total amount of funds, if any, then held in such cash
collateral account that the Administrative Agent determines to be free and clear
of any such right and claim. The application of any prepayment pursuant to
Section 2.11 and this Section 2.12 shall be made, first, to Base Rate Loans and,
second, to Eurodollar Loans. Each prepayment of the Loans under Section 2.11 and
this Section 2.12 (except in the case of Revolving Credit Loans (unless the
Revolving Credit Loans are being repaid in full and the Revolving Credit
Commitments terminated) that are Base Rate Loans and Swing Line Loans) shall be
accompanied by accrued interest to the date of such prepayment on the amount
prepaid.

              2.13. Conversion and Continuation Options.

              (a)    The Borrower may elect from time to time to convert
Eurodollar Loans to Base Rate Loans by giving the Administrative Agent at least
two Business Days' prior irrevocable notice of such election, provided that any
such conversion of Eurodollar Loans may only be made on the last day of an
Interest Period with respect thereto. The Borrower may elect from time to time
to convert Base Rate Loans to Eurodollar Loans by giving the Administrative
Agent at least three Business Days' prior irrevocable notice of such election
(which notice shall specify the length of the initial Interest Period therefor),
provided that no Base Rate Loan under a particular Facility may be converted
into a Eurodollar Loan (i) when any Event of Default has occurred and is
continuing if the Administrative Agent or the Majority Facility Lenders in
respect of such Facility have determined in its or their sole discretion not to
permit such conversions or (ii) after the date that is one month prior to the
final scheduled termination or maturity date of such Facility. Upon receipt of
any such notice the Administrative Agent shall promptly notify each relevant
Lender thereof.

              (b)    Any Eurodollar Loan may be continued as such upon the
expiration of the then current Interest Period with respect thereto by the
Borrower giving irrevocable notice to the Administrative Agent, in accordance
with the applicable provisions of the term "Interest Period" set forth in
Section 1.1, of the length of the next Interest Period to be applicable to such
Loans, provided that no Eurodollar Loan under a particular Facility may be
continued as such (i) when any Event of Default has occurred and is continuing
if the Administrative Agent or the Majority Facility Lenders in respect of such
Facility have determined in its or their sole discretion not to permit such
continuations or (ii) after the date that is one month prior to the final
scheduled termination or maturity date of such Facility, and provided, further,
that if the Borrower shall fail to give any required notice as described above
in this paragraph or if such continuation is not permitted pursuant to the
preceding proviso such Loans shall be automatically converted to Base Rate Loans
on the last day of such then expiring Interest Period. Upon receipt of any such
notice the Administrative Agent shall promptly notify each relevant Lender
thereof.

              2.14. Minimum Amounts and Maximum Number of Eurodollar Tranches.
Notwithstanding anything to the contrary in this Agreement, all borrowings,
conversions, continuations and optional prepayments of Eurodollar Loans
hereunder and all selections of Interest Periods hereunder shall be in such
amounts and be made pursuant to such elections so that, (a) after giving effect
thereto, the aggregate principal amount of the Eurodollar Loans comprising each
Eurodollar Tranche shall be equal to $5,000,000 or a whole multiple of


                                       39


   46


$1,000,000 in excess thereof and (b) no more than six Eurodollar Tranches shall
be outstanding at any one time.

              2.15. Interest Rates and Payment Dates.

              (a)    Each Eurodollar Loan shall bear interest for each day
during each Interest Period with respect thereto at a rate per annum equal to
the Eurodollar Rate determined for such day plus the Applicable Margin.

              (b)    Each Base Rate Loan shall bear interest at a rate per annum
equal to the Base Rate plus the Applicable Margin.

              (c)    (i) If all or a portion of the principal amount of any Loan
or Reimbursement Obligation shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), all outstanding Loans and Reimbursement
Obligations (whether or not overdue) shall bear interest at a rate per annum
that is equal to (x) in the case of the Loans, the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this Section plus
2.0% per annum or (y) in the case of Reimbursement Obligations, the rate
applicable to Base Rate Loans under the Revolving Credit Facility plus 2.0% per
annum, and (ii) if all or a portion of any interest payable on any Loan or
Reimbursement Obligation or any commitment fee or other amount payable hereunder
shall not be paid when due (whether at the stated maturity, by acceleration or
otherwise), such overdue amount shall bear interest at a rate per annum equal to
the rate then applicable to Base Rate Loans under the relevant Facility plus
2.0% per annum (or, in the case of any such other amounts that do not relate to
a particular Facility, the rate then applicable to Base Rate Loans under the
Revolving Credit Facility plus 2.0% per annum), in each case, with respect to
clauses (i) and (ii) above, from the date of such non-payment until such amount
is paid in full (after as well as before judgment).

              (d)    Interest shall be payable in arrears on each Interest
Payment Date, provided that interest accruing pursuant to paragraph (c) of this
Section shall be payable from time to time on demand.

              2.16. Computation of Interest and Fees.

              (a)    Interest, fees and commissions payable pursuant hereto
shall be calculated on the basis of a 360-day year for the actual days elapsed,
except that, with respect to Base Rate Loans the rate of interest on which is
calculated on the basis of the Prime Rate, the interest thereon shall be
calculated on the basis of a 365-day (or 366-day, as the case may be) year for
the actual days elapsed. The Administrative Agent shall as soon as practicable
notify the Borrower and the relevant Lenders of each determination of a
Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the Base Rate or the Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes
effective. The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of the effective date and the amount of each
such change in interest rate.


                                       40


   47


              (b)    Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Agreement shall be
conclusive and binding on the Borrower and the Lenders in the absence of
manifest error. The Administrative Agent shall, at the request of the Borrower
or a Lender, deliver to the Borrower or such Lender a statement showing the
quotations used by the Administrative Agent in determining any interest rate
pursuant to Section 2.15(a).

              2.17. Inability to Determine Interest Rate. If prior to the first
day of any Interest Period:

              (a)    the Administrative Agent shall have determined (which
       determination shall be conclusive and binding upon the Borrower) that, by
       reason of circumstances affecting the relevant market, adequate and
       reasonable means do not exist for ascertaining the Eurodollar Rate for
       such Interest Period, or

              (b)    the Administrative Agent shall have received notice from
       the Majority Facility Lenders in respect of the relevant Facility that
       the Eurodollar Rate determined or to be determined for such Interest
       Period will not adequately and fairly reflect the cost to such Lenders
       (as conclusively certified by such Lenders) of making or maintaining
       their affected Loans during such Interest Period,

the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the relevant Lenders as soon as practicable thereafter. If such
notice is given (x) any Eurodollar Loans under the relevant Facility requested
to be made on the first day of such Interest Period shall be made as Base Rate
Loans, (y) any Loans under the relevant Facility that were to have been
converted on the first day of such Interest Period to Eurodollar Loans shall be
continued as Base Rate Loans and (z) any outstanding Eurodollar Loans under the
relevant Facility shall be converted, on the last day of the then current
Interest Period with respect thereto, to Base Rate Loans. If adequate and
reasonable means do exist for ascertaining the Eurodollar Rate for a future
Interest Period and the Eurodollar Rate determined or to be determined for such
Interest Period will adequately and fairly reflect the cost to such Lenders (as
conclusively determined by such Lenders) then such Lenders shall promptly direct
the Administrative Agent to withdraw such notice. Until such notice has been
withdrawn by the Administrative Agent, no further Eurodollar Loans under the
relevant Facility shall be made or continued as such, nor shall the Borrower
have the right to convert Loans under the relevant Facility to Eurodollar Loans.

              2.18. Pro Rata Treatment and Payments.

              (a)    Each borrowing by the Borrower from the Lenders hereunder,
each payment by the Borrower on account of any commitment fee and any reduction
of the Commitments of the Lenders shall be made pro rata according to the
respective Term Loan Percentages or Revolving Credit Percentages, as the case
may be, of the relevant Lenders. Subject to Section 2.18(c), each payment (other
than prepayments) in respect of principal or interest in respect of the Loans,
and each payment in respect of fees or expenses payable hereunder shall be
applied to the amounts of such obligations owing to the Lenders pro rata


                                       41


   48


according to the respective amounts then due and owing to the Lenders. The
application of any prepayment pursuant to this Section 2.18 shall be made,
first, to Base Rate Loans and, second, to Eurodollar Loans.

              (b)    Each prepayment to be applied to Term Loans shall be
allocated among the Term Loan Lenders holding such Term Loans pro rata based on
the principal amount of the Term Loans held by each Term Loan Lender and shall
be applied to the scheduled quarterly installments due on the Term Loans
pursuant to Section 2.3 pro rata based on the remaining outstanding principal
amount of such installments.

              (c)    Each payment (including each prepayment) by the Borrower on
account of principal of and interest on the Revolving Credit Loans shall be made
pro rata according to the respective outstanding principal amounts of the
Revolving Credit Loans then held by the Revolving Credit Lenders.

              (d)    All payments (including prepayments) to be made by the
Borrower hereunder, whether on account of principal, interest, fees or
otherwise, shall be made without setoff or counterclaim and shall be made prior
to 12:00 Noon, New York City time, on the due date thereof to the Administrative
Agent, for the account of the Lenders, at the Payment Office, in Dollars and in
immediately available funds. The Administrative Agent shall distribute such
payments to the Lenders promptly upon receipt in like funds as received. If any
payment hereunder (other than payments on the Eurodollar Loans) becomes due and
payable on a day other than a Business Day, such payment shall be extended to
the next succeeding Business Day. If any payment on a Eurodollar Loan becomes
due and payable on a day other than a Business Day, the maturity thereof shall
be extended to the next succeeding Business Day unless the result of such
extension would be to extend such payment into another calendar month, in which
event such payment shall be made on the immediately preceding Business Day. In
the case of any extension of any payment of principal pursuant to the preceding
two sentences, interest thereon shall be payable at the then applicable rate
during such extension.

              (e)    Unless the Administrative Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to the daily average Federal Funds Effective Rate for the period
until such Lender makes such amount immediately available to the Administrative
Agent. A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this paragraph shall be conclusive in the
absence of manifest error. If such Lender's share of such borrowing is not made
available to the Administrative Agent by such Lender within three Business Days
of such Borrowing Date, the Administrative Agent shall also be entitled to
recover such amount with interest thereon at the


                                       42


   49


rate per annum applicable to Base Rate Loans under the relevant Facility, on
demand, from the Borrower.

              (f)    Unless the Administrative Agent shall have been notified in
writing by the Borrower prior to the date of any payment being made hereunder
that the Borrower will not make such payment to the Administrative Agent, the
Administrative Agent may assume that the Borrower is making such payment, and
the Administrative Agent may, but shall not be required to, in reliance upon
such assumption, make available to the Lenders their respective pro rata shares
of a corresponding amount. If such payment is not made to the Administrative
Agent by the Borrower within three Business Days of such required date, the
Administrative Agent shall be entitled to recover, on demand, from each Lender
to which any amount which was made available pursuant to the preceding sentence,
such amount with interest thereon at the rate per annum equal to the daily
average Federal Funds Effective Rate. Nothing herein shall be deemed to limit
the rights of the Administrative Agent or any Lender against the Borrower.

              2.19. Requirements of Law.

              (a)    If the adoption of or any change in any Requirement of Law
or in the interpretation or application thereof or compliance by any Lender with
any request or directive (whether or not having the force of law) from any
central bank or other Governmental Authority made subsequent to the date hereof:

                     (i)    shall subject any Lender to any tax of any kind
       whatsoever with respect to this Agreement, any Letter of Credit, any
       Application or any Eurodollar Loan made by it, or change the basis of
       taxation of payments to such Lender in respect thereof (except for
       Non-Excluded Taxes covered by Section 2.20 and changes in the rate of tax
       on, or the imposition of a tax on, the overall net income of such
       Lender);

                     (ii)   shall impose, modify or hold applicable any reserve,
       special deposit, compulsory loan or similar requirement against assets
       held by, deposits or other liabilities in or for the account of,
       advances, loans or other extensions of credit by, or any other
       acquisition of funds by, any office of such Lender that is not otherwise
       included in the determination of the Eurodollar Rate hereunder; or

                     (iii)  shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such Lender,
upon its demand, any additional amounts necessary to compensate such Lender on
an after-tax basis for such increased cost or reduced amount receivable. If any
Lender becomes entitled to claim any additional amounts pursuant to this
Section, it shall promptly notify the Borrower (with a copy to the
Administrative Agent) of the event by reason of which it has become so entitled.


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   50


              (b)    If any Lender shall have determined that the adoption of or
any change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the date hereof shall have the effect of reducing
the rate of return on such Lender's or such corporation's capital as a
consequence of its obligations hereunder or under or in respect of any Letter of
Credit to a level below that which such Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's or such corporation's policies with respect to capital adequacy)
by an amount deemed by such Lender to be material, then from time to time, after
submission by such Lender to the Borrower (with a copy to the Administrative
Agent) of a written request therefor, the Borrower shall pay to such Lender such
additional amount or amounts as will compensate such Lender on an after-tax
basis for such reduction.

              (c)    A certificate as to any additional amounts payable pursuant
to this Section submitted by any Lender to the Borrower (with a copy to the
Administrative Agent) shall be conclusive in the absence of manifest error. The
obligations of the Borrower pursuant to this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.

              2.20. Taxes.

              (a)    All payments made by the Borrower under this Agreement or
any other Loan Document shall be made free and clear of, and without deduction
or withholding for or on account of, any present or future taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental Authority,
excluding net income taxes, branch profits taxes and franchise taxes (imposed in
lieu of net income taxes) imposed on the Arranger, any Agent or any Lender as a
result of a present or former connection between the Arranger, such Agent or
such Lender and the jurisdiction of the Governmental Authority imposing such tax
or any political subdivision or taxing authority thereof or therein (other than
any such connection arising solely from the Arranger's, such Agent's or such
Lender's having executed, delivered or performed its obligations or received a
payment under, or enforced, this Agreement or any other Loan Document). Subject
to the provisions of Section 2.20(f), if any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
Taxes") are required to be withheld from any amounts payable to the Arranger,
any Agent or any Lender hereunder, the amounts so payable to the Arranger, such
Agent or such Lender shall be increased to the extent necessary to yield to the
Arranger, such Agent or such Lender (after payment of all Non-Excluded Taxes)
interest or any such other amounts that would have been received hereunder had
such withholding not been required. The Borrower or the applicable Subsidiary
Guarantor shall make any required withholding and pay the full amount withheld
to the relevant tax authority or other Governmental Authority in accordance with
applicable Requirements of Law.

              (b)    The Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable Requirements of Law.


                                       44




   51

              (c)    Subject to Section 2.20(f), the Borrower shall indemnify
the Arranger, each Agent and each Lender for the full amount of Non-Excluded
Taxes or Other Taxes arising in connection with payments made under this
Agreement (including any Non-Excluded Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 2.20) paid by the Arranger,
such Agent or Lender or any of their respective Affiliates and any liability
(including penalties, additions to tax interest and expenses) arising therefrom
or with respect thereto. Payment under this indemnification shall be made within
ten days from the date the Arranger, any Agent or any Lender or any of their
respective Affiliates makes written demand therefor.

              (d)    Whenever any Non-Excluded Taxes or Other Taxes are payable
by the Borrower, as promptly as possible thereafter the Borrower shall send to
the Administrative Agent for the account of the Arranger or the relevant Agent
or Lender, as the case may be, a certified copy of an original official receipt
received by the Borrower showing payment thereof.

              (e)    The agreements in this Section 2.20 shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.

              (f)    Each Lender (or Transferee) that is not a citizen or
resident of the United States of America, or a corporation, partnership or other
entity created or organized in or under the laws of the United States of America
(or any jurisdiction thereof) (a "Non-U.S. Lender") shall deliver to the
Borrower and the Administrative Agent (and, in the case of a Participant, to the
Lender from which the related participation shall have been purchased) (i) two
copies of either U.S. Internal Revenue Service Form 1001 or Form 4224 (or any
successor forms), or, in the case of a Non-U.S. Lender claiming exemption from
U.S. federal withholding tax under Section 871(h) or 881(c) of the Code with
respect to payments of "portfolio interest," a statement substantially in the
form of Exhibit G to the effect that such Lender is eligible for a complete
exemption from withholding of U.S. taxes under Section 871(h) or 881(c) of the
Code and a Form W-8, or any subsequent versions thereof or successors thereto,
and (ii) any other form or certificate required by a taxing authority (including
a certificate required under the Code) that is requested by the Borrower or the
Administrative Agent in writing, properly completed and duly executed by such
Non-U.S. Lender claiming complete exemption from U.S. federal withholding tax on
all payments by the Borrower under this Agreement and the other Loan Documents.
Such forms shall be delivered by each Non-U.S. Lender on or before the date it
becomes a party to this Agreement (or, in the case of any Participant, on or
before the date such Participant purchases the related participation). In
addition, each Non-U.S. Lender shall deliver such forms promptly upon the
obsolescence or invalidity of any form previously delivered by such Non-U.S.
Lender. Each Non-U.S. Lender shall promptly notify the Borrower at any time it
determines that it is no longer in a position to provide any previously
delivered certificate to the Borrower (or any other form of certification
adopted by the U.S. taxing authorities for such purpose). Notwithstanding any
other provision of this paragraph, a Non-U.S. Lender shall not be required to
deliver any form pursuant to this paragraph that such Non-U.S. Lender is not
legally able to deliver. For any period with respect to which a Lender (or
Transferee) has failed to provide the Borrower with the appropriate forms
described in this Section 2.20(f) (other than if such failure is due to a change
in law occurring subsequent to the date on which a form originally was required
to be provided), such


                                       45
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Lender (or Transferee) shall not be entitled to indemnification under Section
2.20 with respect to Non-Excluded Taxes that would have been avoided but for
such failure.

              (g)    If and to the extent that any Lender is able, in its sole
opinion, to obtain a tax refund or to apply or otherwise take advantage of any
offsetting tax credit or other similar tax benefit arising out of or in
conjunction with any deduction or withholding which gives rise to an obligation
on the Borrower to pay any Non-Excluded Taxes or Other Taxes pursuant to Section
2.20 then such Lender shall, to the extent that in its sole opinion it can do so
without prejudice to the retention of such tax refund or the amount of such
credit or benefit and without any other adverse tax consequences for such
Lender, reimburse to the Borrower at such time as such tax refund or such tax
credit or benefit shall have actually been received by such Lender such amount
as such Lender shall, in its sole opinion, have determined to be attributable to
such tax refund or the relevant deduction or withholding and as will leave such
Lender in no better or worse position than it would have been in if the payment
of such Non-Excluded Taxes or Other Taxes had not been required. Nothing in this
Section 2.20(g) shall oblige any Lender to disclose to the Borrower or any other
person any information regarding its tax affairs or tax computations or
interfere with the right of any Lender to arrange its tax affairs in whatever
manner it thinks fit and, in particular, no Lender shall be under any obligation
to claim relief from its corporate profits or similar tax liability in credits
or deductions available to it and, if it does claim, the extent, order and
manner in which it does so shall be at its absolute discretion.

              2.21.  Indemnity. The Borrower agrees to indemnify each Lender and
to hold each Lender harmless from any loss or expense that such Lender may
sustain or incur as a consequence of (a) default by the Borrower in making a
borrowing of, conversion into or continuation of Eurodollar Loans after the
Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, (b) default by the Borrower in making any
prepayment after the Borrower has given a notice thereof in accordance with the
provisions of this Agreement or (c) the making of a prepayment or conversion of
Eurodollar Loans on a day that is not the last day of an Interest Period with
respect thereto. Such indemnification may include an amount equal to the excess,
if any, of (i) the amount of interest that would have accrued on the amount so
prepaid, or not so borrowed, converted or continued, for the period from the
date of such prepayment or of such failure to borrow, convert or continue to the
last day of such Interest Period (or, in the case of a failure to borrow,
convert or continue, the Interest Period that would have commenced on the date
of such failure) in each case at the applicable rate of interest for such Loans
provided for herein (excluding, however, the Applicable Margin included therein,
if any) over (ii) the amount of interest (as reasonably determined by such
Lender) that would have accrued to such Lender on such amount by placing such
amount on deposit for a comparable period with leading banks in the interbank
eurodollar market. A certificate as to any amounts payable pursuant to this
Section submitted to the Borrower by any Lender shall be conclusive in the
absence of manifest error. This covenant shall survive the termination of this
Agreement and the payment of the Loans and Letters of Credit and all other
amounts payable hereunder.

              2.22.  Illegality. Notwithstanding any other provision herein, if
the adoption of or any change in any Requirement of Law or in the interpretation
or application thereof shall make


                                       46
   53

it unlawful for any Lender to make or maintain Eurodollar Loans as contemplated
by this Agreement, (a) the commitment of such Lender hereunder to make
Eurodollar Loans, continue Eurodollar Loans as such and convert Base Rate Loans
to Eurodollar Loans shall forthwith be canceled and (b) such Lender's Loans then
outstanding as Eurodollar Loans, if any, shall be converted automatically to
Base Rate Loans on the respective last days of the then current Interest Periods
with respect to such Loans or within such earlier period as required by law. If
any such conversion of a Eurodollar Loan occurs on a day which is not the last
day of the then current Interest Period with respect thereto, the Borrower shall
pay to such Lender such amounts, if any, as may be required pursuant to Section
2.21.

              2.23.  Change of Lending Office. Each Lender agrees that, upon the
occurrence of any event giving rise to the operation of Section 2.19, 2.20(a) or
2.22 with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Loans affected by such event with the
object of avoiding the consequences of such event; provided, that such
designation is made on terms that, in the sole judgment of such Lender, cause
such Lender and its lending office(s) to suffer no economic, legal or regulatory
disadvantage, and provided, further, that nothing in this Section shall affect
or postpone any of the obligations of any Borrower or the rights of any Lender
pursuant to Section 2.19, 2.20(a) or 2.22.

              2.24.  Replacement of Lenders under Certain Circumstances. The
Borrower shall be permitted to replace any Lender that (a) requests
reimbursement for amounts owing pursuant to Section 2.19 or 2.20(a) or (b)
defaults in its obligation to make Loans hereunder, with a replacement financial
institution; provided that (i) such replacement does not conflict with any
Requirement of Law, (ii) no Event of Default shall have occurred and be
continuing at the time of such replacement, (iii) prior to any such replacement,
such Lender shall have taken no action under Section 2.23 so as to eliminate the
continued need for payment of amounts owing pursuant to Section 2.19 or 2.20(a),
(iv) the replacement financial institution shall purchase, at par, all Loans and
other amounts owing to such replaced Lender on or prior to the date of
replacement, (v) the Borrower shall be liable to such replaced Lender under
Section 2.21 (as though Section 2.21 were applicable) if any Eurodollar Loan
owing to such replaced Lender shall be purchased other than on the last day of
the Interest Period relating thereto, (vi) the replacement financial
institution, if not already a Lender, shall be reasonably satisfactory to the
Administrative Agent, (vii) the replaced Lender shall be obligated to make such
replacement in accordance with the provisions of Section 10.6 (provided that the
Borrower shall be obligated to pay the registration and processing fee referred
to therein), (viii) until such time as such replacement shall be consummated,
the Borrower shall pay all additional amounts (if any) required pursuant to
Section 2.19 or 2.20(a), as the case may be, and (ix) any such replacement shall
not be deemed to be a waiver of any rights that the Borrower, the Administrative
Agent or any other Lender shall have against the replaced Lender.


                                       47
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                          SECTION 3. LETTERS OF CREDIT

              3.1.  L/C Commitment.

              (a)    Subject to the terms and conditions hereof, the Issuing
Lender, in reliance on the agreements of the other Revolving Credit Lenders set
forth in Section 3.4(a), agrees to issue standby letters of credit ("Letters of
Credit") for the account of the Borrower on any Business Day during the
Revolving Credit Commitment Period in such form as may be approved from time to
time by the Issuing Lender; provided that the Issuing Lender shall not issue any
Letter of Credit if, after giving effect to such issuance, (i) the L/C
Obligations would exceed the L/C Commitment or (ii) the aggregate amount of the
Available Revolving Credit Commitments would be less than zero. Each Letter of
Credit shall (i) be denominated in Dollars and (ii) expire no later than the
earlier of (x) the first anniversary of its date of issuance and (y) the date
which is five Business Days prior to the Scheduled Revolving Credit Termination
Date, provided that any Letter of Credit with a one-year term may provide for
the renewal thereof for additional one-year periods (which shall in no event
extend beyond the date referred to in clause (y) above).

              (b)    The Issuing Lender shall not at any time be obligated to
issue any Letter of Credit hereunder if such issuance would conflict with, or
cause the Issuing Lender or any L/C Participant to exceed any limits imposed by,
any applicable Requirement of Law.

              3.2.  Procedure for Issuance of Letter of Credit. The Borrower may
from time to time request that the Issuing Lender issue a Letter of Credit by
delivering to the Issuing Lender at its address for notices specified herein an
Application therefor, completed to the satisfaction of the Issuing Lender, and
such other certificates, documents and other papers and information as the
Issuing Lender may request. Upon receipt of any Application, the Issuing Lender
will process such Application and the certificates, documents and other papers
and information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall the Issuing Lender be required to issue any
Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Lender and the Borrower. The Issuing Lender shall furnish a copy of such
Letter of Credit to the Borrower promptly following the issuance thereof. The
Issuing Lender shall promptly furnish to the Administrative Agent, which shall
in turn promptly furnish to the Lenders, notice of the issuance of each Letter
of Credit (including the amount thereof).

              3.3.  Fees and Other Charges.

              (a)    The Borrower will pay a fee on the aggregate drawable
amount of each outstanding Letter of Credit at a per annum rate equal to the
Applicable Margin then in effect with respect to Eurodollar Loans under the
Revolving Credit Facility, shared ratably among the Revolving Credit Lenders and
payable quarterly in arrears on each L/C Fee Payment Date after


                                       48
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the issuance date of such Letter of Credit. In addition, the Borrower shall pay
to the Issuing Lender for its own account a fronting fee as agreed between the
Issuing Lender and the Borrower.

              (b)    In addition to the foregoing fees, the Borrower shall pay
or reimburse the Issuing Lender for such normal and customary costs and expenses
as are incurred or charged by the Issuing Lender in issuing, negotiating,
effecting payment under, amending or otherwise administering any Letter of
Credit.

              3.4.  L/C Participations.

              (a)    The Issuing Lender irrevocably agrees to grant and hereby
grants to each L/C Participant, and, to induce the Issuing Lender to issue
Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept
and purchase and hereby accepts and purchases from the Issuing Lender, on the
terms and conditions hereinafter stated, for such L/C Participant's own account
and risk an undivided interest equal to such L/C Participant's Revolving Credit
Percentage in the Issuing Lender's obligations and rights under each Letter of
Credit issued hereunder and the amount of each draft paid by the Issuing Lender
thereunder. Each L/C Participant unconditionally and irrevocably agrees with the
Issuing Lender that, if a draft is paid under any Letter of Credit for which the
Issuing Lender is not reimbursed in full by the Borrower in accordance with the
terms of this Agreement, such L/C Participant shall pay to the Issuing Lender,
regardless of the occurrence or continuance of a Default or the failure to
satisfy any of the other conditions specified in Section 5, on the first
Business Day after demand, at the Issuing Lender's address for notices specified
herein an amount equal to such L/C Participant's Revolving Credit Percentage of
the amount of such draft, or any part thereof, that is not so reimbursed.

              (b)    If any amount required to be paid by any L/C Participant to
the Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed
portion of any payment made by the Issuing Lender under any Letter of Credit is
paid to the Issuing Lender within three Business Days after the date such
payment is due, such L/C Participant shall pay to the Issuing Lender on demand
an amount equal to the product of (i) such amount, times (ii) the daily average
Federal Funds Effective Rate during the period from and including the date such
payment is required to the date on which such payment is immediately available
to the Issuing Lender, times (iii) a fraction the numerator of which is the
number of days that elapse during such period and the denominator of which is
360. If any such amount required to be paid by any L/C Participant pursuant to
Section 3.4(a) is not made available to the Issuing Lender by such L/C
Participant within three Business Days after the date such payment is due, the
Issuing Lender shall be entitled to recover from such L/C Participant, on
demand, such amount with interest thereon calculated from such due date at the
rate per annum applicable to Base Rate Loans under the Revolving Credit
Facility. A certificate of the Issuing Lender submitted to any L/C Participant
with respect to any amounts owing under this Section shall be conclusive in the
absence of manifest error.

              (c)    Whenever, at any time after the Issuing Lender has made
payment under any Letter of Credit and has received from any L/C Participant its
pro rata share of such payment


                                       49
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in accordance with Section 3.4(a), the Issuing Lender receives any payment
related to such Letter of Credit (whether directly from the Borrower or
otherwise, including proceeds of collateral applied thereto by the Issuing
Lender), or any payment of interest on account thereof, the Issuing Lender will
distribute to such L/C Participant its pro rata share thereof; provided,
however, that in the event that any such payment received by the Issuing Lender
shall be required to be returned by the Issuing Lender, such L/C Participant
shall return to the Issuing Lender the portion thereof previously distributed by
the Issuing Lender to it.

              3.5.  Reimbursement Obligation of the Borrower. The Borrower
agrees to reimburse the Issuing Lender on each date on which the Issuing Lender
notifies the Borrower of the date and amount of a draft presented under any
Letter of Credit and paid by the Issuing Lender for the amount of (a) such draft
so paid and (b) any taxes, fees, charges or other costs or expenses incurred by
the Issuing Lender in connection with such payment (the amounts described in the
foregoing clauses (a) and (b) in respect of any drawing, collectively, the
"Payment Amount"). Each such payment shall be made to the Issuing Lender at its
address for notices specified herein in lawful money of the United States of
America and in immediately available funds. Interest shall be payable on each
Payment Amount from the date of the applicable drawing until payment in full at
the rate set forth in (i) until the second Business Day following the date of
the applicable drawing, Section 2.15(b) and (ii) thereafter, Section 2.15(c).
Each drawing under any Letter of Credit shall (unless an event of the type
described in clause (i) or (ii) of Section 8(f) shall have occurred and be
continuing with respect to the Borrower, in which case the procedures specified
in Section 3.4 for funding by L/C Participants shall apply) constitute a request
by the Borrower to the Administrative Agent for a borrowing pursuant to Section
2.5 of Base Rate Loans (or, at the option of the Administrative Agent and the
Swing Line Lender in their sole discretion, a borrowing pursuant to Section 2.7
of Swing Line Loans) in the amount of such drawing. The Borrowing Date with
respect to such borrowing shall be the first date on which a borrowing of
Revolving Credit Loans (or, if applicable, Swing Line Loans) could be made,
pursuant to Section 2.5 (or, if applicable, Section 2.7), if the Administrative
Agent had received a notice of such borrowing at the time of such drawing under
such Letter of Credit.

              3.6.  Obligations Absolute. The Borrower's obligations under this
Section 3 shall be absolute and unconditional under any and all circumstances
and irrespective of any setoff, counterclaim or defense to payment that the
Borrower may have or have had against the Issuing Lender, any beneficiary of a
Letter of Credit or any other Person. The Borrower also agrees with the Issuing
Lender that the Issuing Lender shall not be responsible for, and the Borrower's
Reimbursement Obligations under Section 3.5 shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements
thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, or any dispute between or among the Borrower and any
beneficiary of any Letter of Credit or any other party to which such Letter of
Credit may be transferred or any claims whatsoever of the Borrower against any
beneficiary of such Letter of Credit or any such transferee. The Issuing Lender
shall not be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit. The Borrower agrees that
any action taken or omitted by the Issuing Lender under or in connection with
any Letter of Credit or the related drafts or documents, if done in accordance
with the standards or care


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specified in the Uniform Commercial Code of the State of New York, shall be
binding on the Borrower and shall not result in any liability of the Issuing
Lender to the Borrower.

              3.7.  Letter of Credit Payments. If any draft shall be presented
for payment under any Letter of Credit, the Issuing Lender shall promptly notify
the Borrower of the date and amount thereof. The responsibility of the Issuing
Lender to the Borrower in connection with any draft presented for payment under
any Letter of Credit shall, in addition to any payment obligation expressly
provided for in such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are substantially in conformity with such
Letter of Credit.

              3.8.  Applications. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with the provisions
of this Section 3, the provisions of this Section 3 shall apply.

                   SECTION 4. REPRESENTATIONS AND WARRANTIES

              To induce the Administrative Agent and the Lenders to enter into
this Agreement and to induce the Lenders to make the Loans and issue or
participate in the Letters of Credit, the Borrower hereby represents and
warrants to the Agents and Lenders that:

              4.1.  Financial Condition.

              (a)    The unaudited pro forma consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at March 26, 2000 (including the
notes thereto) (the "Pro Forma Balance Sheet"), copies of which have heretofore
been furnished to each Lender, has been prepared giving effect (as if such
events had occurred on such date) to (i) the consummation of the Rodriguez
Acquisitions and (ii) the payment of fees and expenses in connection with the
foregoing. The Pro Forma Balance Sheet has been prepared based on the best
information available to the Borrower as of the date of delivery thereof, and
presents fairly on a pro forma basis the estimated financial position of
Borrower and its consolidated Subsidiaries as at March 26, 2000, assuming that
the events specified in the preceding sentence had actually occurred at such
date.

              (b)    The audited consolidated balance sheets of the Borrower and
its Subsidiaries as at September 26, 1999, September 27, 1998 and September 28,
1997, and the related consolidated statements of income and of cash flows for
the fiscal years ended on such dates, reported on by and accompanied by an
unqualified report from KPMG LLP, present fairly the consolidated financial
condition of the Borrower and its Subsidiaries as at such date, and the
consolidated results of its operations and its consolidated cash flows for the
respective fiscal years then ended. The unaudited consolidated balance sheet of
the Borrower and its Subsidiaries as at March 26, 2000, and the related
unaudited consolidated statements of income and cash flows for the three-month
period ended on such date, present fairly the consolidated financial condition
of the Borrower and its Subsidiaries as at such date, and the consolidated
results of its operations and its consolidated cash flows for the three-month
period then ended (subject to normal year-end audit adjustments). All such
financial statements, including the related


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schedules and notes thereto, have been prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved by the
aforementioned firm of accountants and disclosed therein). Other than the
Rodriquez Bridge Loan Agreement and Rodriguez Purchase Agreement, the Borrower
and its Subsidiaries do not have any material Guarantee Obligations, contingent
liabilities and liabilities for taxes, or any long-term leases or unusual
forward or long-term commitments, including any interest rate or foreign
currency swap or exchange transaction or other obligation in respect of
derivatives, that are not reflected in the most recent financial statements
referred to in this paragraph. During the period from September 26, 1999 to and
including the Closing Date there has been no Disposition by any of the Borrower
or its Subsidiaries of any material part of its business or Property.

              4.2.  No Change. Since September 26, 1999, there has been no
development or event that has had or could reasonably be expected to have a
Material Adverse Effect.

              4.3.  Corporate Existence; Compliance with Law. Each of the
Borrower and its Subsidiaries (a) is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization, (b) has
the corporate power and authority, and the legal right, to own and operate its
Property, to lease the Property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of Property or the conduct of its business
requires such qualification and (d) is in compliance with all Requirements of
Law except to the extent that the failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.

              4.4.  Corporate Power; Authorization; Enforceable Obligations.
Each Loan Party has the corporate power and authority, and the legal right, to
make, deliver and perform the Loan Documents and Acquisition Documentation to
which it is a party and, in the case of the Borrower, to borrow hereunder. Each
Loan Party has taken all necessary corporate action to authorize the execution,
delivery and performance of the Loan Documents and Acquisition Documentation to
which it is a party and, in the case of the Borrower, to authorize the
borrowings on the terms and conditions of this Agreement. No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in connection with any
Permitted Acquisition and the borrowings hereunder or with the execution,
delivery, performance, validity or enforceability of this Agreement, any of the
Loan Documents or any Acquisition Documentation, except (i) consents,
authorizations, filings and notices that have been obtained or made (or, in the
case of any Permitted Acquisition, will be obtained or made prior to
consummation of such Permitted Acquisition) and are in full force and effect and
(ii) the filings referred to in Section 4.19. The Loan Documents, the Senior
Subordinated Note Indenture and all Acquisition Documentation has been duly
executed and delivered on behalf of each Loan Party party thereto. This
Agreement constitutes, and each other Loan Document, the Senior Subordinated
Note Indenture and all Acquisition Documentation upon execution will constitute,
a legal, valid and binding obligation of each Loan Party party thereto,
enforceable against each such Loan Party in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium


                                       52
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or similar laws affecting the enforcement of creditors' rights generally and by
general equitable principles (whether enforcement is sought by proceedings in
equity or at law).

              4.5.  No Legal Bar. The execution, delivery and performance of
this Agreement, the other Loan Documents and the Acquisition Documentation, the
issuance of Letters of Credit, the borrowings hereunder and the use of the
proceeds thereof will not violate any Requirement of Law or any Contractual
Obligation of the Borrower or any of its Subsidiaries and will not result in, or
require, the creation or imposition of any Lien on any of their respective
properties or revenues pursuant to any Requirement of Law or any such
Contractual Obligation (other than the Liens created by the Security Documents).
No Requirement of Law or Contractual Obligation applicable to the Borrower or
any of its Subsidiaries could reasonably be expected to have a Material Adverse
Effect.

              4.6.  No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the knowledge of the Borrower, threatened by or against the Borrower or any
of its Subsidiaries or against any of their respective properties or revenues
(a) with respect to any of the Loan Documents or the Acquisition Documentation
or any of the transactions contemplated hereby or thereby, or (b) that could
reasonably be expected to have a Material Adverse Effect.

              4.7.  No Default. Neither the Borrower nor any of its Subsidiaries
is in default under or with respect to any of its Contractual Obligations in any
respect that could reasonably be expected to have a Material Adverse Effect. No
Default has occurred and is continuing.

              4.8.  Ownership of Property; Liens. Each of the Borrower and its
Subsidiaries has good, marketable and insurable title in fee simple to, or a
valid leasehold interest in, all its material real property, and good title to,
or a valid leasehold interest in or adequate rights to use, all its other
material Property, and none of such material Property is subject to any Lien
except as permitted by Section 7.3.

              4.9.  Intellectual Property. The Borrower and each of its
Subsidiaries owns, or is licensed to use, all Intellectual Property necessary
for the conduct of its business as currently conducted. No material claim has
been asserted or is pending by any Person challenging or questioning the use of
any Intellectual Property or the validity or effectiveness of any Intellectual
Property, nor does the Borrower know of any valid basis for any such claim. To
the best knowledge of the Borrower, the use of Intellectual Property by the
Borrower and its Subsidiaries does not infringe on the rights of any Person in
any material respect.

              4.10. Taxes. Each of the Borrower and its Subsidiaries has filed
or caused to be filed all material Federal, state and other material tax returns
that are required to be filed and has paid all taxes shown to be due and payable
on said returns or on any assessments made against it or any of its Property and
all other material taxes, fees or other charges imposed on it or any of its
Property by any Governmental Authority (other than any the amount or validity of
which are currently being contested in good faith by appropriate proceedings and
with respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or its


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Subsidiaries, as the case may be). The contents of all such material tax returns
are correct and complete in all material respects. Except as set forth in
Schedule 4.10, no tax Lien has been filed, and, to the knowledge of the
Borrower, no claim is being asserted, with respect to any such tax, fee or other
charge.

              4.11. Federal Regulations. No part of the proceeds of the Loans or
Letters of Credit will be used for purchasing or carrying any "margin stock"
(within the meaning of Regulation U) or for the purpose of purchasing, carrying
or trading in any securities under such circumstances as to involve the Borrower
in a violation of Regulation X or to involve any broker or dealer in a violation
of Regulation T. No indebtedness being reduced or retired out of the proceeds of
the Loans or Letters of Credit was or will be incurred for the purpose of
purchasing or carrying any "margin stock" (within the meaning of Regulation U).
Following application of the proceeds of the Loans and Letters of Credit,
"margin stock" (within the meaning of Regulation U) does not constitute more
than 25% of the value of the assets of the Borrower and its Subsidiaries. None
of the transactions contemplated by this Agreement (including the direct and
indirect use of proceeds of the Loans and Letters of Credit) will violate or
result in a violation of Regulation T, Regulation U or Regulation X. If
requested by any Lender or the Administrative Agent, the Borrower will furnish
to the Administrative Agent and each Lender a statement to the foregoing effect
in conformity with the requirements of FR Form G-3 or FR Form U-1 referred to in
Regulation U.

              4.12. Labor Matters. There are no strikes, stoppages, slowdowns or
other labor disputes against the Borrower or any of its Subsidiaries pending or,
to the knowledge the Borrower, threatened that (individually or in the
aggregate) could reasonably be expected to have a Material Adverse Effect. Hours
worked by and payment made to employees of the Borrower and its Subsidiaries
have not been in violation of the Fair Labor Standards Act or any other
applicable Requirement of Law dealing with such matters that (individually or in
the aggregate) could reasonably be expected to have a Material Adverse Effect.
All payments due from the Borrower or any of its Subsidiaries on account of
employee health and welfare insurance that (individually or in the aggregate)
could reasonably be expected to have a Material Adverse Effect if not paid have
been paid or accrued as a liability on the books of the Borrower or the relevant
Subsidiary.

              4.13. ERISA. Neither a Reportable Event nor an "accumulated
funding deficiency" (within the meaning of Section 412 of the Code or Section
302 of ERISA) has occurred during the five-year period prior to the date on
which this representation is made or deemed made with respect to any Plan, and
each Plan has complied in all material respects with all applicable provisions
of ERISA and the Code. No termination of a Single Employer Plan has occurred,
and no Lien in favor of the PBGC or a Plan has arisen, during such five-year
period. The present value of all accrued benefits under each Single Employer
Plan (based on those assumptions used to fund such Plans) did not, as of the
last annual valuation date prior to the date on which this representation is
made or deemed made, exceed the value of the assets of such Plan allocable to
such accrued benefits by a material amount. Neither the Borrower nor any
Commonly Controlled Entity has had a complete or partial withdrawal from any
Multiemployer Plan that has resulted or could reasonably be expected to result
in a material liability under


                                       54
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ERISA, and neither the Borrower nor any Commonly Controlled Entity would become
subject to any material liability under ERISA if the Borrower or any such
Commonly Controlled Entity were to withdraw completely from all Multiemployer
Plans as of the valuation date most closely preceding the date on which this
representation is made or deemed made. To the best knowledge of the Borrower, no
such Multiemployer Plan is in Reorganization or Insolvent.

              4.14. Investment Company Act; Other Regulations. No Loan Party is
an "investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. No Loan
Party is subject to regulation under any Requirement of Law (other than
Regulation X) which limits or conditions its ability to incur Indebtedness.

              4.15. Subsidiaries.

              (a)    The Subsidiaries listed on Schedule 4.15 constitute all the
Subsidiaries of the Borrower as of the Closing Date. Schedule 4.15 sets forth as
of the Closing Date the name and jurisdiction of incorporation of each
Subsidiary and, as to each such Subsidiary, the percentage and number of each
class of Capital Stock owned by the Borrower and its Subsidiaries.

              (b)    As of the Closing Date, there are no outstanding
subscriptions, options, warrants, calls, rights or other agreements or
commitments (other than stock options granted to employees or directors and
directors' qualifying shares) of any nature relating to any Capital Stock of the
Borrower or any of its Subsidiaries, except as disclosed on Schedule 4.15. None
of the Borrower or any of its Subsidiaries has issued, or authorized the
issuance of, any Disqualified Stock.

              4.16. Use of Proceeds.

              (a)    The proceeds of Term Loans funded on any Term Loan Funding
Date shall be used solely (i) to fund Rodriquez Bridge Loans that are required
to be made by the Company on such Term Loan Funding Date pursuant to the terms
of the Rodriguez Bridge Loan Agreement, upon satisfaction of the conditions
therein set forth, or (ii) to pay when due in accordance with the terms of the
Acquisition Documentation for any Permitted Acquisition, upon satisfaction of
the conditions set forth in such Acquisition Documentation, a portion of the
purchase price for such Permitted Acquisition in an amount that, when added to
any amount concurrently funded by the Borrower or a Subsidiary, is sufficient to
pay such purchase price in full.

              (b)    The proceeds of the Revolving Credit Loans, the Swing Line
Loans and the Letters of Credit, shall be used for lawful and permitted
corporate purposes.

              4.17. Environmental Matters. Other than exceptions to any of the
following that could not, individually or in the aggregate, reasonably be
expected to result in the payment of a Material Environmental Amount:


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              (a)    The Borrower and its Subsidiaries (i) are, and within the
       period of all applicable statutes of limitation have been, in compliance
       with all applicable Environmental Laws; and (ii) reasonably believe that
       compliance with any Environmental Law that is or is expected to become
       applicable to any of them will be timely attained and maintained, without
       material expense.

              (b)    Materials of Environmental Concern are not present at, on,
       under, in, or about any real property now or formerly owned, leased or
       operated by the Borrower or any of its Subsidiaries, or at any other
       location (including any location to which Materials of Environmental
       Concern have been sent for re-use or recycling or for treatment, storage,
       or disposal) which could reasonably be expected to (i) give rise to
       liability of the Borrower or any of its Subsidiaries under any applicable
       Environmental Law, or (ii) interfere with the Borrower's or any of its
       Subsidiaries' continued operations, or (iii) impair the fair saleable
       value of any real property owned or leased by the Borrower or any of its
       Subsidiaries.

              (c)    There is no judicial, administrative, or arbitral
       proceeding (including any notice of violation or alleged violation) under
       or relating to any Environmental Law to which the Borrower or any of its
       Subsidiaries is, or to the knowledge of the Borrower will be, named as a
       party that is pending or, to the knowledge of the Borrower, threatened.

              (d)    Neither the Borrower nor any of its Subsidiaries has
       received any written request for information, or been notified that it is
       a potentially responsible party under or relating to the federal
       Comprehensive Environmental Response, Compensation, and Liability Act or
       any similar Environmental Law, or with respect to any Materials of
       Environmental Concern.

              (e)    Neither the Borrower nor any of its Subsidiaries has
       entered into or agreed to any consent decree, order, or settlement or
       other agreement, or is subject to any judgment, decree, or order or other
       agreement, in any judicial, administrative, arbitral, or other forum for
       dispute resolution, relating to compliance with or liability under any
       Environmental Law.

              (f)    Neither the Borrower nor any of its Subsidiaries has
       assumed or retained, by contract or operation of law, any liabilities of
       any kind, fixed or contingent, known or unknown, under any Environmental
       Law or with respect to any Material of Environmental Concern.

              4.18. Accuracy of Information, etc. No statement or information
contained in this Agreement, any other Loan Document, the Confidential
Information Memorandum or any other document, certificate or statement furnished
to the Arranger, any Agent or any Lender by or on behalf of the Borrower or any
of its Subsidiaries for use in connection with the transactions contemplated by
this Agreement or the other Loan Documents, contained as of the date such
statement, information, document or certificate was so furnished (or, in the
case of the Confidential Information Memorandum, as of the date of this
Agreement), any untrue statement


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of a material fact or omitted to state a material fact necessary in order to
make the statements contained herein or therein not misleading. The projections
and pro forma financial information contained in the materials referenced above
are based upon good faith estimates and assumptions believed by management of
the Borrower to be reasonable at the time made, it being recognized by the
Lenders that such financial information as it relates to future events is not to
be viewed as fact and that actual results during the period or periods covered
by such financial information may differ from the projected results set forth
therein by a material amount. There is no fact known to the Borrower or any of
its Subsidiaries that could reasonably be expected to have a Material Adverse
Effect that has not been expressly disclosed herein, in the other Loan
Documents, in the Confidential Information Memorandum or in any other documents,
certificates and written statements furnished to the Arranger, the Agents and
the Lenders for use in connection with the transactions contemplated hereby and
by the other Loan Documents.

              4.19. Security Documents.

              (a)    The Guarantee and Collateral Agreement is effective to
create in favor of the Administrative Agent, for the benefit of the Secured
Parties, a legal, valid and enforceable security interest in the Collateral
described therein and proceeds thereof. In the case of the Pledged Stock
described, and as defined, in the Guarantee and Collateral Agreement, when any
stock certificates representing such Pledged Stock are delivered to the
Administrative Agent, and in the case of the other Collateral described in the
Guarantee and Collateral Agreement, when financing statements in appropriate
form are filed in the offices specified on Schedule 4.19(a) (which financing
statements have been duly completed and executed and delivered to the
Administrative Agent) and such other filings as are specified on Schedule 3 to
the Guarantee and Collateral Agreement are made (all of which filings have been
duly completed and executed and delivered to the Administrative Agent), the
Guarantee and Collateral Agreement shall constitute a fully perfected Lien on,
and security interest in, all right, title and interest of the Loan Parties in
such Collateral and the proceeds thereof as security for the Obligations, in
each case prior and superior in right to any other Person (except, in the case
of Collateral other than Pledged Stock, non-consensual Liens permitted by
Section 7.3 to the extent arising by operation of law).

              (b)    The Intellectual Property Security Agreement is effective
to create in favor of the Administrative Agent, for the benefit of the Secured
Parties, a legal, valid and enforceable security interest in the Intellectual
Property Collateral described therein and proceeds thereof. Upon the filing of
(i) the Intellectual Property Security Agreement in the appropriate indexes of
the United States Patent and Trademark Office relative to patents and trademarks
(within three (3) months after the Closing Date), and the United States
Copyright Office relative to copyrights (within thirty (30) days after the
Closing Date), together with provision for payment of all requisite fees, and
(ii) financing statements in appropriate form for filing in the offices
specified on Schedule 4.19(b) (which financing statements have been duly
completed and executed and delivered to the Administrative Agent) the
Intellectual Property Security Agreement shall constitute a fully perfected Lien
on, and security interest in, all right, title and interest of the Loan Parties
in the Intellectual Property Collateral and the proceeds and products thereof,
as security for the Obligations (as defined in the Guarantee and Collateral
Agreement), in each case prior


                                       57
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and superior in right to any other Person (except non-consensual Liens permitted
by Section 7.3 to the extent arising by operation of law).

              4.20. Solvency. Each Loan Party is, and after giving effect to the
incurrence of all Indebtedness and obligations being incurred in connection with
the Loan Documents and all Acquisition Documentation will be and will continue
to be, Solvent.

              4.21. Senior Indebtedness. The Obligations (including the
guarantee obligations of each Subsidiary Guarantor under the Guarantee and
Collateral Agreement) constitute "Senior Debt" and "Designated Senior Debt"
under and as defined in the Senior Subordinated Note Indenture and are
Indebtedness permitted to exist under the Senior Subordinated Note Indenture.
The provisions of Article Ten of the Senior Subordinated Note Indenture are
enforceable by each Lender and each other holder of Obligations in accordance
with their terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law).

              4.22. Insurance. Each of the Borrower and its Subsidiaries is
insured by insurers of recognized financial responsibility against such losses
and risks and in such amounts as are prudent and customary in the businesses in
which it is engaged; and none of the Borrower or any of its Subsidiaries (a) has
received notice from any insurer or agent of such insurer that substantial
capital improvements or other material expenditures will have to be made in
order to continue such insurance or (b) has any reason to believe that it will
not be able to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers at a cost that could
not reasonably be expected to have a Material Adverse Effect. The Administrative
Agent has been named as Loss Payee on all property casualty insurance policies
for the benefit of any Loan Party.

              4.23. Permits and Licenses.

              (a)    The FCC Licenses held by the Borrower and its Subsidiaries
constitute all of the licenses, permits, and other authorizations issued by the
FCC that are necessary for the Borrower and its Subsidiaries to conduct the
business in the manner in which it is currently being conducted.

              (b)    All FCC Licenses relating to the business of the Borrower
and its Subsidiaries are in full force and effect, valid for the balance of the
license terms normally applicable to radio stations licensed to the states in
which the stations are licensed, and not subject to any conditions outside the
ordinary course. The stations subject to such FCC Licenses are operating, and
have been operated since their construction or acquisition by the Borrower or
any of its Subsidiaries in material compliance with the Communications Act and
the FCC's rules, regulations, and written policies promulgated thereunder and
with the terms of the FCC Licenses. As of the Closing Date, (i) the Borrower and
its Subsidiaries have not received any notice of apparent liability, notice of
violation, order to show cause or other writing from the FCC that may lead to
any liability or sanction by the FCC and (ii) there is no proceeding pending by
or


                                       58
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before the FCC relating to the Borrower or its Subsidiaries or any station, nor,
to the best knowledge of the Borrower or any Subsidiary of the Borrower, is any
such proceeding threatened and no complaint or investigation is pending or
threatened by or before the FCC (other than rulemaking proceedings of general
applicability to which the Borrower and its Subsidiaries and the stations are
not parties). The Borrower and its Subsidiaries have timely filed all required
reports and notices with the FCC and have paid all amounts due in timely fashion
on account of fees and charges to the FCC.

              (c)    All FCC Licenses relating to the business of the Borrower
and its Subsidiaries (except, to the extent elected by the Borrower, FCC
Licenses that are owned solely by one or more of the Excluded Foreign
Subsidiaries and relate solely to the business conducted by any of the Excluded
Foreign Subsidiaries) are held by one or more Broadcast License Subsidiaries.

              (d)    Other than exceptions to any of the following that could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect (or, in the case of Environmental Permits, result in the payment
of a Material Environmental Amount), both before and after consummation of each
Permitted Acquisition for which Acquisition Documentation has been executed and
delivered, (i) each of the Borrower and its Subsidiaries has obtained and holds
all Permits required for any property owned, leased or otherwise operated by or
on behalf of, or for the benefit of, such Person and for the operation of each
of its businesses as presently conducted and as proposed to be conducted, (ii)
all such Permits are in full force and effect, and each of the Borrower and its
Subsidiaries has performed and observed all requirements of such Permits, (iii)
no event has occurred which allows or results in, or after notice or lapse of
time would allow or result in, revocation or termination by the issuer thereof
or in any other impairment of the rights of the holder of any such Permit, (iv)
no such Permits contain any restrictions, either individually or in the
aggregate, that are materially burdensome to the Borrower or any of its
Subsidiaries, or to the operation of any of its businesses or any property
owned, leased or otherwise operated by such Person, (v) each of the Borrower and
its Subsidiaries reasonably believes that each of its Permits will be timely
renewed and complied with, without material expense, and that any additional
Permits that may be required of such Person will be timely obtained and complied
with, without material expense, and (vi) the Borrower has no knowledge or reason
to believe that any Governmental Authority is considering limiting, suspending,
revoking or renewing on materially burdensome terms any such Permit.

              (e)    No consent or authorization of, filing with, Permit from,
or other act by or in respect of, any Governmental Authority is required in
connection with the execution, delivery, performance, validity or enforceability
of this Agreement and the other Loan Documents other than FCC approval of the
transfer of FCC Licenses to Broadcast License Subsidiaries, which (except in the
case of FCC Licenses owned solely by one or more of the Excluded Foreign
Subsidiaries and relating solely to the business conducted by any of the
Excluded Foreign Subsidiaries that the Borrower has not transferred to a
Broadcast License Subsidiary) has been obtained.


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                        SECTION 5. CONDITIONS PRECEDENT

              5.1.  Conditions to Initial Extension of Credit. The agreement of
each Lender to make the initial extension of credit requested to be made by it
is subject to the satisfaction, prior to or concurrently with the making of such
extension of credit on the Closing Date, of the following conditions precedent:

              (a)    Loan Documents. The Administrative Agent shall have
       received (i) this Agreement, executed and delivered by a duly authorized
       officer of the Borrower, (ii) the Guarantee and Collateral Agreement,
       executed and delivered by a duly authorized officer of the Borrower and
       each Subsidiary Guarantor, (iii) the Intellectual Property Security
       Agreement, executed and delivered by a duly authorized officer of the
       Borrower and each Subsidiary Guarantor, and (iv) if requested by any
       Lender, for the account of such Lender, Notes conforming to the
       requirements hereof and executed and delivered by a duly authorized
       officer of the Borrower.

              (b)    Pro Forma Balance Sheet; Financial Statements. The Lenders
       shall have received (i) the Pro Forma Balance Sheet, (ii) audited
       consolidated financial statements of the Borrower and its Subsidiaries
       for the 1999, 1998 and 1997 fiscal years and (iii) unaudited interim
       consolidated financial statements of the Borrower and its Subsidiaries
       for each fiscal month and quarterly period ended subsequent to the date
       of the latest applicable financial statements delivered pursuant to
       clause (ii) of this paragraph as to which such financial statements are
       available, and such financial statements shall not, in the reasonable
       judgment of the Lenders, reflect any material adverse change in the
       consolidated financial condition of the Borrower and its Subsidiaries, as
       reflected in the financial statements or projections contained in the
       Confidential Information Memorandum.

              (c)    Approvals. All governmental and third party approvals
       (including landlords' and other consents) necessary or reasonably
       appropriate in connection with the continuing operations of the Borrower
       and its Subsidiaries and the transactions contemplated hereby shall have
       been obtained and be in full force and effect, and all applicable waiting
       periods shall have expired without any action being taken or threatened
       by any competent authority which would restrain, prevent or otherwise
       impose adverse conditions on the financing contemplated hereby.

              (d)    Related Agreements. The Administrative Agent shall have
       received (in a form and substance reasonably satisfactory to the
       Administrative Agent), with a copy for each Lender, true and correct
       copies, certified as to authenticity by the Borrower, of the Senior
       Subordinated Note Indenture, the Rodriguez Bridge Loan Agreement and the
       Rodriguez Acquisition Agreement and all agreements in any respect related
       thereto.

              (e)    Fees. The Arranger and the Administrative Agent shall have
       received all amounts payable under the Fee Letter on or before the
       Closing Date.


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              (f)    Business Plan. The Lenders shall have received the
       Borrower's business plan for fiscal years 2000-2006.

              (g)    Solvency. The Lenders shall have received a Solvency
       Certificate executed by the chief financial officer of the Borrower.

              (h)    Lien Searches. The Administrative Agent shall have received
       the results of a recent lien, tax lien, judgment and litigation search in
       each of the jurisdictions or offices (including in the United States
       Patent and Trademark Office and the United States Copyright Office) in
       which Uniform Commercial Code financing statements or other filings or
       recordations should be made to evidence or perfect security interests in
       the Collateral.

              (i)    Closing Certificate. The Administrative Agent shall have
       received a certificate of each Loan Party, dated as of the Closing Date,
       substantially in the form of Exhibit H, with appropriate insertions and
       attachments.

              (j)    Other Certifications. The Administrative Agent shall have
       received the following:

                     (i)    a copy of the Governing Documents of each Loan
       Party, certified (as of a date reasonably near the date of the initial
       extension of credit) as being a true and correct copy thereof by the
       Secretary of State or other applicable Governmental Authority of the
       jurisdiction in which such Loan Party is organized;

                     (ii)   a copy of a good standing certificate of the
       Secretary of State or other applicable Governmental Authority of the
       jurisdiction in which each Loan Party is organized, dated reasonably near
       the date of the initial extension of credit, and

                     (iii)  as requested by the Administrative Agent, a copy of
       a good standing certificate of the Secretary of State or other applicable
       Governmental Authority of any jurisdiction in which the Borrower or any
       of its Subsidiaries is qualified as a foreign corporation or entity,
       dated reasonably near the date of the initial extension of credit.

              (k)    Legal Opinions. The Lenders shall have received the legal
       opinion of Kaye, Scholer, Fierman, Hays & Handler LLP, counsel to the
       Borrower and its Subsidiaries, substantially in the form of Exhibit I and
       covering such other matters incident to the transactions contemplated by
       this Agreement as the Administrative Agent may reasonably require.

              (l)    Pledged Collateral. The Administrative Agent shall have
       received (i) the certificates representing the shares of Capital Stock
       pledged pursuant to the Guarantee and Collateral Agreement, together with
       an undated stock power for each such certificate executed in blank by a
       duly authorized officer of the pledgor thereof and (ii) each promissory
       note representing Rodriguez Bridge Loans outstanding on the Closing Date


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       and all other promissory notes pledged to the Administrative Agent
       pursuant to the Guarantee and Collateral Agreement, all endorsed in blank
       (or accompanied by an executed transfer form in blank satisfactory to the
       Administrative Agent) by the pledgor thereof.

              (m)    Filings, Registrations and Recordings. The Administrative
       Agent shall have received, in proper form for filing, registration or
       recordation, each document (including Uniform Commercial Code financing
       statements) required by the Security Documents or under law or reasonably
       requested by the Administrative Agent to be filed, registered or recorded
       in order to evidence or perfect the Liens granted to the Administrative
       Agent in the Security Documents.

              (n)    Insurance. The Administrative Agent shall have received
       insurance certificates satisfying the requirements of Section 5.3 of the
       Guarantee and Collateral Agreement.

              (o)    Leverage Ratios. The Administrative Agent shall have
       received a certificate of a Responsible Officer of the Borrower stating
       that, based on Adjusted EBITDA determined for the 12-month period ended
       on the last day of the most recent fiscal month of the Borrower for which
       financial statements are available, and after giving effect to all
       transactions that have been or are to be consummated on or before the
       Closing Date, including the funding of Loans and application of the
       proceeds thereof, the Consolidated Leverage Ratio does not exceed 6.75:1
       and the Consolidated Senior Debt Ratio does not exceed 3.00:1 and
       demonstrating, in reasonable detail, the basis for such statement.

              (p)    Rodriguez Agreements. The Rodriguez Bridge Loan Agreement
       and the Rodriguez Purchase Agreements shall remain in full force and
       effect. No "Event of Default," as defined in the Rodriguez Bridge Loan
       Agreement, shall have occurred at any time after the execution and
       delivery of the Rodriguez Bridge Loan Agreement. The sellers under the
       Rodriguez Purchase Agreements shall have duly performed and observed all
       material obligations required to be performed by them thereunder and
       shall not have repudiated any of their obligations thereunder.

              (q)    Miscellaneous. The Administrative Agent shall have received
       such other documents, agreements, certificates and information as it may
       reasonably request.

              5.2.  Conditions to Each Extension of Credit. The agreement of
each Lender to make any extension of credit requested to be made by it on any
date (including its initial extension of credit) is subject to the satisfaction
of the following conditions precedent:

              (a)    Representations and Warranties. Each of the representations
       and warranties made by any Loan Party in or pursuant to the Loan
       Documents shall be true and correct on and as of such date as if made on
       and as of such date.


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              (b)    No Default. No Default shall have occurred and be
       continuing on such date or after giving effect to the extensions of
       credit requested to be made on such date.

              (c)    Pro Forma Financial Covenant Compliance. After giving
       effect to such extension of credit and the application of the proceeds
       thereof as if they had occurred on the last day of the fiscal quarter of
       the Borrower then most recently ended, Consolidated Total Debt and
       Consolidated Senior Debt shall not exceed the maximum amounts that would
       have been permitted under Sections 7.1(c) and (d), respectively, as of
       such day.

              (d)    Term Loan Fundings. In the case of each funding of Term
       Loans, either:

                     (i)    Rodriquez Bridge Loans are to be made by the Company
       on the Term Loan Funding Date for such Term Loans, and (x) all conditions
       required to be satisfied under the Rodriquez Bridge Loan Agreement in
       order for the Company to be obligated to make such Rodriquez Bridge Loans
       on such Term Loan Funding Date shall then be satisfied, (y) such Term
       Loans do not exceed the Rodriguez Bridge Loans to be made by the Company
       on such Term Loan Funding Date, and (z) the Company shall have delivered
       to the Administrative Agent, in pledge, all promissory notes representing
       such Rodriquez Bridge Loans, duly endorsed in blank; or

                     (ii)   Any Permitted Acquisition is to be consummated on
       the Term Loan Funding Date for such Term Loans, and (x) such Permitted
       Acquisition is concurrently consummated on such Term Loan Funding Date in
       conformity with the applicable provisions of the Acquisition
       Documentation for such Permitted Acquisition, upon satisfaction of the
       conditions set forth in such Acquisition Documentation, (y) such Term
       Loans, when added to all other cash and other forms of consideration made
       available by the Company on such Term Loan Funding Date for such
       purposes, are in an amount sufficient to pay in full the entire purchase
       consideration for such Permitted Acquisition, and (z) the Company shall
       have complied with its obligations under Section 6.10 in respect of all
       assets and Persons acquired in such Permitted Acquisition.

Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such extension of credit that the conditions contained in this
Section 5.2 have been satisfied.

                        SECTION 6. AFFIRMATIVE COVENANTS

              The Borrower hereby agrees that, so long as any of the Commitments
remain in effect, any Letter of Credit remains outstanding or any of the
principal of or interest on any Loan or Reimbursement Obligation is outstanding,
the Borrower shall and shall cause each of its Subsidiaries to:

              6.1.  Financial Statements. Furnish to the Administrative Agent
and each Lender:

              (a)    as soon as available, but in any event within 90 days after
       the end of each fiscal year of the Borrower, a copy of the audited
       consolidated balance sheet of the


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       Borrower and its consolidated Subsidiaries as at the end of such year and
       the related audited consolidated statements of income and of cash flows
       for such year, setting forth in each case in comparative form the figures
       for the previous year, reported on without a "going concern" or like
       qualification or exception, or qualification arising out of the scope of
       the audit, by KPMG LLP or other independent certified public accountants
       of nationally recognized standing;

              (b)    as soon as available, but in any event not later than 45
       days after the end of each of the first three quarterly periods of each
       fiscal year of the Borrower, the unaudited consolidated balance sheet of
       the Borrower and its consolidated Subsidiaries as at the end of such
       quarter and the related unaudited consolidated statements of income and
       of cash flows for such quarter and the portion of the fiscal year through
       the end of such quarter, setting forth in each case in comparative form
       the figures for the previous year, certified by a Responsible Officer as
       being fairly stated in all material respects (subject to normal year-end
       audit adjustments and the absence of footnotes); and

              (c)    as soon as available, but in any event not later than 45
       days after the end of each month occurring during each fiscal year of the
       Borrower (other than the third, sixth, ninth and twelfth such month), the
       unaudited consolidated balance sheets of the Borrower and its
       Subsidiaries as at the end of such month and the related unaudited
       consolidated statements of income and of cash flows for such month and
       the portion of the fiscal year through the end of such month, setting
       forth in each case in comparative form the figures for the previous year,
       certified by a Responsible Officer as being fairly stated in all material
       respects (subject to normal year-end audit adjustments and the absence of
       footnotes).

All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in conformity with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).

              6.2.  Certificates; Other Information. Furnish to the
Administrative Agent and each Lender, or, in the case of Section 6.2(i), to the
relevant Lender:

              (a)    concurrently with the delivery of the financial statements
       referred to in Section 6.1(a), a certificate of the independent certified
       public accountants reporting on such financial statements stating that in
       making the examination necessary therefor no knowledge was obtained of
       any Default arising under Section 7.1 or Section 7.7, except as specified
       in such certificate;

              (b)    concurrently with the delivery of any financial statements
       pursuant to Section 6.1, (i) a certificate of a Responsible Officer
       stating that, to the best of such Responsible Officer's knowledge, each
       Loan Party during such period has observed or performed all of its
       covenants and other agreements, and satisfied every condition, contained
       in this Agreement and the other Loan Documents to which it is a party to
       be


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       observed, performed or satisfied by it, and that such Responsible Officer
       has obtained no knowledge of any Default except as specified in such
       certificate, (ii) in the case of quarterly or annual financial
       statements, a Compliance Certificate containing all information and
       calculations necessary for determining compliance by the Borrower and its
       Subsidiaries with the provisions of this Agreement referred to therein as
       of the last day of the fiscal quarter or fiscal year of the Borrower, as
       the case may be, and (iii) in the case of annual financial statements, to
       the extent not previously disclosed to the Administrative Agent in
       writing, a listing of any county, state, territory, province, region or
       any other jurisdiction, or any political subdivision thereof, whether of
       the United States or otherwise, where any Loan Party keeps inventory or
       equipment (other than mobile goods) and of any Intellectual Property
       acquired by any Loan Party since the date of the most recent list
       delivered pursuant to this clause (iii) (or, in the case of the first
       such list so delivered, since the Closing Date);

              (c)    as soon as available, and in any event no later than 45
       days after the end of each fiscal year of the Borrower, a detailed
       consolidated budget for the following fiscal year (including a projected
       consolidated balance sheet of the Borrower and its Subsidiaries as of the
       end of the following fiscal year, and the related consolidated statements
       of projected cash flow, projected changes in financial position and
       projected income), and, as soon as available, significant revisions, if
       any, of such budget and projections with respect to such fiscal year
       (collectively, the "Projections"), which Projections shall in each case
       be accompanied by a certificate of a Responsible Officer stating that
       such Projections are based on reasonable estimates, information and
       assumptions at such time in light of the circumstances in which made and
       that such Responsible Officer has no reason to believe that such
       Projections are incorrect or misleading in any material respect, it being
       recognized that such Projections are not to be viewed as fact and that
       actual results during the subject fiscal year may differ from the
       projected results set forth therein by a material amount;

              (d)    within 45 days after the end of each fiscal quarter of the
       Borrower, the information required to be set forth in a quarterly report
       on Form 10-Q filed pursuant to Section 13 of the Securities Exchange Act
       of 1934, as amended;

              (e)    within five Business Days after the same are sent, copies
       of all financial statements and reports that the Borrower or any of its
       Subsidiaries sends to the holders of any class of its debt securities or
       public equity securities and, within five days after the same are filed,
       copies of all financial statements and reports that the Borrower or any
       of its Subsidiaries may make to, or file with, the SEC;

              (f)    as soon as possible and in any event within five Business
       Days of obtaining knowledge thereof, (i) notice of any development,
       event, or condition that, individually or in the aggregate with other
       developments, events or conditions, could reasonably be expected to
       result in the payment by the Borrower or any of its Subsidiaries, in the
       aggregate, of a Material Environmental Amount; and (ii) any notice that
       any Governmental Authority may deny any application for an Environmental
       Permit


                                       65
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       or any other material Permit held by the Borrower or any of its
       Subsidiaries on terms and conditions that are materially burdensome to
       the Borrower or any of its Subsidiaries, or to the operation of any of
       its businesses or any property owned, leased or otherwise operated by
       such Person;

              (g)    on the date of the occurrence thereof, notice that (i) any
       or all of the obligations under the Senior Subordinated Note Indenture
       have been accelerated, or (ii) the trustee or the required holders of
       Senior Subordinated Notes has given notice that any or all such
       obligations are to be accelerated;

              (h)    to the extent not included in clauses (a) through (h)
       above, no later than the date the same are delivered thereunder, copies
       of all agreements, documents or other instruments (including (i) audited
       and unaudited, pro forma and other financial statements, reports,
       forecasts, and projections, together with any required certifications
       thereon by independent public auditors or officers of the Borrower or any
       of its Subsidiaries or otherwise, (ii) press releases, (iii) statements
       or reports furnished to any other holder of the securities of the
       Borrower or any of its Subsidiaries, and (iv) regular, periodic and
       special securities reports) that the Borrower or any of its Subsidiaries
       is required to provide pursuant to the terms of the Senior Subordinated
       Note Indenture; and

              (i)    promptly, such additional financial and other information
       as any Lender may from time to time reasonably request.

              6.3.  Payment of Obligations. Pay, discharge or otherwise satisfy
at or before maturity or before they become delinquent, as the case may be, all
its material obligations of whatever nature, if the failure to do so could
reasonably be expected to have a Material Adverse Effect.

              6.4.  Conduct of Business and Maintenance of Existence, FCC
Licenses, etc.

              (a)    Preserve, renew and keep in full force and effect its
corporate existence and take all reasonable action to maintain all rights,
privileges and franchises necessary or desirable in the normal conduct of its
business, except as otherwise permitted by Section 7.4 and except to the extent
that failure to take any such action could not reasonably be expected to have a
Material Adverse Effect;

              (b)    Duly perform and observe its obligations under the
Rodriquez Bridge Loan Agreement, the Rodriquez Purchase Agreements and the
Acquisition Documentation for any Permitted Acquisition; and comply with all
other Contractual Obligations and all Requirements of Law except to the extent
that failure to comply with such other Contractual Obligations and Requirements
of Law could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect; and

              (c)    Operate all of the Stations in material compliance with the
Communications Act and the FCC's rules, regulations, and written policies
promulgated thereunder and with the terms of the FCC Licenses, timely file all
required reports and notices


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with the FCC and pay all amounts due in timely fashion on account of fees and
charges to the FCC, timely file and prosecute all applications for renewal or
for extension of time with respect to all of the FCC Licenses, and advise the
Administrative Agent of any deviation from the foregoing and of any written
communication from the FCC outside the ordinary course.

              6.5.  Maintenance of Property; Insurance.

              (a)    Keep all material Property and systems useful and necessary
in its business in good working order and condition, ordinary wear and tear and
damage by casualty excepted.

              (b)    Maintain with financially sound and reputable insurance
companies insurance on all its Property (including all inventory, equipment and
vehicles) in at least such amounts and against at least such risks as are
usually insured against in the same general area by companies engaged in the
same or a similar business; and furnish to the Administrative Agent with copies
for each Lender, upon written request, full information as to the insurance
carried. All insurance shall provide that no cancellation, material reduction in
amount or material change in coverage thereof shall be effective until at least
30 days (10 days in the case of non-payment) after receipt by the Administrative
Agent of written notice thereof. The Administrative Agent for its own benefit
and for the benefit of the Lenders shall be named as additional insured on all
such liability insurance policies, and the Administrative Agent shall be named
as loss payee on all property and casualty insurance policies.

              (c)    Deliver to the Administrative Agent (i) on the Closing
Date, a certificate dated such date showing the amount and types of insurance
coverage as of such date, (ii) upon request of the Administrative Agent from
time to time, full information as to the insurance carried, (iii) forthwith,
notice of any cancellation or nonrenewal of coverage, (iv) promptly after such
information is available to any of the Borrower or any of its Subsidiaries, full
information as to any claim for an amount in excess of $5,000,000 with respect
to any property and casualty insurance policy maintained by any of the Borrower
or its Subsidiaries, and (v) concurrently with the delivery of its audited
financial statements for each fiscal year, a report of a reputable insurance
broker with respect to such insurance and such supplemental reports with respect
thereto as the Administrative Agent may from time to time reasonably request.

              6.6.  Inspection of Property; Books and Records; Discussions.

              (a)    Keep proper books of records and account in which full,
true and correct entries in conformity with GAAP and all Requirements of Law
shall be made of all dealings and transactions in relation to its business and
activities and (b) permit representatives of the Administrative Agent or any
Lender (with respect to visits by any Lender more frequent than once in any
calendar year, if no Default is continuing, at such Lender's expense) to visit
and inspect any of its properties and examine and, at the Borrower's expense,
make abstracts from any of its books and records at any reasonable time, upon
reasonable notice and as often as may reasonably be desired and to discuss the
business, operations, properties and financial and other condition of the
Borrower and its Subsidiaries with officers and employees of the Borrower and
its Subsidiaries and with their respective independent certified public
accountants.


                                       67
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              6.7.  Notices. Promptly give notice to the Administrative Agent
and each Lender of:

              (a)    the occurrence of any Default or Event of Default;

              (b)    the occurrence of any "Event of Default," as defined in the
       Rodriquez Bridge Loan Agreement;

              (c)    any termination, amendment or modification of, or other
       change in, the Rodriquez Bridge Loan Agreement, any of the Rodriquez
       Purchase Agreements or any of Acquisition Documentation for the Pipeline
       Acquisition, or any material default thereunder by any party thereto;

              (d)    any (i) default or event of default under any other
       Contractual Obligation of the Borrower or any of its Subsidiaries or (ii)
       litigation, investigation or proceeding which may exist at any time
       between the Borrower or any of its Subsidiaries and any Governmental
       Authority, that in either case, if not cured or if adversely determined,
       as the case may be, could reasonably be expected to have a Material
       Adverse Effect;

              (e)    any litigation or proceeding affecting the Borrower or any
       of its Subsidiaries in which the amount involved is $5,000,000 or more
       and not covered by insurance or in which injunctive or similar relief is
       sought;

              (f)    the following events, as soon as possible and in any event
       within 30 days after the Borrower or any of its Subsidiaries knows or has
       reason to know thereof: (i) the occurrence of any Reportable Event with
       respect to any Plan, a failure to make any required contribution to a
       Plan, the creation of any Lien in favor of the PBGC or a Plan or any
       withdrawal from, or the termination, Reorganization or Insolvency of, any
       Multiemployer Plan, in each case in connection with or involving an
       amount that could reasonably be expected to have a Material Adverse
       Effect, or (ii) the institution of proceedings or the taking of any other
       action by the PBGC or the Borrower or any Commonly Controlled Entity or
       any Multiemployer Plan with respect to the withdrawal from, or the
       termination, Reorganization or Insolvency of, any Plan; and

              (g)    any development or event that has had or could reasonably
       be expected to have a Material Adverse Effect.

Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Borrower or the relevant Subsidiary proposes to take
with respect thereto.

              6.8.  Environmental Laws. In each of the following cases, except
as could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect:

              (a)    Comply in all material respects with, and ensure compliance
       in all material respects by all tenants and subtenants, if any, with, all
       applicable Environmental Laws


                                       68
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       and Environmental Permits, and obtain, maintain and comply in all
       material respects with and maintain, and ensure that all tenants and
       subtenants obtain, maintain and comply in all material respects with and
       maintain, any and all licenses, approvals, notifications, registrations
       or permits required by applicable Environmental Laws.

              (b)    Conduct and complete all investigations, studies, sampling
       and testing, and all remedial, removal and other actions required under
       Environmental Laws and promptly comply in all material respects with all
       lawful orders and directives of all Governmental Authorities regarding
       Environmental Laws.

              6.9.  Broadcast License Subsidiaries.

              (a)    Cause all FCC Licenses (except, at the option of the
Borrower, FCC Licenses that are owned solely by one or more of the Excluded
Foreign Subsidiaries and relate solely to the business conducted by any of the
Excluded Foreign Subsidiaries) to be owned and held at all times by one or more
Broadcast License Subsidiaries.

              (b)    Ensure that each Broadcast License Subsidiary engages only
in the business of holding FCC Licenses and rights related thereto and that such
restriction is set forth in the Governing Documents of such Broadcast License
Subsidiary.

              (c)    Cause its financial statements, through appropriate
footnote disclosure, to indicate that the FCC Licenses (except, if applicable,
any FCC Licenses that are owned solely by one or more of the Excluded Foreign
Subsidiaries and relate solely to the business conducted by any of the Excluded
Foreign Subsidiaries) are held by one or more Broadcast License Subsidiaries.

              (d)    Conduct its affairs strictly in accordance with its
Governing Documents and observe all necessary, appropriate, and customary
corporate, limited liability company and other organizational formalities,
including keeping separate and accurate minutes of meetings of its board of
directors, shareholders, managers, members or partners, as the case may be,
passing all resolutions or consents necessary to authorize actions to be taken,
and maintaining accurate and separate books, records and accounts and in a
manner permitting the assets and liabilities of the Borrower and each of its
Subsidiaries (including the Broadcast License Subsidiaries) to be easily
separated and readily ascertained.

              (e)    Ensure that the Property of the Borrower or any of its
Subsidiaries (including each Broadcast License Subsidiary) is not commingled
with the Property of any of the others of them or any other Person and otherwise
remains clearly identifiable.

              (f)    Conduct the business of the Borrower or any of its
Subsidiaries (including each Broadcast License Subsidiary) solely in its own
name and through its respective duly authorized managers, members, officers or
agents so as not to mislead others as to the identity of the Person with which
those others are concerned.


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              (g)    Ensure that no Broadcast License Subsidiary has any
Indebtedness or other liabilities except under the Guarantee and Collateral
Agreement and liabilities permitted to be incurred under Section 7.16.

              (h)    Not hold itself out to the public or to any of its
individual creditors as being a unified Person with common assets and
liabilities with the Borrower or any of its Subsidiaries or act in a manner that
would otherwise cause its creditors to believe that the Borrower or any of its
Subsidiaries (including each Broadcast License Subsidiary) is not a separate
entity distinct from each of the others of them and all other Persons.

              (i)    Not take any action, or conduct its affairs in any manner,
that could reasonably be expected to result in the separate existence of any
Broadcast License Subsidiary being ignored or the assets and liabilities of any
Broadcast License Subsidiary being substantively consolidated with those of the
Borrower or any of its other Subsidiaries (including any other Broadcast License
Subsidiary) in a bankruptcy, reorganization or other insolvency proceeding.

              6.10. Additional Collateral, etc.

              (a)    With respect to any Property acquired after the Closing
Date by the Borrower or any of its Subsidiaries (other than (x) any Property
described in paragraphs (b), (c) or (d) of this Section, (y) any Excluded Assets
and (z) Property acquired by a Subsidiary that is not a Subsidiary Guarantor) as
to which the Administrative Agent, for the benefit of the Secured Parties, does
not have a perfected Lien, promptly (and, in any event, within 90 days following
the date of such acquisition) (i) execute and deliver to the Administrative
Agent such amendments to the Guarantee and Collateral Agreement or such other
documents as the Administrative Agent deems reasonably necessary or advisable to
grant to the Administrative Agent, for the benefit of the Secured Parties, a
security interest in such Property and (ii) take all actions reasonably
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Secured Parties, a perfected first priority security interest in such
Property (subject only to Liens permitted by Section 7.3 that are not
consensually granted, including without limitation, the filing of Uniform
Commercial Code financing statements in such jurisdictions as may be required by
the Guarantee and Collateral Agreement or by law or as may be requested by the
Administrative Agent.

              (b)    If at any time so requested by the Administrative Agent or
by the Required Lenders with respect to any fee interest in any real property
having a value (net of Liens thereon permitted under Section 7.3) of at least
$1,000,000 now owned or hereafter acquired by the Borrower or any Subsidiary
Guarantor, promptly (and, in any event, within 90 days following the date of
such request) (i) execute, deliver (in recordable form) and record a mortgage in
favor of the Administrative Agent, for the benefit of the Secured Parties,
covering such real property, (ii) if requested by the Administrative Agent,
provide the Secured Parties with (x) title and extended coverage insurance
covering such real property in an amount at least equal to the value of such
real property (or such other amount as shall be reasonably specified by the
Administrative Agent) as well as a current ALTA survey thereof, together with a
surveyor's certificate and (y) any


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consents or estoppels reasonably deemed necessary or advisable by the
Administrative Agent in connection with such mortgage, each of the foregoing in
form and substance reasonably satisfactory to the Administrative Agent and (iii)
if reasonably requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent.

              (c)    With respect to each Person that now is or hereafter
becomes a Subsidiary of the Borrower (except JuJu Media, Inc. and any Subsidiary
which is and remains an Excluded Foreign Subsidiary), promptly (and, in any
event, within 90 days following such creation or the date of such acquisition)
(i) execute and deliver to the Administrative Agent such amendments to the
Guarantee and Collateral Agreement as the Administrative Agent deems reasonably
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Secured Parties, a perfected first priority security interest in the Capital
Stock of such new Subsidiary that is owned by the Borrower or any of its
Subsidiaries, (ii) deliver to the Administrative Agent the certificates
representing such Capital Stock, together with undated stock powers, in blank,
executed and delivered by a duly authorized officer of the Borrower or such
Subsidiary, as the case may be, (iii) cause such new Subsidiary (A) to become a
party to the Guarantee and Collateral Agreement and the Intellectual Property
Security Agreement and (B) to take such actions reasonably necessary or
advisable to grant to the Administrative Agent for the benefit of the Secured
Parties a perfected first priority security interest (subject only to Liens
permitted by Section 7.3 that are not consensually granted) in the Collateral
described in the Guarantee and Collateral Agreement and the Intellectual
Property Security Agreement with respect to such new Subsidiary, including the
recording of instruments in the United States Patent and Trademark Office and
the United States Copyright Office, the execution and delivery by all necessary
Persons of Control Agreements and the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Guarantee
and Collateral Agreement, the Intellectual Property Security Agreement or by law
or as may be requested by the Administrative Agent, and (iv) if requested by the
Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.

              (d)    With respect to any new Excluded Foreign Subsidiary created
or acquired after the Closing Date by the Borrower or any of its Subsidiaries,
promptly (and, in any event, within 90 days following such creation or the date
of such acquisition) (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement as the Administrative Agent
deems reasonably necessary or advisable in order to grant to the Administrative
Agent, for the benefit of the Secured Parties, a perfected first priority
security interest in the Capital Stock of such new Subsidiary that is owned by
the Borrower or any of its Subsidiaries (provided that in no event shall more
than 65% of the total outstanding Capital Stock of any such new Subsidiary be
required to be so pledged), (ii) deliver to the Administrative Agent the
certificates representing such Capital Stock, together with undated stock
powers, in blank, executed and delivered by a duly authorized officer of the
Borrower or such Subsidiary, as the case may be, and take such other action as
may be necessary or, in the reasonable opinion of the Administrative Agent,
desirable to perfect the Lien of the Administrative Agent thereon, and


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(iii) if requested by the Administrative Agent, deliver to the Administrative
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.

              (e)    Notwithstanding anything to the contrary in this Section
6.10, paragraphs (a), (b), (c) and (d) of this Section 6.10 shall not apply to
any Property, new Subsidiary or new Excluded Foreign Subsidiary created or
acquired after the Closing Date, as applicable, as to which the Administrative
Agent has determined in its sole discretion that the collateral value thereof is
insufficient to justify the difficulty, time and/or expense of obtaining a
perfected Lien thereon.

              6.11. Use of Proceeds. Use the proceeds of the Loans only for the
purposes specified in Section 4.16.

              6.12. Further Assurances. From time to time execute and deliver,
or cause to be executed and delivered, such additional instruments, certificates
or documents, and take all such actions, as the Administrative Agent may
reasonably request, for the purposes of implementing or effectuating the
provisions of this Agreement and the other Loan Documents, or of more fully
perfecting or renewing the rights of the Administrative Agent and the Secured
Parties with respect to the Collateral in accordance with the Guarantee and
Collateral Agreement (or with respect to any additions thereto or replacements
or proceeds or products thereof or with respect to any other property or assets
hereafter acquired which may be deemed to be part of the Collateral) pursuant
hereto or thereto. Upon the exercise by the Administrative Agent or any Lender
of any power, right, privilege or remedy pursuant to this Agreement or the other
Loan Documents which requires any consent, approval, recording, qualification or
authorization of any Governmental Authority, the Borrower will execute and
deliver, or will cause the execution and delivery of, all applications,
certifications, instruments and other documents and papers that the
Administrative Agent or such Lender may be required to obtain from the Borrower
or any of its Subsidiaries for such governmental consent, approval, recording,
qualification or authorization.

              6.13. Corporate Structure. Except for JuJu Media, Inc. and except
as otherwise permitted under Section 7.8(h), the Borrower will cause each of its
Subsidiaries at all times to be and remain a Wholly Owned Subsidiary of the
Borrower.

                         SECTION 7. NEGATIVE COVENANTS

              The Borrower hereby agrees that, so long as any of the Commitments
remain in effect, any Letter of Credit remains outstanding or any of the
principal of or interest on any Loan or Reimbursement Obligation is outstanding,
the Borrower shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly:

              7.1.  Financial Condition Covenants.

              (a)    Consolidated Fixed Charge Coverage Ratio. Permit the
Consolidated Fixed Charge Coverage Ratio for any period of four consecutive
fiscal quarters of the Borrower (or, if less, the number of full fiscal quarters
subsequent to the Closing Date) ending on the last


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day of any fiscal quarter set forth below to be less than the ratio set forth
below opposite such fiscal quarter:


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                                                          Consolidated
                                                          Fixed Charge
              Fiscal Quarter                                Coverage
              --------------                              Ratio (x:1)
                                                          -----------
                                                       
              FQ3 and FQ4 in 2000                             1.00

              FQ1, FQ2, FQ3 and FQ4 in 2001                   1.10

              FQ1 in 2002 and thereafter                      1.20


              (b)    Consolidated Interest Coverage Ratio. Permit the
Consolidated Interest Coverage Ratio for any period of four consecutive fiscal
quarters of the Borrower (or, if less, the number of full fiscal quarters
subsequent to the Closing Date) ending on the last day of any fiscal quarter set
forth below to be less than the ratio set forth below opposite such fiscal
quarter:



                                                          Consolidated
                                                            Interest
              Fiscal Quarter                                Coverage
              --------------                               Ratio (x:1)
                                                           -----------
                                                        
              FQ3 and FQ4 in 2000                             1.40

              FQ1 and FQ2 in 2001                             1.50

              FQ3 and FQ4 in 2001                             1.60

              FQ1, FQ2 and FQ3 in 2002                        1.75

              FQ4 in 2002 and
              FQ1, FQ2, FQ3 and FQ4 in 2003                   2.00

              FQ1 in 2004 and thereafter                      2.25


              (c)    Consolidated Leverage Ratio. Permit the Consolidated
Leverage Ratio determined as of the last day of any fiscal quarter set forth
below to exceed the ratio set forth below opposite such fiscal quarter:


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                                                          Consolidated
              Fiscal Quarter                             Leverage Ratio
              --------------                                  (x:1)
                                                              -----
                                                      
              FQ3 and FQ4 in 2000 and
              FQ1 in 2001                                      6.75

              FQ2 and FQ3 in 2001                              6.50

              FQ4 in 2001                                      6.25

              FQ1 in 2002                                      6.00

              FQ2 in 2002                                      5.75

              FQ3 in 2002                                      5.50

              FQ4 in 2002 and thereafter                       5.00


              (d)    Consolidated Senior Debt Ratio. Permit the Consolidated
Senior Debt Ratio determined as of the last day of any fiscal quarter set forth
below to exceed the ratio set forth below opposite such fiscal quarter:



                                                           Consolidated
              Fiscal Quarter                               Senior Debt
              --------------                                Ratio (x:1)
                                                            -----------
                                                        
              FQ3 and FQ4 in 2000 and
              FQ1, FQ2 and FQ3 in 2001                         3.00

              FQ4 in 2001 and FQ1 in 2002                      2.75

              FQ2 and FQ3 in 2002                              2.50

              FQ4 in 2002 and thereafter                       2.25


              7.2.  Limitation on Indebtedness. Create, incur, assume or suffer
to exist any Indebtedness, except:

              (a)    Indebtedness of any Loan Party pursuant to any Loan
       Document;

              (b)    Unsecured Indebtedness (i) constituting Puerto Rico
       Intercompany Debt, (ii) of the Borrower outstanding to any Solvent
       Subsidiary, (iii) of any Subsidiary Guarantor outstanding to the Borrower
       or any other Subsidiary Guarantor or (iv) of any Subsidiary of the
       Borrower that is not a Subsidiary Guarantor outstanding to the


                                       75
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       Borrower or any Subsidiary Guarantor, so long as the aggregate
       Investments of the Borrower and the Subsidiary Guarantors (whether in the
       form of debt or equity and counted at cost (or if made in assets at the
       fair market value thereof when made, as determined in good faith by the
       Borrower's board of directors), net of returns of the principal thereof
       received in cash thereon) made at any time after the Closing Date in any
       and all Subsidiaries of the Borrower that are not Subsidiary Guarantors
       and in any and all Persons that are not Subsidiaries of the Borrower does
       not at any time exceed $35,000,000; provided, that all such Indebtedness
       outstanding to the Borrower or any Subsidiary Guarantor shall be
       evidenced by a promissory note duly endorsed and delivered to the
       Administrative Agent in pledge as security for the Obligations and, if
       the Borrower is the obligor thereon, subordinated in right of payment to
       the Obligations on terms and conditions satisfactory to the
       Administrative Agent;

              (c)    Indebtedness of the Borrower or any of its Subsidiaries
       (including Capital Lease Obligations) secured by Liens permitted by
       Section 7.3(g) in an aggregate principal amount, for the Borrower and all
       of its Subsidiaries, not exceeding $8,500,000 at any one time
       outstanding;

              (d)    Indebtedness (other than the Indebtedness referred to in
       Section 7.2(f)) outstanding on the date hereof and listed on Schedule
       7.2(d) and any refinancings, refundings, renewals or extensions thereof
       (without any increase in the principal amount thereof or any shortening
       of the maturity of any principal amount thereof);

              (e)    Unsecured Guarantee Obligations made in the ordinary course
       of business by the Borrower or any of its Subsidiaries of obligations of
       the Borrower or any Subsidiary Guarantor;

              (f)    Unsecured Indebtedness of the Borrower in respect of Senior
       Subordinated Notes outstanding under the Senior Subordinated Note
       Indenture in an aggregate principal amount not exceeding $235,000,000 and
       the guaranty of such Indebtedness, on the terms set forth in the Senior
       Subordinated Note Indenture, by any Subsidiary Guarantor that is not a
       Broadcast License Subsidiary;

              (g)    Seller Indebtedness constituting purchase consideration for
       Permitted Acquisitions; and

              (h)    additional Indebtedness of the Borrower or any of its
       Subsidiaries in an aggregate principal amount (for the Borrower and all
       Subsidiaries) not to exceed $5,000,000 at any one time outstanding.

              7.3.  Limitation on Liens. Create, incur, assume or suffer to
exist any Lien upon any of its Property, whether now owned or hereafter
acquired, except for:

              (a)    Liens for taxes, assessments or governmental charges or
       levies not yet due and payable or being contested in good faith by
       appropriate proceedings, provided that


                                       76
   83

       adequate reserves with respect thereto are maintained on its books in
       conformity with GAAP;

              (b)    carriers', warehousemen's, mechanics', materialmen's,
       landlords', repairmen's or other like Liens arising in the ordinary
       course of business that are not overdue for a period of more than 60 days
       or are being contested in good faith by appropriate proceedings;

              (c)    pledges or deposits in connection with workers'
       compensation, unemployment insurance and other social security
       legislation;

              (d)    pledges or deposits by or on behalf of the Borrower or any
       of its Subsidiaries to secure the performance of tenders, bids, trade
       contracts (other than for borrowed money), leases, utilities, statutory
       obligations, surety and appeal bonds, performance and return of money
       bonds and other obligations of a like nature incurred in the ordinary
       course of business;

              (e)    easements, rights-of-way, restrictions and other similar
       charges or encumbrances incurred in the ordinary course of business that,
       in the aggregate, are not substantial in amount and do not in any case
       materially detract from the value of the Property subject thereto or
       materially interfere with the ordinary conduct of the business of the
       Borrower or any of its Subsidiaries;

              (f)    Liens in existence on the date hereof listed on Schedule
       7.3(f), securing Indebtedness permitted by Section 7.2(d) and
       refinancings, renewals and extensions thereof, provided that no such Lien
       is spread to cover any additional Property after the Closing Date and
       that the amount of Indebtedness secured thereby is not increased; and
       Liens in existence on the date hereof listed on Schedule 4.10;

              (g)    Liens securing Indebtedness of the Borrower or any of its
       Subsidiaries incurred pursuant to Section 7.2(c) to finance the
       acquisition of fixed or capital assets, provided that (i) such Liens
       shall be created substantially simultaneously with the acquisition of
       such fixed or capital assets, (ii) such Liens do not at any time encumber
       any Property other than the Property financed by such Indebtedness and
       (iii) the amount of Indebtedness secured thereby is not increased;

              (h)    Liens created pursuant to any of the Loan Documents;

              (i)    any interest or title of a lessor under any lease entered
       into by the Borrower or any of its Subsidiaries in the ordinary course of
       its business and covering only the assets so leased;

              (j)    Liens in favor of the Borrower or any of its Subsidiaries,
       if and to the extent that the liability secured by such Liens is pledged
       to the Administrative Agent for the benefit of the Secured Parties;


                                       77
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              (k)    the Lien in favor of the trustee under the Senior
       Subordinated Note Indenture, attaching to money and property held or
       collected by such trustee and securing amounts due to it in its
       individual capacity, set forth in Section 7.07 of the Senior Subordinated
       Note Indenture;

              (l)    Liens securing judgments that individually and in the
       aggregate do not exceed $5,000,000 and that do not constitute a Default;
       and

              (m)    Liens not otherwise permitted by this Section 7.3 so long
       as neither (i) the aggregate outstanding principal amount of the
       obligations secured thereby nor (ii) the aggregate fair market value
       (determined, in the case of each such Lien, as of the date such Lien is
       incurred) of the assets subject thereto exceeds (as to the Borrower and
       all Subsidiaries) $1,000,000 at any one time.

              7.4.  Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or Dispose of all or substantially all
of its Property or business, except that:

              (a)    any Solvent Subsidiary of the Borrower or, in connection
       with a Permitted Acquisition, any Acquired Business, may be merged or
       consolidated with or into the Borrower (provided that the Borrower shall
       be the continuing or surviving corporation) or with or into any
       Subsidiary Guarantor (provided that the Subsidiary Guarantor shall be the
       continuing or surviving corporation);

              (b)    any Subsidiary of the Borrower that is not a Subsidiary
       Guarantor may Dispose of any or all of its assets (upon voluntary
       liquidation, dissolution or otherwise) to its shareholders in accordance
       with their respective pro rata interests;

              (c)    any Subsidiary Guarantor may Dispose of any or all of its
       assets (upon voluntary liquidation, dissolution or otherwise) to the
       Borrower or any Subsidiary Guarantor; and

              (d)    any Wholly Owned Subsidiary of the Borrower that is not a
       Subsidiary Guarantor may be merged with or into any other Wholly Owned
       Subsidiary of the Borrower that is not a Subsidiary Guarantor.

              7.5.  Limitation on Disposition of Property. Dispose of any of its
Property (including receivables and leasehold interests), whether now owned or
hereafter acquired, or, in the case of any Subsidiary, issue or sell any shares
of such Subsidiary's Capital Stock to any Person, except:

              (a)    the Disposition of obsolete or worn out property in the
       ordinary course of business;

              (b)    the sale of inventory in the ordinary course of business;


                                       78
   85

              (c)    Dispositions of Cash Equivalents and Dispositions permitted
       by Section 7.4;

              (d)    the sale or issuance of any Subsidiary's Capital Stock
       (other than Disqualified Stock) to the Borrower or any Subsidiary
       Guarantor;

              (e)    the Disposition by the Borrower or any of its Subsidiaries
       of other assets (except Rodriguez Bridge Loans) having a fair market
       value not to exceed $20,000,000 in the aggregate for any fiscal year of
       the Borrower; and

              (f)    any Recovery Event, if the requirements of Section 2.12(b)
       are complied with in connection therewith.

              7.6.  Limitation on Restricted Payments. Declare or pay any
dividend (other than dividends payable solely in common stock (excluding
Disqualified Stock) of the Person making such dividend) on, or make any payment
on account of, or set apart assets for a sinking or other analogous fund for,
the purchase, redemption, defeasance, retirement or other acquisition of, any
Capital Stock of the Borrower or any of its Subsidiaries, whether now or
hereafter outstanding, or make any other distribution in respect thereof, either
directly or indirectly, whether in cash or property or in obligations of the
Borrower or any of its Subsidiaries, or enter into any derivatives or other
transaction with any financial institution, commodities or stock exchange or
clearinghouse (a "Derivatives Counterparty") obligating the Borrower or any of
its Subsidiaries to make payments to such Derivatives Counterparty as a result
of any change in market value of any such Capital Stock (collectively,
"Restricted Payments"), except that:

              (a)    any Subsidiary of the Borrower may make Restricted Payments
       to its shareholders in accordance with their respective pro rata
       interests;

              (b)    the Borrower may pay dividends solely in kind, by
       distributing additional shares of the same Capital Stock; and

              (c)    so long as no Default shall have occurred and be
       continuing, the Borrower may purchase Capital Stock of the Borrower from
       present or former officers or employees of the Borrower or any of its
       Subsidiaries upon the death, disability or termination of employment of
       such officer or employee, provided, that the aggregate consideration paid
       for all such purchases in any fiscal year of the Borrower (net of amounts
       repaid in respect of loans contemplated in Section 7.8(d)(i) and any cash
       proceeds received subsequent to the date hereof from the issuance and
       sale of Management Equity in connection with the exercise of common stock
       options for Management Equity) shall not exceed $3,000,000.

              7.7.  Limitation on Capital Expenditures. Make or commit to make
any Capital Expenditure, except Capital Expenditures of the Borrower and its
Subsidiaries in the ordinary course of business not exceeding $10,000,000 per
fiscal year; provided, that (i) up to 50% of any such amount referred to above,
if not so expended in the fiscal year for which it is permitted, may be carried
over for expenditure in the next succeeding fiscal year; (ii) Capital
Expenditures made during any fiscal year shall be deemed made, first, in respect
of amounts permitted for such fiscal


                                       79
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year as provided above and second, in respect of amounts carried over from the
prior fiscal year pursuant to clause (i) above; (iii) in addition, the Borrower
and its Subsidiaries shall be permitted to expend up to $5,400,000 for the
acquisition of facilities in Puerto Rico; and (iv) in addition, the Borrower and
its Subsidiaries shall be permitted to make Capital Expenditures during the term
of this Agreement in an amount not exceeding (x) 50% of the Net Cash Proceeds of
any issuance and sale of Capital Stock (not constituting Disqualified Stock) by
the Borrower after the Closing Date, if such Net Cash Proceeds are used within
180 days from receipt thereof to pay for such Capital Expenditures, and (y) the
proceeds of any Reinvestment Deferred Amount.

              7.8.  Limitation on Investments. Make any advance, loan, extension
of credit (by way of guaranty or otherwise) or capital contribution to, or
purchase any Capital Stock, bonds, notes, debentures or other debt securities
of, or any assets constituting an ongoing business from, or make any other
investment in, any other Person (all of the foregoing, "Investments"), except:

              (a)    extensions of trade credit in the ordinary course of
       business and any conversion to equity upon default or in a bankruptcy of
       an obligor in respect thereof;

              (b)    Investments in cash and Cash Equivalents;

              (c)    Investments arising in connection with the incurrence of
       Indebtedness permitted by Section 7.2(b) and (e);

              (d)    (i) loans made by the Borrower to officers and employees of
       the Borrower or any Subsidiary of the Borrower the proceeds of which are
       utilized contemporaneously to purchase Management Equity from the
       Borrower and (ii) other loans and advances to employees of the Borrower
       or any Subsidiaries of the Borrower in the ordinary course of business
       (including for travel, entertainment and relocation expenses) in an
       aggregate amount for the Borrower and Subsidiaries of the Borrower not to
       exceed $250,000 at any one time outstanding;

              (e)    any Permitted Acquisition made through Wholly Owned
       Subsidiaries, including the acquisition, formation and capitalization of
       any new Wholly Owned Subsidiary of the Borrower to consummate a Permitted
       Acquisition, so long as the Borrower complies with Section 6.10(c) in
       respect thereof;

              (f)    Investments in Capital Stock of a Subsidiary Guarantor, so
       long as the Borrower complies with Section 6.10(c) in respect thereof;
       (g) Investments existing on the Closing Date and listed on Schedule
       7.8(g);

              (h)    any Investments in Capital Stock of any Subsidiary of the
       Borrower that is not a Subsidiary Guarantor or of any Person that is not
       a Subsidiary of the Borrower, so long as the aggregate Investments of the
       Borrower and the Subsidiary Guarantors (whether in the form of debt or
       equity and counted at cost (or if made in assets at the fair market value
       thereof when made, as determined in good faith by the Borrower's board of
       directors), net of returns of the principal thereof received in cash
       thereon) made at any


                                       80
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       time after the Closing Date in any and all Subsidiaries of the Borrower
       that are not Subsidiary Guarantors and in any and all Persons that are
       not Subsidiaries of the Borrower does not at any time exceed $35,000,000;

              (i)    Rodriguez Bridge Loans; and

              (j)    in addition to Investments otherwise expressly permitted by
       this Section, Investments by the Borrower or any of its Subsidiaries in
       an aggregate amount (valued at cost, net of returns of the principal
       thereof received in cash thereon) not exceeding $1,000,000.

              7.9.  Limitation on Subordinated Indebtedness.

              (a)    Make or offer to make any optional or voluntary payment,
prepayment, repurchase or redemption of, or otherwise voluntarily or optionally
defease, any Indebtedness that is subordinated in right of payment to the
Obligations, or segregate funds for any such payment, prepayment, repurchase,
redemption or defeasance, or enter into any derivative or other transaction with
any Derivatives Counterparty obligating the Borrower or any of its Subsidiaries
to make payments to such Derivatives Counterparty as a result of any change in
market value of any such Indebtedness;

              (b)    Make any payment or distribution in respect of any
Indebtedness that is subordinated in right of payment to the Obligations at any
time when such payment or distribution, or the acceptance thereof, is prohibited
or restricted under the subordination provisions governing such Subordinated
Indebtedness;

              (c)    Amend, modify or otherwise change, or consent or agree to
any amendment, modification, waiver or other change to, any of the terms
(including the subordination terms) of any of the Senior Subordinated Note
Indenture or any other agreement governing or relating to any Indebtedness that
is subordinated in right of payment to the Obligations, except any such
amendment, modification, waiver or other change which (i) would extend the
maturity or reduce the amount of any payment of principal thereof, reduce the
rate or extend the date for payment of interest thereon or relax any covenant or
other restriction applicable to the Borrower or any of its Subsidiaries and (ii)
does not involve the payment of a consent fee); or

              (d)    Designate any Indebtedness (other than the Obligations) as
"Designated Senior Debt" for the purposes of the Senior Subordinated Note
Indenture.

              7.10. Limitation on Transactions with Affiliates. Enter into any
transaction, including any purchase, sale, lease or exchange of Property, the
rendering of any service or the payment of any management, advisory or similar
fees, with any Affiliate (other than the Borrower, any Wholly Owned Subsidiary
of the Borrower, or any other Subsidiary of the Borrower so long as no Capital
Stock of such other Subsidiary is owned by any Person that controls the
Borrower) unless such transaction is (a) otherwise permitted under this
Agreement, (b) in the ordinary course of business of the Borrower or such
Subsidiary, as the case may be, and


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(c) upon fair and reasonable terms no less favorable to the Borrower or such
Subsidiary, as the case may be, than it could reasonably be expected to obtain
in a comparable arm's length transaction with a Person that is not an Affiliate.
Notwithstanding the foregoing, the following transactions shall not be
prohibited: (i) fees and compensation paid to, and indemnity provided on behalf
of, officers, directors or employees of the Borrower or any of its Subsidiaries,
to the extent the same are reasonable and customary; and (ii) transactions
pursuant to agreements or arrangements in effect on the Closing Date and listed
on Schedule 7.10.

              7.11. Limitation on Sales and Leasebacks. Enter into any
arrangement with any Person providing for the leasing by the Borrower or any of
its Subsidiaries of Property which has been or is to be sold or transferred by
the Borrower or such Subsidiary to such Person or to any other Person to whom
funds have been or are to be advanced by such Person on the security of such
Property or rental obligations of the Borrower or such Subsidiary.

              7.12. Limitation on Changes in Fiscal Periods. Permit the fiscal
year of the Borrower or any of its Subsidiaries to end on a day other than the
last Sunday in September or change the Borrower's or any of its Subsidiaries'
method of determining fiscal quarters.

              7.13. Limitation on Negative Pledge Clauses. Enter into or suffer
to exist or become effective any agreement that prohibits or limits the ability
of the Borrower or any of its Subsidiaries to create, incur, assume or suffer to
exist any Lien upon any of its Property or revenues, whether now owned or
hereafter acquired, to secure the Obligations or, in the case of any guarantor,
its obligations under the Guarantee and Collateral Agreement, other than (a)
this Agreement and the other Loan Documents, (b) agreements in effect on the
date hereof and listed on Schedule 7.13, (c) any Lease, any intellectual
property license agreement under which the Borrower or a Subsidiary of the
Borrower is the licensee, and any other agreement under which the Borrower or a
Subsidiary of the Borrower is entitled to the performance of any obligation
other than the payment of money, if any such prohibition or limitation is
limited to the interest of the Borrower or such Subsidiary thereunder and in the
reasonable judgment of the Borrower, the acceptance of such prohibition or
limitation was necessary to achieve a business purpose of the Borrower or such
Subsidiary, and (d) any restriction under any agreement governing Indebtedness
permitted under Section 7.2(c), if such restriction is enforceable only by the
holder of such Indebtedness and applies only to the assets securing such
Indebtedness.

              7.14. Limitation on Restrictions on Subsidiary Distributions, etc.
Enter into or suffer to exist or become effective any consensual encumbrance or
restriction on the ability of the Borrower or any of its Subsidiaries (or, in
the case of clause (a) only, any Subsidiary of the Borrower) to (a) make
Restricted Payments in respect of any Capital Stock of such Subsidiary held by,
or pay or subordinate any Indebtedness owed to, the Borrower or any other
Subsidiary, (b) make Investments in the Borrower or any other Subsidiary or (c)
transfer any of its assets to the Borrower or any other Subsidiary, except for
such encumbrances or restrictions existing under or by reason of (i) any
restrictions existing under the Loan Documents, (ii) any restrictions with
respect to a Subsidiary imposed pursuant to an agreement that has been entered
into in connection with the Disposition of all or substantially all of the
Capital Stock or assets of such Subsidiary, (iii) customary provisions
restricting subletting or assignment of any lease, license or


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other contract entered into in the ordinary course of business, (iv)
restrictions on the transfer or disposition of any asset subject to a Lien
otherwise permitted under this Agreement, if such restriction is enforceable
only by the holder of such Lien and only against such assets and (v)
restrictions imposed by any joint venture or similar agreement entered into with
respect to Investments otherwise permitted under this Agreement.

              7.15. Limitation on Lines of Business. Enter into any business,
either directly or through any Subsidiary, except for Permitted Businesses.

              7.16. Broadcast License Subsidiaries. In the case of each
Broadcast License Subsidiary, (a) engage in any business or activity other than
holding FCC Licenses and rights related thereto, (b) incur, assume or otherwise
become or remain obligated in respect of any liability except trade payables
incurred in the ordinary course of business and tax liabilities incidental to
ownership of such rights, (c) grant or become subject to any Lien except Liens
securing Obligations or (d) take any Material Action.

              7.17. Amendment of Certain Documents.

              (a)    Amend or permit the amendment of its Governing Documents in
any manner materially adverse to the Lenders.

              (b)    Terminate, cancel, amend, modify, supplement or otherwise
change the Rodriguez Bridge Loan Agreement or grant any moratorium, indulgence,
suspension or waiver in respect of any "Default" or "Event of Default," as
defined therein, or in respect of the availability, exercise or enforcement of
any right or remedy thereunder.

              (c)    Amend, modify, supplement or otherwise change the Rodriguez
Purchase Agreements or (after they have been provided to the Administrative
Agent and Lenders pursuant to clause (d)(i) in the definition of "Permitted
Acquisition" and the 10 Business Day period described in clause (d)(ii) of such
definition has expired) the Acquisition Documentation for the Pipeline
Acquisition, except upon written notice to and the consent of the Administrative
Agent (which consent shall not unreasonably be withheld).

                          SECTION 8. EVENTS OF DEFAULT

              If any of the following events shall occur and be continuing:

              (a)    The Borrower shall fail to pay any principal of any Loan or
       Reimbursement Obligation when due in accordance with the terms hereof; or
       the Borrower shall fail to pay any interest on any Loan or Reimbursement
       Obligation, or any other amount payable hereunder or under any other Loan
       Document, within five days after any such interest or other amount
       becomes due in accordance with the terms hereof; or

              (b)    Any representation or warranty made or deemed made by any
       Loan Party herein or in any other Loan Document or that is contained in
       any certificate, document or


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       financial or other statement furnished by it at any time under or in
       connection with this Agreement or any such other Loan Document shall
       prove to have been inaccurate in any material respect on or as of the
       date made or deemed made; or

              (c)    Any Loan Party shall default in the observance or
       performance of any agreement contained in (i) Section 7, (ii) clause (i)
       or (ii) of Section 6.4(a) (with respect to the Borrower only), or (iii)
       Section 5 of the Guarantee and Collateral Agreement; or

              (d)    Any Loan Party shall default in the observance or
       performance of any other covenant or agreement contained in this
       Agreement or any other Loan Document (other than as provided in
       paragraphs (a) through (c) of this Section), and such default shall
       continue unremedied for a period of 30 days; or

              (e)    The Borrower or any of its Subsidiaries shall (i) default
       in making any payment of any principal of any Indebtedness (including any
       Guarantee Obligation, but excluding the Loans) on the due date with
       respect thereto; or (ii) default in making any payment of any interest on
       any such Indebtedness beyond the period of grace, if any, provided in the
       instrument or agreement under which such Indebtedness was created; or
       (iii) default in the observance or performance of any other agreement or
       condition relating to any such Indebtedness or contained in any
       instrument or agreement evidencing, securing or relating thereto, or any
       other event shall occur or condition exist, the effect of which default
       or other event or condition is to cause, or to permit the holder or
       beneficiary of such Indebtedness (or a trustee or agent on behalf of such
       holder or beneficiary) to cause, with the giving of notice if required,
       such Indebtedness to become due prior to its stated maturity or (in the
       case of any such Indebtedness constituting a Guarantee Obligation) to
       become payable; provided, that a default, event or condition described in
       clause (i), (ii) or (iii) of this paragraph (e) shall not at any time
       constitute an Event of Default unless, at such time, one or more
       defaults, events or conditions of the type described in clauses (i), (ii)
       and (iii) of this paragraph (e) shall have occurred and be continuing
       with respect to Indebtedness the outstanding principal amount of which
       exceeds in the aggregate $5,000,000; or

              (f)    (i) The Borrower or any of its Subsidiaries shall commence
       any case, proceeding or other action (A) under any existing or future law
       of any jurisdiction, domestic or foreign, relating to bankruptcy,
       insolvency, reorganization or relief of debtors, seeking to have an order
       for relief entered with respect to it, or seeking to adjudicate it a
       bankrupt or insolvent, or seeking reorganization, arrangement,
       adjustment, winding-up, liquidation, dissolution, composition or other
       relief with respect to it or its debts, or (B) seeking appointment of a
       receiver, trustee, custodian, conservator or other similar official for
       it or for all or any substantial part of its assets, or the Borrower or
       any of its Subsidiaries shall make a general assignment for the benefit
       of its creditors; or (ii) there shall be commenced against the Borrower
       or any of its Subsidiaries any case, proceeding or other action of a
       nature referred to in clause (i) above that (A) results in the entry of
       an order for relief or any such adjudication or appointment or (B)
       remains undismissed, undischarged or unbonded for a period of 60 days; or
       (iii) there shall be


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       commenced against the Borrower or any of its Subsidiaries any case,
       proceeding or other action seeking issuance of a warrant of attachment,
       execution, distraint or similar process against all or any substantial
       part of its assets that results in the entry of an order for any such
       relief that shall not have been vacated, discharged, or stayed or bonded
       pending appeal within 60 days from the entry thereof; or (iv) the
       Borrower or any of its Subsidiaries shall take any action in furtherance
       of, or indicating its consent to, approval of, or acquiescence in, any of
       the acts set forth in clause (i), (ii), or (iii) above; or (v) the
       Borrower or any of its Subsidiaries shall generally not, or shall be
       unable to, or shall admit in writing its inability to, pay its debts as
       they become due; or

              (g)    (i) Any Person shall engage in any "prohibited transaction"
       (as defined in Section 406 of ERISA or Section 4975 of the Code)
       involving any Plan, (ii) any "accumulated funding deficiency" (as defined
       in Section 302 of ERISA), whether or not waived, shall exist with respect
       to any Plan or any Lien in favor of the PBGC or a Plan shall arise on the
       assets of the Borrower or any Commonly Controlled Entity, (iii) a
       Reportable Event shall occur with respect to, or proceedings shall
       commence to have a trustee appointed, or a trustee shall be appointed, to
       administer or to terminate, any Single Employer Plan, which Reportable
       Event or commencement of proceedings or appointment of a trustee is, in
       the reasonable opinion of the Required Lenders, likely to result in the
       termination of such Plan for purposes of Title IV of ERISA, (iv) any
       Single Employer Plan shall terminate for purposes of Title IV of ERISA,
       (v) the Borrower or any Commonly Controlled Entity shall, or in the
       reasonable opinion of the Required Lenders is likely to, incur any
       liability in connection with a withdrawal from, or the Insolvency or
       Reorganization of, a Multiemployer Plan, (vi) the Borrower, any of its
       Subsidiaries or any Commonly Controlled Entity shall be required to make
       during any fiscal year of the Borrower payments pursuant to any employee
       welfare benefit plan (as defined in Section 3(1) of ERISA) that provides
       benefits to retired employees (or their dependents) that, in the
       aggregate, exceed $1,000,000, (vii) the Borrower, any of its Subsidiaries
       or any Commonly Controlled Entity shall be required to make during any
       fiscal year of the Borrower contributions to any defined benefit pension
       plan subject to Title IV of ERISA (including any Multiemployer Plan)
       that, in the aggregate, exceed $1,600,000 or (viii) any other similar
       event or condition shall occur or exist with respect to a Plan; and in
       each case in clauses (i) through (viii) above, such event or condition,
       together with all other such events or conditions, if any, could, in the
       sole judgment of the Required Lenders, reasonably be expected to have a
       Material Adverse Effect; or

              (h)    One or more judgments or decrees shall be entered against
       the Borrower or any of its Subsidiaries involving for the Borrower and
       its Subsidiaries taken as a whole a liability (not paid or covered by
       insurance in the reasonable opinion of the Borrower if the Borrower
       provides evidence of such coverage to the Administrative Agent) of
       $5,000,000 or more, and all such judgments or decrees shall not have been
       vacated, discharged, stayed or bonded pending appeal within 30 days from
       the entry thereof; or

              (i)    Any of the Security Documents shall cease, for any reason
       (other than pursuant to the terms thereof), to be in full force and
       effect, or any Loan Party or any


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       Affiliate of any Loan Party shall so assert, or any Lien created by any
       of the Security Documents shall cease to be enforceable and of the same
       effect and priority purported to be created thereby; or

              (j)    The guarantee contained in Section 2 of the Guarantee and
       Collateral Agreement shall cease, for any reason (other than pursuant to
       the terms thereof), to be in full force and effect or any Loan Party or
       any Affiliate of any Loan Party shall so assert; or

              (k)    Any Loan Party or any Affiliate of any Loan Party shall
       assert in writing that any provision of any Loan Document is not
       enforceable; or

              (l)    (i) The Permitted Investors shall cease to have the power
       to vote or direct the voting of securities having a majority of the
       ordinary voting power for the election of directors of the Borrower
       (determined on a fully diluted basis); (ii) any "person" or "group" (as
       such terms are used in Sections 13(d) and 14(d) of the Securities
       Exchange Act of 1934, as amended (the "Exchange Act")), excluding the
       Permitted Investors, shall become, or obtain rights (whether by means or
       warrants, options or otherwise) to become, the "beneficial owner" (as
       defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or
       indirectly, of more than 35% of the outstanding common stock of the
       Borrower; (iii) the board of directors of the Borrower shall cease to
       consist of a majority of Continuing Directors; or (iv) a Specified Change
       of Control shall occur; or

              (m)    Any FCC License necessary for the conduct of any business
       or activity at any time conducted by the Borrower or any of its
       Subsidiaries shall be revoked, annulled, cancelled or the FCC takes any
       action with respect to any FCC License, the effect of which would
       reasonably be expected to result in, individually or in the aggregate, a
       Material Adverse Effect;

then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to any Loan Party,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents (including all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
Credit shall have presented the documents required thereunder) shall immediately
become due and payable, and (B) if such event is any other Event of Default,
either or both of the following actions may be taken: (i) upon the request of
the Required Lenders, the Administrative Agent shall, by notice to the Borrower
declare the Commitments to be terminated forthwith, whereupon the Commitments
shall immediately terminate; and (ii) with the consent of the Required Lenders,
the Administrative Agent may, or upon the request of the Required Lenders, the
Administrative Agent shall, by notice to the Borrower, declare the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents (including all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
Credit shall have presented the documents required thereunder) to be due and
payable forthwith, whereupon the same shall immediately become due and payable.
Upon


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the occurrence and during the continuation of an Event of Default, the
Administrative Agent and the Lenders shall be entitled to exercise any and all
remedies available under the Security Documents, including the Guarantee and
Collateral Agreement, or otherwise available under applicable law or otherwise.
With respect to all Letters of Credit with respect to which presentment for
honor shall not have occurred at the time of an acceleration pursuant to this
paragraph, the Borrower shall at such time deposit in a cash collateral account
opened by the Administrative Agent an amount in immediately available funds
equal to the aggregate then undrawn and unexpired amount of such Letters of
Credit (and the Borrower hereby grants to the Administrative Agent, for the
ratable benefit of the Secured Parties, a continuing security interest in all
amounts at any time on deposit in such cash collateral account to secure the
undrawn and unexpired amount of such Letters of Credit and all other
Obligations). If at any time the Administrative Agent determines that any funds
held in such cash collateral account are subject to any right or claim of any
Person other than the Administrative Agent and the Secured Parties or that the
total amount of such funds is less than the aggregate undrawn and unexpired
amount of outstanding Letters of Credit, the Borrower shall, forthwith upon
demand by the Administrative Agent, pay to the Administrative Agent, as
additional funds to be deposited and held in such cash collateral account, an
amount equal to the excess of (a) such aggregate undrawn and unexpired amount
over (b) the total amount of funds, if any, then held in such cash collateral
account that the Administrative Agent determines to be free and clear of any
such right and claim. Amounts held in such cash collateral account shall be
applied by the Administrative Agent to the payment of drafts drawn under such
Letters of Credit, and the unused portion thereof after all such Letters of
Credit shall have expired or been fully drawn upon, if any, shall be applied to
repay other obligations of the Loan Parties hereunder and under the other Loan
Documents. After all such Letters of Credit shall have expired or been fully
drawn upon, all Reimbursement Obligations shall have been satisfied and all
other obligations of the Loan Parties hereunder and under the other Loan
Documents shall have been paid in full, the balance, if any, in such cash
collateral account shall be returned to the Loan Parties (or such other Person
as may be lawfully entitled thereto).

                       SECTION 9. THE AGENTS and ARRANGER

              9.1.   Appointment. Each Lender hereby irrevocably designates and
appoints Lehman Commercial Paper Inc. as the Administrative Agent under this
Agreement and the other Loan Documents, and each Lender irrevocably authorizes
the Administrative Agent, in such capacity, to take such action on its behalf
under the provisions of this Agreement and the other Loan Documents and to
exercise such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, no
Agent shall have any duties or responsibilities, except those expressly set
forth herein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Loan Document or otherwise exist
against any Agent.


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              9.2.  Delegation of Duties. The Administrative Agent may execute
any of its duties under this Agreement and the other Loan Documents by or
through agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.

              9.3.  Exculpatory Provisions. Neither the Arranger, nor any Agent
nor any of their respective Related Persons shall be (i) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement or any other Loan Document (except for any
liability imposed by law, but then only if and to the extent found by a final
and nonappealable decision of a court of competent jurisdiction to have resulted
solely from its or any of its Related Persons' personal gross negligence or
willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by any Loan Party
or any officer thereof contained in this Agreement or any other Loan Document or
in any certificate, report, statement or other document referred to or provided
for in, or received by the Arranger or the Agents under or in connection with,
this Agreement or any other Loan Document or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document or for any failure of any Loan Party party thereto to
perform its obligations hereunder or thereunder or for the creation, validity,
legality, enforceability, perfection, priority, maintenance or enforcement of
any guaranty or Lien required or purporting to be created under any of the Loan
Documents or any other collateral security for the Obligations. As against any
Secured Party, any matter required herein to be satisfactory to, found
acceptable by or otherwise approved by the Administrative Agent may be approved
or disapproved by it in its sole discretion, acting as it may see fit given any
interest that it or its Affiliates may have and without any duty whatsoever to
any other Lender. The Agents shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party.

              9.4.  Reliance by Agents. Each Agent shall be entitled to rely,
and shall be fully protected in relying, upon any instrument, writing,
resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or
teletype message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including
counsel the Loan Parties), independent accountants and other experts selected by
such Agent. The Agents may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. Each Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless it shall first receive such advice
or concurrence of the Required Lenders or the requisite Lenders required under
Section 10.1 to authorize or require such action (or, if so specified by this
Agreement, all Lenders) as it deems appropriate or it shall first be indemnified
to its satisfaction by the Lenders against any and all liability and expense
that may be incurred by it by reason of taking or continuing to take any such
action. Each Agent shall in all cases be fully protected in acting, or in
refraining from acting,


                                       88
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under this Agreement and the other Loan Documents in accordance with a request
of the Required Lenders or the requisite Lenders under Section 10.1 to authorize
or require such action (or, if so specified by this Agreement, all Lenders), and
such request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders and all future holders of the Obligations.

              9.5.  Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default hereunder
unless it has received written notice from a Lender or the Borrower referring to
this Agreement, describing such Default and stating that such notice is a
"notice of default". In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default as
shall be reasonably directed by the Required Lenders (or, if so specified by
this Agreement, all Lenders), except that (a) the Administrative Agent shall not
be required to take any such action that it in good faith determines may be
unlawful or that it in good faith believes may be imprudent or may expose it to
liability, (b) the Administrative Agent shall not be required to take any such
action unless it receives indemnity satisfactory to it from the Persons
directing such action, and (c) unless and until the Administrative Agent shall
have received such direction, the Administrative Agent may decline to act or may
(but shall not be obligated to) take any action that it deems advisable.

              9.6.  Non-Reliance on Agents and Other Lenders. Each Lender
expressly acknowledges that neither the Arranger nor any of the Agents nor any
of their respective officers, directors, employees, agents, attorneys and other
advisors, partners, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by the Arranger or any Agent
hereinafter taken, including any review of the affairs of a Loan Party or any
affiliate of a Loan Party, shall be deemed to constitute any representation or
warranty by the Arranger or any Agent to any Lender. Each Lender represents to
the Arranger and the Agents that it has, independently and without reliance upon
the Arranger or any Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition, prospects and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans (and in the case of the
Issuing Lender, its Letters of Credit) hereunder and enter into this Agreement.
Each Lender also represents that it will, independently and without reliance
upon the Arranger or any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition, prospects and
creditworthiness of the Loan Parties and their affiliates. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent hereunder, neither the Arranger nor any Agent shall
have any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of any Loan Party or any affiliate
of a Loan Party that may come into the possession of the Arranger or such Agent
or any of its officers, directors, employees, agents, attorneys and other
advisors, partners, attorneys-in-fact or affiliates.


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              9.7.  Indemnification. The Lenders agree to indemnify the Arranger
and each Agent in its capacity as such (to the extent not reimbursed by the
Borrower and without limiting the obligation of the Borrower to do so), ratably
according to their respective Aggregate Exposure Percentages in effect on the
date on which indemnification is sought under this Section (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with such Aggregate Exposure Percentages immediately prior to such date), from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever that may at any time (including at any time following the payment of
the Loans) be imposed on, incurred by or asserted against the Arranger or such
Agent in any way relating to or arising out of, the Commitments, this Agreement,
any of the other Loan Documents, any Acquisition Documentation or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Arranger or
such Agent under or in connection with any of the foregoing; provided that no
Lender shall be liable for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements that are found by a final and nonappealable decision
of a court of competent jurisdiction to have resulted solely from the Arranger's
or such Agent's gross negligence or willful misconduct. The agreements in this
Section 9.7 shall survive the payment of the Loans and Letters of Credit and all
other amounts payable hereunder.

              9.8.  Arranger and Agents in Their Individual Capacities. The
Arranger and each Agent and their respective affiliates may make loans to,
accept deposits from and generally engage in any kind of business with any Loan
Party as though the Arranger was not the Arranger and such Agent was not an
Agent. With respect to its Loans made or renewed by it and with respect to any
Letter of Credit issued or participated in by it, the Arranger and each Agent
shall have the same rights and powers under this Agreement and the other Loan
Documents as any Lender and may exercise the same as though it were not the
Arranger or an Agent, as the case may be, and the terms "Lender" and "Lenders"
shall include the Arranger and each Agent in their respective individual
capacities.

              9.9.  Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Required Lenders shall
appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 8(a) or Section
8(f) with respect to the Borrower shall have occurred and be continuing) be
subject to approval by the Borrower (which approval shall not be unreasonably
withheld or delayed), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans or Letters of Credit.
If no successor agent has accepted appointment as Administrative Agent by the
date that is 10 days following a retiring Administrative Agent's


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notice of resignation, the retiring Administrative Agent's resignation shall
nevertheless thereupon become effective, and the Lenders shall assume and
perform all of the duties of the Administrative Agent hereunder until such time,
if any, as the Required Lenders appoint a successor agent as provided for above.
After any retiring Administrative Agent's resignation as such, the provisions of
this Section 9 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under this Agreement and the
other Loan Documents.

              9.10. Authorization to Release Liens. The Administrative Agent is
hereby irrevocably authorized by each of the Lenders to release any Lien
covering any Property of the Borrower or any of its Subsidiaries that is the
subject of a Disposition which the Administrative Agent in good faith believes
to be permitted by this Agreement or to have been consented to in accordance
with Section 10.1 or to be owned by any Subsidiary of the Borrower the Capital
Stock of which was transferred, in any such Disposition, to a Person who is not
an Affiliate of the Borrower.

              9.11. The Arranger, Syndication Agent and Documentation Agent. The
parties acknowledge and agree that Lehman Brothers Inc. (in such capacity, the
"Arranger") shall be credited as and may publicize that it is the sole lead
arranger and book-running manager of the financing contemplated hereby, any
Lender or Affiliate of a Lender that is appointed Syndication Agent (in such
capacity, the "Syndication Agent") by the Arranger shall be credited as and may
publicize that it is the syndication agent of such financing, and any Lender or
Affiliate of a Lender that is appointed Documentation Agent (in such capacity,
the "Documentation Agent") by the Arranger shall be credited as and may
publicize that it is the documentation agent of such financing. The Arranger,
Syndication Agent and Documentation Agent (a) shall not, by reason of their
designation as such or the provisions of this Section 9 or any action taken or
omitted in such capacity, have any power, duty, responsibility or liability
whatsoever under this Agreement or any other Loan Document or in respect of the
financing contemplated hereby and (b) shall nevertheless be entitled to all of
the rights, immunities, indemnities and benefits granted to them herein.

                           SECTION 10. MISCELLANEOUS

              10.1. Amendments and Waivers. Neither this Agreement nor any other
Loan Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 10.1. The
Required Lenders and each Loan Party party to the relevant Loan Document may, or
(with the written consent of the Required Lenders) the Administrative Agent and
each Loan Party party to the relevant Loan Document may, from time to time, (a)
enter into written amendments, supplements or modifications hereto and to the
other Loan Documents (including amendments and restatements hereof or thereof)
for the purpose of adding any provisions to this Agreement or the other Loan
Documents or changing in any manner the rights of the Lenders or of the Loan
Parties hereunder or thereunder or (b) waive, on such terms and conditions as
may be specified in the instrument of waiver, any of the requirements of this
Agreement or the other Loan Documents or any Default and its consequences;
provided, however, that no such waiver and no such amendment, supplement or


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modification shall (i) forgive the principal amount or extend the final
scheduled date of maturity of any Loan or Reimbursement Obligation, extend the
scheduled date of any amortization payment in respect of any Term Loan, reduce
the stated rate of any interest or fee payable hereunder or extend the scheduled
date of any payment thereof, or increase the amount or extend the expiration
date of any Commitment of any Lender, in each case without the consent of each
Lender directly affected thereby; (ii) amend, modify or waive any provision of
this Section or reduce any percentage specified in the definition of "Required
Lenders", consent to the assignment or transfer by any Loan Party of any of its
rights and obligations under this Agreement and the other Loan Documents,
release all or substantially all of the Collateral or release all or
substantially all of the Subsidiary Guarantors from their guarantee obligations
under the Guarantee and Collateral Agreement, in each case without the consent
of all Lenders; (iii) reduce the percentage specified in the definition of
"Majority Facility Lenders" with respect to any Facility without the written
consent of all Lenders under such Facility; (iv) amend, modify or waive any
provision of Section 9 without the consent of the Arranger or any Agent directly
affected thereby; (v) amend, modify or waive any provision of Section 2.6 or 2.7
without the written consent of the Swing Line Lender; (vi) amend, modify or
waive any provision of Section 2.18 without the consent of each Lender directly
affected thereby; or (vii) amend, modify or waive any provision of Section 3
without the consent of the Issuing Lender. Any such waiver and any such
amendment, supplement or modification shall apply equally to each of the Lenders
and shall be binding upon the Loan Parties, the Lenders, the Agents, the
Arranger and all existing and future holders of the Obligations. In the case of
any waiver, the Loan Parties, the Lenders, the Arranger and the Agents shall be
restored to their former position and rights hereunder and under the other Loan
Documents, and any Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default,
or impair any right consequent thereon. Any such waiver, amendment, supplement
or modification shall be effected by a written instrument signed by the parties
required to sign pursuant to the foregoing provisions of this Section; provided,
that delivery of an executed signature page of any such instrument by facsimile
transmission shall be effective as delivery of a manually executed counterpart
thereof. For the avoidance of doubt, this Agreement may be amended (or amended
and restated) with the written consent of the Required Lenders, the Arranger,
the Agents and the Borrower (x) to add one or more additional credit facilities
to this Agreement and to permit the extensions of credit from time to time
outstanding thereunder and the accrued interest and fees in respect thereof
(collectively, the "Additional Extensions of Credit") to share ratably in the
benefits of this Agreement and the other Loan Documents with the Term Loans and
Revolving Extensions of Credit and the accrued interest and fees in respect
thereof and (y) to include appropriately the Lenders holding such credit
facilities in any determination of the Required Lenders, Required Prepayment
Lenders and Majority Revolving Facility Lenders; provided, however, that no such
amendment shall permit the Additional Extensions of Credit to share ratably with
or with preference to the Term Loans in the application of mandatory prepayments
without the consent of the Required Prepayment Lenders or otherwise to share
ratably with or with preference to the Revolving Extensions of Credit without
the consent of the Majority Revolving Facility Lenders.

              10.2. Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise


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expressly provided herein, shall be deemed to have been duly given or made when
delivered, or three Business Days after being deposited in the mail, postage
prepaid, or, in the case of telecopy notice, when received, addressed (a) in the
case of the Borrower, the Arranger and the Agents, as follows and (b) in the
case of the Lenders, as set forth on Schedule 1 to the Lender Addendum to which
such Lender is a party or, in the case of a Lender which becomes a party to this
Agreement pursuant to an Assignment and Acceptance, in such Assignment and
Acceptance or (c) in the case of any party, to such other address as such party
may hereafter notify to the other parties hereto:

              The Borrower:                    Spanish Broadcasting System, Inc.
                                               3191 Coral Way
                                               Miami, Florida 33145
                                               Attention:  Joseph A. Garcia
                                               Telecopy:  305-447-0891
                                               Telephone:  305-476-2900

              with a copy to:                  Kaye, Scholer, Fierman, Hays &
                                               Handler LLP
                                               The McPherson Building
                                               901 15th Street NW, Ste. 1100
                                               Washington, DC 20005
                                               Attention: Jason L. Shrinsky
                                               Telecopy: 202-682-3580
                                               Telephone: 202-682-3506

              Lehman Commercial Paper Inc.:    Lehman Commercial Paper Inc.
                                               3 World Financial Center
                                               New York, New York 10285
                                               Attention:  Andrew Keith
                                               Telecopy:  (212) 526-7691
                                               Telephone:  (212) 526-4059

              with a copy to:                  Latham & Watkins
                                               885 Third Avenue, Suite 1000
                                               New York, New York  10386
                                               Attention:  Christopher R. Plaut
                                               Telecopy: (212) 751-4864
                                               Telephone: (212) 906-1200

              The Arranger:                    Lehman Brothers Inc.
                                               3 World Financial Center
                                               New York, New York 10285
                                               Attention:  Andrew Keith
                                               Telecopy:  (212) 526-7691
                                               Telephone:  (212) 526-4059


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              with a copy to:                  Latham & Watkins
                                               885 Third Avenue, Suite 1000
                                               New York, New York  10386
                                               Attention:  Christopher R. Plaut
                                               Telecopy: (212) 751-4864
                                               Telephone: (212) 906-1200

              Issuing Lender:                  As notified by the Issuing Lender
                                               to the Administrative Agent and
                                               the Borrower

provided that any notice, request or demand to or upon any Agent or any Lender
shall not be effective until received.

              10.3. No Waiver; Cumulative Remedies. No failure to exercise and
no delay in exercising, on the part of the Arranger, any Agent or any Lender,
any right, remedy, power or privilege hereunder or under the other Loan
Documents shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.

              10.4. Survival of Representations and Warranties. All
representations and warranties made hereunder, in the other Loan Documents and
in any document, certificate or statement delivered pursuant hereto or in
connection herewith shall survive the execution and delivery of this Agreement
and the making of the Loans and other extensions of credit hereunder.

              10.5. Payment of Expenses. The Borrower agrees (a) to pay or
reimburse the Arranger and the Agents on demand for all out-of-pocket expenses,
including the reasonable fees, disbursements and other charges of counsel,
incurred in connection with the Facilities and the development, preparation and
execution of, and any amendment, supplement or modification to, this Agreement
and the other Loan Documents and any other documents prepared in connection
herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, subject to the limitation set
forth in the proviso in paragraph 1(f) of the Fee Letter, (b) to pay or
reimburse each Lender, the Arranger and each Agent for all its costs and
expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the other Loan Documents and any such other
documents, including the fees and disbursements of counsel (including the
allocated fees and disbursements and other charges of in-house counsel) to each
Lender and of counsel to the Arranger and each Agent, (c) to pay, indemnify, and
hold each Lender, the Arranger and the Agents harmless from, any and all
recording and filing fees and any and all liabilities with respect to, or
resulting from any delay in paying, stamp, excise and other similar taxes, if
any, which may be payable or determined to be payable in connection with the
execution and delivery of, or consummation or administration of any of the
transactions contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, this Agreement, the other Loan




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Documents and any such other documents, and (d) to pay, indemnify, and hold each
Lender, the Arranger and each Agent, and each of their respective Related
Persons (each of the Lenders, Arranger and Agents and their Related Persons, an
"Indemnitee") harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement, the other Loan Documents and any such other documents, including any
of the foregoing relating to the use of proceeds of the Loans or Letters of
Credit or the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of any Loan Party or any of the
Properties and the fees and disbursements and other charges of legal counsel in
connection with claims, actions or proceedings by any Indemnitee against the
Borrower hereunder (all the foregoing in this clause (d), collectively, the
"Indemnified Liabilities"), provided, that the Borrower shall have no obligation
hereunder to any Indemnitee with respect to Indemnified Liabilities to the
extent such Indemnified Liabilities are found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted solely from the
gross negligence or willful misconduct of such Indemnitee. Without limiting the
foregoing, and to the extent permitted by applicable law, the Borrower agrees
not to assert and to cause its Subsidiaries not to assert, and hereby waives and
agrees to cause its Subsidiaries so to waive, all rights for contribution or any
other rights of recovery with respect to all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or
nature, under or related to Environmental Laws, that any of them might have by
statute or otherwise against any Indemnitee. All amounts due under this Section
shall be payable not later than five days after written demand therefor.
Statements payable by the Borrower pursuant to this Section shall be submitted
to the Borrower in accordance with Section 10.2, or to such other Person or
address as may be hereafter designated by the Borrower in a written notice to
the Administrative Agent. The agreements in this Section shall survive repayment
of the Loans and Letters of Credit and all other amounts payable hereunder.

              10.6. Successors and Assigns; Participations and Assignments.

              (a)    This Agreement shall be binding upon and inure to the
benefit of the Borrower, the Lenders, the Arranger, the Agents, all other
holders of the Obligations and their respective successors and assigns, except
that the Borrower may not assign or transfer any of its rights or obligations
under this Agreement without the prior written consent of the Arranger, the
Agents and each Lender.

              (b)    Any Lender may, without the consent of the Borrower or any
other Person, in accordance with applicable law, at any time sell to one or more
banks, financial institutions or other entities (each, a "Participant")
participating interests in any Loan owing to such Lender, any Commitment of such
Lender or any other interest of such Lender hereunder and under the other Loan
Documents. In the event of any such sale by a Lender of a participating interest
to a Participant, such Lender's obligations under this Agreement to the other
parties to this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain the
holder of any such Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrower and the Administrative Agent


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shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement and the other Loan
Documents. In no event shall any Participant under any such participation have
any right to approve any amendment or waiver of any provision of any Loan
Document, or any consent to any departure by any Loan Party therefrom, except to
the extent that such amendment, waiver or consent would reduce the principal of,
or interest on, the Loans or any fees payable hereunder, or postpone the date of
the final maturity of the Loans, in each case to the extent subject to such
participation. The Borrower agrees that if amounts outstanding under this
Agreement and the Loans are due or unpaid, or shall have been declared or shall
have become due and payable upon the occurrence of an Event of Default, each
Participant shall, to the maximum extent permitted by applicable law, be deemed
to have the right of setoff in respect of its participating interest in amounts
owing under this Agreement to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under this
Agreement, provided that, in purchasing such participating interest, such
Participant shall be deemed to have agreed to share with the Lenders the
proceeds thereof as provided in Section 10.7(a) as fully as if it were a Lender
hereunder. The Borrower also agrees that each Participant shall be entitled to
the benefits of Sections 2.19, 2.20 and 2.21 with respect to its participation
in the Commitments and the Loans outstanding from time to time as if it was a
Lender; provided that, in the case of Section 2.20, such Participant shall have
complied with the requirements of said Section and provided, further, that no
Participant shall be entitled to receive any greater amount pursuant to any such
Section than the transferor Lender would have been entitled to receive in
respect of the amount of the participation transferred by such transferor Lender
to such Participant had no such transfer occurred.

              (c)    Any Lender (an "Assignor") may, in accordance with
applicable law, upon written notice to the Administrative Agent, at any time and
from time to time assign to any Lender or any affiliate or Control Investment
Affiliate thereof or, with the consent of the Borrower and the Administrative
Agent and, in the case of any assignment of Revolving Credit Commitments, the
written consent of the Issuing Lender and the Swing Line Lender (which, in each
case, shall not be unreasonably withheld or delayed) (provided (x) that no such
consent need be obtained by a Lehman Entity for a period of 60 days following
the Closing Date, (y) the consent of the Borrower need not be obtained with
respect to any assignment of Term Loans to any Person other than a Person that
is, or is an Affiliate of a Person that is, engaged in a Permitted Business, and
(z) in any event the consent of the Borrower need not be obtained with respect
to any assignment at any time when a Default is continuing), to an additional
bank, financial institution or other entity (an "Assignee") all or any part of
its rights and obligations under this Agreement pursuant to an Assignment and
Acceptance, substantially in the form of Exhibit J, executed by such Assignee
and such Assignor (and, where the consent of the Borrower, the Administrative
Agent or the Issuing Lender or the Swing Line Lender is required pursuant to the
foregoing provisions, by the Borrower and such other Persons) and delivered to
the Administrative Agent for its acceptance and recording in the Register;
provided that no such assignment to an Assignee (other than any Lender or any
affiliate thereof) shall be in an aggregate principal amount of less than
$5,000,000 (other than in the case of an assignment of all of a Lender's
interests under this Agreement), unless otherwise agreed by the Borrower and the
Administrative Agent. Any such assignment need not be ratable as among the
Facilities. Upon such execution, delivery, acceptance and recording, from and
after the effective date determined


                                       96
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pursuant to such Assignment and Acceptance, (x) the Assignee thereunder shall be
a party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder with a Commitment and/or
Loans as set forth therein, and (y) the Assignor thereunder shall, to the extent
provided in such Assignment and Acceptance, be released from its obligations
under this Agreement (and, in the case of an Assignment and Acceptance covering
all of an Assignor's rights and obligations under this Agreement, such Assignor
shall cease to be party hereto as a Lender).

              (d)    The Administrative Agent shall, on behalf of the Borrower,
maintain at its address referred to in Section 10.2 a copy of each Assignment
and Acceptance delivered to it and a register (the "Register") for the
recordation of the names and addresses of the Lenders and the Commitment of, and
principal amount of the Loans owing to, each Lender from time to time. The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Borrower, the Administrative Agent and the Lenders shall treat each
Person whose name is recorded in the Register as the owner of the Loans and any
Notes evidencing such Loans recorded therein for all purposes of this Agreement.
Any assignment of any Loan, whether or not evidenced by a Note, shall be
effective only upon appropriate entries with respect thereto being made in the
Register (and each Note shall expressly so provide). Any assignment or transfer
of all or part of a Loan evidenced by a Note shall be registered on the Register
only upon surrender for registration of assignment or transfer of the Note
evidencing such Loan, accompanied by a duly executed Assignment and Acceptance;
thereupon one or more new Notes in the same aggregate principal amount shall be
issued to the designated Assignee, and the old Notes shall be returned by the
Administrative Agent to the Borrower marked "canceled". The Register shall be
available for inspection by the Borrower or any Lender (with respect to any
entry relating to such Lender's Loans) at any reasonable time and from time to
time upon reasonable prior notice.

              (e)    Upon its receipt of an Assignment and Acceptance executed
by an Assignor and an Assignee (and, in any case where the consent of any other
Person is required by Section 10.6(c), by each such other Person) together with
payment to the Administrative Agent of a registration and processing fee of
$3,500 (except that no such registration and processing fee shall be payable (y)
in connection with an assignment by or to a Lehman Entity or (z) in the case of
an Assignee which is already a Lender or is an affiliate of a Lender or a Person
under common management with a Lender), the Administrative Agent shall promptly
accept such Assignment and Acceptance and record the information contained
therein in the Register and give notice of such acceptance and recordation to
the Borrower. On or prior to such effective date, the Borrower, at its own
expense, upon request, shall execute and deliver to the Administrative Agent (in
exchange for the Revolving Credit Note and/or applicable Term Notes, as the case
may be, of the assigning Lender) a new Revolving Credit Note and/or applicable
Term Notes, as the case may be, to such Assignee or its registered assigns in an
amount equal to the Revolving Credit Commitment and/or applicable Term Loans, as
the case may be, assumed or acquired by it pursuant to such Assignment and
Acceptance and, if the Assignor has retained a Revolving Credit Commitment
and/or Term Loans, as the case may be, upon request, a new Revolving Credit Note
and/or Term Notes, as the case may be, to the Assignor or its registered assigns
in an amount equal to the Revolving Credit Commitment and/or applicable Term
Loans, as the case


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may be, retained by it hereunder. Such new Note or Notes shall be dated the
Closing Date and shall otherwise be in the form of the Note or Notes replaced
thereby.

              (f)    For the avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this Section concerning assignments of Loans
and Notes relate only to absolute assignments and that such provisions do not
prohibit assignments creating security interests, including any pledge or
assignment by a Lender of any Loan or Note to any Federal Reserve Bank in
accordance with applicable law.

              10.7. Adjustments; Set-off.

              (a)    Except to the extent that this Agreement provides for
payments to be allocated to a particular Lender or to the Lenders under a
particular Facility, if any Lender (a "Benefited Lender") shall at any time
receive any payment of all or part of the Obligations owing to it, or receive
any collateral in respect thereof (whether voluntarily or involuntarily, by
set-off, pursuant to events or proceedings of the nature referred to in Section
8(f), or otherwise), in a greater proportion than any such payment to or
collateral received by any other Lender, if any, in respect of such other
Lender's Obligations, such Benefited Lender shall purchase for cash from the
other Lenders a participating interest in such portion of each such other
Lender's Obligations, or shall provide such other Lenders with the benefits of
any such collateral, as shall be necessary to cause such Benefited Lender to
share the excess payment or benefits of such collateral ratably with each of the
Lenders; provided, however, that if all or any portion of such excess payment or
benefits is thereafter recovered from such Benefited Lender, such purchase shall
be rescinded, and the purchase price and benefits returned, to the extent of
such recovery, but without interest.

              (b)    In addition to any rights and remedies of the Lenders
provided by law, each Lender shall have the right, without prior notice to the
Borrower, any such notice being expressly waived by the Borrower to the extent
permitted by applicable law, upon any amount becoming due and payable by the
Borrower hereunder (whether at the stated maturity, by acceleration or
otherwise), to set off and appropriate and apply against such amount any and all
deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender or any branch or agency
thereof to or for the credit or the account of the Borrower. Each Lender agrees
to notify promptly the Borrower and the Administrative Agent after any such
setoff and application made by such Lender, provided that the failure to give
such notice shall not affect the validity of such setoff and application.

              10.8. Counterparts. This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts, and all
of said counterparts taken together shall be deemed to constitute one and the
same instrument. Delivery of an executed signature page of this Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof. A set of the copies of this Agreement signed by all the
parties shall be lodged with the Borrower and the Administrative Agent.


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              10.9. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

              10.10. Integration. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Agents, the Arranger and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Arranger, any Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.

              10.11. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

              10.12. Submission To Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:

              (a)    submits for itself and its Property in any legal action or
       proceeding relating to this Agreement and the other Loan Documents to
       which it is a party, or for recognition and enforcement of any judgment
       in respect thereof, to the non-exclusive general jurisdiction of the
       courts of the State of New York situate in the County of New York, the
       courts of the United States of America for the Southern District of New
       York, and appellate courts from any thereof;

              (b)    consents that any such action or proceeding may be brought
       in such courts and waives any objection that it may now or hereafter have
       to the venue of any such action or proceeding in any such court or that
       such action or proceeding was brought in an inconvenient court and agrees
       not to plead or claim the same;

              (c)    agrees that service of process in any such action or
       proceeding may be effected by mailing a copy thereof by registered or
       certified mail (or any substantially similar form of mail), postage
       prepaid, to the Borrower at its address set forth in Section 10.2 or at
       such other address of which the Administrative Agent shall have been
       notified pursuant thereto;

              (d)    agrees that nothing herein shall affect the right to effect
       service of process in any other manner permitted by law or shall limit
       the right to sue in any other jurisdiction; and

              (e)    waives, to the maximum extent not prohibited by law, any
       right it may have to claim or recover in any legal action or proceeding
       referred to in this Section any special, exemplary, punitive or
       consequential damages.


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              10.13. Acknowledgments. The Borrower hereby acknowledges that:

              (a)    it has been advised by counsel in the negotiation,
       execution and delivery of this Agreement and the other Loan Documents;

              (b)    neither the Arranger, nor any Agent nor any Lender has any
       fiduciary relationship with or duty to the Borrower arising out of or in
       connection with this Agreement or any of the other Loan Documents, and
       the relationship between the Arranger, the Agents and Lenders, on one
       hand, and the Borrower, on the other hand, in connection herewith or
       therewith is solely that of participants in a debtor and creditor
       transaction; and

              (c)    no joint venture is created hereby or by the other Loan
       Documents or otherwise exists by virtue of the transactions contemplated
       hereby among the Arranger, the Agents and the Lenders or between the
       Borrower and any of them.

              10.14. Confidentiality. Each of the Arranger, the Agents and the
Lenders agrees to keep confidential all non-public information provided to it by
any Loan Party pursuant to this Agreement that is designated by such Loan Party
as confidential; provided that nothing herein shall prevent the Arranger, any
Agent or any Lender from disclosing any such information (a) to the Arranger,
any Agent, any other Lender or any affiliate of any thereof (b) to any
Participant or Assignee (each, a "Transferee") or prospective Transferee that
agrees to comply with the provisions of this Section, (c) to any of its
employees, directors, agents, attorneys, accountants and other professional
advisors, (d) upon the request or demand of any Governmental Authority having
jurisdiction over it, (e) in response to any order of any court or other
Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (f) if required to do so in connection with any litigation
or similar proceeding, (g) that has been publicly disclosed other than in breach
of this Section, (h) to the National Association of Insurance Commissioners or
any similar organization or any nationally recognized rating agency that
requires access to information about a Lender's investment portfolio in
connection with ratings issued with respect to such Lender or (i) in connection
with the exercise of any remedy hereunder or under any other Loan Document.

              10.15. Release of Collateral and Guarantee Obligations.

              (a)    Notwithstanding anything to the contrary contained herein
or in any other Loan Document, upon request of the Borrower in connection with
any Disposition of Property permitted by the Loan Documents, the Administrative
Agent shall (without notice to or vote or consent of any Lender, or any
affiliate of any Lender that is a party to any Specified Hedge Agreement) take
such actions as shall be required to release its security interest in any
Collateral being Disposed of in such Disposition, and to release any guarantee
obligations of any Person being Disposed of in such Disposition, to the extent
necessary to permit consummation of such Disposition in accordance with the Loan
Documents provided that the Borrower shall have delivered to the Administrative
Agent, at least five Business Days prior to the date of the proposed release, a
written request for release identifying the relevant Collateral being Disposed



                                      100
   107

of in such Disposition and the terms of such Disposition in reasonable detail,
including the date thereof, the price thereof and any estimated expenses in
connection therewith, together with a certification by the Borrower stating that
such transaction is in compliance with this Agreement and the other Loan
Documents and that the proceeds of such Disposition will be applied in
accordance with this Agreement and the other Loan Documents.

              (b)    The Administrative Agent shall be, and hereby is,
irrevocably authorized and empowered to release any and all of the Collateral
and take any and all actions necessary therefor or reasonably incidental
thereto, upon request of the Borrower and without notice to or consent of any
Lender or any other holder of Obligations, when all Commitments have terminated,
all Letters of Credit have been discharged, the principal of and interest on all
Loans and Reimbursement Obligations have been paid in full, and the
Administrative Agent has received payment in full, or payment security
satisfactory to it, as to all other Obligations that are claimed by the
Administrative Agent or in respect of which the Administrative Agent has
received, reasonably in advance of such release, written notice that any payment
is due or any claim is pending.

              10.16. Accounting Changes. In the event that any "Accounting
Change" (as defined below) shall occur and such change results in a change in
the method of calculation of financial covenants, standards or terms in this
Agreement, then the Borrower and the Administrative Agent agree to enter into
negotiations in order to amend such provisions of this Agreement so as to
equitably reflect such Accounting Changes with the desired result that the
criteria for evaluating the Borrower's financial condition shall be the same
after such Accounting Changes as if such Accounting Changes had not been made.
Until such time as such an amendment shall have been executed and delivered by
the Borrower, the Administrative Agent and the Required Lenders, all financial
covenants, standards and terms in this Agreement shall continue to be calculated
or construed as if such Accounting Changes had not occurred. "Accounting
Changes" refers to changes in accounting principles required or permitted by the
promulgation of any rule, regulation, pronouncement or opinion by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants or, if applicable, the SEC.

              10.17. Delivery of Lender Addenda. Each initial Lender shall
become a party to this Agreement by delivering to the Administrative Agent a
Lender Addendum duly executed by such Lender, the Borrower and the
Administrative Agent.

              10.18. Construction. Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.

              10.19. WAIVERS OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN


                                      101
   108

ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.


                                      102
   109


              IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered by their proper and duly authorized officers
as of the day and year first above written.

                                        SPANISH BROADCASTING SYSTEM, INC.


                                        By: /s/ Joseph A. Garcia
                                           ----------------------------------
                                            Name:   Joseph A. Garcia
                                            Title:  Executive Vice-President,
                                                    Chief Financial Officer and
                                                    Secretary


                                        LEHMAN COMMERCIAL PAPER INC., as
                                        Administrative Agent


                                        By:  /s/ Jeffrey Goodwin
                                           ----------------------------------
                                            Name:   Jeffrey Goodwin
                                            Title:  Authorized Signatory


                                      103
   110

                                                                         Annex A

                    PRICING GRID FOR REVOLVING CREDIT LOANS,
                         SWING LINE LOANS AND TERM LOANS




             -------------------------------------------------------------------
              Consolidated Leverage     Applicable Margin    Applicable Margin
                      Ratio            for Eurodollar Loans    for Base Rate
                                                                   Loans
             -------------------------------------------------------------------
                                                       
             >=6.5:1                    2.75%                 1.75%
             -------------------------------------------------------------------
             >=5:1 and <6.5:1           2.50%                 1.50%
             -------------------------------------------------------------------
             >=4:1 and <5:1             2.25%                 1.25%
             -------------------------------------------------------------------
             <4:1                       2.00%                 1.00%
             -------------------------------------------------------------------


The Applicable Margin shall be determined on a quarterly basis based on the
Consolidated Leverage Ratio as of the last day of the most recent fiscal quarter
and for the period of four consecutive fiscal quarters then ended, except that
the Applicable Margin will be the highest rate set forth above (2.75% for
Eurodollar Rate Loans and 1.75% for Base Rate Loans) (i) for the period from the
Closing Date until the Grid Effective Date and (ii) whenever any Event of
Default is continuing. Changes in the Applicable Margin resulting from changes
in the Consolidated Leverage Ratio shall become effective on the date (the
"Adjustment Date") on which financial statements are delivered to the Lenders
pursuant to Section 6.1 (but in any event not later than the 45th day after the
end of each of the first three quarterly periods of each fiscal year or the 90th
day after the end of each fiscal year, as the case may be) and shall remain in
effect until the next change to be effected pursuant to this paragraph. If any
financial statements referred to above are not delivered within the time periods
specified above, then, until such financial statements are delivered, the
Consolidated Leverage Ratio as at the end of the fiscal period that would have
been covered thereby shall for the purposes of this definition be deemed to be
greater than 6.5:1.


                                   S-8(g)(ii)
   111
                                                                       EXHIBIT A

                         FORM OF COMPLIANCE CERTIFICATE

              This Compliance Certificate is delivered to you pursuant to
Section 6.2 of the Credit Agreement, dated as of July 6, 2000, as amended,
supplemented or modified from time to time (the "Credit Agreement"), among
SPANISH BROADCASTING SYSTEM, INC., a Delaware corporation (the "Borrower"), the
several lenders from time to time party to the Credit Agreement (the "Lenders"),
and LEHMAN COMMERCIAL PAPER INC., as administrative agent (in such capacity, the
"Administrative Agent"). Terms defined in the Credit Agreement and not otherwise
defined herein are used herein with the meanings so defined.

              1.     I am the duly elected, qualified and acting Chief Financial
Officer of the Borrower.

              2.     I have reviewed and am familiar with the contents of this
Certificate.

              3.     I have reviewed the terms of the Credit Agreement and the
Loan Documents and have made or caused to be made under my supervision, a review
in reasonable detail of the transactions and condition of the Borrower during
the accounting period covered by the financial statements attached hereto as
Attachment 1 (the "Financial Statements"). Such review did not disclose the
existence during or at the end of the accounting period covered by the Financial
Statements, and I have no knowledge of the existence, as of the date of this
Certificate, of any condition or event which constitutes a Default or an Event
of Default [, except as set forth below].

              4.     Attached hereto as Attachment 2 are the computations
showing compliance with the covenants set forth in Sections 5.1(o) and 7.1 of
the Credit Agreement.

              IN WITNESS WHEREOF, I execute this Certificate this _____ day of
__________, ____.

                                            SPANISH BROADCASTING SYSTEM, INC.


                                            By:
                                               ---------------------------------
                                               Name:
                                               Title:

   112

                                                                 Attachment 2 to
                                                                       Exhibit A

              The information described herein is as of _________, ____, and
pertains to the period from _________ __, ____ to ______________,____.

                        [Set forth Covenant Calculations]

EX-10.45

   1


                                                                   Exhibit 10.45






================================================================================


                       GUARANTEE AND COLLATERAL AGREEMENT



                                     made by



                        SPANISH BROADCASTING SYSTEM, INC.



                         and certain of its Subsidiaries



                                   in favor of



                          LEHMAN COMMERCIAL PAPER INC.
                             as Administrative Agent



                            Dated as of July 6, 2000


================================================================================


   2



                                TABLE OF CONTENTS



                                                                                                                PAGE
                                                                                                                ----
                                                                                                        

SECTION 1.            DEFINED TERMS...............................................................................1

         1.1.     Definitions.....................................................................................1
         1.2.     Other Definitional Provisions...................................................................7

SECTION 2.            GUARANTEE...................................................................................7

         2.1.     Guarantee.......................................................................................7
         2.2.     Right of Contribution...........................................................................8
         2.3.     Subrogation.....................................................................................8
         2.4.     Amendments, etc. with respect to the Borrower Obligations.......................................9
         2.5.     Guarantee Absolute and Unconditional............................................................9
         2.6.     Reinstatement..................................................................................10
         2.7.     Payments.......................................................................................10

SECTION 3.            GRANT OF SECURITY INTEREST.................................................................10


SECTION 4.            REPRESENTATIONS AND WARRANTIES.............................................................12

         4.1.     Representations in Credit Agreement............................................................12
         4.2.     Title; No Other Liens..........................................................................12
         4.3.     Perfected First Priority Liens.................................................................12
         4.4.     Chief Executive Office.........................................................................12
         4.5.     Inventory, Equipment and Books and Records.....................................................12
         4.6.     Farm Products..................................................................................13
         4.7.     Investment Property............................................................................13
         4.8.     Receivables....................................................................................13

SECTION 5.            COVENANTS..................................................................................13

         5.1.     Covenants in Credit Agreement..................................................................13
         5.2.     Delivery and Control of Instruments, Chattel Paper and Investment Property.....................13
         5.3.     Maintenance of Insurance.......................................................................14
         5.4.     Maintenance of Perfected Security Interest; Further Documentation..............................14
         5.5.     Changes in Locations, Name, etc. ..............................................................15
         5.6.     Investment Property............................................................................15
         5.7.     Intellectual Property..........................................................................16

SECTION 6.            REMEDIAL PROVISIONS........................................................................19

         6.1.     Default........................................................................................19
         6.2.     Remedies Upon Default..........................................................................19
         6.3.     Waivers by Grantors............................................................................20
         6.4.     Standard of Care...............................................................................20
         6.5.     Application of Proceeds........................................................................21



                                       i


   3




                                                                                                                PAGE
                                                                                                                ----
                                                                                                        

         6.6.     Surplus, Deficiency............................................................................21
         6.7.     Information Related to the Collateral..........................................................21

SECTION 7.            THE ADMINISTRATIVE AGENT...................................................................22

         7.1.     Administrative Agent's Appointment as Attorney-in-Fact, etc. ..................................22
         7.2.     Duty of Administrative Agent...................................................................24
         7.3.     Execution of Financing Statements..............................................................24
         7.4.     Authority of Administrative Agent..............................................................25

SECTION 8.            MISCELLANEOUS..............................................................................25

         8.1.     Amendments in Writing..........................................................................25
         8.2.     Notices........................................................................................25
         8.3.     No Waiver by Course of Conduct; Cumulative Remedies............................................25
         8.4.     Enforcement Expenses; Indemnification..........................................................26
         8.5.     Successors and Assigns.........................................................................26
         8.6.     Set-Off........................................................................................26
         8.7.     Counterparts...................................................................................27
         8.8.     Severability...................................................................................27
         8.9.     Section Headings...............................................................................27
         8.10.    Integration....................................................................................27
         8.11.    GOVERNING LAW..................................................................................27
         8.12.    Submission To Jurisdiction; Waivers............................................................27
         8.13.    Acknowledgments................................................................................28
         8.14.    Additional Grantors............................................................................28
         8.15.    Releases.......................................................................................28
         8.16.    WAIVER OF JURY TRIAL...........................................................................29



                                       ii

   4


                                     FORM OF
                       GUARANTEE AND COLLATERAL AGREEMENT


                GUARANTEE AND COLLATERAL AGREEMENT, dated as of July 6, 2000,
made by each of the signatories hereto (together with any other entity that may
become a party hereto as provided herein, the "Grantors"), in favor of LEHMAN
COMMERCIAL PAPER INC., as Administrative Agent (in such capacity, the
"Administrative Agent") for (i) the banks and other financial institutions or
entities (the "Lenders") from time to time parties to the Credit Agreement,
dated as of July 6, 2000 (as amended, supplemented or otherwise modified from
time to time, the "Credit Agreement"), among Spanish Broadcasting System, Inc.,
a Delaware corporation (the "Borrower"), the Lenders and the Administrative
Agent, and (ii) the other Secured Parties (as hereinafter defined).


                              W I T N E S S E T H:

                WHEREAS, pursuant to the Credit Agreement, the Lenders have
severally agreed to make extensions of credit to the Borrower upon the terms and
subject to the conditions set forth therein;

                WHEREAS, the Borrower is a member of an affiliated group of
companies that includes each other Grantor;

                WHEREAS, the proceeds of the extensions of credit under the
Credit Agreement will be used in part to enable the Borrower to make valuable
transfers to one or more of the other Grantors in connection with the operation
of their respective businesses;

                WHEREAS, the Borrower and the other Grantors are engaged in
related businesses, and each Grantor will derive substantial direct and indirect
benefit from the making of the extensions of credit under the Credit Agreement;
and

                WHEREAS, it is a condition precedent to the obligation of the
Lenders to make their respective extensions of credit to the Borrower under the
Credit Agreement that the Grantors shall have executed and delivered this
Agreement to the Administrative Agent for the ratable benefit of the Secured
Parties;

                NOW, THEREFORE, in consideration of the premises and to induce
the Administrative Agent and the Lenders to enter into the Credit Agreement and
to induce the Lenders to make their respective extensions of credit to the
Borrower thereunder, each Grantor hereby agrees with the Administrative Agent,
for the ratable benefit of the Secured Parties, as follows:

                            SECTION 1. DEFINED TERMS

                1.1.    Definitions. (a) Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the meanings given to
them in the Credit



                                       1
   5


Agreement, and the following terms which are defined in the Uniform Commercial
Code in effect in the State of New York on the date hereof are used herein as so
defined: Accounts, Certificated Security, Chattel Paper, Commodity Account,
Commodity Contract, Commodity Intermediary, Documents, Entitlement Order,
Equipment, Farm Products, Financial Asset, Fixtures, Goods, Instruments,
Inventory, Securities Account, Securities Intermediary, Security, Security
Entitlement and Uncertificated Security.

                (b)     The following terms shall have the following meanings:

                "Agreement": this Guarantee and Collateral Agreement, as the
        same may be amended, supplemented, replaced or otherwise modified from
        time to time.

                "Arranger": Lehman Brothers Inc., in its capacity as sole lead
        arranger and book running manager.

                "Borrower Obligations": the collective reference to the
        Obligations (as defined in the Credit Agreement).

                "Collateral": as defined in Section 3.

                "Copyright Licenses": any written agreement naming any Grantor
        as licensor or licensee (including, without limitation, those listed in
        Schedule 6), granting any right under any Copyright, including, without
        limitation, the grant of rights to manufacture, distribute, exploit and
        sell materials derived from any Copyright.

                "Copyrights": (i) all copyrights, whether or not the underlying
        works of authorship have been published, and all works of authorship and
        other intellectual property rights therein, all copyrights of works
        based on, incorporated in, derived from or relating to works covered by
        such copyrights, all right, title and interest to make and exploit all
        derivative works based on or adopted from works covered by such
        copyrights, and all copyright registrations and copyright applications,
        and any renewals or extensions thereof, including, without limitation,
        each registration and application identified in Schedule 6, (ii) the
        rights to print, publish and distribute any of the foregoing, (iii) the
        right to sue or otherwise recover for any and all past, present and
        future infringements and misappropriations thereof, (iv) all income,
        royalties, damages and other payments now and hereafter due and/or
        payable with respect thereto (including, without limitation, payments
        under all Copyright Licenses entered into in connection therewith, and
        damages and payments for past, present or future infringements thereof),
        and (v) all other rights of any kind whatsoever accruing thereunder or
        pertaining thereto.

                "Deposit Account": as defined in the Uniform Commercial Code of
        any applicable jurisdiction and, in any event, including, without
        limitation, any demand, time, savings, passbook or like account
        maintained with a depositary institution.

                "Excluded Assets": collectively, (a) FCC Licenses, but only if
        and to the extent that, and only for as long as, the grant of a security
        interest therein is prohibited (notwithstanding the intention of the
        holder to grant such security interest to the fullest



                                       2
   6


        extent lawful) under the laws of the United States and (b) any Lease,
        any intellectual property license agreement under which any Grantor is
        the licensee, and any other agreement under which any Grantor is
        entitled to the performance of any obligation other than the payment of
        money, to the extent that, and so long as, the grant by such Grantor of
        a security interest pursuant to this Agreement in its right, title and
        interest therein (i) is prohibited by the terms of such Lease, license
        agreement or other agreement without the consent of any other party
        thereto (other than the Borrower or any of its Subsidiaries), (ii) would
        give any other party (other than the Borrower or any of its
        Subsidiaries) to such Lease, license agreement or other agreement the
        right to terminate its obligations thereunder, or (iii) is permitted
        only upon obtaining consents from the other parties thereto (other than
        the Borrower and any of its Subsidiaries) which have not been obtained;
        provided, that no Receivable, no money or other amounts due or to become
        due under any Lease, license agreement or other agreement described in
        clause (b) of this definition, and no Proceeds from any Disposition of
        any Property described in clauses (a) or (b) of this definition, shall
        be an Excluded Asset.

                "Excluded Foreign Subsidiary": any Foreign Subsidiary in respect
        of which either (i) the pledge of all of the Capital Stock of such
        Subsidiary as Collateral or (ii) the guaranteeing by such Subsidiary of
        the Obligations, would, in the good faith judgment of the Borrower,
        result in adverse tax consequences to the Borrower; provided, however,
        that (a) a Foreign Subsidiary that is treated as a pass-through entity
        for United States federal income tax purposes shall not be an Excluded
        Foreign Subsidiary while so treated and (b) SBS Puerto Rico shall not be
        an Excluded Foreign Subsidiary.

                "Excluded Foreign Subsidiary Voting Stock": the voting Capital
        Stock of any Excluded Foreign Subsidiary.

                "FCC Licenses": any licenses, permits and authorizations issued
        by the Federal Communications Commission for the operation of stations.

                "Foreign Subsidiary": any Subsidiary organized under the laws of
        any jurisdiction other than any state of the United States of America or
        the District of Columbia.

                "General Intangibles": all "general intangibles" as such term is
        defined in Section 9-106 of the Uniform Commercial Code in effect in the
        State of New York on the date hereof and, in any event, including,
        without limitation, with respect to any Grantor, all contracts,
        agreements, instruments and indentures and all licenses and permits
        issued by Governmental Authorities in any form, and portions thereof, to
        which such Grantor is a party or under which such Grantor has any right,
        title or interest or to which such Grantor or any property of such
        Grantor is subject, as the same may from time to time be amended,
        supplemented, replaced or otherwise modified, including, without
        limitation, (i) all rights of such Grantor to receive moneys due and to
        become due to it thereunder or in connection therewith, (ii) all rights
        of such Grantor to receive proceeds of any insurance, indemnity,
        warranty or guaranty with respect thereto, (iii) all rights of such
        Grantor to damages arising thereunder, (iv) all rights of such Grantor
        to receive any tax refunds, and (v) all rights of such Grantor to
        terminate and to perform, compel



                                       3
   7


        performance and to exercise all remedies thereunder, in each case to the
        extent the grant by such Grantor of a security interest pursuant to this
        Agreement in its right, title and interest in such contract, agreement,
        instrument, indenture, license or permit is not prohibited by such
        contract, agreement, instrument, indenture, license or permit without
        the consent of any other party thereto (other than any of its
        Subsidiaries), would not give any other party (other than any of its
        Subsidiaries) to such contract, agreement, instrument, indenture,
        license or permit the right to terminate its obligations thereunder, or
        is permitted with consent if all necessary consents to such grant of a
        security interest have been obtained from the other parties thereto
        (other than any of its Subsidiaries); provided, that the foregoing
        limitation shall not affect, limit, restrict or impair the grant by such
        Grantor of a security interest pursuant to this Agreement in any
        Receivable or any money or other amounts due or to become due under any
        such contract, agreement, instrument, indenture, license or permit, or
        in the Proceeds from the Disposition of any such contract, agreement,
        instrument, indenture, license or permit.

                "Guarantor Obligations": with respect to any Guarantor, all
        obligations and liabilities of such Guarantor which may arise under or
        in connection with this Agreement (including, without limitation,
        Section 2) or any other Loan Document to which such Guarantor is a
        party, in each case whether on account of guarantee obligations,
        reimbursement obligations, fees, indemnities, costs, expenses or
        otherwise (including, without limitation, all fees and disbursements of
        counsel to any Secured Party that are required to be paid by such
        Guarantor pursuant to the terms of this Agreement or any other Loan
        Document).

                "Guarantors": the collective reference to each Grantor other
        than the Borrower.

                "Hedge Agreements": as to any Person, all interest rate swaps,
        caps or collar agreements or similar arrangements entered into by such
        Person providing for protection against fluctuations in interest rates
        or currency exchange rates or the exchange of nominal interest
        obligations, either generally or under specific contingencies.

                "Intellectual Property": the collective reference to all rights,
        priorities and privileges relating to intellectual property, whether
        arising under United States, multinational or foreign laws or otherwise,
        including the Copyrights, the Copyright Licenses, the Patents, the
        Patent Licenses, the Trademarks, the Trademark Licenses, the Trade
        Secrets and the Trade Secret Licenses, and all rights to sue at law or
        in equity for any infringement or other impairment thereof, including
        the right to receive all proceeds and damages therefrom.

                "Intercompany Note": any promissory note evidencing loans made
        by any Grantor to any of its Subsidiaries.

                "Investment Property": the collective reference to (i) all
        "investment property" as such term is defined in Section 9-115 of the
        Uniform Commercial Code in effect in the State of New York on the date
        hereof including, without limitation, all Certificated Securities and
        Uncertificated Securities, all Security Entitlements, all Securities


                                       4
   8


        Accounts, all Commodity Contracts and all Commodity Accounts (other than
        any Excluded Foreign Subsidiary Voting Stock excluded from the
        definition of "Pledged Stock"), (ii) security entitlements, in the case
        of any United States Treasury book-entry securities, as defined in 31
        C.F.R. section 357.2, or, in the case of any United States federal
        agency book-entry securities, as defined in the corresponding United
        States federal regulations governing such book-entry securities, and
        (iii) whether or not constituting "investment property" as so defined,
        all Pledged Notes, all Pledged Stock, all Pledged Security Entitlements
        and all Pledged Commodity Contracts.

                "Issuers": the collective reference to each issuer of a Pledged
        Security.

                "Lease": any lease of real or personal property under which any
        Grantor is the lessee.

                "New York UCC": the Uniform Commercial Code as from time to time
        in effect in the State of New York.

                "Obligations": (i) in the case of the Borrower, the Borrower
        Obligations, and (ii) in the case of each Guarantor, its Guarantor
        Obligations.

                "Patent License": all agreements, whether written or oral,
        providing for the grant by or to any Grantor of any right to
        manufacture, use or sell any invention covered in whole or in part by a
        Patent, including, without limitation, any of the foregoing referred to
        in Schedule 6.

                "Patents": (i) all patents, patent applications and patentable
        inventions, including, without limitation, each patent and patent
        application identified in Schedule 6, (ii) all inventions and
        improvements described and claimed therein, (iii) the right to sue or
        otherwise recover for any and all past, present and future infringements
        and misappropriations thereof, (iv) all income, royalties, damages and
        other payments now and hereafter due and/or payable with respect thereto
        (including, without limitation, payments under all Patent Licenses
        entered into in connection therewith, and damages and payments for past,
        present or future infringement thereof), and (v) all reissues,
        divisions, continuations, continuations-in-art, substitutes, renewals,
        and extensions thereof, all improvements thereon and all other rights of
        any kind whatsoever accruing thereunder or pertaining thereto.

                "Pledged Commodity Contracts": all commodity contracts listed on
        Schedule 2 and all other commodity contracts to which any Grantor is
        party from time to time.

                "Pledged Debt Securities": the debt securities listed on
        Schedule 2, together with any other certificates, options, rights or
        security entitlements of any nature whatsoever in respect of the debt
        securities of any Person that may be issued or granted to, or held by,
        any Grantor while this Agreement is in effect.

                "Pledged Notes": all promissory notes listed on Schedule 2, all
        Intercompany Notes at any time issued to any Grantor and all other
        promissory notes issued to or held



                                       5
   9


        by any Grantor (other than promissory notes in an aggregate principal
        amount not to exceed $250,000 at any time outstanding issued in
        connection with extensions of trade credit by any Grantor in the
        ordinary course of business).

                "Pledged Securities": the collective reference to the Pledged
        Debt Securities, the Pledged Notes and the Pledged Stock.

                "Pledged Security Entitlements": all security entitlements with
        respect to the financial assets listed on Schedule 2 and all other
        security entitlements of any Grantor.

                "Pledged Stock": the shares of Capital Stock listed on Schedule
        2, together with any other shares, stock certificates, options, rights
        or security entitlements of any nature whatsoever in respect of the
        Capital Stock of any Person that may be issued or granted to, or held
        by, any Grantor while this Agreement is in effect; provided that in no
        event shall more than 66% of the total outstanding Excluded Foreign
        Subsidiary Voting Stock of any Excluded Foreign Subsidiary be required
        to be pledged hereunder.

                "Proceeds": all "proceeds" as such term is defined in Section
        9-306(1) of the Uniform Commercial Code in effect in the State of New
        York on the date hereof and, in any event, shall include, without
        limitation, all dividends or other income from the Pledged Securities,
        collections thereon or distributions or payments with respect thereto.

                "Receivable": any right to payment on account of any obligation
        that could create any right to receive money, whether or not such right
        is evidenced by an Instrument or Chattel Paper and whether or not it has
        been earned by performance (including, without limitation, any Account).

                "SBS Puerto Rico": Spanish Broadcasting System of Puerto Rico,
        Inc., a Puerto Rico corporation.

                "Secured Parties": collectively, the Arranger, the Agents, the
        Lenders and, with respect to any Specified Hedge Agreement, any
        affiliate of any Lender party thereto that has agreed to be bound by the
        provisions of Section 7.2 hereof as if it were a party hereto and by the
        provisions of Section 9 of the Credit Agreement as if it were a Lender
        party thereto and each Indemnitee.

                "Securities Act": the Securities Act of 1933, as amended.

                "Trademark License": any agreement, whether written or oral,
        providing for the grant by or to any Grantor of any right to use any
        Trademark, including, without limitation, any of the foregoing referred
        to in Schedule 6.

                "Trademarks": (i) all trademarks, service marks, trade names,
        corporate names, company names, business names, trade dress, trade
        styles, logos, or other indicia of origin or source identification,
        trademark and service mark registrations, and applications for trademark
        or service mark registrations and any renewals thereof, including,
        without limitation, each registration and application identified in
        Schedule 6, (ii) the right to sue



                                       6
   10


        or otherwise recover for any and all past, present and future
        infringements and misappropriations thereof, (iii) all income,
        royalties, damages and other payments now and hereafter due and/or
        payable with respect thereto (including, without limitation, payments
        under all Trademark Licenses entered into in connection therewith, and
        damages and payments for past, present or future infringements thereof),
        and (iv) all other rights of any kind whatsoever accruing thereunder or
        pertaining thereto, together in each case with the goodwill of the
        business connected with the use of, and symbolized by, each of the
        above.

                "Trade Secret License": any agreement, whether written or oral,
        providing for the grant by or to any Grantor of any right to use any
        Trade Secret, including, without limitation, any of the foregoing
        referred to in Schedule 6.

                "Trade Secrets": (i) all trade secrets and all confidential and
        proprietary information, including know-how, trade secrets,
        manufacturing and production processes and techniques, inventions,
        research and development information, technical data, financial,
        marketing and business data, pricing and cost information, business and
        marketing plans, and customer and supplier lists and information,
        including, without limitation, any of the foregoing referred to in
        Schedule 6, (ii) the right to sue or otherwise recover for any and all
        past, present and future infringements and misappropriations thereof,
        (iii) all income, royalties, damages and other payments now and
        hereafter due and/or payable with respect thereto (including, without
        limitation, payments under all licenses entered into in connection
        therewith, and damages and payments for past, present or future
        infringements thereof), and (iv) all other rights of any kind whatsoever
        of such Grantor accruing thereunder or pertaining thereto.

                1.2.    Other Definitional Provisions. (a) The words "hereof",
"herein", "hereto" and "hereunder" and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement, and Section and Schedule references are to this
Agreement unless otherwise specified.

                (b)     The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.

                (c)     Where the context requires, terms relating to the
Collateral or any part thereof, when used in relation to a Grantor, shall refer
to such Grantor's Collateral or the relevant part thereof.

                (d)     The expressions "payment in full," "paid in full" and
any other similar terms or phrases when used herein with respect to the Borrower
Obligations shall mean the payment in full, in immediately available funds, of
all of the Borrower Obligations.

                              SECTION 2. GUARANTEE

                2.1.    Guarantee. (a) Each of the Guarantors hereby, jointly
and severally, unconditionally and irrevocably, guarantees to the Administrative
Agent, for the ratable benefit



                                       7
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of the Secured Parties and their respective successors, indorsees, transferees
and assigns, the prompt and complete payment and performance by the Borrower
when due (whether at the stated maturity, by acceleration or otherwise) of the
Borrower Obligations.

                (b)     Anything herein or in any other Loan Document to the
contrary notwithstanding, the maximum liability of each Guarantor hereunder and
under the other Loan Documents shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal, state and other laws
relating to the insolvency of debtors (after giving effect to the right of
contribution established in Section 2.2).

                (c)     Each Guarantor agrees that the Borrower Obligations may
at any time and from time to time exceed the amount of the liability of such
Guarantor hereunder without impairing the guarantee contained in this Section 2
or affecting the rights and remedies of any Secured Party hereunder.

                (d)     The guarantee contained in this Section 2 shall remain
in full force and effect until all the Borrower Obligations and Guarantor
Obligations shall have been satisfied by payment in full, no Letter of Credit
shall be outstanding and the Commitments shall be terminated or have expired,
notwithstanding that from time to time during the term of the Credit Agreement
the Borrower may be free from any Borrower Obligations.

                (e)     No payment made by the Borrower, any of the Guarantors,
any other guarantor or any other Person or received or collected by any Secured
Party from the Borrower, any of the Guarantors, any other guarantor or any other
Person by virtue of any action or proceeding or any set-off or appropriation or
application at any time or from time to time in reduction of or in payment of
the Borrower Obligations shall be deemed to modify, reduce, release or otherwise
affect the liability of any Guarantor hereunder which shall, notwithstanding any
such payment (other than any payment made by such Guarantor in respect of the
Borrower Obligations or any payment received or collected from such Guarantor in
respect of the Borrower Obligations), remain liable for the Borrower Obligations
up to the maximum liability of such Guarantor hereunder until the Borrower
Obligations (other than Obligations in respect of any Specified Hedge Agreement)
are paid in full, no Letter of Credit shall be outstanding and the Commitments
are terminated or have expired.

                2.2.    Right of Contribution. Each Guarantor hereby agrees that
to the extent that a Guarantor shall have paid more than its proportionate share
of any payment made hereunder, such Guarantor shall be entitled to seek and
receive contribution from and against any other Guarantor hereunder which has
not paid its proportionate share of such payment. Each Guarantor's right of
contribution shall be subject to the terms and conditions of Section 2.3. The
provisions of this Section 2.2 shall in no respect limit the obligations and
liabilities of any Guarantor to the Secured Parties and each Guarantor shall
remain liable to the Secured Parties for the full amount guaranteed by such
Guarantor hereunder.

                2.3.    Subrogation. Notwithstanding any payment made by any
Guarantor hereunder or any set-off or application of funds of any Guarantor by
any Secured Party, no Guarantor shall be entitled to be subrogated to any of the
rights of any Secured Party against the



                                       8
   12


Borrower or any other Guarantor or Grantor or any collateral security or
guarantee or right of offset held by any Secured Party for the payment of the
Borrower Obligations, nor shall any Guarantor seek or be entitled to seek any
contribution or reimbursement from the Borrower or any other Guarantor or
Grantor in respect of payments made by such Guarantor hereunder, until all
amounts owing to the Secured Parties by the Borrower on account of the Borrower
Obligations (other than Obligations in respect of any Specified Hedge Agreement)
are paid in full, no Letter of Credit shall be outstanding and the Commitments
are terminated or have expired. If any amount shall be paid to any Guarantor on
account of such subrogation rights at any time when all of the Borrower
Obligations (other than Obligations in respect of any Specified Hedge Agreement)
shall not have been paid in full, any Letter of Credit is outstanding or the
Commitments remain in effect, such amount shall be held by such Guarantor in
trust for the Secured Parties, segregated from other funds of such Guarantor,
and shall, forthwith upon receipt by such Guarantor, be turned over to the
Administrative Agent in the exact form received by such Guarantor (duly endorsed
by such Guarantor to the Administrative Agent, if required), to be applied
against the Borrower Obligations, whether matured or unmatured, in such order as
the Administrative Agent may determine.

                2.4.    Amendments, etc. with respect to the Borrower
Obligations. Each Guarantor shall remain obligated hereunder notwithstanding
that, without any reservation of rights against any Guarantor and without notice
to or further assent by any Guarantor, any demand for payment of any of the
Borrower Obligations made by any Secured Party may be rescinded by such Secured
Party and any of the Borrower Obligations continued, and the Borrower
Obligations, or the liability of any other Person upon or for any part thereof,
or any collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, waived, surrendered or released by
any Secured Party, and the Credit Agreement and the other Loan Documents and any
other documents executed and delivered in connection therewith may be amended,
modified, supplemented or terminated, in whole or in part, as the Administrative
Agent (or the requisite Lenders under the Credit Agreement or all Lenders, as
the case may be) may deem advisable from time to time, and any collateral
security, guarantee or right of offset at any time held by any Secured Party for
the payment of the Borrower Obligations may be sold, exchanged, waived,
surrendered or released. No Secured Party shall have any obligation to protect,
secure, perfect or insure any Lien at any time held by it as security for the
Borrower Obligations or for the guarantee contained in this Section 2 or any
property subject thereto.

                2.5.    Guarantee Absolute and Unconditional. Each Guarantor
waives any and all notice of the creation, renewal, extension or accrual of any
of the Borrower Obligations and notice of or proof of reliance by any Secured
Party upon the guarantee contained in this Section 2 or acceptance of the
guarantee contained in this Section 2; the Borrower Obligations, and any of
them, shall conclusively be deemed to have been created, contracted or incurred,
or renewed, extended, amended or waived, in reliance upon the guarantee
contained in this Section 2; and all dealings between the Borrower and any of
the Guarantors, on the one hand, and the Secured Parties, on the other hand,
likewise shall be conclusively presumed to have been had or consummated in
reliance upon the guarantee contained in this Section 2. Each Guarantor waives
diligence, presentment, protest, demand for payment and notice of default or
nonpayment to or upon the Borrower or any of the Guarantors with respect to the
Borrower Obligations. Each



                                       9
   13


Guarantor understands and agrees that the guarantee contained in this Section 2
shall be construed as a continuing, absolute and unconditional guarantee of
payment and performance without regard to (a) the validity or enforceability of
the Credit Agreement or any other Loan Document, any of the Borrower Obligations
or any other collateral security therefor or guarantee or right of offset with
respect thereto at any time or from time to time held by any Secured Party, (b)
any defense, set-off or counterclaim (other than a defense of payment or
performance hereunder) which may at any time be available to or be asserted by
the Borrower or any other Person against any Secured Party, or (c) any other
circumstance whatsoever (with or without notice to or knowledge of the Borrower
or such Guarantor) which constitutes, or might be construed to constitute, an
equitable or legal discharge of the Borrower for the Borrower Obligations, or of
such Guarantor under the guarantee contained in this Section 2, in bankruptcy or
in any other instance. When making any demand hereunder or otherwise pursuing
its rights and remedies hereunder against any Guarantor, any Secured Party may,
but shall be under no obligation to, make a similar demand on or otherwise
pursue such rights and remedies as it may have against the Borrower, any other
Guarantor or any other Person or against any collateral security or guarantee
for the Borrower Obligations or any right of offset with respect thereto, and
any failure by any Secured Party to make any such demand, to pursue such other
rights or remedies or to collect any payments from the Borrower, any other
Guarantor or any other Person or to realize upon any such collateral security or
guarantee or to exercise any such right of offset, or any release of the
Borrower, any other Guarantor or any other Person or any such collateral
security, guarantee or right of offset, shall not relieve any Guarantor of any
obligation or liability hereunder, and shall not impair or affect the rights and
remedies, whether express, implied or available as a matter of law, of any
Secured Party against any Guarantor. For the purposes hereof "demand" shall
include the commencement and continuance of any legal proceedings.

                2.6.    Reinstatement. The guarantee contained in this Section 2
shall continue to be effective, or be reinstated, as the case may be, if at any
time payment, or any part thereof, of any of the Borrower Obligations is
rescinded or must otherwise be restored or returned by any Secured Party upon
the insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Borrower or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the
Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payments had not been made.

                2.7.    Payments. Each Guarantor hereby guarantees that payments
hereunder will be paid to the Administrative Agent without set-off or
counterclaim in Dollars in immediately available funds at the office of the
Administrative Agent located at the Payment Office specified in the Credit
Agreement.

                     SECTION 3. GRANT OF SECURITY INTEREST

                Each Grantor hereby assigns and transfers to the Administrative
Agent, and hereby grants to the Administrative Agent, for the ratable benefit of
the Secured Parties, a security interest in and mortgage on, all of the
following property now owned or at any time hereafter acquired by such Grantor
or in which such Grantor now has or at any time in the future may acquire any
right, title or interest (collectively, the "Collateral"), as collateral
security for the



                                       10
   14


prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of such Grantor's Obligations,:

                (a)     all Accounts;

                (b)     all Chattel Paper;

                (c)     all Deposit Accounts;

                (d)     all Documents;

                (e)     all Equipment;

                (f)     all Fixtures;

                (g)     all General Intangibles;

                (h)     all Instruments;

                (i)     all Intellectual Property;

                (j)     all Inventory;

                (k)     all Investment Property;

                (l)     all Leases;

                (m)     all Goods and other property not otherwise described
above;

                (n)     all bank accounts, all funds held therein and all
certificates and instruments, if any, from time to time representing or
evidencing such bank accounts;

                (o)     all books and records pertaining to the Collateral; and

                (p)     to the extent not otherwise included, all Proceeds and
products of any and all of the foregoing and all collateral security and
guarantees given by any Person with respect to any of the foregoing.

                Notwithstanding the foregoing, none of the Excluded Assets
shall, to the extent and for so long as they are Excluded Assets, constitute
Collateral. If at any time, by reason of any change in law or the receipt of any
required consent or otherwise, (i) any FCC License that was an Excluded Asset
ceases to meet the conditions set forth in clause (a) of the definition of
"Excluded Assets" found in Section 1.1 of this Agreement or (ii) any Lease,
license agreement or other agreement that was an Excluded Asset ceases to meet
the conditions set forth in the definition of "Excluded Assets" found in Section
1.1 of this Agreement, then such FCC License, Lease, license agreement or other
agreement shall immediately and automatically cease to be an Excluded Asset and
the security interest herein granted shall immediately and automatically attach
thereto without necessity of any further act or deed by any Grantor.



                                       11
   15


                   SECTION 4. REPRESENTATIONS AND WARRANTIES

                To induce the Arranger, the Administrative Agent, the
Syndication Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the Borrower
thereunder, each Grantor hereby represents and warrants to the Secured Parties
that:

                4.1.    Representations in Credit Agreement In the case of each
Guarantor, the representations and warranties set forth in Section 4 of the
Credit Agreement as they relate to such Guarantor or to the Loan Documents to
which such Guarantor is a party, each of which is hereby incorporated herein by
reference, are true and correct in all material respects, and the Secured
Parties shall be entitled to rely on each of them as if they were fully set
forth herein, provided that each reference in each such representation and
warranty to the Borrower's knowledge shall, for the purposes of this Section
4.l, be deemed to be a reference to such Guarantor's knowledge.

                4.2.    Title; No Other Liens. Except for the security interest
granted to the Administrative Agent for the ratable benefit of the Secured
Parties pursuant to this Agreement and the other Liens permitted to exist on the
Collateral by the Credit Agreement, such Grantor owns its interest in each item
of the Collateral granted by it free and clear of any and all Liens or claims of
others. No financing statement or other public notice with respect to all or any
part of the Collateral is on file or of record in any public office, except such
as have been filed in favor of the Administrative Agent, for the ratable benefit
of the Secured Parties, pursuant to this Agreement or as are permitted by the
Credit Agreement.

                4.3.    Perfected First Priority Liens. Except with respect to
assets which in the aggregate do not have a value exceeding $200,000, the
security interests granted pursuant to this Agreement (a) upon completion of the
filings and other actions specified on Schedule 3 (which, in the case of all
filings and other documents referred to on said Schedule, have been delivered to
the Administrative Agent in completed and duly executed form) will constitute
valid perfected security interests in all of the Collateral in favor of the
Administrative Agent, for the ratable benefit of the Secured Parties, as
collateral security for such Grantor's Obligations, enforceable in accordance
with the terms hereof against all creditors of such Grantor and (b) are prior to
all other Liens on the Collateral in existence on the date hereof except for (i)
unrecorded Liens permitted by the Credit Agreement which have priority over the
Liens on the Collateral by operation of law and (ii) Liens described on Schedule
7.

                4.4.    Chief Executive Office. On the date hereof, such
Grantor's jurisdiction of organization and the location of such Grantor's chief
executive office or sole place of business are specified on Schedule 4.

                4.5.    Inventory, Equipment and Books and Records. On the date
hereof, the Inventory and the Equipment (other than mobile goods) and the books
and records pertaining to the Collateral are kept at the locations listed on
Schedule 5.



                                       12
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                4.6.    Farm Products. None of the Collateral constitutes, or is
the Proceeds of, Farm Products.

                4.7.    Investment Property. (a) The shares of Pledged Stock
pledged by such Grantor hereunder constitute all of the issued and outstanding
shares of all classes of the Capital Stock of each Issuer owned by such Grantor
or, in the case of Excluded Foreign Subsidiary Voting Stock, if less, 66% of the
outstanding Excluded Foreign Subsidiary Voting Stock of each relevant Issuer.

                (b)     All the shares of the Pledged Stock have been duly and
validly issued and are fully paid and nonassessable.

                (c)     The terms of any uncertificated limited liability
company interests and partnership interests included in the Pledged Stock
expressly provide that they are securities governed by Article 8 of the Uniform
Commercial Code in effect from time to time in the "issuer's jurisdiction" of
each Issuer thereof (as such term is defined in the Uniform Commercial Code in
effect in such jurisdiction).

                (d)     Such Grantor is the record and beneficial owner of, and
has good and marketable title to, the Pledged Stock and Pledged Notes pledged by
it hereunder, free of any and all Liens or options in favor of, or claims of,
any other Person, except the security interest created by this Agreement.

                4.8.    Receivables. No amount exceeding $250,000 and payable
to such Grantor under or in connection with any Receivable is evidenced by any
Instrument or Chattel Paper which has not been delivered to the Administrative
Agent.

                              SECTION 5. COVENANTS

                Each Grantor covenants and agrees with the Secured Parties that,
from and after the date of this Agreement until the Obligations (other than
Obligations in respect of any Specified Hedge Agreement) shall have been paid in
full, no Letter of Credit shall be outstanding and the Commitments shall have
terminated or expired:

                5.1.    Covenants in Credit Agreement. Each Guarantor shall
take, or shall refrain from taking, as the case may be, each action that is
necessary to be taken or not taken, as the case may be, so that no Default or
Event of Default is caused by the failure to take such action or to refrain from
taking such action by such Guarantor or any of its Subsidiaries.

                5.2.    Delivery and Control of Instruments, Chattel Paper and
Investment Property. (a) If an aggregate principal amount of the Collateral
exceeding $250,000 shall be or become evidenced or represented by any
Instrument, Certificated Security or Chattel Paper, such Instrument,
Certificated Security or Chattel Paper shall be immediately delivered to the
Administrative Agent, duly endorsed in a manner satisfactory to the
Administrative Agent, to be held as Collateral pursuant to this Agreement.



                                       13
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                (b)     If any of the Collateral shall be or become evidenced or
represented by an Uncertificated Security, such Grantor shall cause the Issuer
thereof either (i) to register the Administrative Agent as the registered owner
of such Uncertificated Security, upon original issue or registration of transfer
or (ii) to agree in writing with such Grantor and the Administrative Agent that
such Issuer will comply with instructions with respect to such Uncertificated
Security originated by the Administrative Agent without further consent of such
Grantor, such agreement to be in substantially the form of Exhibit B.

                (c)     If any of the Collateral shall be or become evidenced or
represented by a Security Entitlement, such Grantor shall cause the Securities
Intermediary with respect to such Security Entitlement either (i) to identify in
its records the Administrative Agent as having such Security Entitlement against
such Securities Intermediary or (ii) to agree in writing with such Grantor and
the Administrative Agent that such Securities intermediary will comply with
Entitlement Orders originated by the Administrative Agent without further
consent of such Grantor, such agreement to be in substantially the form of
Exhibit C.

                (d)     If any of the Collateral shall be or become evidenced or
represented by a Commodity Contract, such Grantor shall cause the Commodity
Intermediary with respect to such Commodity Contract to agree in writing with
such Grantor and the Administrative Agent that such Commodity Intermediary will
apply any value distributed on account of such Commodity Contract as directed by
the Administrative Agent without further consent of such Grantor, such agreement
to be in substantially the form of Exhibit D.

                (e)     If any of the Collateral shall be or become evidenced or
represented by or held in a Securities Account or a Commodity Account, such
Grantor shall, in the case of a Securities Account, comply with subsection (c)
of this Section 5.2 with respect to all Security Entitlements carried in such
Securities Account and, in the case of a Commodity Account, comply with
subsection (d) of this Section 5.2 with respect to all Commodity Contracts
carried in such Commodity Account.

                5.3.    Maintenance of Insurance. Such Grantor will maintain
insurance as required pursuant to Section 6.5 of Credit Agreement.

                5.4.    Maintenance of Perfected Security Interest; Further
Documentation. (a) Such Grantor shall maintain the security interest created by
this Agreement as a perfected security interest having at least the priority
described in Section 4.3 and shall defend such security interest against the
claims and demands of all Persons whomsoever.

                (b)     Such Grantor will furnish to the Secured Parties from
time to time statements and schedules further identifying and describing the
Collateral and such other reports in connection with the assets and property of
such Grantor as the Administrative Agent may reasonably request, all in
reasonable detail.

                (c)     At any time and from time to time, upon the written
request of the Administrative Agent, and at the sole expense of such Grantor,
such Grantor will promptly and duly execute and deliver, and have recorded, such
further instruments and documents and take



                                       14
   18


such further actions as the Administrative Agent may reasonably request for the
purpose of obtaining or preserving the full benefits of this Agreement and of
the rights and powers herein granted, including, without limitation, (i) the
filing of any financing or continuation statements under the Uniform Commercial
Code (or other similar laws) in effect in any jurisdiction with respect to the
security interests created hereby and (ii) in the case of Investment Property,
Deposit Accounts and any other relevant Collateral, taking any actions necessary
to enable the Administrative Agent to obtain "control" (within the meaning of
the applicable Uniform Commercial Code) with respect thereto (or, in the case of
Deposit Accounts, taking sole dominion and control thereof).

                5.5.    Changes in Locations, Name, etc. Such Grantor will not,
except upon 15 days' prior written notice to the Administrative Agent and
delivery to the Administrative Agent of (a) all additional executed financing
statements and other documents reasonably requested by the Administrative Agent
to maintain the validity, perfection and priority of the security interests
provided for herein and (b) if applicable, a written supplement to Schedule 5
showing any additional location at which Inventory or Equipment (other than
mobile goods) or books and records pertaining to the Collateral shall be kept:

                (i)     permit any of the Inventory or Equipment (other than
mobile goods) or books and records pertaining to the Collateral to be kept at a
location other than those listed on Schedule 5;

                (ii)    change its jurisdiction of organization or the location
of its chief executive office or sole place of business from that referred to in
Section 4.4; or

                (iii)   change its name, identity or structure to such an extent
that any financing statement filed by the Administrative Agent in connection
with this Agreement would become misleading.

                5.6.    Investment Property. (a) If such Grantor shall receive
any stock or other ownership certificate (including, without limitation, any
certificate representing a stock dividend or a distribution in connection with
any reclassification, increase or reduction of capital or any certificate issued
in connection with any reorganization), option or rights in respect of the
Capital Stock of any Issuer, whether in addition to, in substitution of, as a
conversion of, or in exchange for, any shares of or other ownership interests in
the Pledged Stock, or otherwise in respect thereof, such Grantor shall accept
the same as the agent of the Secured Parties, hold the same in trust for the
Secured Parties and deliver the same forthwith to the Administrative Agent in
the exact form received, duly endorsed by such Grantor to the Administrative
Agent, if required, together with an undated stock power covering such
certificate duly executed in blank by such Grantor and with, if the
Administrative Agent so requests, signature guaranteed, to be held by the
Administrative Agent, subject to the terms hereof, as additional collateral
security for the Obligations. Any sums paid upon or in respect of the Pledged
Securities upon the liquidation or dissolution of any Issuer shall be paid over
to the Administrative Agent to be held by it hereunder as additional collateral
security for the Obligations, and in case any distribution of capital shall be
made on or in respect of the Pledged Securities or any property shall be
distributed upon or with respect to the Pledged Securities pursuant to the
recapitalization or reclassification of the capital



                                       15
   19


of any Issuer or pursuant to the reorganization thereof, the property so
distributed shall, unless otherwise subject to a perfected security interest in
favor of the Administrative Agent, be delivered to the Administrative Agent to
be held by it hereunder as additional collateral security for the Obligations.
If any sums of money or property so paid or distributed in respect of the
Pledged Securities shall be received by such Grantor, such Grantor shall, until
such money or property is paid or delivered to the Administrative Agent, hold
such money or property in trust for the Secured Parties, segregated from other
funds of such Grantor, as additional collateral security for the Obligations.

                (b)     Without the prior written consent of the Administrative
Agent, such Grantor will not (i) sell, assign, transfer, exchange, or otherwise
dispose of, or grant any option with respect to, any of the Investment Property
or Proceeds thereof or any interest therein (except pursuant to a transaction
permitted by the Credit Agreement), (ii) create, incur or permit to exist any
Lien or option in favor of, or any claim of any Person with respect to, any of
the Investment Property or Proceeds thereof, or any interest therein, except for
the security interests created by this Agreement or (iii) enter into any
agreement or undertaking restricting the foreclosure of the Administrative
Agent's security interest in any of the Investment Property or Proceeds thereof
or any interest therein.

                (c)     In the case of each Grantor which is an Issuer, such
Issuer agrees that (i) it will be bound by the terms of this Agreement relating
to the Pledged Securities issued by it and will comply with such terms insofar
as such terms are applicable to it, (ii) it will notify the Administrative Agent
promptly in writing of the occurrence of any of the events described in Section
5.6(a) with respect to the Pledged Securities issued by it and (iii) the terms
of Section 6.3(c) shall apply to it, mutatis mutandis, with respect to all
actions that may be required of it with respect to the Pledged Securities issued
by it.

                5.7.    Intellectual Property. Except in any respect that would
not materially impair the right, power, authority and ability of the Grantors to
use their intellectual property as necessary or convenient for the profitable
conduct of their businesses and would not reasonably be expected to have a
Material Adverse Effect:

                (a)     Such Grantor (either itself or through licensees) will
(i) continue to use each material Trademark on each and every trademark class of
goods applicable to its current line as reflected in its current catalogs,
brochures and price lists in order to maintain such Trademark in full force free
from any claim of abandonment for non-use, (ii) maintain as in the past the
quality of products and services offered under such Trademark and take all
necessary steps to ensure that all licensed users of such Trademark maintain as
in the past such quality, (iii) use such Trademark with the appropriate notice
of registration and all other notices and legends required by applicable
Requirements of Law, (iv) not adopt or use any mark which is confusingly similar
or a colorable imitation of such Trademark unless the Administrative Agent, for
the ratable benefit of the Secured Parties, shall obtain a perfected security
interest in such mark pursuant to this Agreement and the Intellectual Property
Security Agreement, and (v) not (and not permit any licensee or sublicensee
thereof to) do any act or knowingly omit to do any act whereby such Trademark
may become invalidated or impaired in any way.



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                (b)     Such Grantor (either itself or through licensees) will
not do any act, or omit to do any act, whereby any material Patent may become
forfeited, abandoned or dedicated to the public.

                (c)     Such Grantor (either itself or through licensees) (i)
will employ each material Copyright and (ii) will not (and will not permit any
licensee or sublicensee thereof to) do any act or knowingly omit to do any act
whereby any material portion of the Copyrights may become invalidated or
otherwise impaired. Such Grantor will not (either itself or through licensees)
do any act whereby any material portion of the Copyrights may fall into the
public domain.

                (d)     Such Grantor (either itself or through licensees) will
not do any act that knowingly uses any material Intellectual Property to
infringe the intellectual property rights of any other Person.

                (e)     Such Grantor (either itself or through licensees) will
use proper statutory notice in connection with the use of each material Patent,
Trademark and Copyright included in the Intellectual Property.

                (f)     Such Grantor will notify the Secured Parties immediately
if it knows, or has reason to know, that any application or registration
relating to any material Intellectual Property may become forfeited, abandoned
or dedicated to the public, or of any adverse determination or development
(including, without limitation, the institution of, or any such determination or
development in, any proceeding in the United States Patent and Trademark Office,
the United States Copyright Office or any court or tribunal in any country)
regarding such Grantor's ownership of, or the validity of, any material
Intellectual Property or such Grantor's right to register the same or to own and
maintain the same.

                (g)     Whenever such Grantor, either by itself or through any
agent, employee, licensee or designee, shall file an application for the
registration of any Intellectual Property with the United States Patent and
Trademark Office, the United States Copyright Office or any similar office or
agency in any other country or any political subdivision thereof, such Grantor
shall report such filing to the Administrative Agent within five Business Days
after the last day of the fiscal quarter in which such filing occurs. Upon
request of the Administrative Agent, such Grantor shall execute and deliver, and
have recorded, any and all agreements, instruments, documents, and papers as the
Administrative Agent may request to evidence the Secured Parties' security
interest in any Copyright, Patent, Trademark or other Intellectual Property and
the goodwill and general intangibles of such Grantor relating thereto or
represented thereby.

                (h)     Such Grantor will take all reasonable and necessary
steps, including, without limitation, in any proceeding before the United States
Patent and Trademark Office, the United States Copyright Office or any similar
office or agency in any other country or any political subdivision thereof, to
maintain and pursue each application (and to obtain the relevant registration)
and to maintain each registration of material Intellectual Property, including,
without limitation, the payment of required fees and taxes, the filing of
responses to office actions issued by the United States Patent and Trademark
Office and the United States Copyright



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Office, the filing of applications for renewal or extension, the filing of
affidavits of use and affidavits of incontestability, the filing of divisional,
continuation, continuation-in-part, reissue, and renewal applications or
extensions, the payment of maintenance fees, and the participation in
interference, reexamination, opposition, cancellation, infringement and
misappropriation proceedings.

                (i)     Such Grantor (either itself or through licensees) will
not, without the prior written consent of the Administrative Agent, discontinue
use of or otherwise abandon any Intellectual Property, or abandon any right to
file an application for letters patent, trademark, or copyright, unless such
Grantor shall have previously determined that such use or the pursuit or
maintenance of such Intellectual Property is no longer desirable in the conduct
of such Grantor's business and that the loss thereof could not reasonably be
expected to have a Material Adverse Effect and, in which case, such Grantor
shall give prompt notice of any such abandonment to the Administrative Agent in
accordance herewith.

                (j)     In the event that any material Intellectual Property is
infringed, misappropriated or diluted by a third party, such Grantor shall (i)
take such actions as such Grantor shall reasonably deem appropriate under the
circumstances to protect such Intellectual Property and (ii) if such
Intellectual Property is of material economic value, promptly notify the
Administrative Agent after it learns thereof and sue for infringement,
misappropriation or dilution, to seek injunctive relief where appropriate and to
recover any and all damages for such infringement, misappropriation or dilution.

                (k)     Such Grantor agrees that, should it obtain an ownership
interest in any item of intellectual property which is not now a part of the
Intellectual Property Collateral (the "After-Acquired Intellectual Property"),
(i) the provisions of Section 3 shall automatically apply thereto, (ii) any such
After-Acquired Intellectual Property, and in the case of trademarks, the
goodwill of the business connected therewith or symbolized thereby, shall
automatically become part of the Intellectual Property Collateral, (iii) it
shall give prompt (and, in any event within 15 days after the date of such
acquisition) written notice thereof to the Administrative Agent in accordance
herewith, and (iv) it shall provide the Administrative Agent promptly (and, in
any event within 15 days after the date of such acquisition) with an amended
Schedule 6 hereto and amended schedules to the Intellectual Property Security
Agreement reflecting the acquisition of such After-Acquired Intellectual
Property. Such Grantor authorizes the Administrative Agent to modify this
Agreement by amending Schedule 6 hereto and to modify the schedules to the
Intellectual Property Security Agreement if such Grantor fails to provide the
Administrative Agent with satisfactory amended schedules hereto or thereto
within the time period required hereunder (and will cooperate with the
Administrative Agent in effecting any such amendment) to include any
After-Acquired Intellectual Property which becomes part of the Intellectual
Property Collateral under this Section, and to record any such modified
agreement with the United States Patent and Trademark Office, the United States
Copyright Office, or any other applicable Governmental Authority.

                (l)     Such Grantor agrees to execute an Intellectual Property
Security Agreement with respect to its Intellectual Property in substantially
the form of Exhibit A in order to record the security interest granted herein to
the Administrative Agent for the ratable benefit of



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the Secured Parties with the United States Patent and Trademark Office, the
United States Copyright Office, and any other applicable Governmental Authority.

                         SECTION 6. REMEDIAL PROVISIONS

                6.1.    Default. Grantors shall be in default under this
Agreement (a) whenever any Event of Default has occurred and is continuing (and
each of the Grantors shall thereupon be in default hereunder without regard to
whether or to what degree any Grantor individually may have caused, participated
in, or had any knowledge of the occurrence of such Event of Default) and (b) at
all times after the Loans have become due and payable, whether at maturity, upon
acceleration pursuant to the Credit Agreement or otherwise.

                6.2.    Remedies Upon Default. At any time when any Grantor is
in default under this Agreement as set forth in Section 6.1, the Administrative
Agent may exercise and enforce, in any order, (i) each and all of the rights and
remedies available to a secured party upon default under the Uniform Commercial
Code or other applicable law, (ii) each and all of the rights and remedies
available to it under the Credit Agreement or any other Loan Document and (iii)
each and all of the following rights and remedies:

                (a)     Collection Rights. Without notice to any Grantor or any
other Loan Party, the Administrative Agent may notify any or all account debtors
and obligors on any Accounts, Instruments or other Claims constituting
Collateral of the Administrative Agent's security interests therein and may
direct, demand and enforce payment thereof directly to the Administrative Agent.

                (b)     Taking Possession. The Administrative Agent may (i)
enter upon any and all premises owned or leased by any Grantor where Collateral
is located (or believed by the Administrative Agent to be located), with or (to
the fullest extent permitted by law) without judicial process and without any
obligation to pay rent, (ii) prior to the disposition of the Collateral, store,
process, repair or recondition the Collateral or otherwise prepare the
Collateral for disposition in any manner to the extent the Administrative Agent
deems appropriate, (iii) take possession of any Grantor's premises or place
custodians in exclusive control thereof, remain on such premises and use the
same and any Grantor's equipment for the purpose of completing any work in
process or otherwise preparing the Collateral for sale or selling or otherwise
transferring the Collateral, (iv) take possession of all items of Collateral
that are not then in its possession, either upon such premises or by removal
from such premises, and (v) require any Grantor or the Person in possession
thereof to deliver such Collateral to the Administrative Agent at one or more
locations designated by the Administrative Agent and reasonably convenient to it
and each Grantor owning an interest therein.

                (c)     Foreclosure. The Administrative Agent may sell, lease,
license or otherwise dispose of or transfer any or all of the Collateral or any
part thereof in one or more parcels at public sale or in private sale or
transaction, on any exchange or market or at the Administrative Agent's offices
or on any Grantor's premises or at any other location, for cash, on credit or
for future delivery, and may enter into all contracts necessary or appropriate
in connection therewith, without any notice whatsoever unless required by law.
Where permitted



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by law, one or more of the Secured Parties may be the purchasers at any such
sale and in such event, if such bid is made by all of the Lenders or otherwise
whenever a credit bid is expressly permitted under the Credit Agreement or
approved in writing by the Administrative Agent and the Required Lenders, the
Secured Parties bidding at such sale may bid part or all of the Obligations
owing to them without necessity of any cash payment on account of the purchase
price, even though any other purchaser at such sale is required to bid a
purchase price payable in cash. Each Grantor agrees that at least 10 calendar
days' written notice to such Grantor of the time and place of any public sale of
Collateral owned by it (or, to the extent such Grantor is entitled by law to
notice thereof, the public sale of any other Collateral), or the time after
which any private sale of Collateral owned by it (or, to the extent such Grantor
is entitled by law to notice thereof, the private sale of any other Collateral)
is to be made, shall be commercially reasonable. For purposes of such notice, to
the fullest extent permitted by law (i) each Grantor waives notice of any sale
of Collateral owned by any other Grantor and (ii) each Grantor agrees that
notice given to the Borrower shall constitute notice given to such Grantor. The
giving of notice of any such sale or other disposition shall not obligate the
Administrative Agent to proceed with the sale or disposition, and any such sale
or disposition may be postponed or adjourned from time to time, without further
notice.

                (d)     Use of Intellectual Property. The Administrative Agent
may, on a royalty-free basis, use and license use of any trademark, trade name,
trade style, copyright, patent or technical knowledge or process owned, held or
used by any Grantor in respect of any Collateral as to which any right or remedy
of the Administrative Agent is exercised or enforced.

In addition, the Administrative Agent may exercise and enforce such rights and
remedies for collection as may be available to it by law or agreement.

                6.3.    Waivers by Grantors. Each Grantor hereby irrevocably
waives (a) all rights of redemption from any foreclosure sale, (b) the benefit
of all valuation, appraisal, exemption and moratorium laws, (c) to the fullest
extent permitted by law, all rights to notice or a hearing prior to the exercise
by the Administrative Agent of its right to take possession of any Collateral,
whether by self-help or by legal process and any right to object to the
Administrative Agent taking possession of any Collateral by self-help, and (d)
if the Administrative Agent seeks to obtain possession of any Collateral by
replevin, claim and delivery, attachment, levy or other legal process, (i) any
notice or demand for possession prior to the commencement of legal proceedings,
(ii) the posting of any bond or security in any such proceedings, and (iii) any
requirement that the Administrative Agent retain possession and not dispose of
any Collateral until after a trial or final judgment in such proceedings.

                6.4.    Standard of Care. The powers conferred on the
Administrative Agent hereunder are solely to protect its interest in the
Collateral and shall not impose any duty upon it to exercise any such powers.
Except for the exercise of reasonable care in the custody of any Collateral in
its possession and the accounting for moneys actually received by it hereunder,
the Administrative Agent shall have no duty as to any Collateral or as to the
taking of any necessary steps to preserve rights against prior parties or to
protect, preserve, vote or exercise any rights pertaining to any Collateral. The
Administrative Agent shall be deemed to have exercised reasonable care in the
custody and preservation of Collateral in its possession if such Collateral is



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accorded treatment substantially equal to that which the Administrative Agent
accords its own property or if it selects, with reasonable care, a custodian to
hold such Collateral on its behalf.

                6.5.    Application of Proceeds. Except as expressly provided
elsewhere in this Agreement, all proceeds received by the Administrative Agent
in respect of any sale of, collection from, or other realization upon all or any
part of the Collateral may, in the discretion of the Administrative Agent, be
held by the Administrative Agent as Collateral for, or then, or at any other
time thereafter, applied in full or in part by the Administrative Agent against,
the Obligations in the following order of priority:

                FIRST: To the payment of all reasonable costs and expenses of
        such sale, collection or other realization, including reasonable
        compensation to the Administrative Agent and its agents and counsel, and
        all other reasonable expenses, liabilities and advances made or incurred
        by the Administrative Agent in connection therewith, and all amounts for
        which the Administrative Agent is entitled to indemnification hereunder
        and all reasonable advances made by the Administrative Agent hereunder
        for the account of any Grantor, and to the payment of all reasonable
        costs and expenses paid or incurred by the Administrative Agent in
        connection with the exercise of any right or remedy hereunder, all in
        accordance with Section 8.4;

                SECOND: To the payment of all other Obligations (for the ratable
        benefit of the holders thereof) then due and payable; and

                THIRD: To the payment to or upon the order of the Grantor
        entitled thereto, or to whomsoever may be lawfully entitled to receive
        the same or as a court of competent jurisdiction may direct, of any
        surplus then remaining from such proceeds.

                6.6.    Surplus, Deficiency. Any surplus proceeds of any sale or
other disposition by the Administrative Agent of any Collateral remaining after
discharge of the Credit Agreement and after all Obligations are paid in full and
in cash shall be paid over to the Grantor entitled thereto, or to whomever may
be lawfully entitled to receive such surplus or as a court of competent
jurisdiction may direct, but prior to discharge of the Credit Agreement, such
surplus proceeds may be retained by the Administrative Agent and held as
Collateral until discharge of the Credit Agreement. The Borrower and each
Guarantor shall be and remain liable for any deficiency.

                6.7.    Information Related to the Collateral. If, during the
continuance of an Event of Default, the Administrative Agent determines to sell
or otherwise transfer any Collateral, each Grantor shall, and shall cause any
Person controlled by it to, furnish to the Administrative Agent all information
the Administrative Agent may request that pertains or could pertain to the value
or condition of the Collateral or that would or might facilitate such sale or
transfer. The Administrative Agent shall have the right, notwithstanding any
confidentiality obligation or agreement otherwise binding upon it, freely to
disclose such information, and any and all other information (including
confidential information) pertaining in any manner to the Collateral or the
assets, liabilities, results of operations, business or prospects of any Secured
Parties, freely to any Person that the Administrative Agent in good faith
believes to be a potential



                                       21
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or prospective purchaser in such sale or transfer, without liability for any
disclosure, dissemination or use that may be made as to such information by any
such Person.

                6.8     Sale Exempt from Registration. The Administrative Agent
shall be entitled at any such sale or other transfer, if it deems it advisable
to do so, to restrict the prospective bidders or purchasers to Persons who will
provide assurances satisfactory to the Administrative Agent that the Collateral
may be offered and sold to them without registration under the Securities Act of
1933, as amended, and without registration or qualification under any other
applicable state or federal law. Upon the consummation of any such sale, the
Administrative Agent shall have the right to assign, transfer and deliver to the
purchaser or purchasers thereof the Collateral so sold. The Administrative Agent
may solicit offers to buy the Collateral, or any part of it, from a limited
number of investors deemed by the Administrative Agent, in its good faith
judgment or in good faith reliance upon advice of its counsel, to meet the
requirements to purchase securities under Regulation D promulgated under the
Securities Act of 1933 as then in effect (or any other regulation of similar
import). If the Administrative Agent solicits such offers from such investors,
then the acceptance by the Administrative Agent of the highest offer obtained
from any of them shall be deemed to be a commercially reasonable method of
disposition of the Collateral

                6.9     Rights and Remedies Cumulative. The rights provided for
in this Agreement and the other Loan Documents are cumulative and are not
exclusive of any other rights, powers or privileges or remedies provided by law
or in equity, or under any other instrument, document or agreement. The
Administrative Agent may exercise and enforce each right and remedy available to
it either before or concurrently with or after, and independently of, any
exercise or enforcement of any other right or remedy of the Administrative Agent
or any Secured Party against any Person or property. All such rights and
remedies shall be cumulative, and no one of them shall exclude or preclude any
other.

                6.10    No Direct Enforcement by Secured Parties. The
Administrative Agent may freely exercise and enforce any and all of its rights
and remedies hereunder, for the benefit of the Secured Parties. No Secured
Party, other than the Administrative Agent, shall have any independent right to
collect, take possession of, foreclose against or otherwise enforce the security
interests granted hereby.

                      SECTION 7. THE ADMINISTRATIVE AGENT

                7.1.    Administrative Agent's Appointment as Attorney-in-Fact,
etc. (a) Each Grantor hereby irrevocably constitutes and appoints the
Administrative Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of such Grantor and in the name of
such Grantor or in its own name, for the purpose of carrying out the terms of
this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, and, without limiting the generality of the
foregoing, each Grantor hereby gives the Administrative Agent the power and
right, on behalf of such Grantor, without notice to or assent by such Grantor,
to do any or all of the following:


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                (i)     in the name of such Grantor or its own name, or
        otherwise, take possession of and endorse and collect any checks,
        drafts, notes, acceptances or other instruments for the payment of
        moneys due under any Receivable or with respect to any other Collateral
        and file any claim or take any other action or proceeding in any court
        of law or equity or otherwise deemed appropriate by the Administrative
        Agent for the purpose of collecting any and all such moneys due under
        any Receivable or with respect to any other Collateral whenever payable;

                (ii)    in the case of any Intellectual Property, execute and
        deliver, and have recorded, any and all agreements, instruments,
        documents and papers as the Administrative Agent may request to evidence
        the Secured Parties' security interest in such Intellectual Property and
        the goodwill and general intangibles of such Grantor relating thereto or
        represented thereby;

                (iii)   pay or discharge taxes and Liens levied or placed on or
        threatened against the Collateral, effect any repairs or any insurance
        called for by the terms of this Agreement and pay all or any part of the
        premiums therefor and the costs thereof;

                (iv)    execute, in connection with any sale provided for in
        Section 6, any endorsements, assignments or other instruments of
        conveyance or transfer with respect to the Collateral; and

                (v)     (1) direct any party liable for any payment under any of
        the Collateral to make payment of any and all moneys due or to become
        due thereunder directly to the Administrative Agent or as the
        Administrative Agent shall direct; (2) ask or demand for, collect, and
        receive payment of and receipt for, any and all moneys, claims and other
        amounts due or to become due at any time in respect of or arising out of
        any Collateral; (3) sign and endorse any invoices, freight or express
        bills, bills of lading, storage or warehouse receipts, drafts against
        debtors, assignments, verifications, notices and other documents in
        connection with any of the Collateral; (4) commence and prosecute any
        suits, actions or proceedings at law or in equity in any court of
        competent jurisdiction to collect the Collateral or any portion thereof
        and to enforce any other right in respect of any Collateral; (5) defend
        any suit, action or proceeding brought against such Grantor with respect
        to any Collateral; (6) settle, compromise or adjust any such suit,
        action or proceeding and, in connection therewith, give such discharges
        or releases as the Administrative Agent may deem appropriate; (7) assign
        any Copyright, Patent or Trademark (along with the goodwill of the
        business to which any such Copyright, Patent or Trademark pertains),
        throughout the world for such term or terms, on such conditions, and in
        such manner, as the Administrative Agent shall in its sole discretion
        determine; and (8) generally, sell, transfer, pledge and make any
        agreement with respect to or otherwise deal with any of the Collateral
        as fully and completely as though the Administrative Agent were the
        absolute owner thereof for all purposes, and do, at the Administrative
        Agent's option and such Grantor's expense, at any time, or from time to
        time, all acts and things which the Administrative Agent deems necessary
        to protect, preserve or realize upon the Collateral and the Secured
        Parties' security interests therein



                                       23
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        and to effect the intent of this Agreement, all as fully and effectively
        as such Grantor might do.

                Anything in this Section 7.1(a) to the contrary notwithstanding,
the Administrative Agent agrees that it will not exercise any rights under the
power of attorney provided for in this Section 7.1(a) unless an Event of Default
shall have occurred and be continuing.

                (b)     If any Grantor fails to perform or comply with any of
its agreements contained herein, the Administrative Agent, at its option, but
without any obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement.

                (c)     The expenses of the Administrative Agent incurred in
connection with actions undertaken as provided in this Section 7.1, together
with interest thereon at a rate per annum equal to the rate per annum at which
interest would then be payable on past due Base Rate Loans under the Credit
Agreement, from the date of payment by the Administrative Agent to the date
reimbursed by the relevant Grantor, shall be payable by such Grantor to the
Administrative Agent on demand.

                (d)     Each Grantor hereby ratifies all that said attorneys
shall lawfully do or cause to be done by virtue hereof. All powers,
authorizations and agencies contained in this Agreement are coupled with an
interest and are irrevocable until this Agreement is terminated and the security
interests created hereby are released.

                7.2.    Duty of Administrative Agent. The Administrative Agent's
sole duty with respect to the custody, safekeeping and physical preservation of
the Collateral in its possession, under Section 9-207 of the New York UCC or
otherwise, shall be to deal with it in the same manner as the Administrative
Agent deals with similar property for its own account. Neither the
Administrative Agent, nor any other Secured Party nor any of their respective
officers, directors, partners, employees, agents, attorneys and other advisors,
attorneys-in-fact or affiliates shall be liable for failure to demand, collect
or realize upon any of the Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Collateral upon the
request of any Grantor or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof. The powers
conferred on the Secured Parties hereunder are solely to protect the Secured
Parties' interests in the Collateral and shall not impose any duty upon any
Secured Party to exercise any such powers. The Secured Parties shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
partners, employees, agents, attorneys and other advisors, attorneys-in-fact or
affiliates shall be responsible to any Grantor for any act or failure to act
hereunder, except to the extent that any such act or failure to act is found by
a final and nonappealable decision of a court of competent jurisdiction to have
resulted solely from their own gross negligence or willful misconduct.

                7.3.    Execution of Financing Statements. Pursuant to Section
9-402 of the New York UCC and any other applicable law, each Grantor authorizes
the Administrative Agent to file or record financing statements and other filing
or recording documents or instruments with



                                       24
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respect to the Collateral without the signature of such Grantor in such form and
in such offices as the Administrative Agent reasonably determines appropriate to
perfect or maintain the perfection of the security interests of the
Administrative Agent under this Agreement. A photographic or other reproduction
of this Agreement shall be sufficient as a financing statement or other filing
or recording document or instrument for filing or recording in any jurisdiction.

                7.4.    Authority of Administrative Agent. Each Grantor
acknowledges that the rights and responsibilities of the Administrative Agent
under this Agreement with respect to any action taken by the Administrative
Agent or the exercise or non-exercise by the Administrative Agent of any option,
voting right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the Administrative
Agent and the other Secured Parties, be governed by the Credit Agreement and by
such other agreements with respect thereto as may exist from time to time among
them, but, as between the Administrative Agent and the Grantors, the
Administrative Agent shall be conclusively presumed to be acting as agent for
the Secured Parties with full and valid authority so to act or refrain from
acting, and no Grantor shall be under any obligation, or entitlement, to make
any inquiry respecting such authority.

                            SECTION 8. MISCELLANEOUS

                8.1.    Amendments in Writing. None of the terms or provisions
of this Agreement may be waived, amended, supplemented or otherwise modified
except by a written instrument executed by each affected Grantor and the
Administrative Agent, provided that any provision of this Agreement imposing
obligations on any Grantor may be waived by the Administrative Agent in a
written instrument executed by the Administrative Agent in accordance with
Section 10.1 of the Credit Agreement.

                8.2.    Notices. All notices, requests and demands to or upon
the Administrative Agent or any Grantor hereunder shall be effected in the
manner provided for in Section 10.2 of the Credit Agreement; provided that any
such notice, request or demand to or upon any Guarantor shall be addressed to
such Guarantor at its notice address set forth on Schedule 1.

                8.3.    No Waiver by Course of Conduct; Cumulative Remedies. No
Secured Party shall by any act (except by a written instrument pursuant to
Section 8.1), delay, indulgence, omission or otherwise be deemed to have waived
any right or remedy hereunder or to have acquiesced in any Default or Event of
Default. No failure to exercise, nor any delay in exercising, on the part of any
Secured Party, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by any Secured Party of any
right or remedy hereunder on any one occasion shall not be construed as a bar to
any right or remedy which such Secured Party would otherwise have on any future
occasion. The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.



                                       25
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                8.4.    Enforcement Expenses; Indemnification. (a) Each Grantor
agrees to pay or reimburse each Secured Party for all its costs and expenses
incurred in collecting against such Grantor under the guarantee contained in
Section 2 or otherwise enforcing or preserving any rights under this Agreement
and the other Loan Documents to which such Grantor is a party, including,
without limitation, the fees and disbursements of counsel (including the
allocated fees and expenses of in-house counsel) to each Secured Party and of
counsel to the Administrative Agent.

                (b)     Each Grantor agrees to pay, and to save the Secured
Parties harmless from, any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever with respect to the execution, delivery, enforcement,
performance and administration of this Agreement to the extent the Borrower
would be required to do so pursuant to Section 10.5 of the Credit Agreement.

                (c)     The agreements in this Section shall survive repayment
of the Obligations and all other amounts payable under the Credit Agreement and
the other Loan Documents.

                (d)     Each Grantor agrees that the provisions of Section 2.20
of the Credit Agreement are hereby incorporated herein by reference, mutatis
mutandis, and each Secured Party shall be entitled to rely on each of them as if
they were fully set forth herein.

                8.5.    Successors and Assigns. This Agreement shall be binding
upon the successors and assigns of each Grantor and shall inure to the benefit
of the Secured Parties and their successors and assigns; provided that no
Grantor may assign, transfer or delegate any of its rights or obligations under
this Agreement without the prior written consent of the Administrative Agent.

                8.6.    Set-Off. Each Grantor hereby irrevocably authorizes each
Secured Party at any time and from time to time while an Event of Default shall
have occurred and be continuing, without notice to such Grantor or any other
Grantor, any such notice being expressly waived by each Grantor, to set-off and
appropriate and apply any and all deposits (general or special, time or demand,
provisional or final), in any currency, and any other credits, indebtedness or
claims, in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by such Secured
Party to or for the credit or the account of such Grantor, or any part thereof
in such amounts as such Secured Party may elect, against and on account of the
obligations and liabilities of such Grantor to such Secured Party hereunder and
claims of every nature and description of such Secured Party against such
Grantor, in any currency, whether arising hereunder, under the Credit Agreement,
any other Loan Document or otherwise, as such Secured Party may elect, whether
or not any Secured Party has made any demand for payment and although such
obligations, liabilities and claims may be contingent or unmatured. Each Secured
Party shall notify such Grantor promptly of any such set-off and the application
made by such Secured Party of the proceeds thereof, provided that the failure to
give such notice shall not affect the validity of such set-off and application.
The rights of each Secured Party under this Section are in addition to other
rights and remedies (including, without limitation, other rights of set-off)
which such Secured Party may have.



                                       26
   30


                8.7.    Counterparts. This Agreement may be executed by one or
more of the parties to this Agreement on any number of separate counterparts
(including by telecopy), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument.

                8.8.    Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

                8.9.    Section Headings. The Section headings used in this
Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.

                8.10.   Integration. This Agreement and the other Loan Documents
represent the agreement of the Grantors, the Administrative Agent and the other
Secured Parties with respect to the subject matter hereof and thereof, and there
are no promises, undertakings, representations or warranties by any Secured
Party relative to subject matter hereof and thereof not expressly set forth or
referred to herein or in the other Loan Documents.

                8.11.   GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

                8.12.   Submission To Jurisdiction; Waivers. Each Grantor hereby
irrevocably and unconditionally:

                (a)     submits for itself and its property in any legal action
        or proceeding relating to this Agreement and the other Loan Documents to
        which it is a party, or for recognition and enforcement of any judgment
        in respect thereof, to the non-exclusive general jurisdiction of the
        Courts of the State of New York, the courts of the United States of
        America for the Southern District of New York, and appellate courts from
        any thereof;

                (b)     consents that any such action or proceeding may be
        brought in such courts and waives any objection that it may now or
        hereafter have to the venue of any such action or proceeding in any such
        court or that such action or proceeding was brought in an inconvenient
        court and agrees not to plead or claim the same;

                (c)     agrees that service of process in any such action or
        proceeding may be effected by mailing a copy thereof by registered or
        certified mail (or any substantially similar form of mail), postage
        prepaid, to such Grantor at its address referred to in Section 8.2 or at
        such other address of which the Administrative Agent shall have been
        notified pursuant thereto;

                (d)     agrees that nothing herein shall affect the right to
        effect service of process in any other manner permitted by law or shall
        limit the right to sue in any other jurisdiction; and



                                       27
   31


                (e)     waives, to the maximum extent not prohibited by law, any
        right it may have to claim or recover in any legal action or proceeding
        referred to in this Section any special, exemplary, punitive or
        consequential damages.

                8.13.   Acknowledgments. Each Grantor hereby acknowledges that:

                (a)     it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents to which
it is a party;

                (b)     no Secured Party has any fiduciary relationship with or
duty to any Grantor arising out of or in connection with this Agreement or any
of the other Loan Documents, and the relationship between the Grantors, on the
one hand, and the Secured Parties, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and

                (c)     no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions contemplated hereby
among the Secured Parties or among the Grantors and the Secured Parties.

                8.14.   Additional Grantors. Each Subsidiary of the Borrower
that is required to become a party to this Agreement pursuant to Section 6.10 of
the Credit Agreement shall become a Grantor for all purposes of this Agreement
upon execution and delivery by such Subsidiary of an Assumption Agreement in the
form of Annex 1 hereto.

                8.15.   Releases. (a) Notwithstanding anything to the contrary
contained in the Credit Agreement, herein or in any other Loan Document, upon
request of the Borrower in connection with any Disposition of Property permitted
by the Loan Documents, the Administrative Agent shall (without notice to or vote
or consent of any Lender, or any affiliate of any Lender that is a party to any
Specified Hedge Agreement) take such actions as shall be required to release its
security interest in any Collateral being Disposed of in such Disposition, and
to release any guarantee obligations of any Person being Disposed of in such
Disposition, to the extent necessary to permit consummation of such Disposition
in accordance with the Loan Documents, provided that the Borrower shall have
delivered to the Administrative Agent, at least five Business Days prior to the
date of the proposed release, a written request for release identifying the
relevant Collateral being Disposed of in such Disposition and the terms of such
Disposition in reasonable detail, including the date thereof, the price thereof
and any estimated expenses in connection therewith, together with a
certification by the Borrower stating that such transaction is in compliance
with the Credit Agreement and the other Loan Documents and that the proceeds of
such Disposition will be applied in accordance with the Credit Agreement and the
other Loan Documents.

                (b)     If any of the Collateral shall be Disposed of by any
Grantor in a transaction permitted by the Credit Agreement, then the
Administrative Agent, at the request and sole expense of such Grantor, shall
execute and deliver to such Grantor all releases or other documents reasonably
necessary or desirable for the release of the Liens created hereby on such
Collateral. At the request and sole expense of the Borrower, a Subsidiary
Guarantor shall be released from its obligations hereunder in the event that all
the Capital Stock of such Subsidiary



                                       28
   32


Guarantor shall be Disposed of in a transaction permitted by the Credit
Agreement; provided that the Borrower shall have delivered to the Administrative
Agent, at least ten Business Days prior to the date of the proposed release, a
written request for release identifying the relevant Subsidiary Guarantor and
the terms of the Disposition in reasonable detail, including the price thereof
and any expenses in connection therewith, together with a certification by the
Borrower stating that such transaction is in compliance with the Credit
Agreement and the other Loan Documents and that the Proceeds of such Disposition
will be applied in accordance therewith.

                8.16.   WAIVER OF JURY TRIAL. EACH GRANTOR HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM
THEREIN.

                           [SIGNATURE PAGE TO FOLLOW]



                                       29
   33


                IN WITNESS WHEREOF, each of the undersigned has caused this
Guarantee and Collateral Agreement to be duly executed and delivered as of the
date first above written.

SPANISH BROADCASTING SYSTEM, INC., a Delaware corporation
SPANISH BROADCASTING SYSTEM FINANCE CORPORATION, a Delaware corporation
SPANISH BROADCASTING SYSTEM OF GREATER MIAMI, INC.
SPANISH BROADCASTING SYSTEM OF ILLINOIS, INC.
SPANISH BROADCASTING SYSTEM, INC., a New Jersey corporation
SPANISH BROADCASTING SYSTEM OF SAN ANTONIO, INC.
ALARCON HOLDINGS, INC.
SPANISH BROADCASTING SYSTEM OF CALIFORNIA, INC.
SPANISH BROADCASTING SYSTEM OF PUERTO RICO, INC., a Delaware corporation
SPANISH BROADCASTING SYSTEM OF FLORIDA, INC.
SBS OF GREATER NEW YORK, INC.
SBS FUNDING, INC.
SPANISH BROADCASTING SYSTEM OF PUERTO RICO, INC., a Puerto Rico corporation
SPANISH BROADCASTING SYSTEM NETWORK, INC.
SBS PROMOTIONS, INC.
WRMA LICENSING, INC.
WXDJ LICENSING, INC.
WLEY LICENSING, INC.
WSKQ LICENSING, INC.
KLEY LICENSING, INC.
WCMQ LICENSING, INC.
KLAX LICENSING, INC.
WPAT LICENSING, INC.
WCMA LICENSING, INC.
WEGM LICENSING, INC.
WMEG LICENSING, INC.


By: /s/ Joseph A. Garcia
    ------------------------------------
    Name:
    Title: Vice President and/or Chief Financial Officer
                of each Loan Party



                                       30
   34


                                                                      Schedule 1



                         NOTICE ADDRESSES OF GUARANTORS



                                       31
   35

                                                                      Schedule 2


                   DESCRIPTION OF PLEDGED INVESTMENT PROPERTY


PLEDGED STOCK:



                Issuer's Jurisdiction
                 Under New York UCC
   Issuer        Section 9-103(b)(c)    Class of Stock     Stock Certificate No.   Percentage of Shares      No. of Shares
- ------------   ----------------------  ----------------   ----------------------  ----------------------    ---------------
                                                                                             





PLEDGED NOTES:



        Issuer                              Payee                       Principal Amount
- ------------------------           -------------------------      ------------------------------
                                                            






                                       2-1

   36



PLEDGED DEBT SECURITIES:



                             Issuer's Jurisdiction
                              Under New York UCC
        Issuer                Section 9-103(b)(c)              Payee                   Principal Amount
- -----------------------  ----------------------------        ---------             -----------------------
                                                                          





PLEDGED SECURITY ENTITLEMENTS:



                                                   Securities                                       Securities Intermediary's
      Issuer of          Description of           Intermediary           Securities Account        Jurisdiction Under New York
   Financial Asset       Financial Asset       (Name and Address)      (Number and Location)         UCC Section 9-103(6)(d)
- --------------------   ------------------    ----------------------   -----------------------     ------------------------------
                                                                                      






                                       2-2

   37



PLEDGED COMMODITY CONTRACTS:



                                                                                                       Commodity Intermediary's
       Description of               Commodity Intermediary             Commodity Account             Jurisdiction Under New York
     Commodity Contract               (Name and Address)             (Number and Location)             UCC Section 9-103(6)(e)
- ------------------------------   -----------------------------    ---------------------------   -----------------------------------
                                                                                       






                                       2-3

   38
                                                                      Schedule 3





                            FILINGS AND OTHER ACTIONS
                     REQUIRED TO PERFECT SECURITY INTERESTS




                         Uniform Commercial Code Filings




          [List each office where a financing statement is to be filed]




                     Copyright, Patent and Trademark Filings




                               [List all filings]




                   Actions with respect to Investment Property




   [Describe all actions required to obtain "control" of Investment Property]




                                  Other Actions




                      [Describe other actions to be taken]



                                      3-1
   39





                                                                      Schedule 4



       LOCATION OF JURISDICTION OF ORGANIZATION AND CHIEF EXECUTIVE OFFICE


       Grantor                                                  Location
       -------                                                  --------


                                      4-1
   40





                                                                     Schedule 5




                       LOCATION OF INVENTORY AND EQUIPMENT


       Grantor                                                  Locations
       -------                                                  ---------


                                      5-1
   41





                                                                     Schedule 6



                                   COPYRIGHTS



                                     PATENTS




                                   TRADEMARKS




                                  TRADE SECRETS




                         INTELLECTUAL PROPERTY LICENSES




                           OTHER INTELLECTUAL PROPERTY





                                      6-1
   42




                                                                      Schedule 7



                              EXISTING PRIOR LIENS






                                      7-1
   43




                                                                    Exhibit A to
                                              Guarantee and Collateral Agreement

                FORM OF INTELLECTUAL PROPERTY SECURITY AGREEMENT

               This INTELLECTUAL PROPERTY SECURITY AGREEMENT, dated as of July
6, 2000 (as amended, supplemented or otherwise modified from time to time, the
"Intellectual Property Security Agreement"), is made by each of the signatories
hereto (collectively, the "Grantors") in favor of Lehman Commercial Paper Inc.,
as administrative agent (in such capacity, the "Administrative Agent") for the
Secured Parties (as defined in the Credit Agreement referred to below).

               WHEREAS, Spanish Broadcasting System, Inc., a Delaware
corporation (the "Borrower") has entered into a Credit Agreement, dated as of
July 6, 2000 (as amended, supplemented, replaced or otherwise modified from time
to time, the "Credit Agreement"), with the lenders from time to time party
thereto (the "Lenders") and the Administrative Agent. Capitalized terms used and
not defined herein have the meanings given such terms in the Credit Agreement.

               WHEREAS, it is a condition precedent to the obligation of the
Lenders to make their respective extensions of credit to the Borrower under the
Credit Agreement that the Grantors shall have executed and delivered that
certain Guarantee and Collateral Agreement, dated as of July 6, 2000, in favor
of the Administrative Agent (as amended, supplemented, replaced or otherwise
modified from time to time, the "Guarantee and Collateral Agreement").

               WHEREAS, under the terms of the Guarantee and Collateral
Agreement, the Grantors have granted a security interest in certain Property,
including, without limitation, certain Intellectual Property of the Grantors to
the Administrative Agent for the ratable benefit of the Secured Parties, and
have agreed as a condition thereof to execute this Intellectual Property
Security Agreement for recording with the United States Patent and Trademark
Office, the United States Copyright Office, and other applicable Governmental
Authorities.

               NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Grantors agree as follows:

               SECTION 1. Grant of Security. Each Grantor hereby grants to the
Administrative Agent for the ratable benefit of the Secured Parties a security
interest in and to all of such Grantor's right, title and interest in and to the
following (the "Intellectual Property Collateral"), as collateral security for
the prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of such Grantor's Obligations:

              (a) (i) all trademarks, service marks, trade names, corporate
names, company names, business names, trade dress, trade styles, logos, or other
indicia of origin or source identification, trademark and service mark
registrations, and applications for trademark or service mark registrations and
any new renewals thereof, including, without limitation, each registration and
application identified in Schedule 1, (ii) the right to sue or otherwise recover
for any and all

                                       1
   44



past, present and future infringements and misappropriations thereof, (iii) all
income, royalties, damages and other payments now and hereafter due and/or
payable with respect thereto (including, without limitation, payments under all
licenses entered into in connection therewith, and damages and payments for
past, present or future infringements thereof), and (iv) all other rights of any
kind whatsoever of such Grantor accruing thereunder or pertaining thereto,
together in each case with the goodwill of the business connected with the use
of, and symbolized by, each of the above (collectively, the "Trademarks");

              (b) (i) all patents, patent applications and patentable
inventions, including, without limitation, each patent and patent application
identified in Schedule 1, (ii) all inventions and improvements described and
claimed therein, (iii) the right to sue or otherwise recover for any and all
past, present and future infringements and misappropriations thereof, (iv) all
income, royalties, damages and other payments now and hereafter due and/or
payable with respect thereto (including, without limitation, payments under all
licenses entered into in connection therewith, and damages and payments for
past, present or future infringements thereof), and (v) all reissues, divisions,
continuations, continuations-in-art, substitutes, renewals, and extensions
thereof, all improvements thereon and all other rights of any kind whatsoever of
such Grantor accruing thereunder or pertaining thereto (collectively, the
"Patents");

              (c) (i) all copyrights, whether or not the underlying works of
authorship have been published, and all works of authorship and other
intellectual property rights therein, all copyrights of works based on,
incorporated in, derived from or relating to works covered by such copyrights,
all right, title and interest to make and exploit all derivative works based on
or adopted from works covered by such copyrights, and all copyright
registrations and copyright applications, and any renewals or extensions
thereof, including, without limitation, each registration and application
identified in Schedule 1, (ii) the rights to print, publish and distribute any
of the foregoing, (iv) the right to sue or otherwise recover for any and all
past, present and future infringements and misappropriations thereof, (iv) all
income, royalties, damages and other payments now and hereafter due and/or
payable with respect thereto (including, without limitation, payments under all
licenses entered into in connection therewith, and damages and payments for
past, present or future infringements thereof), and (v) all other rights of any
kind whatsoever of such Grantor accruing thereunder or pertaining thereto
("Copyrights");

              (d) (i) all trade secrets and all confidential and proprietary
information, including know-how, trade secrets, manufacturing and production
processes and techniques, inventions, research and development information,
technical data, financial, marketing and business data, pricing and cost
information, business and marketing plans, and customer and supplier lists and
information, including, without limitation, any of the foregoing identified in
Schedule 1, (ii) the right to sue or otherwise recover for any and all past,
present and future infringements and misappropriations thereof, (iii) all
income, royalties, damages and other payments now and hereafter due and/or
payable with respect thereto (including, without limitation, payments under all
licenses entered into in connection therewith, and damages and payments for
past, present or future infringements thereof), and (iv) all other rights of any
kind whatsoever of such Grantor accruing thereunder or pertaining thereto
(collectively, the "Trade Secrets");

                                       2
   45

              (e) (i) all licenses or agreements, whether written or oral,
providing for the grant by or to any Grantor of: (A) any right to use any
Trademark or Trade Secret, (B) any right to manufacture, use or sell any
invention covered in whole or in part by a Patent, and (C) any right under any
Copyright including, without limitation, the grant of rights to manufacture,
distribute, exploit and sell materials derived from any Copyright including,
without limitation, any of the foregoing identified in Schedule 1, (ii) the
right to sue or otherwise recover for any and all past, present and future
infringements and misappropriations of any of the foregoing, (iii) all income,
royalties, damages and other payments now and hereafter due and/or payable with
respect thereto (including, without limitation, payments under all licenses
entered into in connection therewith, and damages and payments for past, present
or future infringements thereof), and (iv) all other rights of any kind
whatsoever of such Grantor accruing thereunder or pertaining thereto; and

               (f)    any and all proceeds of the foregoing.

               SECTION 2. Recordation. Each Grantor authorizes and requests that
the Register of Copyrights, the Commissioner of Patents and Trademarks and any
other applicable government officer record this Intellectual Property Security
Agreement.

               SECTION 3. Execution in Counterparts. This Agreement may be
executed in any number of counterparts (including by telecopy), each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

               SECTION 4.  Governing Law.  This Intellectual Property Security
Agreement shall be governed by, and construed and interpreted in accordance
with, the law of the State of New York.

               SECTION 5. Conflict Provision. This Intellectual Property
Security Agreement has been entered into in conjunction with the provisions of
the Guarantee and Collateral Agreement and the Credit Agreement. The rights and
remedies of each party hereto with respect to the security interest granted
herein are without prejudice to, and are in addition to those set forth in the
Guarantee and Collateral Agreement and the Credit Agreement, all terms and
provisions of which are incorporated herein by reference. In the event that any
provisions of this Intellectual Property Security Agreement are in conflict with
the Guarantee and Collateral Agreement or the Credit Agreement, the provisions
of the Guarantee and Collateral Agreement or the Credit Agreement shall govern.




                                       3
   46



               IN WITNESS WHEREOF, each of the undersigned has caused this
Intellectual Property Security Agreement to be duly executed and delivered as of
the date first above written.


                                       [NAME OF GRANTOR]


                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:



                                       4
   47





                                                                      Schedule 1



                                   COPYRIGHTS



                                     PATENTS




                                   TRADEMARKS




                                  TRADE SECRETS




                         INTELLECTUAL PROPERTY LICENSES





   48




                                                                    Exhibit B to
                                              Guarantee and Collateral Agreement

                            FORM OF CONTROL AGREEMENT


               This CONTROL AGREEMENT (as amended, supplemented or otherwise
modified from time to time, the "Control Agreement") dated as of July 6, 2000,
is made by and among _______________, a __________ corporation (the "Grantor"),
Lehman Commercial Paper Inc., as administrative agent (in such capacity, the
"Administrative Agent") for the Secured Parties (as defined in the Guarantee and
Collateral Agreement referred to below), and ____________, a ____________
corporation (the "Issuer").

               WHEREAS, the Grantor has granted to the Administrative Agent for
the benefit of the Secured Parties a security interest in the uncertificated
securities of the Issuer owned by the Grantor from time to time (collectively,
the "Pledged Securities"), and all additions thereto and substitutions and
proceeds thereof (collectively, with the Pledged Securities, the "Collateral")
pursuant to a Guarantee and Collateral Agreement, dated as of July 6, 2000 (as
amended, supplemented, replaced or otherwise modified from time to time, the
"Guarantee and Collateral Agreement"), among the Grantor and the other persons
party thereto as grantors in favor of the Administrative Agent.

               WHEREAS, the following terms which are defined in Articles 8 and
9 of the Uniform Commercial Code in effect in the State of New York on the date
hereof (the "UCC") are used herein as so defined: Adverse Claim, Control,
Instruction, Proceeds and Uncertificated Security.

               NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

               SECTION 1. Notice of Security Interest. The Grantor, the
Administrative Agent and the Issuer are entering into this Control Agreement to
perfect, and to confirm the priority of, the Administrative Agent's security
interest in the Collateral. The Issuer acknowledges that this Control Agreement
constitutes written notification to the Issuer of the Administrative Agent's
security interest in the Collateral. The Issuer agrees to promptly make all
necessary entries or notations in its books and records to reflect the
Administrative Agent's security interest in the Collateral and, upon request by
the Administrative Agent, to register the Administrative Agent as the registered
owner of any or all of the Pledged Securities. The Issuer acknowledges that the
Administrative Agent has control over the Collateral.

               SECTION 2. Collateral. The Issuer hereby represents and warrants
to, and agrees with the Grantor and the Administrative Agent that (i) the terms
of any limited liability company interests or partnership interests included in
the Collateral from time to time shall expressly provide that they are
securities governed by Article 8 of the Uniform Commercial Code in effect from
time to time in the State of [__________], (ii) the Pledged Securities are
uncertificated securities, (iii) the issuer's jurisdiction is, and during the
term of this Control Agreement shall remain, the State of [____________], (iv)
Schedule 1 contains a true and


                                       1
   49



complete description of the Pledged Securities as of the date hereof and (v)
except for the claims and interests of the Administrative Agent and the Grantor
in the Collateral, the Issuer does not known of any claim to or security
interest or other interest in the Collateral.

               SECTION 3. Control. The Issuer hereby agrees, upon written
direction from the Administrative Agent and without further consent from the
Grantor, (a) to comply with all instructions and directions of any kind
originated by the Administrative Agent concerning the Collateral, to liquidate
or otherwise dispose of the Collateral as and to the extent directed by the
Administrative Agent and to pay over to the Administrative Agent all proceeds
without any setoff or deduction, and (b) except as otherwise directed by the
Administrative Agent, not to comply with the instructions or directions of any
kind originated by the Grantor or any other person.

               SECTION 4. Other Agreements. The Issuer shall notify promptly the
Administrative Agent and the Grantor if any other person asserts any lien,
encumbrance, claim (including any adverse claim) or security interest in or
against any of the Collateral. In the event of any conflict between the
provisions of this Control Agreement and any other agreement governing the
Pledged Securities or the Collateral, the provisions of this Control Agreement
shall control.

               SECTION 5. Protection of Issuer. The Issuer may rely and shall be
protected in acting upon any notice, instruction or other communication that it
reasonably believes to be genuine and authorized.

               SECTION 6. Termination. This Control Agreement shall terminate
automatically upon receipt by the Issuer of written notice executed by the
Administrative Agent that (i) all of the obligations secured by the Collateral
have been paid in full in immediately available funds, or (ii) all of the
Collateral has been released, whichever is sooner, and the Issuer shall
thereafter be relieved of all duties and obligations hereunder.

               SECTION 7. Notices. All notices, requests and demands to or upon
the respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three days after being deposited
in the mail, postage prepaid, or, in the case of telecopy notice, when received,
to the Grantor's and the Administrative Agent's addresses as set forth in the
Guarantee and Collateral Agreement, and to the Issuer's address as set forth
below, or to such other address as any party may give to the others in writing
for such purpose:

               [Name of Issuer]
               [Address of Issuer]
               Attention:
                         -------------------
               Telephone: (     )      -
                           -----  ----- -----------
               Telecopy:  (     )      -
                           -----  ----- -----------



                                       2
   50

               SECTION 8. Amendments in Writing. None of the terms or provisions
of this Control Agreement may be waived, amended, supplemented or otherwise
modified except by a written instrument executed by the parties hereto.

               SECTION 9. Entire Agreement. This Control Agreement and the
Guarantee and Collateral Agreement constitute the entire agreement and supersede
all other prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof.

               SECTION 10.Execution in Counterparts. This Control Agreement may
be executed in any number of counterparts (including by telecopy), each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

               SECTION 11.Successors and Assigns. This Control Agreement will
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Grantor may not assign,
transfer or delegate any of its rights or obligations under this Control
Agreement without the prior written consent of the Administrative Agent.

               SECTION 12.Governing Law and Jurisdiction. This Control
Agreement has been delivered to and accepted by the Administrative Agent and
will be deemed to be made in the State of New York. THIS CONTROL AGREEMENT SHALL
BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK. Each of the parties hereto submits for itself and its
property in any legal action or proceeding relating to this Control Agreement,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the Courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof.

               SECTION 13.WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS CONTROL AGREEMENT AND FOR ANY COUNTERCLAIM
THEREIN.




                                       3
   51



               IN WITNESS WHEREOF, each of the undersigned has caused this
Control Agreement to be duly executed and delivered as of the date first above
written.


                                       [NAME OF GRANTOR]


                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:



                                       LEHMAN COMMERCIAL PAPER INC., as
                                       Administrative Agent



                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:



                                       [NAME OF ISSUER]

                                        By:
                                          --------------------------------------
                                          Name:
                                          Title:



                                       4
   52



                                                                    Exhibit C to
                                              Guarantee and Collateral Agreement

                            FORM OF CONTROL AGREEMENT


               This CONTROL AGREEMENT (as amended, supplemented or otherwise
modified from time to time, the "Control Agreement") dated as of July 6, 2000,
is made by and among _______________, a __________ corporation (the "Grantor"),
Lehman Commercial Paper Inc., as administrative agent (in such capacity, the
"Administrative Agent") for the Secured Parties (as defined in the Guarantee and
Collateral Agreement referred to below), and ____________, a ____________
corporation (the "Broker").

               WHEREAS, the Broker maintains for the Grantor a securities
account, Account No. _________________ (the "Pledged Account"), in the name of
the Grantor.

               WHEREAS, the Grantor has granted to the Administrative Agent for
the benefit of the Secured Parties a security interest in the Pledged Account,
the financial assets and any free credit balance carried therein, all security
entitlements with respect thereto, and all additions thereto and substitutions
and proceeds thereof (collectively, the "Collateral") pursuant to a Guarantee
and Collateral Agreement, dated as of July 6, 2000 (as amended, supplemented,
replaced or otherwise modified from time to time, the "Guarantee and Collateral
Agreement"), among the Grantor and the other persons party thereto as grantors
in favor of the Administrative Agent.

               WHEREAS, the following terms which are defined in Articles 8 and
9 of the Uniform Commercial Code in effect in the State of New York on the date
hereof (the "UCC") are used herein as so defined: Adverse Claim, Commodity
Account, Commodity Contract, Control, Entitlement Order, Financial Asset,
Instruction, Investment Property, Proceeds, Securities Account, Securities
Intermediary, Securities Intermediary's Jurisdiction and Security Entitlement.

               NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

               SECTION 1. Notice of Security Interest. The Grantor, the
Administrative Agent and the Broker are entering into this Control Agreement to
perfect, and to confirm the priority of, the Administrative Agent's security
interest in the Collateral. The Broker acknowledges that this Control Agreement
constitutes written notification to the Broker of the Administrative Agent's
security interest in the Collateral. The Broker agrees to promptly make all
necessary entries or notations in its books and records to reflect the
Administrative Agent's security interest in the Collateral. The Broker
acknowledges that the Administrative Agent has control over the Pledged Account,
all financial assets contained therein from time to time, and all security
entitlements with respect thereto.

               SECTION 2. Collateral; Pledged Account. (a) The Grantor hereby
represents and warrants to, and agrees with the Administrative Agent and the
Broker that, all investment

                                       1
   53


property (other than any commodity contract or commodity account) held by the
Broker for the Grantor is and shall be credited to the Pledged Account.

               (b) The Broker hereby represents and warrants to, and agrees with
the Grantor and the Administrative Agent that (i) the Broker is a securities
intermediary with respect to the Grantor and the Pledged Account is a securities
account, (ii) all assets, property and items from time to time carried in the
Pledged Account, including, without limitation, any investment property, are,
and will continue to be, financial assets, (iii) the securities intermediary's
jurisdiction is, and during the term of this Control Agreement shall remain, the
State of New York, (iv) Schedule 1 contains a true and complete statement of the
Pledged Account and the financial assets carried therein and any free credit
balance therein as of the date hereof, (v) no financial asset included in the
Collateral is registered in the name of, payable to the order of, or specially
indorsed to, the Grantor, which has not been indorsed to the Broker or in blank,
and (vi) the Pledged Account is and shall remain a cash account, and the Broker
will not extend, directly or indirectly, any "purpose credit" (within the
meaning of such term under Regulation T of the Board of Governors of the Federal
Reserve System of the United States) to the Grantor in respect of the Pledged
Account.

               (c) The Administrative Agent hereby instructs the Broker, and the
Broker hereby confirms and agrees that, unless the Administrative Agent shall
otherwise direct the Broker in writing, the investment property (other than any
commodity contract or commodity account) from time to time held by the Broker
for the Grantor shall be credited only to, and carried only in, the Pledged
Account.

               SECTION 3. Control. The Broker hereby agrees, upon written
direction from the Administrative Agent and without further consent from the
Grantor, (a) to comply with all instructions, entitlement orders and directions
of any kind originated by the Administrative Agent concerning the Collateral, to
liquidate or otherwise dispose of the Collateral as and to the extent directed
by the Administrative Agent and to pay over to the Administrative Agent all
proceeds without any setoff or deduction, and (b) except as otherwise directed
by the Administrative Agent, not to comply with the instructions, entitlement
orders or directions of any kind originated by the Grantor or any other person.

               SECTION 4. Other Agreements; Termination; Successor Brokers. The
Broker shall simultaneously send to the Administrative Agent copies of all
notices given and statements rendered pursuant to the Pledged Account. The
Broker shall notify promptly the Administrative Agent and the Grantor if any
other person asserts any lien, encumbrance, claim (including any adverse claim)
or security interest in or against any of the Collateral. As long as the
Guarantee and Collateral Agreement remains in effect, neither the Grantor nor
the Broker shall terminate the Pledged Account without thirty (30) days' prior
written notice to the other party and the Administrative Agent. In the event of
any conflict between the provisions of this Control Agreement and any other
agreement governing the Pledged Account or the Collateral, the provisions of
this Control Agreement shall control. In the event the Broker no longer serves
as Broker for the Collateral, the Pledged Account and the financial assets
carried therein shall be transferred to a successor broker or custodian
satisfactory to the Administrative Agent, provided, that prior to such transfer,
such successor broker or custodian shall execute an agreement that is


                                       2
   54


substantially in the form of this Control Agreement or is otherwise in form and
substance satisfactory to the Administrative Agent.

               SECTION 5. Protection of Broker. The Broker may rely and shall be
protected in acting upon any notice, instruction or other communication that it
reasonably believes to be genuine and authorized.

               SECTION 6. Termination. This Control Agreement shall terminate
automatically upon receipt by the Broker of written notice executed by the
Administrative Agent that (i) all of the obligations secured by the Collateral
have been paid in full in immediately available funds, or (ii) all of the
Collateral has been released, whichever is sooner, and the Broker shall
thereafter be relieved of all duties and obligations hereunder.

               SECTION 7. Waiver; Priority of Administrative Agent's Interests.
Other than with respect to its fees and customary commissions with respect to
the Pledged Account, the Broker hereby waives its right to set off any
obligations of the Grantor to the Broker against any or all of the Collateral,
and hereby agrees that any and all liens, encumbrances, claims or security
interests which the Broker may have against the Collateral, either now or in the
future in connection with the Pledged Account are and shall be subordinate and
junior to the prior payment in full in immediately available funds of all
obligations of the Grantor now or hereafter existing under the Credit Agreement,
the Guarantee and Collateral Agreement, and all other documents related thereto,
whether for principal, interest (including, without limitation, interest as
provided in the Credit Agreement, whether or not such interest accrues after the
filing of such petition for purposes of the federal Bankruptcy Code or is an
allowed claim in such proceeding), indemnities, fees, premiums, expenses or
otherwise. Except for the foregoing and claims and interests of the
Administrative Agent and the Grantor in the Collateral, the Broker does not know
of any claim to or security interest or other interest in the Collateral.

               SECTION 8. Notices. All notices, requests and demands to or upon
the respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three days after being deposited
in the mail, postage prepaid, or, in the case of telecopy notice, when received,
to the Grantor's and the Administrative Agent's addresses as set forth in the
Guarantee and Collateral Agreement, and to the Broker's address as set forth
below, or to such other address as any party may give to the others in writing
for such purpose:

               [Name of Broker]
               [Address of Broker]
               Attention:
                         -------------------
               Telephone: (     )      -
                           -----  ----- -----------
               Telecopy:  (     )      -
                           -----  ----- -----------

               SECTION 9. Amendments in Writing. None of the terms or provisions
of this Control Agreement may be waived, amended, supplemented or otherwise
modified except by a written instrument executed by the parties hereto.

                                       3
   55

               SECTION 10. Entire Agreement. This Control Agreement and the
Guarantee and Collateral Agreement constitute the entire agreement and supersede
all other prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof.

               SECTION 11. Execution in Counterparts. This Control Agreement may
be executed in any number of counterparts (including by telecopy), each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

               SECTION 12. Successors and Assigns. This Control Agreement will
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Grantor may not assign,
transfer or delegate any of its rights or obligations under this Control
Agreement without the prior written consent of the Administrative Agent.

               SECTION 13. Governing Law and Jurisdiction. This Control
Agreement has been delivered to and accepted by the Administrative Agent and
will be deemed to be made in the State of New York. THIS CONTROL AGREEMENT SHALL
BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK. Each of the parties hereto submits for itself and its
property in any legal action or proceeding relating to this Control Agreement,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the Courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof.

               SECTION 14. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS CONTROL AGREEMENT AND FOR ANY COUNTERCLAIM
THEREIN.



                                       4
   56




               IN WITNESS WHEREOF, each of the undersigned has caused this
Control Agreement to be duly executed and delivered as of the date first above
written.


                                       [NAME OF GRANTOR]


                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:



                                       LEHMAN COMMERCIAL PAPER INC., as
                                       Administrative Agent



                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:



                                       [NAME OF BROKER]

                                        By:
                                          --------------------------------------
                                          Name:
                                          Title:




                                       5
   57



                                                                    Exhibit D to
                                              Guarantee and Collateral Agreement

                            FORM OF CONTROL AGREEMENT


               This CONTROL AGREEMENT (as amended, supplemented or otherwise
modified from time to time, the "Control Agreement") dated as of July 6, 2000,
is made by and among _______________, a __________ corporation (the "Grantor"),
Lehman Commercial Paper Inc., as administrative agent (in such capacity, the
"Administrative Agent") for the Secured Parties (as defined in the Guarantee and
Collateral Agreement referred to below), and ____________, a ____________
corporation (the "Broker").

               WHEREAS, the Broker maintains for the Grantor a commodity
account, Account No. _________________ (the "Pledged Account"), in the name of
the Grantor.

               WHEREAS, the Grantor has granted to the Administrative Agent for
the benefit of the Secured Parties a security interest in the Pledged Account,
the commodity contracts and any free credit balance carried therein, and all
additions thereto and substitutions and proceeds thereof (collectively, the
"Collateral") pursuant to a Guarantee and Collateral Agreement, dated as of July
6, 2000 (as amended, supplemented, replaced or otherwise modified from time to
time, the "Guarantee and Collateral Agreement"), among the Grantor and the other
persons party thereto as grantors in favor of the Administrative Agent.

               WHEREAS, the following terms which are defined in Articles 8 and
9 of the Uniform Commercial Code in effect in the State of New York on the date
hereof (the "UCC") are used herein as so defined: Commodity Account, Commodity
Contract, Commodity Intermediary's Jurisdiction, Control and Proceeds.

               NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

               SECTION 1. Notice of Security Interest. The Grantor, the
Administrative Agent and the Broker are entering into this Control Agreement to
perfect, and to confirm the priority of, the Administrative Agent's security
interest in the Collateral. The Broker acknowledges that this Control Agreement
constitutes written notification to the Broker of the Administrative Agent's
security interest in the Collateral. The Broker agrees to promptly make all
necessary entries or notations in its books and records to reflect the
Administrative Agent's security interest in the Collateral. The Broker
acknowledges that the Administrative Agent has control over the Pledged Account
and all commodity contracts and any free credit balance carried therein from
time to time.

               SECTION 2. Collateral; Pledged Account. (a) The Grantor hereby
represents and warrants to, and agrees with the Administrative Agent and the
Broker that, all commodity contracts carried by the Broker on its books for the
Grantor are and shall be credited to the Pledged Account.


                                       1
   58

               (b) The Broker hereby represents and warrants to, and agrees with
the Grantor and the Administrative Agent that (i) the Broker is a commodity
intermediary with respect to the Grantor and the Pledged Account is a commodity
account, (ii) the commodity intermediary's jurisdiction is, and during the term
of this Control Agreement shall remain, the State of New York, (iii) Schedule 1
contains a true and complete statement of the Pledged Account and the commodity
contracts and any free credit balance carried therein as of the date hereof, and
(iv) the Pledged Account is and shall remain a cash account, and the Broker will
not extend, directly or indirectly, any "purpose credit" (within the meaning of
such term under Regulation T of the Board of Governors of the Federal Reserve
System of the United States) to the Grantor in respect of the Pledged Account.

               (c) The Administrative Agent hereby instructs the Broker, and the
Broker hereby confirms and agrees that, unless the Administrative Agent shall
otherwise direct the Broker in writing, all commodity contracts carried by the
Broker on its books for the Grantor shall be credited only to, and carried only
in, the Pledged Account.

               SECTION 3. Control. The Broker hereby agrees, upon written
direction from the Administrative Agent and without further consent from the
Grantor, (a) to apply any value distributed on account of the commodity
contracts carried in the Pledged Account as directed by the Administrative
Agent, to liquidate or otherwise dispose of the Collateral as and to the extent
directed by the Administrative Agent and to pay over to the Administrative Agent
all proceeds and other value therefrom or otherwise distributed with respect
thereto without any setoff or deduction, and (b) except as otherwise directed by
the Administrative Agent, not to apply any value distributed on account of any
commodity contract carried in the Pledged Account as directed by the Grantor or
any other person.

               SECTION 4. Other Agreements; Termination; Successor Brokers. The
Broker shall simultaneously send to the Administrative Agent copies of all
notices given and statements rendered pursuant to the Pledged Account. The
Broker shall notify promptly the Administrative Agent and the Grantor if any
other person asserts any lien, encumbrance, claim or security interest in or
against any of the Collateral. As long as the Guarantee and Collateral Agreement
remains in effect, neither the Grantor nor the Broker shall terminate the
Pledged Account without thirty (30) days' prior written notice to the other
party and the Administrative Agent. In the event of any conflict between the
provisions of this Control Agreement and any other agreement governing the
Pledged Account or the Collateral, the provisions of this Control Agreement
shall control. In the event the Broker no longer serves as Broker for the
Collateral, the Pledged Account, the commodity contracts and any free credit
balance carried therein shall be transferred to a successor broker, custodian or
futures commission merchant satisfactory to the Administrative Agent, provided,
that prior to such transfer, such successor broker, custodian or futures
commission merchant shall execute an agreement that is substantially in the form
of this Control Agreement or is otherwise in form and substance satisfactory to
the Administrative Agent.

               SECTION 5. Protection of Broker. The Broker may rely and shall be
protected in acting upon any notice, instruction or other communication that it
reasonably believes to be genuine and authorized.


                                       2
   59

               SECTION 6. Termination. This Control Agreement shall terminate
automatically upon receipt by the Broker of written notice executed by the
Administrative Agent that (i) all of the obligations secured by the Collateral
have been paid in full in immediately available funds, or (ii) all of the
Collateral has been released, whichever is sooner, and the Broker shall
thereafter be relieved of all duties and obligations hereunder.

               SECTION 7. Waiver; Priority of Administrative Agent's Interests.
Other than with respect to its fees and customary commissions with respect to
the Pledged Account, the Broker hereby waives its right to set off any
obligations of the Grantor to the Broker against any or all of the Collateral,
and hereby agrees that any and all liens, encumbrances, claims or security
interests which the Broker may have against the Collateral, either now or in the
future in connection with the Pledged Account are and shall be subordinate and
junior to the prior payment in full in immediately available funds of all
obligations of the Grantor now or hereafter existing under the Credit Agreement,
the Guarantee and Collateral Agreement, and all other documents related thereto,
whether for principal, interest (including, without limitation, interest as
provided in the Credit Agreement, whether or not such interest accrues after the
filing of such petition for purposes of the federal Bankruptcy Code or is an
allowed claim in such proceeding), indemnities, fees, premiums, expenses or
otherwise. Except for the foregoing and claims and interests of the
Administrative Agent and the Grantor in the Collateral, the Broker does not know
of any claim to or security interest or other interest in the Collateral.

               SECTION 8. Notices. All notices, requests and demands to or upon
the respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three days after being deposited
in the mail, postage prepaid, or, in the case of telecopy notice, when received,
to the Grantor's and the Administrative Agent's addresses as set forth in the
Guarantee and Collateral Agreement, and to the Broker's address as set forth
below, or to such other address as any party may give to the others in writing
for such purpose:

               [Name of Broker]
               [Address of Broker]
               Attention:
                         -------------------
               Telephone: (     )      -
                           -----  ----- -----------
               Telecopy:  (     )      -
                           -----  ----- -----------

               SECTION 9. Amendments in Writing. None of the terms or provisions
of this Control Agreement may be waived, amended, supplemented or otherwise
modified except by a written instrument executed by the parties hereto.

               SECTION 10. Entire Agreement. This Control Agreement and the
Guarantee and Collateral Agreement constitute the entire agreement and supersede
all other prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof.

               SECTION 11. Execution in Counterparts. This Control Agreement may
be executed in any number of counterparts (including by telecopy), each of which
when so executed



                                       3
   60

shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.

               SECTION 12. Successors and Assigns. This Control Agreement will
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Grantor may not assign,
transfer or delegate any of its rights or obligations under this Control
Agreement without the prior written consent of the Administrative Agent.

               SECTION 13. Governing Law and Jurisdiction. This Control
Agreement has been delivered to and accepted by the Administrative Agent and
will be deemed to be made in the State of New York. THIS CONTROL AGREEMENT SHALL
BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK. Each of the parties hereto submits for itself and its
property in any legal action or proceeding relating to this Control Agreement,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the Courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof.

               SECTION 14. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS CONTROL AGREEMENT AND FOR ANY COUNTERCLAIM
THEREIN.




                                       4
   61



               IN WITNESS WHEREOF, each of the undersigned has caused this
Control Agreement to be duly executed and delivered as of the date first above
written.


                                       [NAME OF GRANTOR]


                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:



                                       LEHMAN COMMERCIAL PAPER INC., as
                                       Administrative Agent



                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:



                                       [NAME OF BROKER]

                                        By:
                                          --------------------------------------
                                          Name:
                                          Title:



                                       5
   62



                                                                      Annex 1 to
                                              Guarantee and Collateral Agreement

               ASSUMPTION AGREEMENT, dated as of ____________, 200__, made by
______________________, a _______________ corporation (the "Additional
Grantor"), in favor of Lehman Commercial Paper Inc., as administrative agent (in
such capacity, the "Administrative Agent") for (i) the lenders (the "Lenders")
party to the Credit Agreement referred to below, and (ii) the other Secured
Parties (as defined in the Guarantee and Collateral Agreement (as hereinafter
defined)). All capitalized terms not defined herein shall have the meaning
ascribed to them in such Credit Agreement.


                              W I T N E S S E T H:

               WHEREAS, Spanish Broadcasting System, Inc., a Delaware
corporation (the "Borrower"), the Lenders and the Administrative Agent have
entered into a Credit Agreement, dated as of July 6, 2000 (as amended,
supplemented, replaced or otherwise modified from time to time, the "Credit
Agreement");

               WHEREAS, in connection with the Credit Agreement, the Borrower
and certain of its Affiliates (other than the Additional Grantor) have entered
into the Guarantee and Collateral Agreement, dated as of July 6, 2000 (as
amended, supplemented or otherwise modified from time to time, the "Guarantee
and Collateral Agreement") in favor of the Administrative Agent for the benefit
of the Secured Parties;

               WHEREAS, the Credit Agreement requires the Additional Grantor to
become a party to the Guarantee and Collateral Agreement; and

               WHEREAS, the Additional Grantor has agreed to execute and deliver
this Assumption Agreement in order to become a party to the Guarantee and
Collateral Agreement;

               NOW, THEREFORE, IT IS AGREED:

               1. Guarantee and Collateral Agreement. By executing and
delivering this Assumption Agreement, the Additional Grantor, as provided in
Section 8.14 of the Guarantee and Collateral Agreement, hereby becomes a party
to the Guarantee and Collateral Agreement as a Grantor thereunder with the same
force and effect as if originally named therein as a Grantor and, without
limiting the generality of the foregoing, hereby expressly assumes all
obligations and liabilities of a Grantor thereunder. The information set forth
in Annex 1-A hereto is hereby added to the information set forth in the
Schedules to the Guarantee and Collateral Agreement. The Additional Grantor
hereby represents and warrants that each of the representations and warranties
contained in Section 4 of the Guarantee and Collateral Agreement is true and
correct on and as the date hereof (after giving effect to this Assumption
Agreement) as if made on and as of such date.


   63

               2.  GOVERNING LAW. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.

               IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered as of the date first above written.

                                            [ADDITIONAL GRANTOR]


                                            By:
                                               ---------------------------------
                                               Name:
                                               Title:



                                       2
   64





                                                                       Exhibit C

                             FORM OF LENDER ADDENDUM


               Reference is made to the Credit Agreement, dated as of July 6,
2000 (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among SPANISH BROADCASTING SYSTEM, INC., a Delaware
corporation, the lenders from time to time party thereto (the "Lenders"), and
Lehman Commercial Paper Inc. as Administrative Agent. Unless otherwise defined
herein, terms defined in the Credit Agreement and used herein shall have the
meanings given to them in the Credit Agreement.

               Upon execution and delivery of this Lender Addendum by the
parties hereto as provided in Section 10.17 of the Credit Agreement, the
undersigned hereby becomes a Lender thereunder having the Commitments set forth
in Schedule 1 hereto, effective as of the Closing Date.

               THIS LENDER ADDENDUM SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

               This Lender Addendum may be executed by one or more of the
parties hereto on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page hereof by facsimile
transmission shall be effective as delivery of a manually executed counterpart
hereof.

               IN WITNESS WHEREOF, the parties hereto have caused this Lender
Addendum to be duly executed and delivered by their proper and duly authorized
officers as of this ____ day of ____, ____

                                            [NAME OF LENDER]


                                            By:
                                                --------------------------------
                                                Name:
                                                Title:


Accepted and agreed:

SPANISH BROADCASTING SYSTEM, INC.


By:
     -------------------------------
     Name:
     Title:


   65

LEHMAN COMMERCIAL PAPER INC., as
     Administrative Agent



By:
     -------------------------------
     Name:
     Title:





                                       2
   66





                         COMMITMENTS AND NOTICE ADDRESS





        Name and Notice                     Revolving                        Term
       Address of Lender                Credit Commitment               Loan Commitment
- --------------------------------   ----------------------------   ------------------------
                                                            























   67




                                                                       EXHIBIT D
                           FORM OF NOTICE OF BORROWING

                                     [Date]


Lehman Commercial Paper Inc.,
 as Administrative Agent
3 World Financial Center
New York, New York 10285
Attention:  [________]


                        SPANISH BROADCASTING SYSTEM, INC.

Ladies and Gentlemen:

               Pursuant to Section 2.5 of that certain Credit Agreement, dated
as of July 6, 2000 (as amended, supplemented, replaced or otherwise modified
from time to time, the "Credit Agreement"; capitalized terms used but not
defined herein having the meanings given such terms in the Credit Agreement),
among Spanish Broadcasting System, Inc., a Delaware corporation (the
"Borrower"), each lender from time to time party thereto, and Lehman Commercial
Paper Inc., as administrative agent (the "Administrative Agent"), the Borrower
hereby gives the Administrative Agent irrevocable notice that the Borrower
hereby requests a Loan under the Credit Agreement, and in that connection sets
forth below the information relating to such Loan:

      (1)  The Business Day of the proposed Loan is _________ ___, ____.

      (2)  The Type of the proposed Loan is a [Base Rate Loan] [Eurodollar
           Loan].

      (3)  The aggregate amount of the proposed Loan is $____________.

      (4)  The initial Interest Period for each Eurodollar Loan made as part of
the proposed Loan is ____ month[s].

               The Borrower hereby certifies that the following statements are
true and correct on the date hereof, and will be true and correct on the date of
the proposed Loan:

               (a) Each of the representations and warranties made by any Loan
Party in or pursuant to the Loan Documents is true and correct on and as of the
date hereof as if made on and as of the date hereof (except to the extent that
they relate expressly to an earlier date).

               (b) No Default or Event of Default has occurred and is continuing
on the date hereof, or would result from the proposed Loan or the application of
the proceeds thereof.


   68

               The Borrower agrees that, if prior to the time of the proposed
Loan any of the foregoing certifications shall cease to be true and correct, the
Borrower shall forthwith notify the Administrative Agent thereof in writing (any
such notice, a "Non-Compliance Notice"). Except to the extent, if any, that
prior to the time of the proposed Loan, the Borrower shall deliver a
Non-Compliance Notice to the Administrative Agent, each of the foregoing
certifications shall be deemed to be made additionally on the date of the
proposed Loan as if made on such date.

                                               Very truly yours,

                                               SPANISH BROADCASTING SYSTEM, INC.


                                               By:
                                                  ------------------------------
                                                  Name:
                                                  Title:


   69






                                                                       EXHIBIT E
                          FORM OF SOLVENCY CERTIFICATE

               This Solvency Certificate (this "Certificate") is delivered in
connection with that certain Credit Agreement, dated as of July 6, 2000 (as
amended, supplemented, replaced or otherwise modified from time to time, the
"Credit Agreement"), among Spanish Broadcasting System, Inc., a Delaware
corporation, as borrower (the "Borrower"), the lenders from time to time party
thereto, and Lehman Commercial Paper Inc., as administrative agent (in such
capacity, the "Administrative Agent"). Capitalized terms used but not defined
herein have the meanings given such terms in the Credit Agreement.

               For purposes of this Certificate, "Transactions" means (i) the
fulfillment of all conditions to the making of Loans and the issuance of Letters
of Credit under the Credit Agreement and the funding of such Loans and Letters
of Credit, if any, on the Closing Date, (ii) the execution and delivery of the
Loan Documents, (iii) the repayment, if any, of outstanding Indebtedness on the
Closing Date and (iv) the payment of all fees, costs and expenses associated
with the foregoing.

               I hereby certify as of the date hereof on behalf of the Loan
Parties as follows:

      1.       I am the duly qualified and acting Vice President and/or Chief
Financial Officer of each Loan Party and in such capacity am a senior financial
officer with responsibility for the management of the financial affairs of such
Loan Party and the preparation of financial statements of such Loan Party. I,
together with other officers of the Loan Parties, acted on behalf of each Loan
Party in connection with the negotiation and execution of the Credit Agreement
and the other Loan Documents to which any Loan Party is a party. In connection
with the following certifications, I have reviewed the financial statements of
the Loan Parties.

      2.       I have carefully reviewed the contents of this Certificate, and I
have conferred with counsel for the Loan Parties for the purpose of discussing
the meaning of its contents and the purpose for which it is to be used. I have
made such investigations and inquiries as I have deemed to be necessary and
prudent, and have reviewed the Credit Agreement, the Notes and the other Loan
Documents to which any Loan Party is a party. I am providing this certificate
solely in my capacity as an officer of each Loan Party.

      3.       The audited consolidated balance sheets of the Borrower and its
Subsidiaries as at September 26, 1999, September 27, 1998 and September 28,
1997, and the related consolidated statements of income and of cash flows for
the fiscal years ended on such dates, reported on by and accompanied by an
unqualified report from KPMG LLP, present fairly the consolidated financial
condition of the Borrower and its Subsidiaries as at such date, and the
consolidated results of its operations and its consolidated cash flows for the
respective fiscal years then ended. All such financial statements, including the
related schedules and notes thereto, have been prepared in accordance with GAAP
applied consistently throughout the periods involved (except as approved by the
aforementioned firm of accountants and disclosed therein). After due inquiry, I
have concluded that the Borrower and its Subsidiaries do not have any material
Guarantee Obligations, contingent liabilities and liabilities for taxes, or any
long-term leases or unusual


   70

forward or long-term commitments, including, without limitation, any interest
rate or foreign currency swap or exchange transaction or other obligation in
respect of derivatives, that are not reflected in the most recent financial
statements referred to in this paragraph. After due inquiry, I have concluded
that during the period from September 26, 1999 to and including the date hereof
there has been no Disposition, other than the contemplated Florida Keys Sale, by
the Borrower or any of its Subsidiaries of any material part of its business or
Property.

      4.       For purposes of delivering this Certificate, I have:

               (a) consulted with counsel for the Loan Parties concerning, among
other matters, pending and threatened litigation, uninsured risks, guaranties of
obligations of other Persons and other contingent obligations and have included
as a liability in my conclusions my best judgment as to the maximum realistic
exposure of each Loan Party to liabilities which would not be included in
reserves otherwise reflected on the consolidated balance sheet of the Borrower
and its Subsidiaries as of September 26, 1999;

               (b) consulted with the chief executive officer and controller of
each Loan Party and reviewed the financial statements of each Loan Party;

               (c) consulted with, and reviewed reports prepared by the
accountants referred to in paragraph 3 above with respect to the financial
statements of the Loan Parties and their respective assets and liabilities; and

               (d) made such other investigations and inquiries as I have deemed
appropriate and have taken into account the nature of the particular business
anticipated to be conducted by the Loan Parties after consummation of the
Transactions.

               Based upon the foregoing, I have reached the following
conclusions:

               (A) No Loan Party is now, and the consummation of the
Transactions will not render any Loan Party, "insolvent" as defined below. I
understand that in this context, "insolvent" means that the present fair salable
value of assets of each Loan Party is less than the amount that will be required
to pay its probable liability on its existing debts as they become absolute and
matured. I have assumed that in this context "fair salable value" means the
price available upon the sale of such assets by a willing seller to a willing
buyer, where material information as to the asset and the market for such asset
is known to both, and where the sale is executed with commercially reasonable
promptness. I also understand that (i) the term "debts" includes any liability
on a "claim", and (ii) "claim" means any (x) right to payment, whether or not
such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured
or unsecured or (y) right to an equitable remedy for breach of performance if
such breach gives rise to a right to payment, whether or not such right to an
equitable remedy is reduced to judgment, fixed, contingent, matured or
unmatured, disputed, undisputed, secured or unsecured.

               (B) No Loan Party will incur, and no Loan Party intended to incur
or believed that it would incur, debts beyond its ability to pay as they mature
as a result of the consummation


   71

of the Transactions. I have concluded that the realization of the current assets
in the ordinary course of business of each Loan Party will be sufficient to pay
recurring current debt, short-term debt and long-term debt service of such Loan
Party as such debts mature and that the cash flow and cash resources (including
earnings plus non-cash charges to earnings and, to the extent permitted under
the Credit Agreement, the disposition of assets held for sale) of such Loan
Party will be sufficient to provide cash necessary to repay indebtedness and
liabilities of such Loan Party (including, in the case of the Borrower, the
indebtedness and liabilities of the Borrower under the Credit Agreement, the
Notes and any outstanding Letters of Credit) as such debts and liabilities
mature.

               (C) The consummation of the Transactions will not leave any Loan
Party with property remaining in its hands constituting "unreasonably small
capital." I have assumed for purposes of reaching this conclusion that
"unreasonably small capital" depends upon the nature of the particular business
or businesses conducted or to be conducted, and I have reached my conclusion
based on the needs and anticipated needs for capital of the businesses conducted
or anticipated to be conducted by each Loan Party in light of the Projections
and available credit capacity.

               (D) No Loan Party has executed the Credit Agreement, the Notes,
any Letters of Credit, any other Loan Documents, in each case, to which such
Loan Party is a party or made any transfer or incurred any obligations in
connection with the Transactions, with actual intent to hinder, delay or defraud
either present or future creditors.

               I understand that the Secured Parties are relying on the truth
and accuracy of the foregoing in connection with each extension of credit to the
Borrower pursuant to the Credit Agreement and the other Loan Documents.

               I represent the foregoing information to be, to the best of my
knowledge and belief, after diligent inquiry, true, correct and complete and
execute this Solvency Certificate as the Vice President and/or Chief Financial
Officer of each Loan Party as of the ___ day of _______, ____.

                            [SIGNATURE PAGE FOLLOWS]



   72



               IN WITNESS WHEREOF, the undersigned has duly executed this
Solvency Certificate as of the date first written above.


SPANISH BROADCASTING SYSTEM, INC., a Delaware corporation
SPANISH BROADCASTING SYSTEM FINANCE CORPORATION, a Delaware corporation
SPANISH BROADCASTING SYSTEM OF GREATER MIAMI, INC.
SPANISH BROADCASTING SYSTEM OF ILLINOIS, INC.
SPANISH BROADCASTING SYSTEM, INC., a New Jersey corporation
SPANISH BROADCASTING SYSTEM OF SAN ANTONIO, INC.
ALARCON HOLDINGS, INC.
SPANISH BROADCASTING SYSTEM OF CALIFORNIA, INC.
SPANISH BROADCASTING SYSTEM OF PUERTO RICO, INC., a Delaware corporation
SPANISH BROADCASTING SYSTEM OF FLORIDA, INC.
SBS OF GREATER NEW YORK, INC.
SBS FUNDING, INC.
SPANISH BROADCASTING SYSTEM OF PUERTO RICO, INC., a Puerto Rico corporation
SPANISH BROADCASTING SYSTEM NETWORK, INC.
SBS PROMOTIONS, INC.
WRMA LICENSING, INC.
WXDJ LICENSING, INC.
WLEY LICENSING, INC.
WSKQ LICENSING, INC.
KLEY LICENSING, INC.
WCMQ LICENSING, INC.
KLAX LICENSING, INC.
WPAT LICENSING, INC.
WCMA LICENSING, INC.
WEGM LICENSING, INC.
WMEG LICENSING, INC.


By:
    ----------------------------
    Name:
    Title: Vice President and/or Chief Financial Officer
              of each Loan Party




   73


                                                                     EXHIBIT F-1



                                      FORM OF TERM NOTE


THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MAY NOT BE TRANSFERRED EXCEPT
IN COMPLIANCE WITH THE TERMS AND PROVISIONS OF THE CREDIT AGREEMENT REFERRED TO
BELOW. TRANSFERS OF THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MUST BE
RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE
TERMS OF SUCH CREDIT AGREEMENT.

$____________                                                New York, New York
                                                             _____________, ____

               FOR VALUE RECEIVED, the undersigned, SPANISH BROADCASTING SYSTEM,
INC., a Delaware corporation (the "Borrower"), hereby unconditionally promises
to pay to ___________ (the "Lender") or its registered assigns at the Payment
Office specified in the Credit Agreement (as hereinafter defined) in lawful
money of the United States and in immediately available funds, the principal
amount of (a) ________________________ DOLLARS ($________), or, if less, (b) the
unpaid principal amount of the Term Loan outstanding to the Lender made pursuant
to Section 2.1 of the Credit Agreement. The principal amount shall be paid in
the amounts and on the dates specified in Section 2.3 of the Credit Agreement.
The Borrower further agrees to pay interest in like money at such office on the
unpaid principal amount hereof from time to time outstanding at the rates and on
the dates specified in Section 2.15 of the Credit Agreement.

               The holder of this Note is authorized to endorse on the schedules
annexed hereto and made a part hereof or on a continuation thereof which shall
be attached hereto and made a part hereof the date, Type and amount of the Term
Loan and the date and amount of each payment or prepayment of principal with
respect thereto, each conversion of all or a portion thereof to another Type,
each continuation of all or a portion thereof as the same Type and, in the case
of Eurodollar Loans, the length of each Interest Period with respect thereto.
Each such endorsement shall constitute prima facie evidence of the accuracy of
the information endorsed. The failure to make any such endorsement or any error
in any such endorsement shall not affect the obligations of the Borrower in
respect of the Term Loan.

               This Note (a) is one of the Term Notes referred to in the Credit
Agreement dated as of July 6, 2000 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among the Borrower, the
Lender, the lenders from time to time party thereto, and Lehman Commercial Paper
Inc., as Administrative Agent, (b) is subject to the provisions of the Credit
Agreement and (c) is subject to optional and mandatory prepayment in whole or in
part as provided in the Credit Agreement. This Note is secured and guaranteed as
provided in the Loan Documents. Reference is hereby made to the Loan Documents
for a description of the properties and assets in which a security interest has
been granted, the nature and extent of the security and the guarantees, the
terms and conditions upon which the security


   74

interests and each guarantee were granted and the rights of the holder of this
Note in respect thereof.

               Upon the occurrence of any one or more of the Events of Default,
all principal and all accrued interest then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Credit Agreement.

               All parties now and hereafter liable with respect to this Note,
whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.

               Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit
Agreement

               NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN
THE CREDIT AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN
ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 10.6 OF THE
CREDIT AGREEMENT.

               THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

                                            SPANISH BROADCASTING SYSTEM, INC.



                                            By:
                                                --------------------------------
                                                Name:
                                                Title:


                                      2
   75




                                                                      Schedule A
                                                                    to Term Note



              LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS






- ---------------- ------------------ -------------------- ----------------------- --------------------------
                                                          AMOUNT OF PRINCIPAL       AMOUNT OF BASE RATE
                  AMOUNT OF BASE     AMOUNT CONVERTED      OF BASE RATE LOANS       LOANS CONVERTED TO
     DATE           RATE LOANS      TO BASE RATE LOANS           REPAID              EURODOLLAR LOANS
- ---------------- ------------------ -------------------- ----------------------- --------------------------
                                                                     
- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------

- ---------------- ------------------ -------------------- ----------------------- --------------------------


- --------------------- ------------------
  UNPAID PRINCIPAL
  BALANCE OF BASE
     RATE LOANS        NOTATION MADE BY
- --------------------- ------------------
                    
- --------------------- ------------------

- --------------------- ------------------

- --------------------- ------------------

- --------------------- ------------------

- --------------------- ------------------

- --------------------- ------------------

- --------------------- ------------------

- --------------------- ------------------

- --------------------- ------------------

- --------------------- ------------------

- --------------------- ------------------



   76


                                                                      Schedule B
                                                                    to Term Note




      LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS





- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------
                                  AMOUNT        INTEREST PERIOD
                AMOUNT OF      CONVERTED TO      AND EURODOLLAR     AMOUNT OF PRINCIPAL   AMOUNT OF BASE RATE
               EURODOLLAR       EURODOLLAR     RATE WITH RESPECT    OF EURODOLLAR LOANS   LOANS CONVERTED TO
   DATE           LOANS            LOANS            THERETO               REPAID           EURODOLLAR LOANS
- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------
                                                                           
- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------




- ----------------------- -------------
   UNPAID PRINCIPAL
       BALANCE            NOTATION
 OF EURODOLLAR LOANS      MADE BY
- ----------------------- -------------
                     
- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------

- ----------------------- -------------


   77

                                                                     EXHIBIT F-2




                          FORM OF REVOLVING CREDIT NOTE


THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MAY NOT BE TRANSFERRED EXCEPT
IN COMPLIANCE WITH THE TERMS AND PROVISIONS OF THE CREDIT AGREEMENT REFERRED TO
BELOW. TRANSFERS OF THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MUST BE
RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE
TERMS OF SUCH CREDIT AGREEMENT.

$___________                                                  New York, New York
                                                              ____________, ____

               FOR VALUE RECEIVED, the undersigned, SPANISH BROADCASTING SYSTEM,
INC., a Delaware corporation (the "Borrower"), hereby unconditionally promises
to pay to _______________________ (the "Lender") or its registered assigns at
the Payment Office specified in the Credit Agreement (as hereinafter defined) in
lawful money of the United States and in immediately available funds, on the
Revolving Credit Termination Date the principal amount of (a) ____________
DOLLARS ($_______), or, if less, (b) the aggregate unpaid principal amount of
all Revolving Credit Loans outstanding to the Lender made pursuant to Section
2.4 of the Credit Agreement. The Borrower further agrees to pay interest in like
money at such Payment Office on the unpaid principal amount hereof from time to
time outstanding at the rates and on the dates specified in Section 2.15 of the
Credit Agreement.

               The holder of this Note is authorized to endorse on the schedules
annexed hereto and made a part hereof or on a continuation thereof which shall
be attached hereto and made a part hereof the date, Type and amount of each
Revolving Credit Loan made pursuant to the Credit Agreement and the date and
amount of each payment or prepayment of principal thereof, each continuation
thereof, each conversion of all or a portion thereof to another Type and, in the
case of Eurodollar Loans, the length of each Interest Period with respect
thereto. Each such endorsement shall constitute prima facie evidence of the
accuracy of the information endorsed. The failure to make any such endorsement
or any error in any such endorsement shall not affect the obligations of the
Borrower in respect of any Revolving Credit Loan.

               This Note (a) is one of the Revolving Credit Notes referred to in
the Credit Agreement dated as of July 6, 2000 (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"), among the
Borrower, the Lender, the lenders from time to time party thereto, and Lehman
Commercial Paper Inc., as Administrative Agent, (b) is subject to the provisions
of the Credit Agreement and (c) is subject to optional and mandatory prepayment
in whole or in part as provided in the Credit Agreement. This Note is secured
and guaranteed as provided in the Loan Documents. Reference is hereby made to
the Loan Documents for a description of the properties and assets in which a
security interest has been granted, the nature and extent of the security and
the guarantees, the terms and conditions upon which the security interests and
each guarantee were granted and the rights of the holder of this Note in respect
thereof.


   78

               Upon the occurrence of any one or more of the Events of Default,
all principal and all accrued interest then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Credit Agreement.

               All parties now and hereafter liable with respect to this Note,
whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.

               Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit
Agreement.

               NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN
THE CREDIT AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN
ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 10.6 OF THE
CREDIT AGREEMENT.

               THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF TILE STATE OF NEW YORK.

                                            SPANISH BROADCASTING SYSTEM, INC.



                                            By:
                                                --------------------------------
                                                Name:
                                                Title:


                                       2
   79
                                                                      Schedule A
                                                        to Revolving Credit Note



              LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS






- ---------------- ------------------ -------------------- -----------------------
                                                          AMOUNT OF PRINCIPAL
                  AMOUNT OF BASE     AMOUNT CONVERTED      OF BASE RATE LOANS
     DATE           RATE LOANS      TO BASE RATE LOANS           REPAID
- ---------------- ------------------ -------------------- -----------------------
                                                
- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------

- ---------------- ------------------ -------------------- -----------------------



- -------------------------- --------------------- ------------------
   AMOUNT OF BASE RATE       UNPAID PRINCIPAL
   LOANS CONVERTED TO        BALANCE OF BASE
    EURODOLLAR LOANS            RATE LOANS       NOTATION MADE BY
- -------------------------- --------------------- ------------------
                                           
- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

- -------------------------- --------------------- ------------------

   80

                                                                      Schedule B
                                                        to Revolving Credit Note



      LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS





- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------
                                  AMOUNT        INTEREST PERIOD                                AMOUNT OF
                AMOUNT OF      CONVERTED TO      AND EURODOLLAR     AMOUNT OF PRINCIPAL       EURODOLLAR
               EURODOLLAR       EURODOLLAR     RATE WITH RESPECT    OF EURODOLLAR LOANS   LOANS CONVERTED TO
   DATE           LOANS            LOANS            THERETO               REPAID            BASE RATE LOANS
- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------
                                                                           
- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------

- ------------ ---------------- ---------------- ------------------- ---------------------- --------------------




 ----------------------- -------------

    UNPAID PRINCIPAL
 BALANCE OF EURODOLLAR     NOTATION
         LOANS             MADE BY
 ----------------------- -------------
                      
 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------

 ----------------------- -------------


   81
                                                                     EXHIBIT F-3



                             FORM OF SWING LINE NOTE


THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MAY NOT BE TRANSFERRED EXCEPT
IN COMPLIANCE WITH THE TERMS AND PROVISIONS OF THE CREDIT AGREEMENT REFERRED TO
BELOW. TRANSFERS OF THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MUST BE
RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE
TERMS OF SUCH CREDIT AGREEMENT.

$___________                                                  New York, New York
                                                              ____________, ____

               FOR VALUE RECEIVED, the undersigned, SPANISH BROADCASTING SYSTEM,
INC., a Delaware corporation (the "Borrower"), hereby unconditionally promises
to pay to LEHMAN COMMERCIAL PAPER INC. (the "Swing Line Lender") or its
registered assigns at the Payment Office specified in the Credit Agreement (as
hereinafter defined) in lawful money of the United States and in immediately
available funds, on the Revolving Credit Termination Date the principal amount
of (a) ___________ DOLLARS ($_______________), or, if less, (b) the aggregate
unpaid principal amount of all Swing Line Loans outstanding to the Swing Line
Lender made pursuant to Section 2.6 of the Credit Agreement, as hereinafter
defined. The Borrower further agrees to pay interest in like money at such
office on the unpaid principal amount hereof from time to time outstanding at
the rates and on the dates specified in Section 2.15 of such Credit Agreement.

               The holder of this Note is authorized to endorse on the schedules
annexed hereto and made a part hereof or on a continuation thereof which shall
be attached hereto and made a part hereof the date and amount of each Swing Line
Loan made pursuant to the Credit Agreement and the date and amount of each
payment or prepayment of principal thereof. Each such endorsement shall
constitute prima facie evidence of the accuracy of the information endorsed. The
failure to make any such endorsement or any error in any such endorsement shall
not affect the obligations of the Borrower in respect of any Swing Line Loan.

               This Note (a) is [one of] the Swing Line Note[s] referred to in
the Credit Agreement dated as of July 6, 2000 (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"), among the
Borrower, the Swing Line Lender, the lenders from time to time party thereto,
and Lehman Commercial Paper Inc., as Administrative Agent, (b) is subject to the
provisions of the Credit Agreement and (c) is subject to optional and mandatory
prepayment in whole or in part as provided in the Credit Agreement. This Note is
secured and guaranteed as provided in the Loan Documents. Reference is hereby
made to the Loan Documents for a description of the properties and assets in
which a security interest has been granted, the nature and extent of the
security and the guarantees, the terms and conditions upon which the security
interests and each guarantee were granted and the rights of the holder of this
Note in respect thereof.


   82

               Upon the occurrence of any one or more of the Events of Default,
all principal and all accrued interest then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Credit Agreement.

               All parties now and hereafter liable with respect to this Note,
whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.

               Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit
Agreement.

               NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN
THE CREDIT AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN
ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 10.6 OF THE
CREDIT AGREEMENT.

               THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

                                            SPANISH BROADCASTING SYSTEM, INC.



                                            By:
                                                --------------------------------
                                                Name:
                                                Title:



                                       2
   83


                                                                      Schedule A
                                                              to Swing Line Note



                          LOANS AND REPAYMENTS OF LOANS





- ------------------- -------------------------- ----------------------------
                            AMOUNT OF            AMOUNT OF PRINCIPAL OF
       DATE             SWING LINE LOANS         SWING LINE LOANS REPAID
- ------------------- -------------------------- ----------------------------
                                         
- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------

- ------------------- -------------------------- ----------------------------




- ----------------------------------- ---------------------
   UNPAID PRINCIPAL BALANCE OF
         SWING LINE LOANS             NOTATION MADE BY
- ----------------------------------- ---------------------
                                 
- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------

- ----------------------------------- ---------------------



   84


                                                                       EXHIBIT G


                          FORM OF EXEMPTION CERTIFICATE


               Reference is made to the Credit Agreement, dated as of July 6,
2000 (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement") among SPANISH BROADCASTING SYSTEM, INC., a Delaware
corporation (the "Borrower"), the lenders from time to time party to the Credit
Agreement (the "Lenders"), and LEHMAN COMMERCIAL PAPER INC., as administrative
agent (in such capacity, the "Administrative Agent"). Capitalized terms used
herein that are not defined herein shall have the meanings ascribed to them in
the Credit Agreement. __________________ (the "Non-U.S. Lender") is providing
this certificate pursuant to Section 2.20(f) of the Credit Agreement. The
Non-U.S. Lender hereby represents and warrants that:

               1.  The Non-U.S.  Lender is the sole record and beneficial owner
of the Loans or the obligations evidenced by Note(s) in respect of which it is
providing this certificate.

               2.  The Non-U.S.  Lender is not a "bank" for purposes of Section
881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the "Code"). In
this regard, the

Non-U.S.  Lender further represents and warrants that:

               (a)     the Non-U.S.  Lender is not subject to regulatory or
               other legal requirements as a bank in any jurisdiction; and

               (b)     the Non-U.S. Lender has not been treated as a bank for
               purposes of any tax, securities law or other filing or submission
               made to any Governmental Authority, any application made to a
               rating agency or qualification for any exemption from tax,
               securities law or other legal requirements;

               3.  The Non-U.S.  Lender is not a 10-percent shareholder of the
Borrower within the meaning of Section 881(c)(3)(B) of the Code; and

               4.  The Non-U.S.  Lender is not a controlled foreign corporation
receiving interest from a related person within the meaning of Section
881(c)(3)(C) of the Code.

               IN WITNESS WHEREOF, the undersigned has duly executed this
certificate.

                                            [NAME OF NON-U.S. LENDER]



                                            By:
                                                --------------------------------
                                                Name:
                                                Title:

Date:
       -----------------------------



   85


                                                                      EXHIBIT H

                           FORM OF CLOSING CERTIFICATE

               Pursuant to subsection 5.l(i) of the Credit Agreement dated as of
July 6, 2000 (the "Credit Agreement"; terms defined therein being used herein as
therein defined), among SPANISH BROADCASTING SYSTEM, INC., a Delaware
corporation (the "Borrower"), the lenders from time to time party to the Credit
Agreement (the "Lenders"), and LEHMAN COMMERCIAL PAPER INC., as administrative
agent (in such capacity, the "Administrative Agent"), the undersigned [INSERT
TITLE OF OFFICER] of [INSERT NAME OF COMPANY] (the "Company") hereby certifies
as follows:

               1.  The representations and warranties of the Company set forth
in each of the Loan Documents to which it is a party or which are contained in
any certificate furnished by or on behalf of the Company pursuant to any of the
Loan Documents to which it is a party are true and correct in all material
respects on and as of the date hereof with the same effect as if made on the
date hereof, except for representations and warranties expressly stated to
relate to a specific earlier date, in which case such representations and
warranties were true and correct in all material respects as of such earlier
date.

               2.  ____________________ is the duly elected and qualified
Corporate Secretary of the Company and the signature set forth for such officer
below is such officer's true and genuine signature.

               3.  No Default or Event of Default has occurred and is continuing
as of the date hereof or after giving effect to the Loans to be made on the date
hereof. [Borrower only]

               4.  The conditions precedent set forth in Section 5.1 of the
Credit Agreement were satisfied as of the Closing Date except as set forth on
Schedule I hereto.
[Borrower only]

               The undersigned Corporate Secretary of the Company certifies as
follows:

               5.  There are no liquidation or dissolution proceedings pending
or to my knowledge threatened against the Company, nor has any other event
occurred adversely affecting or threatening the continued corporate existence of
the Company.

               6.  The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the jurisdiction of its
organization.

               7.  Attached hereto as Annex 1 is a true and complete copy of
resolutions duly adopted by the Board of Directors of the Company on
__________________; such resolutions have not in any way been amended, modified,
revoked or rescinded, have been in full force and effect since their adoption to
and including the date hereof and are now in full force and effect [and are the
only corporate proceedings of the Company now in force relating to or affecting
the matters referred to therein.]


   86

               8.  Attached hereto as Annex 2 is a true and complete copy of the
By-Laws of the Company as in effect on the date hereof.

               9.  Attached hereto as Annex 3 is a true and complete copy of the
Certificate of Incorporation of the Company as in effect on the date hereof, and
such certificate has not been amended, repealed, modified or restated.

               10. The following persons are now duly elected and qualified
officers of the Company holding the offices indicated next to their respective
names below, and such officers have held such offices with the Company at all
times since the date indicated next to their respective titles to and including
the date hereof, and the signatures appearing opposite their respective names
below are the true and genuine signatures of such officers, and each of such
officers is duly authorized to execute and deliver on behalf of the Company each
of the Loan Documents to which it is a party and any certificate or other
document to be delivered by the Company pursuant to the Loan Documents to which
it is a party:

 
 
      Name                   Office                   Date                 Signature
      ----                   ------                   ----                 ---------
                                                                  

 
               IN WITNESS WHEREOF, the undersigned have hereunto set our names
as of the date set forth below.

- ------------------------------------        ------------------------------------
Name:                                       Name:
Title:                                      Title:


Date:
       ----------------, ----


                                       2
   87



                                                                      SCHEDULE I


                          [Waived Conditions Precedent]







                                       3
   88




                                                                       EXHIBIT J



                                     FORM OF
                            ASSIGNMENT AND ACCEPTANCE


               Reference is made to the Credit Agreement, dated as of July 6,
2000 (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among SPANISH BROADCASTING SYSTEM, INC., a Delaware
corporation (the "Borrower"), the lenders from time to time party thereto (the
"Lenders"), and Lehman Commercial Paper Inc., as administrative agent (in such
capacity, the "Administrative Agent"). Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the meanings given to
them in the Credit Agreement.

               The Assignor identified on Schedule 1 hereto (the "Assignor") and
the Assignee identified on Schedule 1 hereto (the "Assignee") agree as follows:

               1. The Assignor hereby irrevocably sells and assigns to the
Assignee without recourse to the Assignor, and the Assignee hereby irrevocably
purchases and assumes from the Assignor without recourse to the Assignor, as of
the Effective Date (as defined below), the interest described in Schedule 1
hereto (the "Assigned Interest") in and to the Assignor's rights and obligations
under the Credit Agreement with respect to those credit facilities contained in
the Credit Agreement as are set forth on Schedule 1 hereto (individually, an
"Assigned Facility" collectively, the "Assigned Facilities"), in a principal
amount for each Assigned Facility as set forth on Schedule 1 hereto.

               2. The Assignor (a) makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or with
respect to the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement, any other Loan Document or any
other instrument or document furnished pursuant thereto, other than that the
Assignor has not created any adverse claim upon the interest being assigned by
it hereunder and that such interest is free and clear of any such adverse claim;
(b) makes no representation or warranty and assumes no responsibility with
respect to the financial condition of the Borrower, any of its Subsidiaries or
any other obligor or the performance or observance by the Borrower, any of its
Subsidiaries or any other obligor of any of their respective obligations under
the Credit Agreement or any other Loan Document or any other instrument or
document furnished pursuant hereto or thereto; and (c) attaches any Notes held
by it evidencing the Assigned Facilities and (i) requests that the
Administrative Agent, upon request by the Assignee, exchange the attached Notes
for a new Note or Notes payable to the Assignee and (ii) if the Assignor has
retained any interest in the Assigned Facility, requests that the Administrative
Agent exchange the attached Notes for a new Note or Notes payable to the
Assignor, in each case in amounts which reflect the assignment being made hereby
(and after giving effect to any other assignments which have become effective on
the Effective Date).


   89

               3.  The Assignee (a) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance; (b) confirms that it
has received a copy of the Credit Agreement, together with copies of the
financial statements delivered pursuant to Section 4.1 thereof and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (c) agrees
that it will, independently and without reliance upon the Assignor, the Agents
or any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Agreement, the other Loan Documents or any
other instrument or document furnished pursuant hereto or thereto; (d) appoints
and authorizes the Agents to take such action as agent on its behalf and to
exercise such powers and discretion under the Credit Agreement, the other Loan
Documents or any other instrument or document furnished pursuant hereto or
thereto as are delegated to the Agents by the terms thereof, together with such
powers as are incidental thereto; and (e) agrees that it will be bound by the
provisions of the Credit Agreement and will perform in accordance with its terms
all the obligations which by the terms of the Credit Agreement are required to
be performed by it as a Lender including, if it is organized under the laws of a
jurisdiction outside the United States, its obligation pursuant to Section
2.20(f) of the Credit Agreement.

               4.  The effective date of this Assignment and Acceptance shall be
the Effective Date of Assignment described in Schedule 1 hereto (the "Effective
Date"). Following the execution of this Assignment and Acceptance, it will be
delivered to the Administrative Agent for acceptance by it and recording by the
Administrative Agent pursuant to the Credit Agreement, effective as of the
Effective Date (which shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days after the date of such
acceptance and recording by the Administrative Agent).

               5.  Upon such acceptance and recording, from and after the
Effective Date, the Administrative Agent shall make all payments in respect of
the Assigned Interest (including payments of principal, interest, fees and other
amounts) [to the Assignor for amounts which have accrued to the Effective Date
and to the Assignee for amounts which have accrued subsequent to the Effective
Date] [to the Assignee whether such amounts have accrued prior to the Effective
Date or accrue subsequent to the Effective Date. The Assignor and the Assignee
shall make all appropriate adjustments in payments by the Agent for periods
prior to the Effective Date or with respect to the making of this assignment
directly between themselves.]

               6.  From and after the Effective Date, (a) the Assignee shall be
a party to the Credit Agreement and, to the extent provided in this Assignment
and Acceptance, have the rights and obligations of a Lender thereunder and under
the other Loan Documents and shall be bound by the provisions thereof and (b)
the Assignor shall, to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Credit
Agreement.

               7.  This Assignment and Acceptance shall be governed by and
construed in accordance with the laws of the State of New York.

                                       2
   90


               IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance to be executed as of the date first above written by
their respective duly authorized officers on Schedule 1 hereto.












                                       3
   91





                                   Schedule I
                          to Assignment and Acceptance


Name of Assignor:
                   ----------------------------------------------

Name of Assignee:
                   ----------------------------------------------

Effective Date of Assignment:
                               ----------------------------------





     Credit Facility                  Principal Amount
        Assigned                         Assigned             Commitment Percentage Assigned
- -----------------------------  ----------------------------  ---------------------------------
                                                       
                                      $----------             ---.----------%





[Name of Assignee]                               [Name of Assignor]



By:                                              By:
    ---------------------------------------         ----------------------------
    Title:                                          Title:



   92



Accepted:                                          Consented To:

LEHMAN COMMERCIAL PAPER                            SPANISH BROADCASTING SYSTEM,
INC.                                               INC.


By:                                                By:
     ---------------------------------------          --------------------------
     Title:                                           Title:


                                       2

EX-10.46

   1
                                                                   Exhibit 10.46

                          EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT dated as of December 7, 2000, by and between Spanish
Broadcasting System, Inc., a Delaware corporation, having a place of business
at 3191 Coral Way, Miami, Florida (the "Company") and Joseph A. Garcia (the
"Executive").

     WHEREAS, the Executive has been employed by the Company for a number of
years as its Chief Financial Officer, Executive Vice President and Secretary;
and

     WHEREAS, the Company desires to assure the continued services of the
Executive and the Executive is willing to continue to serve in the employ of
the Company for the period set forth herein upon the terms and conditions
hereinafter provided;

     NOW, THEREFORE, in consideration of the mutual promises and agreements set
forth below, the Company and the Executive agree as follows:

     1.  Term. Except as otherwise provided in Section 4 hereof, the Company
agrees to employ the Executive, and the Executive agrees to serve, for a period
of five years commencing on the date the signing of this contract and ending on
the fifth anniversary of the signing date, provided that, unless either party
otherwise elects by notice in writing to the other at least 90 days prior to
the fifth anniversary of the signing date or any succeeding anniversary of the
signing date, the employment term shall be automatically renewed for successive
one-year terms unless sooner terminated pursuant to the terms of this Agreement
(the "Employment Term").

     2.  Positions and Duties; Place of Performance.

         (a)  Positions and Duties. The Executive shall be employed as Chief
Financial Officer, Executive Vice President and Secretary of the Company and
shall have the
   2
duties, responsibilities and authority as may from time to time be assigned to
him by Raul Alarcon, Jr. (the "CEO") that are consistent with and normally
associated with such positions, and shall continue to have responsibility for
those segments of the Company's business for which he is currently responsible.
The Executive shall devote substantially all of his business time, effort and
energies exclusively to the business of the Company, and shall not serve as an
active principal or a director or officer of any other company or entity
without the prior written consent of the CEO, except that the Executive may
serve as a director or officer of any trade association, civic, religious,
business, educational or charitable organization without such consent.

         (b)  Place of Performance. The Executive shall be based in Miami,
Florida, except for required travel on the Company's business.

     3.  Compensation and Benefits.

         (a)  Base Salary. During the Employment Term, the Company shall pay
the Executive a base salary at the annual rate of $400,000 per year (the "Base
Salary"), payable in accordance with the Company's normal payroll practices for
executive compensation, but not less frequently than monthly. The Executive
Base Salary will be reviewed not less often than annually by the Company's
Compensation Committee. In addition, the Compensation Committee shall meet
annually to determine what, if any, bonus shall be provided Executive for the
fiscal year.

         (b)  Bonuses. In addition to the Base Salary, the Executive shall be
entitled to receive a cash bonus each year at the discretion of the Board of
Directors of the Company.

         (c)  Other Benefit Plan and Fringe Benefits. The Executive shall be
eligible (I) to participate in any and all retirement, family group health,
insurance plans and in all

                                       2
   3
other employee benefit plans in which he currently participates and/or in any
such plans established or maintained by the Company during the Employment Term
that are made available to its management executives generally, (ii) to
receive all fringe benefits, for which his status and level of employment
qualify him in accordance with the Company's usual policies and arrangements
and the terms of such plans, policies and arrangements and (iii) to receive
such other benefits as are specified on Schedule A.

         (d)  Options. The Company has granted the Executive an option to
purchase 250,000 shares of common stock of the Company upon the Effective Date
(the "Option") at an exercise price equal to the public offering price of the
Company's initial public offering. The Options shall be incentive stock options
(within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code")) to the maximum extent possible, (subject to qualification
of such options or any portion thereof as incentive stock options, and shall be
nonqualified stock options to the extent they do not so qualify). The Company
shall grant the Executive an option to purchase 100,000 shares of common stock
of the Company upon the execution of this Employment Agreement at an exercise
price equal to the closing price (NASDAQ) at such date of execution. The
Options shall be incentive stock options (within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended (the "Code")) to the maximum
extent possible, (subject to qualification of such options or any portion
thereof as incentive stock options, and shall be nonqualified stock options to
the extent they do not so qualify). The Option for 100,000 shares shall vest
20,000 upon execution of this Employment Agreement, the remain shares shall vest
over the four (4) years following the execution of this Employment Agreement
(with 20,000 to vest each year on the first, second, third and fourth
anniversary of the execution date), provided that the Executive is employed on
each such date.

                                       3
   4
Notwithstanding the foregoing, the Executive shall be eligible to participate
in any stock option or other equity-based program established by the Company
during the Employment Term.
               (e)  Expenses. The Company shall reimburse the Executive for any
and all out-of-pocket expenses incurred by the Executive during the Employment
Term in connection with his duties and responsibilities hereunder in accordance
with the Company's usual policy of reimbursing senior executives.
          4.   Termination.
               (a)  Compensation and Benefits. Except as otherwise provided in
this section or in Section 4 hereof, upon termination of the Executive's
employment hereunder, his right to any form of compensation hereunder shall
cease, except that he shall be entitled to receive any salary or other benefits
accrued but not paid up to his Date of Termination or for any period required
by law and any out-of-pocket expenses reasonably incurred by the Executive
prior to such date.
               (b)  Death and Disability. The Executive's employment hereunder
shall terminate upon his death, and may be terminated by the Company due to
Disability. For purposes of this Agreement, "Disability" shall mean the
determination by the Board that the Executive is physically or mentally
incapacitated and has been unable for a period of six consecutive months, or for
shorter periods aggregating six months in any period of twelve (12) consecutive
months to perform the duties for which he was responsible immediately before the
onset of his incapacity. In order to assist the Board in making such a
determination, the Executive shall, as reasonably requested by the Board, make
himself available for medical examinations by a physician chosen by the Board
and approved by the Executive. The



                                       4
   5
determination of the physician chosen in accordance with the preceding sentence
shall be final and binding on the Company and the Executive.
               (c)  Termination By the Company For Cause. The Executive's
employment hereunder may be terminated by the Company for Cause at any time.
For purposes of this Agreement, the term "Cause" shall mean the Executive's
(I) commission of an illegal act or acts that was intended to and did defraud
the Company or any of its affiliates, (ii) gross negligence or willful
misconduct in the management of the Company's affairs which materially harms
the Company and which is not remedied within 30 days of receiving notice of
same, or (iii) breach of the provisions of Section 5(a) or (b) hereof. In any
case described in this section, the Executive shall be given written notice, in
accordance with Section 4(f), that the Company intends to terminate his
employment for Cause. Such written notice shall specify the particular act or
acts, or failure to act, that is or are the basis for the decision to so
terminate the Executive's employment for Cause, and shall give the Executive
the right to cure any breach so specified for a period of thirty (30) days.
               (d)  Termination By the Executive For Good Reason. The Executive
may terminate his employment hereunder for Good Reason. For purposes of this
Agreement, the term "Good Reason" shall mean and shall be deemed to exist if,
without the prior written consent of the Executive, (I) the Executive is
replaced as CFO or is assigned duties or responsibilities that are inconsistent
in any material respect with the scope of the duties or responsibilities
associated with his titles or positions, as set forth in this Agreement (or to
which he is promoted). (ii) the Executive's duties or responsibilities are
significantly reduced, (iii) benefits to which the Executive is entitled under
the employee benefit plans of the Company are in the aggregate materially
decreased, unless such decrease is required by law or is applicable to all
employees of



                                       5
   6
the Company eligible to participate in any plan so affected, not just those
covered by employment agreements with the Company, (iv) the Executive's Base
Salary is reduced, (v) the Company fails to perform any material term or
provision of this Agreement, (vi) the Executive's office location is relocated
to one that is more than fifty (50) miles from the location at which the
Executive was based immediately prior to the relocation, (vii) the Company
fails to obtain the full assumption of this Agreement by a successor or (viii)
the Executive does not report directly to Raul Alarcon, Jr. In the event this
agreement is not assumed by a successor, then, in that event the Company shall
make a lump sum payment equal to the remaining compensation due Executive
pursuant to this agreement. Such payment shall be made at the time of
consummation of any sale of Company.
               (e)  Compensation Upon Termination Without Cause or for Death or
Disability.
                    (I)  If the Company terminates the Executive's employment
hereunder other than for Cause or other than in accordance with Section 4(b),
or the Executive terminates his employment for Good Reason, notwithstanding any
other provision of this Agreement to the contrary:
               (A)  In addition to the amounts paid to the Executive pursuant
to Section 4(a), in lieu of any further salary payments to the Executive for
periods subsequent to the Date of Termination, the Company shall pay the
Executive an amount equal to two times the Executive's annual Base Salary rate
in effect as of the Date of Termination, plus two times the bonus paid him with
respect to the year preceding such Date of Termination. Except as provided in
Section 6(a)(I), this amount shall be paid in [substantially equal monthly
payments during the two years following the Executive's Date of Termination,
provided, however, that the Company



                                       6
   7


may determine, in its sole discretion, to pay such amount (or any portion
remaining during such period if periodic payments have commenced) in a single
lump sum in cash.

               (B)  The Company shall continue to provide the Executive (and his
eligible dependents, if any) with group health and life insurance benefits and
long-term disability insurance coverage (or the economic equivalent thereof) at
the level (including, if applicable, the portion of the premium paid by the
Company for such coverage) in effect on the Date of Termination for the one-year
period following such date, provided that such coverage shall cease to be
provided if the Executive is employed by another employer within such one-year
period, and further provided that, the date of the expiration of the extended
period of coverage provided under this clause (I)(B) shall be treated as the
date of the termination of the Executive's employment solely for the purpose of
determining the rights of the Executive (and his eligible dependents, if any) to
the continuation coverage provided under Section 4980B of the Code.

               (C)  All nonvested Options previously granted to Executive shall
immediately vest and remain exercisable until the earlier of (I) two years from
the Executive's Date of Termination and (ii) the remaining term of the Option.

               (D)  If the Executive's employment hereunder is terminated as a
result of Death or Disability, he shall be paid a single lump sum in cash within
thirty (30) days of his Date of Termination in an amount equal to one year of
his Base Salary.

               (f)  Notice of Termination: Date of Termination. Any termination
of the Executive's employment, other than by reason of his death, shall be
communicated by the terminating party by a written notice of termination (the
"Notice of Termination"). The Notice of Termination shall (I) indicate the
specific termination provision in this Agreement relied upon (ii) set forth in
reasonable detail the facts and circumstances claimed to provide a basis for


                                       7
   8


termination of the Executive's employment under the provision so indicated, and
(iii) if the termination date is other than the date of receipt of such notice,
specify the date on which the Executive's employment is to be terminated (which
date shall not be earlier than the date on which such notice is actually
received, or in the case of a termination for Disability, the sixtieth (60th)
day after such notice is received). In the case of a termination by the Company
for Cause, the Notice of Termination shall be given within one hundred and
eighty (180) business days after the Company's CEO has actual knowledge of the
events justifying the purported termination, and in the case of a termination
by the Executive for Good Reason, the notice shall be given within one hundred
and eighty (180) days of the Executive's having actual knowledge of the events
justifying such termination. For purposes of this Agreement, "Date of
Termination" shall mean (I) if the Executive's employment is terminated by his
death, the date of his death, and (ii) in all other cases, the later of the date
of actual receipt of the Notice of Termination, or the date specified in such
notice.

               (g)  No Mitigation; No Offset. In the event of any termination of
the Executive's employment under this Section 4, the Executive shall be under no
obligation to seek other employment and there shall be no offset against any
amounts due the Executive under this Agreement on account of any remuneration
that the Executive may obtain from any subsequent employment. Any amounts due
under this Section 4 are in the nature of liquidated damages, and not in the
nature of a penalty.

           5.  Covenants.

               (a)  Competitive Activity. During the Employment Term, and for a
period of twelve (12) months after the Executive's Date of Termination, the
Executive agrees that, without the prior written consent of the Board, he shall
not render services in any capacity


                                       8
   9


for a radio station competitive with the Company's radio business, nor shall he
be directly or indirectly involved in any radio business or radio network
competitive with the Company's radio business.

               (b)  Solicitation or Interference. During the Employment Term and
for a period of twelve (12) months after the Executive's Date of Termination,
the Executive shall not, either for himself or on behalf of any third party: (I)
in any manner induce any employee, agent, representative, customer, former
customer, or any other person or concern, dealing with or in some other way
associated with the Company, to terminate such dealings or association; or (ii)
do anything, directly or indirectly, to interfere with the relationship between
the Company and any such person or concern.

               (c)  Non-Disclosure of Proprietary Information. The Executive
agrees that he will not disclose the trade secrets or confidential and
proprietary information of the Company during the Employment Term or thereafter.
The parties understand and agree that nothing contained herein shall prevent the
Executive from disclosing: (1) information required to be disclosed pursuant to
compulsory legal process, provided that he shall give the Company prompt notice
of such process prior to disclosure; (2) information which was in his lawful
possession at the time of or prior to its submission to him by the Company; or
(3) information which is in the public domain.

               (d)  Remedy for Breach. If any provision of this Section 4 is
deemed invalid or unenforceable, such provision shall be deemed modified and
limited to the extent necessary to make it valid and enforceable. The Executive
acknowledges and agrees that the provisions of this section are reasonable and
necessary for the protection of the Company and that the Company will be
irrevocably damaged if such provisions are not specifically enforced



                                       9
   10
Accordingly, money damages from the Executive for a breach of this section
would be difficult, if not impossible, to calculate and the most appropriate
relief in the event of the Executive's breach would be injunctive relief.
Nothing contained herein shall be deemed to prohibit the Company, for any such
breach, from instituting or prosecuting any other proceeding in any court of
competent jurisdiction, in either law or equity, to obtain damages for any
breach of this Agreement. All remedies given to the Company by this Agreement
shall be construed as cumulative remedies and shall not be alternative or
exclusive remedies.

     6. Change in Control Provisions.

          (a) Impact of Event. In the event of a "Change in Control" of the
Company, as defined in Section 6(b), the following provisions shall apply in
addition to the other provisions of this Agreement:

               (I) If, on or before the second anniversary of the Change in
Control, the Executive's employment hereunder is terminated by the Company for
any reason other than for Cause or by the Executive for Good Reason, (A)
Section 5(a) shall not be applicable to the Executive from and after his Date
of Termination, (B) the Executive shall be entitled to receive the amount
determined under Section 4(e)(I)(A) in a single lump sum in cash within thirty
(30) days of the Executive's Date of Termination, and such amount shall not be
discounted in any way to reflect its present value, (C) any and all Options the
Executive then holds which are not exercisable shall vest and be exercisable
immediately, and (D) notwithstanding Section 4(e)(B) hereof, at the Company's
expense, the Executive shall continue to be a participant in any group health
plan (which may be provided by payment of COBRA continuation coverage premiums)
maintained by the Company (or the economic equivalent in

                                       10
   11
cash) at the level in effect on the Executive's Date of Termination for a
period of eighteen (18) months following his Date of Termination.

               (ii) All expenses (including, without limitation, legal fees and
expenses) incurred by the Executive in connection with, or in prosecuting or
defending, any claim or controversy arising out of or relating to this
Agreement shall be paid by the Company, unless the Executive fails to prevail at
least in part in any such claim or controversy and the Company receives a
written opinion of independent legal counsel, selected by the Board, to the
effect that such expenses were not incurred by the Executive in good faith.
Pending any such determination, such expenses shall be paid by the Company in
advance on a monthly basis, upon an undertaking by the Executive to repay such
advanced amounts if the Executive fails to prevail in any such claim or
controversy and it should thus be determined that the expenses were not
incurred by the Executive in good faith.

          (b) Definition of Change in Control. A Change in Control shall mean
the happening of any of the following:

               (I) any "person," as such term is used in Section 13(d) and 14(d)
of the Securities Exchange Act of 1934 (the "Exchange Act") (other than the
Company or any subsidiary of the Company, or any trustee or other fiduciary
holding securities under an employee benefit plan of the Company or any
subsidiary) becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company
representing [thirty percent (30%)] or more of the combined voting power of the
Company's then outstanding securities;

               (ii) during any period of two consecutive years beginning on or
after the Effective Date hereof, individuals who at the beginning of such
period constitute the

                                        11
   12
Board, and any new director (other than a director designated by a person who
has entered into an agreement with the Company to effect a transaction
described in clause (I), (iii) or (iv)) whose election by the Board or
nomination for election by the Company's shareholders was approved by a vote of
at least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved (unless the approval of the election or
nomination for election of such new directors was in connection with an actual
or threatened election or proxy contest), cease for any reason to constitute at
least a majority thereof;

               (iii) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than (x) a
merger of consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities of the
surviving entity) more than eighty percent (80%) of the combined voting power
of the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (y) a merger or consolidation
effected to implement a recapitalization of the Company (or similar
transaction) in which no "person" (as defined above in clause (I) acquires
more than fifty percent (50%) of the combined voting power of the Company's
then outstanding securities; or

               (iv) the shareholders of the Company approve an agreement for
the sale or disposition by the Company of all or substantially all of the
Company's assets or any transaction having a similar effect, or the Company,
directly or indirectly, begins proceedings to effect a complete liquidation.

                                       12
   13
     7.  Miscellaneous.

         (a)  Governing Law. This Agreement shall be governed by the laws of
the State of New York, without regard to any conflicts of laws principles
thereof that would call for the application of the laws of any other
jurisdiction.

         (b)  Notice. Any notice, consent, request or other communication made
or given in connection with this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by registered or
certified mail, return receipt requested, to those listed below at their
following respective addresses or at such other address as each may specify by
notice to the others:

              To the Executive:

              Joseph A. Garcia
              14021 S.W. 67 Court
              Miami, Florida
              (305) 971-9261

              To the Company:

              Spanish Broadcasting System, Inc.
              2601 South Bayshore Drive
              Penthouse 2
              Coconut Grove, Florida 33133

              with a copy to:
              Jason L. Shrinsky, Esq.
              Kaye, Scholer, Fierman, Hays & Handler, LLP
              425 Park Avenue
              New York, New York 10022

         (c)  Entire Agreement; Amendment. This Agreement shall supersede any
and all existing agreements between the Executive and the Company or any of its
affiliates relating to the terms of the Executive's employment during the
Employment Term. It may not be amended except by a written agreement signed by
both parties.

                                       13
   14
         (d)  Waiver. The failure of a party to insist upon strict adherence to
any term of this Agreement on any occasion shall not be considered a waiver
thereof or deprive that party of the right thereafter to insist upon strict
adherence to that term or any other term of this Agreement.

         (e)  Assignment. Except as otherwise provided in this Section 9(e),
this Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective heirs, representatives, successors and assigns.
This Agreement shall not be assignable by the Executive, and shall be
assignable by the Company only to any corporation or other entity resulting
from the reorganization, merger or consolidation of the Company with any other
corporation or entity or any corporation or entity to or with which the
Company's business or substantially all of its business or assets may be sold,
exchanged or transferred, and it must be so assigned by the Company to, and
accepted as binding upon it by, such other corporation or entity in connection
with any such reorganization, merger, consolidation, sale, exchange or transfer
(the provisions of this sentence also being applicable to any successive such
transaction).

         (f)  Headings. Section headings are used herein for convenience of
reference only and shall not affect the meaning of any provision of this
Agreement.

         (g)  Rules of Construction. Whenever the context so requires, the use
of the masculine gender shall be deemed to include the feminine and vice versa,
and the use of the singular shall be deemed to include the plural and vice
versa.

         (h)  Arbitration. Any dispute or controversy arising out of, or
relating to this Agreement, shall be resolved by arbitration at the American
Arbitration Association ("AAA") at its New York City office before a panel of
three arbitrators under the then existing rules and regulations of the AAA. The
determination of the arbitrators shall be final and binding

                                       14
   15
on the parties hereto and judgment on it may be entered in any court of
competent jurisdiction. In the event the Executive prevails in such
proceedings, as determined by the arbitration panel, the Company shall
reimburse the Executive for all expenses (including, without limitation,
reasonable legal fees and expenses) he incurred in connection with any such
proceeding. All such amounts shall be paid promptly but in any event within ten
(10) business days after the Executive provides the Company with a statement of
the amounts to be reimbursed. In all other cases, each party shall be
responsible for their own expenses incurred in connection with such
proceedings.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.


                                       SPANISH BROADCASTING SYSTEM, INC.


                                       By: /s/ RAUL ALARCON, JR.
                                          ----------------------
                                               Raul Alarcon, Jr.


                                       JOSEPH GARCIA


                                          /S/ JOSEPH A. GARCIA
                                          -------------------------

                                       15
   16
SCHEDULE A



Bonus:            To the extent that the projected broadcast cash flow target is
                  achieved by the Company, the Executive will be entitled to
                  receive a sum equal to two hundred thousand dollars ($200,000)
                  to be paid on a quarterly basis for every quarter that the
                  Company meets the projected cash flow target. Once the Bonus
                  is increased, the new annual bonus shall thereafter
                  constituted the "Bonus" for purposes of this Agreement.

Health Insurance: Health and dental insurance for the executive and family
                  under the current Company's plan.

Allowance:        $5,040 payable in monthly installments.

Car:              Lease for a S430 Mercedes Benz, renewable every four years.


                                       16

EX-10.47

   1
                                                                   Exhibit 10.47

                             EMPLOYMENT AGREEMENT

THIS AGREEMENT is made as of August 31, 2000 between Spanish Broadcasting
System, Inc., a corporation existing under the laws of Delaware with offices
located at 3191 Coral Way, Miami, Florida (SBS), and William B. Tanner
(hereinafter referred to as Employee), an individual whose principal place of
residence and mailing address is 4180 Lybyer Avenue, Coconut Grove, Florida
33133-6154.

                                   RECITALS

     WHEREAS, SBS is the owner/operator of certain Spanish-language radio
stations whose signals are broadcast throughout several U.S. metropolitan areas
(the Stations); and

     WHEREAS, SBS wishes to engage Employee, and Employee wishes to become
engaged to perform services for SBS as Executive Vice President of Programming
during the term of and pursuant to the terms and conditions set forth in this
Agreement;

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

     1.  EMPLOYMENT. Employee shall be employed to perform services as
Executive Vice President of Programming reporting to Raul Alarcon, Jr.,
Chairman/CEO or a mutually agreed to designee and Employee shall have hiring
and firing authority over all programming personnel and final decision as to the
music played and programming within a programming format approved by Raul
Alarcon, Jr., or his designee over the SBS stations. Employee's services will
be rendered subject to and in accordance with, the direction, control, rules,
and regulations of SBS.

     2.  TERM. The term of this Agreement shall be from August 31, 2000 through
and including August 31, 2005. Beginning on September 1, 2004 but no later than
December 1, 2004 SBS and Employee agree to negotiate a mutually acceptable
extension of this contract.

     3.  COMPENSATION AND BENEFITS. See Compensation Rider.

     (a) BONUS. See Compensation Rider.

     (b) STOCK OPTIONS.

         Beginning on August 31, 2000 and provided Employee remains employed
by SBS on the respective date of grant, SBS shall grant to Employee an option
to purchase shares of SBS common stock at the market price on the immediately
preceding business date, in accordance with the schedule below. Each such
option shall be deemed vested on the date of grant and shall remain exercisable
by Employee for a period of five (5) years thereafter or for a period of sixty
(60) days after Employee's employment is terminated for any reason, whichever
occurs first, after which time all vested and unexercised grants and or options
shall be forfeited.
   2


          (a)  August 31, 2001 - 15,000 shares
          (b)  August 31, 2002 - 15,000 shares
          (c)  August 31, 2003 - 15,000 shares
          (d)  August 31, 2004 - 15,000 shares
          (e)  August 31, 2005 - 15,000 shares

Additionally, in compensation for stock options forfeited due to Employee's
termination of his employment with Hispanic Broadcasting Corporation, as
evidenced by Exhibits "A" and "B" of this Agreement, SBS does hereby grant
Employee an additional 218,552 options to purchase shares of SBS common stock
at the closing stock market price of September 1, 2000 and vesting 1/3 at the
signing of this Agreement, 1/3 on August 30, 2001 and 1/3 on August 30, 2002.
All such options are non-forfeitable, shall immediately vest, and shall be
exercisable for a period of sixty (60) days after Employee's termination, if
Employee's employment is terminated for any reason, other than with cause.

Each and every outstanding option under this Agreement shall become immediately
vested and fully exercisable in the event of a "Change of Control" at SBS or in
the event of the cancellation or withdrawal of the above options or any SBS
option plans. The term "Change in Control" is defined as: (a) a reorganization;
merger; consolidation; or other form of transaction, or series of transactions,
whereby the persons or entities owning more than 50% of the outstanding shares
of stock of SBS, no longer own 50% of the outstanding shares immediately after
such a transaction or series of transactions, or (b) a liquidation or
dissolution of SBS, or (c) the sale of all or substantially all of the assets
of SBS.

     (c)  BENEFITS. Employee shall be provided comparable health care coverage
and other benefits extended to other similarly situated SBS executives. The
Company shall provide Employee with the following; business class travel, (or
first class if business class is not available) payment of power and telephone
bill for the Los Angeles residence and an automobile allowance equal to
($2,000) Two Thousand Dollars per month, the professional support of a shared
administrative assistant and a (3) three week vacation per year. Employee may
continue his consulting relationship with radio stations WPOW-FM and WQAM-AM,
Miami, Florida and with the radio stations presently owned by COX BROADCASTING
in the Birmingham, Alabama market and at the sole discretion of Raul Alarcon,
Jr., President/CEO or a mutually agreed to designee of the radio stations
presently owned by COX BROADCASTING in the Long Island, New York market.

     (d)  EXPENSES. SBS shall reimburse Employee for reasonable business and
          entertainment expenses that he incurs subject to reasonable guidelines
          comparable with other similarly situated executives.
   3
         4.  COVENANTS.

         (a) COMPETITIVE ACTIVITY. During the term of this Agreement, and for a
period of twelve (12) months after the termination of this Agreement for any
reason, Employee shall not render services in any capacity for any radio
station in any area competitive with SBS or any of its Stations, whether as
on-air talent, host, producer of radio programs, program director or
consultant. Employee further agrees that during the term of this Agreement, and
for a period of twelve (12) months after the termination of this Agreement for
any reason, Employee shall not render services, directly or indirectly, for any
radio station competitive with any of SBS radio stations wherever located.

         (b)  SOLICITATION OR INTERFERENCE. During the term of this Agreement
or for a period of twelve (12) months after the earlier termination hereof by
either party for any reason (whichever period expires earlier), Employee shall
not:

              (I)  in any manner induce any employee, agent, representative,
customer, former customer, or any other person or concern, dealing with or in
some other way associated with SBS or its Stations, to terminate such dealings
or association nor;

              (ii) do anything, directly or indirectly, to interfere in any
fashion with such relationship between SBS or its Stations, on the one hand,
and any such person or concern, on the other.

         (c)  NON-DISCLOSURE OF PROPRIETARY INFORMATION. Employee shall not
disclose the trade secrets or confidential and proprietary information of SBS
or its Stations, whether during the employment term or thereafter. The parties
understand and agree, moreover, that nothing contained herein shall prevent
Employee form disclosing: (1) information required to be disclosed pursuant to
compulsory legal process, provided that Employee shall give SBS immediate
notice of such process prior to disclosure; (2) information which was in
Employee's lawful possession at the time of or prior to its submission to
Employee by SBS; or (3) information which is in the public domain.

         (d)  EMPLOYEE FIDELITY. Employee agrees that during the term of this
Agreement Employee will not, directly or through third-party intermediaries,
initiate or invite contact with, or solicit offers or proposals of employment
from, employers that compete with SBS or its stations, wherever located. Except
for contacts which may occur during the last 90 days of the term of this
Agreement, Employee expressly acknowledges that a breach of this covenant of
fidelity shall constitute grounds for termination for cause under Section 7.

         (e)  In any provision of this Section 4 is deemed invalid or
unenforceable, such provision shall be deemed modified and limited to the
extent necessary to make it valid and enforceable.
   4

        5.      PROPERTY RIGHTS. (a) All broadcasts, airchecks or recordings,
prerecorded or otherwise, of the programming of SBS's Stations commercials,
data, copy, written and recorded materials, as well as all recordings,
characters, personalities or "skits", if applicable, created by Employee during
his employment with SBS, including during the Term of this Agreement or any
Extension Term, including without limitation the Employee's work product, are
the exclusive property of SBS ("Property Rights"), SBS owns or shall own all
right, title and interest throughout the Universe in and to Employee's and SBS's
work product and all Copyright, Trademark and Other Intellectual Property Rights
in and related thereto ("Intellectual Property"). Material, characters,
personalities and skits created by or for Employee during his employment with
SBS may only be used by Employee during the Term or any Extension Term thereof.
All documents or other tangible property and concepts or inventions, including
Internet and other electronic media, relating in any way to the business of SBS
which are conceived or generated by Employee or come into Employee's possession
during or by virtue of his employment with SBS shall be and remain the property
of SBS. Employee must return all such documents and tangible property to SBS on
termination of this Agreement for any reason or at such earlier time as SBS may
request.

                        (b)     Employee acknowledges and agrees that Employee
is and has been retained by SBS to create work product and on a
work-made-for-hire basis for SBS. Insofar as the authorship and ownership of
all right, title and interest in and to any part of the work product and any
portion of the Intellectual Property are not deemed to vest in or be owned by
SBS as a work-made-for-hire or by operation of law or otherwise, Employee
agrees to and hereby does during the term assign, sell, transfer, grant and
convey to SBS (without the necessity of any further consideration,
documentation or further acts by either party) the entirety of whatever right,
title and interest Employee has in the Intellectual Property throughout the
Universe. At SBS's request, Employee shall execute any documents reasonably
required by SBS to confirm, establish, record, file applications for, renew or
maintain SBS's rights and ownership in the Intellectual Property worldwide and
will cooperate fully with SBS in connection with any or all of these efforts.

                        (c)     Employee waives any right and claim Employee may
have in any jurisdiction throughout the Universe in or to any moral rights or
rights of "droit moral" with respect to any portion of the Intellectual Property
and confirms that SBS shall have the right, in addition to other rights and
notwithstanding the termination of Employee's employment for any reason, to make
or have made and to own enhancement, derivative works and other modifications
to any part of the Intellectual Property.

                6.      NAME AND LIKENESS.

                        (a)     Use of Name and Likeness.

                        Employee hereby grants to SBS the irrevocable and
exclusive right (whether this Agreement expires in its normal course or is
terminated for any reason whatsoever) during the term of the Agreement
throughout the universe the right to use Employee's name, actual or simulated
likeness, nickname(s), character name(s), slogans, biography and other personal
identification in and in connection with the following uses:

                                (i)     Advertising, publicizing or otherwise
exploiting Employee's



   5

services hereunder, any program or other material in connection with which
Employee renders services hereunder, the results and proceeds of Employee's
services hereunder, and any rights granted to SBS hereunder; and

                                (ii)    Advertising, publicizing or otherwise
exploiting the name, product or services of SBS or any affiliate or any
successor, licensee or assign.

                                (iii)   Section 6(a) is not intended to alter,
compromise or limit in any way SBS's Property Rights as stated in Section 5
above.

                7.      NO OBLIGATION TO PRODUCE OR RELEASE. Notwithstanding any
other provision of this Agreement, SBS shall have no obligation to actually
utilize Employee's services or any of the results and proceeds thereof in any
Program or otherwise, or to produce or exploit any Program, or to exercise any
of the rights granted to SBS hereunder, or to continue any such use, exercise,
production or exploitation, if commenced. SBS's obligations to Employee under
this Agreement shall be fully performed by the payment to Employee of the
applicable compensation provided for in this agreement with respect to which SBS
has guaranteed Employee payment hereunder, subject to all of SBS's rights
hereunder.

                8.      RESOLUTION OF DISPUTES. Employee acknowledges and agrees
that the provisions of Section 4 are reasonable and necessary for protection of
SBS and that SBS will be irrevocably damaged if such provisions are not
specifically enforced. Accordingly, money damages from Employee's breach of
Section 4 would be difficult, if not impossible, to calculate and the most
appropriate relief in the event of Employee's breach would be injunctive relief.
Nothing contained herein shall be deemed to prohibit SBS, for any such breach,
from instituting or prosecuting any other proceeding in any court of competent
jurisdiction, in either law or equity, to obtain damages for any breach of this
Agreement. All remedies given to SBS by this Agreement shall be construed as
cumulative remedies and shall not be alternative or exclusive remedies. In the
event of a breach by Employee of Section 4, Employee agrees to pay to SBS all
costs and expenses, including reasonable attorney's fees, as may be expended by
SBS relative to said breach.

                9.      COMPLIANCE WITH SECTION 508 OF THE COMMUNICATIONS ACT
OF 1934. Employee shall comply with the provisions of Section 508 of the
Communications Act of 1934, as amended, in that he will not accept money or any
valuable consideration, including services, for the broadcast of any matter by
the Stations and in that he will promptly complete the Annual Statement and
Questionnaire and promptly return it to SBS. Without limiting SBS's right to
terminate for any other cause, SBS shall have the right, upon violation of this
provision by Employee, immediately to terminate this Agreement and Employee's
employment hereunder for cause.

                10.     TERMINATION.

                (a)     WITHOUT CAUSE. SBS may terminate this Agreement, without
cause and with prior notice, at any time in which event Employee shall receive
in a lump sum as liquidated damages the equivalent of (12) months' Base Salary
plus any Bonus earned to the date of notice of termination plus health benefits
per COBRA.


   6


                (b)     WITH CAUSE. SBS may terminate this Agreement for cause
at any time upon four (4) weeks prior notice or pay, less withholdings, in lieu
of notice. If Employee is terminated for cause, which shall include, but not be
limited to, termination resulting from (i) death of Employee (ii) misconduct by
Employee as described in (c) below; (iii) Employee disability which prevents
Employee from performing his duties hereunder for six (6) months in any one-year
period, he shall be entitled to only such compensation that has accrued up to
the date of termination and no more.

                (c)     Misconduct by Employee permitting termination for cause
hereunder shall include the following:

                        (i)     failure to comply with any of the terms and
conditions of this Agreement, to perform any reasonable duties assigned by SBS,
to follow any operating policies of SBS, any personnel policies of SBS
(Employee acknowledges having read and understood SBS's Employee policy manual),
to comply with any rule, regulation guideline or policy of the FCC or other
governmental agency with jurisdiction over SBS.

                        (ii)    repeated or sustained absences from the assigned
workplaces;

                        (iii)   conviction of any criminal offense, other than a
traffic violation or minor misdemeanor resulting in incarceration for less than
forty-eight (48) hours;

                        (iv)    any material act of dishonesty which creates or
has a negative effect on SBS

                        (v)     engaging in "payola" or "plugola" practices.

                        (vi)    use of illegal drugs or sustained alcohol abuse,
which is repeated and uncorrected.

                        (vii)   any intentional act that reflects unfavorably
and egregiously on the reputation of SBS.

                        11.     (a)     ASSIGNMENT. SBS shall be entitled to
assign this Agreement to any future licensee of SBS; provided, however, that
such future licensee must agree to be bound by the terms and conditions in this
Agreement. Employee may not assign his obligations under this Agreement.

                                (b)     NOTICE. Any notice or other
communication under this Agreement shall be in writing and shall be considered
given when mailed by registered or certified mail, return receipt requested or
by a reputable overnight courier or service (i.e., Federal Express) to the
parties at the address set forth below (or any other such address as one party
may specify by notice to the other).

        As to SBS:      Raul Alarcon, Jr.
                        SBS
                        3191 Coral Way
                        Miami, Florida 33134



   7

                With a copy to:
                Kaye, Scholer, Fierman, Hays & Handler, LLP
                425 Park Avenue
                New York, New York 10022
                Attention: William C. Zifchak, Esq.


As to
Employee:       4180 Lybyer Avenue,
                Coconut Grove, Florida 33133-6154.

        (c)  NO WAIVER. The failure of either party hereto to object to the
failure on the part of the other party to perform any of the terms, provisions,
or conditions of this Agreement or to exercise any option or remedy herein
given or to require at any time performance on the part of the other party of
any term, provision, or condition hereof, or any delay in doing so, or any
custom or practice of the parties at variance with the terms hereof, shall not
constitute a waiver or modification thereof or of any subsequent breach of the
same or a different nature nor affect the validity of this Agreement or any
part thereof nor the right of either party thereafter to enforce the same not
constitute a novation or laches.

        (d)  CONFORMITY TO LAW. If any one or more provisions of this Agreement
should ever be determined to be illegal, invalid, or otherwise unenforceable by
a court of competent jurisdiction or be invalid or invalidated or unenforceable
by reason of any law or statute, then to the extent and within the jurisdiction
invalid or unenforceable, it shall be limited, construed or severed and deleted
therefrom, and the remaining portions of this Agreement shall survive, remain in
full force and effect, and continue to be binding and shall not be affected and
shall be interpreted to give effect to the intention of the parties insofar as
that is possible.

        (e)  ATTORNEY'S FEES. In the event of any action involving this
Agreement, the prevailing party shall be entitled to reimbursement of its
reasonable attorney's fees and disbursements, in addition to any damages.

        (f)  HEADINGS. The Headings used in this Agreement are for the
convenience of the parties and for reference purposes only and shall not form a
part of or affect the interpretation of this Agreement.

        (g)  CONSTRUCTION. This Agreement shall be construed without regard to
any presumption or other rule requiring construction against the party causing
this Agreement to be drafted, since the attorneys for the respective parties
have submitted revisions to the text hereof.

        (h)  GOVERNING LAW. The validity of this Agreement, its interpretation
and any disputes arising from, or relating in any way to, this Agreement or the
relationship of the parties, shall be governed by the law of the State of
Florida without regard to conflicts of law principles.

        (i)  ENTIRE AGREEMENT. The Agreement shall constitute the entire
agreement concerning the subject matter hereof between the parties, superseding
all previous agreements, memoranda of understanding, negotiations, and
representations made prior to the effective date of this Agreement. This
Agreement shall be modified or amended only by written agreement executed


   8
by Employee and SBS.

        (j)  COUNTERPARTS AND FACSIMILE TRANSMISSIONS. This Agreement may be
executed simultaneously in one or more counterparts and in facsimile
transmission versions, each of which shall be deemed to be an original copy of
this Agreement and all of which together shall constitute one and the same
instrument.

        IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first written above.





SPANISH BROADCASTING SYSTEM, INC.

By: /s/ RAUL ALARCON                              /s/     [SIG]
   ------------------------------               -----------------------------
      Raul Alarcon, Jr.                                 Witness
      Chairman/CEO

    /s/ WILLIAM D. TANNER
   ------------------------------               -----------------------------
      William D. Tanner                                 Witness
      Employee


   9



                               COMPENSATION RIDER

             Base Salary:                 $475,000, per year, plus an
                                          annual 10% per year increase
                                          over the prior year's Base
                                          Salary.


                                          Additional Bonus:

                                          Employee shall be entitled to
                                          quarterly bonuses (for Stations
                                          Owned or LMA'd or TBA'd by
                                          SBS*), payable within 30 days
                                          from the date ratings are
                                          released, of:



             LOS ANGELES
                        a)  $25,000 whenever any SBS Los
             Angeles station achieves a #1 overall ranking (as published
             by Arbitron, 12+, 6:AM-12:MID, Mon.-Sun.) among the
             Spanish language stations in the market for each regularly
             published Arbitron radio audience survey.

                        b)  $15,000 whenever any SBS Los
             Angeles station achieves a #2 overall ranking (as published by
             Arbitron, 12+, 6:AM-12:MID, Mon.-Sun.) among the
             Spanish language stations in the market for each regularly
             published Arbitron radio audience survey.

                        c)  $15,000 per point increase per Arbitron
             survey book for KLAX-FM for each regularly published
   10
Arbitron radio audience survey.

          d) $10,000 per point increase per Arbitorn survey book for Class "A"
stations for each regularly published Arbitron radio audience survey.

          e) Same for additionally acquired or LMA stations depending on signal
strength for each regularly published Arbitron radio audience survey.

NEW YORK, CHICAGO, MIAMI

          a) $10,000 per point increase per Arbitron survey book for each
regularly published Arbitron radio audience survey.

PUERTO RICO, SAN ANTONIO, SAN FRANCISCO, DALLAS AND ALL FUTURE MARKETS

          a) $5,000 per point increase per Arbitron survey book for each
regularly published Arbitron radio audience survey.



* All increases are payable on a one-tenth of a point basis and are cumulative
taking into account increases and decreases from the commencement date of this
Agreement, which shall be deemed the base rate. All increases for new stations
are calculated from an initial audience base to be mutually determined. For
example, SBS station in Los Angeles is the #2 ranked Spanish station in
the market with a market share rating of 5.0 as of September 1, 2000, the
commencement date of the first
   11
contract year. Arbitron ratings are released on November 1, 2000 revealing a #1
Spanish ranking, and a 5.4 market share. By December 1, 2000, Employee will be
entitled to a $25,000.00 bonus under a) above, and $6,000.00 under c) above.
Arbitron ratings are released on February 1, 2001 revealing a #1 Spanish
ranking, and a 5.3 market share. By March 1, 2001, Employee will be entitled to
a $25,000.00 bonus under a) above, and $4,500.00 under c) above. Arbitron
ratings are released on May 1, 2001 revealing a #2 Spanish ranking, and a 5.1
market share. By June 1, 2001, Employee will be entitled to a $15,000.00 bonus
under a) above, and $1,500.00 under c) above. Arbitron ratings are released on
August 1, 2001 revealing a #2 Spanish ranking, and a 4.9 market share. By
September 1, 2001, Employee will be entitled to a $15,000.00 bonus under a)
above, and no bonus under c) above. Arbitron ratings are released on November
1, 2001 revealing a #2 Spanish ranking, and a 5.1 market share. By December 1,
2001, Employee will be entitled to a $15,000.00 bonus under a) above, and
$1,500 (based on 5.0 rating as of the commencement date of the Agreement)
under c) above.

   12
                  EXHIBIT "A"

No of Shares     Exercise Price     Vesting Date

41,875           4.36               Upon execution of Agreement
19,163           4.36               August 31, 2001
21,547           6.73               August 31, 2001
 1,165           7.78               August 31, 2001
20,340           7.78               August 31, 2002
21,534           12.23              August 31, 2002

   13
August 31, 2000

Mr. William B. Tanner
4180 Lyoyor Avenue
Coconut Grove, Florida 33133-6154

Dear Bill:

In conjunction with the Employment Agreement by and between Spanish
Broadcasting System, Inc. ("SBS") and William B. Tanner dated August 31, 2000,
("Agreement") this will serve to confirm our understanding as follows:

In the event that you were to be terminated from your present role as a
Consultant to WPOW-FM and / or WQAM-AM, Miami, Florida as a direct result of
your employment with SBS, we would compensate you in an amount equal to the
lost consulting fees from the WPOW-FM and / or WQAM-AM and at the same rate and
pay schedule as existing as of the date of this letter as of the date of said
termination.

At the same time you hereby agree that in such an event the Agreement and its
modification by this letter may be extended at the sole discretion of SBS under
the same terms and conditions contained in the Agreement and this letter until
August 31, 2007.

Sincerely,

/s/ RAUL ALARCON, JR.

Raul Alarcon, Jr.
Chairman / CEO


Accepted by and agreed to:

/s/ WILLIAM B. TANNER
- ----------------------
Mr. William B. Tanner
August 31, 2000
   14
EXHIBIT B

                            STOCK OPTION COMPARISON
                                AUGUST 18, 2000

                           REVISED SEPTEMBER 5, 2000

This document is hereby revised based on September 1, 2000, closing prices of
26-15/16 for Hispanic Broadcasting and 10 for Spanish Broadcasting.

HSP  = Hispanic Broadcasting
SBSA = Spanish Broadcasting

EP=Exercise
SP=Stock Price



- ----------------------------------------------------------------------------------------------------------------------------------
HSP Grant Date      Shares Granted      Exercise Price      Net Value      % EP to SP       Parity SBSA shrs.      Exercise Price
- ----------------------------------------------------------------------------------------------------------------------------------
                                                                                                 
June 6, 1997*           22,867               11.75           344,255         -66.38%               61,038                4.36
- ----------------------------------------------------------------------------------------------------------------------------------
June 4, 1998**           8,000               18.13            70,480         -32.70%               21,647                6.73
- ----------------------------------------------------------------------------------------------------------------------------------
March 23, 1999***        8,000               20.97            47,740         -22.15%               21,505                7.78
- ----------------------------------------------------------------------------------------------------------------------------------
May 25, 2000****         8,000               32.94           (48,020)        +22.26%               21,534               12.23
- ----------------------------------------------------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------------------------------------------------
    TOTALS              46,867                                                                    125,624
- ----------------------------------------------------------------------------------------------------------------------------------


Values may be slightly disparate due to rounding.

*       Vesting 1/3 on each of the third, fourth, and fifth anniversaries of the
        Date of Grant

**      5,332 Nonstatutory Stock Options vesting 1/2 on the third and fourth
        anniversaries of the Date of Grant
        2,666 Incentive Stock Options vesting in full on the fifth anniversary
        of the Date of Grant

***     770 Nonstatutory Stock Options vesting on the third anniversary of the
        Date of Grant
        7,230 Incentive Stock Options vesting in installments of 2,462 and
        4,788 shares, respectively, on the fourth and fifth anniversaries of
        the Date of Grant

****    5,062 Nonstatutory Stock Options vesting in installments of 1,600
        shares, 1,600 shares, 1,600 shares, and 262 shares, respectively, on the
        first, second, third and fourth anniversaries of the Date of Grant
        2,938 Incentive Stock Options, vesting in installments of 1,338 shares
        and 1,600 shares, respectively, on the fourth and fifth anniversaries of
        the Date of Grant

   15

August 31, 2000

Mr. William B. Tanner
4180 Lybyer Avenue
Coconut Grove, Florida 33133-6154

Dear Bill:

In conjunction with the Employment Agreement by and between Spanish
Broadcasting System, Inc., ("SBS") and William B. Tanner dated August 31, 2000,
("Agreement") this will serve to confirm our understanding as follows:

In the event that the publicly traded stock of SBS were not to reach a level of
$12.12 on or before August 30, 2001, SBS with make a cash payment to you equal
to $ 484,226 thirty (30) days after said date.

Sincerely,


Raul Alarcon, Jr.
Chairman / CEO


Accepted by and agreed to:

/s/ WILLIAM B. TANNER
- -----------------------
Mr. William B. Tanner
August 31, 2000

EX-10.48

   1
                                                                   Exhibit 10.48

                           EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT dated as of February 16, 2000, by and between Spanish
Broadcasting System, Inc., a Delaware corporation (the "Company") and Juan A.
Garcia (the "Executive").

     WHEREAS, the Company desires to employ the Executive as its Vice President
of Finance and Strategic Planning; and

     WHEREAS, the Executive is willing to serve in the employ of the Company
for the period set forth herein upon the terms and conditions hereinafter
provided;

     NOW, THEREFORE, in consideration of the mutual promises and agreements set
forth below, the Company and the Executive agree as follows:

 1.  Term. Except as otherwise provided in Section 4 hereof, the Company agrees
to employ the Executive, and the Executive agrees to serve, for a period
commencing on February 16, 2000 (the "Effective Date") and ending on the third
anniversary of the Effective Date, provided that, unless either party otherwise
elects by notice in writing to the other at least 90 days prior to the third
anniversary of the Effective Date or any succeeding anniversary of the
Effective Date, the employment term shall be automatically renewed for
successive one-year terms unless sooner terminated pursuant to the terms of the
Agreement (the "Employment Term").
   2
  2. Positions and Duties; Place of Performance.

     (a) Positions and Duties. The Executive shall be employed as Vice
President of Finance and Strategic Planning of the Company and shall have the
duties, responsibilities and authority as may from time to time be assigned to
him by either of Raul Alarcon, Jr., the Company's President (the "President"),
or Joseph A. Garcia, the Company's Chief Financial Officer (the "CFO"), that
are consistent with and normally associated with such position. The Executive
shall devote substantially all of his business time, effort and energies
exclusively to the business of the Company, and shall not serve as an active
principal or a director or officer of any other company or entity without the
prior consent of the President, except that the Executive may serve as a
director or officer of any trade association, civic, religious, business,
educational or charitable organization without such consent.

     (b) Place of Performance. The Executive shall be based in Miami, Florida,
but shall be required to visit and work with all Company broadcast stations
wherever located on a regular and continuing basis.

  3. Compensation and Benefits.

     (a) Base Salary. During the Employment Term, the Company shall pay the
Executive a base salary at the annual rate of Two Hundred Ten Thousand
Dollars ($210,000.00) per year (the "Base Salary"), payable in accordance with
the Company's normal payroll practices for executive compensation, but not less
frequently than monthly. The Executive shall be entitled to such increases (but
not less than 5% annually) in his Base Salary as may be determined from time to
time by the Company's Board of Directors (the "Board") or pursuant to its
delegation, provided that the Executive's Base Salary will be reviewed not less
often than


                                      2
   3
annually. Once the Base Salary is increased, the new salary shall thereafter
constitute the "Base Salary" for purposes of this Agreement.

      (b) Bonuses. In addition to the Base Salary, the Executive shall be
entitled to receive a cash bonus (the "Bonus") each year based on the Company
meeting projected consolidated broadcast cash flow for each fiscal year. For
the purpose of determining the Bonus, projected broadcast cash flow is the
consolidated amount approved by the President to compensate for performance of
all those executives with compensation plans that include bonuses based on
meeting annual broadcast cash flow targets. The Bonus in the first year will be
One Hundred Forty Thousand Dollars ($140,000.00) and shall be increased
annually by no less than five percent (5%). To the extent that the projected
broadcast cash flow target is not achieved by the Company, the Executive will
be entitled to receive fifty percent (50%) of the Bonus if at least eighty
percent (80%) of the projected broadcast cash flow target is achieved in a
respective fiscal year. Once the Bonus is increased, the new annual bonus shall
thereafter constitute the "Bonus" for purposes of this Agreement.

     (c) Other Benefit Plans and Fringe Benefits. The Executive shall be
eligible (i) to participate in any and all retirement, group health and
insurance plans and in all other employee benefit plans and/or in any such
plans established or maintained by the Company during the Employment Term that
are made available to its management executives generally, and (ii) to receive
all fringe benefits, for which his status and level of employment qualify him
in accordance with the Company's usual policies and arrangements and the terms
of such plans, policies and arrangements.


                                       3
   4
             (d)     Options. The Company shall grant the Executive options to
purchase One Hundred Thousand (100,000) shares of Class A common stock of the
Company (the "Common Stock") upon the Effective Date (the "Option") with the
exercise price of $20.8125 per share which represents the closing price on the
NASDAQ Stock Market of the Company's Common Stock on the Effective Date. The
Option shall consist of incentive stock options (within the meaning of Section
422 of the Internal Revenue Code of 1986, as amended (the "Code")) to the
maximum extent possible (subject to qualification of such options or any
portion thereof as incentive stock options, and shall be nonqualified stock
options to the extent they do not so qualify). A portion of the Option to
purchase Ten Thousand (10,000) shares of Common Stock shall vest on the
Effective Date and the remainder of the Option shall vest over a five year
period (i.e. 10,000 on the first anniversary of the Effective Date and 20,000
on the second, third, fourth and fifth anniversaries of the Effective Date)
provided the Executive is employed on each such date. Notwithstanding the
foregoing, the Executive shall be eligible to participate in any stock option
or other equity-based program established by the Company during the Employment
Term.

             (e)     Expenses. The Company shall reimburse the Executive for any
and all out-of-pocket expenses incurred by the Executive during the Employment
Term in connection with his duties and responsibilities hereunder in accordance
with the Company's usual policy of reimbursing senior executives and for those
relocation expenses set forth as Exhibit 1 hereof.

     4.      Termination

             (a)     Compensation and Benefits. Except as otherwise provided in
this section or Section 6 hereof, upon termination of the Executive's employment
hereunder, his right to any form of compensation hereunder shall cease, except
that he shall be entitled to receive any salary


                                       4

   5





or other benefits accrued but not paid up to his Date of Termination (as
hereinafter defined in Section 4(f)), or for any period required by law and any
out-of-pocket expenses reasonably incurred by the Executive prior to such date.

             (b)     Death and Disability. The Executive's employment hereunder
shall terminate upon his death, and may be terminated by the Company due to
Disability. For purposes of this Agreement, "Disability" shall mean the
determination by the Board that the Executive is physically or mentally
incapacitated and has been unable for a period of six consecutive months, or for
shorter periods aggregating six months in any period of twelve (12) consecutive
months, to perform the duties for which he was responsible immediately before
the onset of his incapacity. In order to assist the Board in making such a
determination, the Executive shall, as reasonably requested by the Board, make
himself available for medical examinations by a physician chosen by the Board
and approved by the Executive. The determination of the physician chosen in
accordance with the preceding sentence shall be final and binding on the Company
and the Executive.

             (c)     Termination By the Company For Cause. The Executive's
employment hereunder may be terminated by the Company for Cause at any time. For
purposes of this Agreement, the term "Cause" shall mean the Executive's (i)
commission of an illegal act or acts that was intended to and did defraud the
Company or any of its affiliates, (ii) gross negligence or willful misconduct in
the management of the Company's affairs which materially harms the Company and
which is not remedied within 30 days of receiving notice of same, or (iii)
breach of the provisions of Section 5(a) or (b) hereof. In any case described in
this section, the Executive shall be given written notice, in accordance with
Section 4(f), that the Company intends to

                                       5

   6


terminate his employment for Cause. Such written notice shall specify the
particular act or acts, or failure to act, that is or are the basis for the
decision to so terminate the Executive's employment for Cause, and shall give
the Executive the right to cure any breach so specified for a period of thirty
(30) days.

             (d)     Termination By the Executive For Good Reason. The Executive
may terminate his employment hereunder for Good Reason. For purposes of this
Agreement, the term "Good Reason" shall mean and shall be deemed to exist if,
without the prior written consent of the Executive, (i) the Executive is
assigned duties or responsibilities that are inconsistent in any material
respect with the scope of the duties or responsibilities associated with his
titles or positions, as set forth in this Agreement (or to which he is
promoted), (ii) the Executive's duties or responsibilities are significantly
reduced, (iii) benefits to which the Executive is entitled under the employee
benefit plans of the Company are in the aggregate materially decreased, unless
such decrease is required by law or is applicable to all employees of the
Company eligible to participate in any plan so affected, not just those covered
by employment agreements with the Company, (iv) the Executive's Base Salary is
reduced, (v) the Company fails to perform any material term or provision of
this Agreement, (vi) the Executives office location is relocated to one that is
more than fifty (50) miles from the location at which the Executive was based
immediately prior to the relocation, or (vii) the Company fails to obtain the
full assumption of this Agreement by a successor.




                                       6



   7
         (c)  Compensation Upon Termination Without Cause or for Death or
Disability.

              (i)  If the Company terminates the Executive's employment
hereunder other than for Cause or other than in accordance with Section 4(b),
or the Executive terminates his employment for Good Reason, notwithstanding any
other provision of this Agreement to the contrary:

                   (A)  In addition to the amounts paid to the Executive
pursuant to Section 4(a), in lieu of any further salary payments to the
Executive for periods subsequent to the Date of Termination, the Company shall
pay the Executive an amount equal to two times the Executive's annual Base
Salary rate in effect as of the Date of Termination, plus two times the annual
Bonus agreed to under this Agreement for the first year whether or not
projected broadcast cash flow is achieved, or paid him with respect to the year
preceding such Date of Termination, as may be applicable. Except as provided in
Section 6(a)(i), this amount shall be paid in substantially equal monthly
payments during the two years following the Executive's Date of Termination,
provided, however, that the Company may determine, in its sole discretion, to
pay such amount (or any portion remaining during such period if periodic
payments have commenced) in a single lump sum in cash (such amount not to be
discounted in any way to reflect its present value).

                   (B)  The Company shall continue to provide the Executive
(and his eligible dependents, if any) with group health and life insurance
benefits and long-term disability insurance coverage (or the economic
equivalent thereof) at the level (including, if applicable, the portion of the
premium paid by the Company for such coverage) in effect on the

                                       7
   8
Date of Termination for the one-year period following such date, provided that
such coverage shall cease to be provided if the Executive is employed by
another employer within such one-year period, and further provided that, the
date of the expiration of the extended period of coverage provided under this
clause (i)(B) shall be treated as the date of the termination of the
Executive's employment solely for the purpose of determining the rights of the
Executive (and his eligible dependents, if any) to the continuation coverage
provided under Section 4980B of the Internal Revenue Code of 1986, as amended
(the "Code").

                   (C)  The nonvested portion of the Option previously granted
to Executive shall immediately vest and remain exercisable until the earlier of
(i) two years from the Executive's Date of Termination and (ii) the remaining
term of the Option.

                   (D)  If the Executive's employment hereunder is terminated
as a result of death or Disability, he shall be paid a single lump sum in cash
within thirty (30) days of his Date of Termination in an amount equal to fifty
percent (50%) of his Base Salary.

              (f)  Notice of Termination; Date of Termination. Any termination
of the Executive's employment, other than by reason of his death, shall be
communicated by the terminating party by a written notice of termination (the
"Notice of Termination"). The Notice of Termination shall (i) indicate the
specific termination provision in this Agreement relied upon, (ii) set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision so indicated, and
(iii) if the termination date is other than the date of receipt of such notice,
specify the date on which the Executive's employment is to be terminated (which
date shall not be earlier than the date on which such notice is actually
received, or in the case of a termination for Disability, the sixtieth

                                       8
   9
(60th) day after such notice is received). In the case of a termination by the
Company for Cause, the Notice of Termination shall be given within one hundred
and eighty (180) business days after the Company's President or CFO has actual
knowledge of the events justifying the purported termination, and in the case
of a termination by the Executive for Good Reason, the notice shall be given
within one hundred and eighty (180) days of the Executive's having actual
knowledge of the events justifying such termination. For purposes of this
Agreement, "Date of Termination" shall mean (i) if the Executive's employment
is terminated by his death, the date of his death, and (ii) in all other cases,
the later of the date of actual receipt of the Notice of Termination, or the
date specified in such notice.

                   (g)  No Mitigation; No Offset. In the event of any
termination of the Executive's employment under this Section 4, the Executive
shall be under no obligation to seek other employment and there shall be no
offset against any amounts due the Executive under this Agreement on account of
any remuneration that the Executive may obtain from any subsequent employment.
Any amounts due under this Section 4 are in the nature of liquidated damages,
and not in the nature of a penalty.

               5.  Covenants

                   (a)  Competitive Activity. During the Term, and for a period
of twelve (12) months after the Executive's Date of Termination, the Executive
agrees that, without the prior written consent of the Board, he shall not
render services in any capacity for a radio station competitive with the
Company's radio business, nor shall he be directly or indirectly involved in any
radio business competitive with the Company's radio business.


                                       9
   10
an agreement with the Company to effect a transaction described in clause (i),
(iii) or (iv)) whose election by the Board or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were directors at the beginning
of the period or whose election or nomination for election was previously so
approved (unless the approval of the election or nomination for election of
such new directors was in connection with an actual or threatened election or
proxy contest), cease for any reason to constitute at least a majority thereof;

          (iii) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than (x) a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities of the
surviving entity) more than eighty percent (80%) of the combined voting power
of the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (y) a merger or consolidation
effected to implement a recapitalization of the Company (or similar
transaction) in which no "person" (as defined above in clause (j)) acquires
more than thirty percent (30%) of the combined voting power of the Company's
then outstanding securities; or

          (iv) the shareholders of the Company approve an agreement for the
sale or disposition by the Company of all or substantially all of the Company's
assets or any transaction having a similar effect, or the Company, directly or
indirectly, begins proceedings to effect a complete liquidation.



                                      13
   11
     7.  Miscellaneous.

         (a)  Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York applicable to agreements
made and to be performed in that State.

         (b)  Notice. Any notice, consent, request or other communication made
or given in connection with this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by registered or
certified mail, return receipt requested, to those listed below at their
following respective addresses or at such other address as each may specify by
notice to the others:

              To the Executive:

              Juan A. Garcia
              4706 Granada Blvd.
              Coral Gables, Florida 33146

              To the Company:

              c/o Spanish Broadcasting System, Inc.
              3191 Coral Way
              Suite 805
              Miami, Florida 33145
              ATTN: Raul Alarcon, Jr.

              with a copy to:

              Jason L. Shrinsky, Esq.
              Kaye, Scholer, Fierman, Hays & Handler, LLP
              901 15th Street, N.W.
              Suite 1100
              Washington, D.C. 20005



                                   14
   12
     (c) Entire Agreement; Amendment. This Agreement shall supersede any and
all existing agreements between the Executive and the Company or any of its
affiliates relating to the terms of the Executive's employment during the
Employment Term. It may not be amended except by a written agreement signed by
both parties.

     (d) Waiver. The failure of a party to insist upon strict adherence to any
term of this Agreement on any occasion shall not be considered a waiver thereof
or deprive that party of the right thereafter to insist upon strict adherence
to that term or any other term of this Agreement.

     (e) Assignment. Except as otherwise provided in this Section 9(e), this
Agreement shall inure to the benefit of and be binding upon the parties hereto
and their respective heirs, representatives, successors and assigns. This
Agreement shall not be assignable by the Executive, and shall be assignable by
the Company only to any corporation or other entity resulting from the
reorganization, merger or consolidation of the Company with any other
corporation or entity or any corporation or entity to or with which the
Company's business or substantially all of its business or assets may be sold,
exchanged or transferred, and it must be so assigned by the Company to, and
accepted as binding upon it by, such other corporation or entity in connection
with any such reorganization, merger, consolidation, sale, exchange or transfer
(the provisions of this sentence also being applicable to any successive such
transaction).

     (f) Headings. Section headings are used herein for convenience of
reference only and shall not affect the meaning of any provisions of this
Agreement.

                                     15
   13

            (g)  Rules of Construction. Whenever the context so requires, the
use of the masculine gender shall be deemed to include the feminine and vice
versa, and the use of the singular shall be deemed to include the plural and
vice versa.

            (h)  Arbitration. Any dispute or controversy arising out of, or
relating to this Agreement, shall be resolved by arbitration at the American
Arbitration Association ("AAA") at its New York City office before a panel of
three arbitrators under the then existing rules and regulations of the AAA. The
determination of the arbitrators shall be final and binding on the parties
hereto and judgment on it may be entered in any court of competent
jurisdiction. In the event the Executive prevails in such proceedings, as
determined by the arbitration panel, the Company shall reimburse the Executive
for all expenses (including, without limitation, reasonable legal fees and
expenses) he incurred in connection with any such proceeding. All such amounts
shall be paid promptly but in any event within ten (10) business days after the
Executive provides the Company with a statement of the amounts to be
reimbursed. In all other cases, each party shall be responsible for their own
expenses incurred in connection with such proceedings.



                                       16
   14
     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first above written.


                                   SPANISH BROADCASTING SYSTEM, INC.



                                   By: /s/ RAUL ALARCON, JR.
                                       ----------------------------------------
                                   Name:  Raul Alarcon, Jr.
                                   Title: Chief Executive Officer and President



                                   JUAN A. GARCIA

                                   /s/ JUAN A. GARCIA
                                   ------------------


                                       17
   15




                                   EXHIBIT 1


                              RELOCATION EXPENSES


1.  Cost of moving personal belongings from New York to Florida; and

2.  Travel expenses incurred by household family members to relocate from New
    York to Florida.
   16
        (b)     Solicitation or Interference. During the Term and for a period
of twelve (12) months after the Executive's Date of Termination, the Executive
shall not, either for himself or on behalf of any third party: (i) in any manner
induce any employee, agent, representative, customer, former customer, or any
other person or concern, dealing with or in some other way associated with the
Company, to terminate such dealings or association; or (ii) do anything,
directly or indirectly, to interfere with the relationship between the Company
and any such person or concern.

        (c)     Non-Disclosure of Proprietary information. The Executive agrees
that he will not disclose the trade secrets or confidential and proprietary
information of the Company during the Term or thereafter. The parties understand
and agree that nothing contained herein shall prevent the Executive from
disclosing: (1) information required to be disclosed pursuant to compulsory
legal process, provided that he shall give the Company prompt notice of such
process prior to disclosure; (2) information which was in his lawful possession
at the time of or prior to its submission to him by the Company; or (3)
information which is in the public domain.

        (d)     Remedy for Breach. If any provision of this Section 4 is deemed
invalid or unenforceable, such provision shall be deemed modified and limited to
the extent necessary to make it valid and enforceable. The Executive
acknowledges and agrees that the provisions of this section are reasonable and
necessary for the protection of the Company and that the Company will be
irrevocably damaged if such provisions are not specifically enforced.
Accordingly, money damages from the Executive for a breach of this section would
be difficult, if not impossible, to calculate and the most appropriate relief in
the event of the Executive's breach would be injunctive relief. Nothing
contained herein shall be deemed to prohibit the

                                       10

   17
Company, for any such breach, from instituting or prosecuting any other
proceeding in any court of competent jurisdiction, in either law or equity, to
obtain damages for any breach of this Agreement. All remedies given to the
Company by this Agreement shall be construed as cumulative remedies and shall
not be alternative or exclusive remedies.

            6.  Change in Control Provisions.

                (a)     Impact of Event. In the event of a "Change in Control"
of the Company, as defined in Section 6(b), the following provisions shall apply
in addition to the other provisions of this Agreement:

                        (i)     If, on or before the second anniversary of the
Change in Control, the Executive's employment hereunder in terminated by the
Company for any reason other than for Cause, or by the Executive for Good
Reason, (A) Section 5(a) shall not be applicable to the Executive from and after
his Date of Termination, (B) the Executive shall be entitled to receive the
amount determined under Section 4(e)(i)(A) in a single lump sum in cash within
thirty (30) days of the Executive's Date of Termination, and such amount shall
not be discounted in any way to reflect its present value, (C) any and all
nonvested portion of the Option the Executive then holds which is not
exercisable shall vest and be exercisable immediately, and (D) notwithstanding
Section 4(e)(B) hereof, at the Company's expense, the Executive shall continue
to be a participant in any group health plan (which may be provided by payment
of COBRA continuation coverage premiums) maintained by the Company (or the
economic equivalent in cash) at the level in effect on the Executive's Date of
Termination for a period of eighteen (18) months following his Date of
Termination.

                                       11
   18

                         (ii)    All expenses (including, without limitation,
legal fees and expenses) incurred by the Executive in connection with, or in
prosecuting or defending, any claim or controversy arising out of or relating
to this Agreement shall be paid by the Company, unless the Executive fails to
prevail at least in part in any such claim or controversy and the Company
receives written opinion of independent legal counsel, selected by the Board,
to the effect that such expenses were not incurred by the Executive in good
faith. Pending any such determination, such expenses shall be paid by the
Company in advance on a monthly basis, upon an undertaking by the Executive to
repay such advanced amounts if the Executive fails to prevail in any such claim
or controversy and it should thus be determined that the expenses were not
incurred by the Executive in good faith.

                 (b)     Definition of Change in Control. A Change in Control
shall mean the happening of any of the following:

                         (i)     any "person," as such term is used in Section
13(d) and 14(d) of the Securities Exchange Act of 1934 (the "Exchange Act")
(other than the Company or any subsidiary of the Company, or any trustee or
other fiduciary holding securities under an employee benefit plan of the
Company or any subsidiary) becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of the
Company representing thirty percent (30%) or more of the combined voting power
of the Company's then outstanding securities;

                         (ii)    during any period of two consecutive years
beginning on or after the Effective Date hereof, individuals who at the
beginning of such period constitute the Board, and any new director (other than
a director designated by a person who has entered into

                                       12

EX-10.49

   1

                                                                   Exhibit 10.49

- --------------------------NUMBER FORTY THREE (43)------------------------------

- ----------------------DEED OF CONSTITUTION OF MORTGAGE-------------------------

- ---In the City of San Juan, Commonwealth of Puerto Rico, this twenty third
(23rd) day of June, Two Thousand (2000).---------------------------------------

- -----------------------------------BEFORE ME-----------------------------------

- ---JUAN C. SALICHS POU, Attorney-at-Law and Notary Public in and for the
Commonwealth of Puerto Rico, with residence in Guaynabo, Puerto Rico, and an
office on the fifth (5th) floor of Torre BBV, at two hundred fifty four (254)
Munoz Rivera Avenue, Hato Rey, San Juan, Puerto Rico.---------------------------

- ------------------------------------APPEAR--------------------------------------

- ---AS OF THE FIRST PART: CADENA ESTEREOTEMPO, INC. (hereinafter referred to as
"Mortgagor"), a corporation duly organized and validly existing under the laws
of the Commonwealth of Puerto Rico, Federal Employer Identification Number
66-0473159, represented by its Chief Financial Officer and Executive Vice
President, Joseph A. Garcia, also known as Jose Antonio Garcia Sobrino, who is
of legal age, married, business executive, and resident of Miami, Florida, who
is authorized to appear herein on behalf of Mortgagor as per the Certificate of
Resolution executed in San Juan, Puerto Rico on even date herewith bearing
affidavit number one thousand four hundred eighty seven (1487) of Notary Public
Juan C. Salichs Pou.-----------------------------------------------------------

- ---AS PARTY OF THE SECOND PART: BANCO BILBAO VIZCAYA PUERTO RICO (hereinafter
referred to as the "Mortgagee"), a banking corporation duly organized and
validly existing under  the laws of the Commonwealth of Puerto Rico, with
Federal Employer Identification
   2
Number 66-0274576, herein represented by its Executive Vice President, Norberto
Gonzalez Perez, of legal age, married, bank executive and resident of San Juan,
Puerto Rico, and by its Branch Manager, Edgardo Fumero Acosta, of legal age,
married, bank executive and resident of San Juan, Puerto Rico, who are
authorized to appear on behalf and in representation of the Mortgagee, as per
the Certificate of Resolution executed on the sixteenth (16th) day of June, Two
Thousand (2000) before Notary Public Nilda M. Vazquez.----I, the Notary, hereby
certify and attest that I personally know the persons appearing herein and from
their statements, I also attest as to their age, civil status, occupations and
residences. The persons appearing herein assure me that they have and in my
judgment they do have the legal capacity necessary for this act, and for that
purpose they freely and voluntarily,-------------------------------------------

- -----------------------------------SET FORTH-----------------------------------

- ---FIRST: The Mortgaged Property. The Mortgagor is the owner of record, with
valid, good and marketable fee simple title ("pleno domino") of the real
property described in paragraph SIXTEENTH of this Deed.------------------------
- ---SECOND: The Mortgage Note. Simultaneously herewith Mortgagor has subscribed
before me a mortgage note (hereinafter called the "Mortgage Note"), which is
copied literally in paragraph FIFTEENTH hereof.--------------------------------
- ---THIRD: Creation of Mortgage. In order to guarantee and secure:--------------
- -----(i) the full and complete payment of the principal of and the interest on
the Mortgage Note;-------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

   3
- -----(ii) the performance and observance of the terms therein and herein
contained;--------------------------------------------------------------
- -----(iii) an additional credit in the amount set forth in paragraph
SEVENTEENTH hereof to cover interest in addition to that secured by law (herein
after called the "Interest Credit");-------------------------------------------
- -----(iv) an additional credit in the amount set forth in paragraph
SEVENTEENTH hereof to cover any amounts that may be paid by or advanced by the
holder of the Mortgage Note hereunder; together with interest thereon
(hereinafter called the "Credit for Additional Advances"); and-----------------
- -----(v) an additional credit (hereinafter called the "Credit for Liquidated
Damages") in the amount set forth in paragraph SEVENTEENTH hereof as a
liquidated and agreed amount payable without necessity for further liquidation
or approval by any court, to cover the costs and expenses (including attorneys'
fees) of the Mortgagee in the event that the Mortgagee shall have recourse to
the courts or to any other governmental agency in order to collect all or any
part of the principal thereof or any interest thereon (by foreclosure or other
proceedings or action), Mortgagor hereby grants, constitutes and creates a
voluntary mortgage (the "Mortgage") and security interest in favor of the
Mortgagee or any present or future holder of the Mortgage Note, by endorsement,
delivery or otherwise on the parcel of land described in Paragraph SIXTEENTH
hereof (the "Parcel") and the following additional property (hereinafter
collectively called the "Mortgaged Property"):---------------------------------
   4
- -------(a) the Parcel and all of the buildings, structures, additions, fixtures,
improvements, appurtenances and facilities now or hereafter located thereon or
hereafter erected or placed on said property and all materials intended for the
construction, reconstruction, alteration and repair of such buildings or
improvements now or hereafter erected thereon, all of which materials shall be
deemed to be included within the Mortgaged Property immediately upon the
delivery thereof to the Mortgaged Property;------------------------------------
- -------(b) all of the rights, title and interest of the Mortgagor, in and to,
all and singular, the tenements, hereditaments, rights of way, easements,
appendages and appurtenances, licenses, passages, waters, water rights,
riparian rights, and other rights, liberties and privileges thereof or in any
way or hereafter appertaining, including any other claim at law or in equity,
as well as any after acquired title, franchise or license and the reversion and
reversions and remainder and remainders thereof and any other real property
belonging or appertaining to the Mortgaged Property, and all of the right,
title and interest of the Mortgagor in and to any streets, ways, alleys, strips
or gores of and adjoining the Mortgaged Property or any part thereof;----------
- -------(c) all renewals and replacements of, substitutions for and additions to
the property described in subparagraphs (a) and (b) above, and all other real
property now owned or hereafter acquired by Mortgagor and enjoyed in common
with or in any way appertaining to such property as well as all real properties
which may be consolidated or grouped with the Mortgaged Property;--------------
   5
- -------(d) all chattels that may be removed without breaking the material or
deteriorating the object and that are presently or hereafter permanently
placed on the Mortgaged Property, either for its decoration, comfort or
development, or for commercial, office of industrial use;----------------------
- -----(e) All machinery, furniture, furnishings, equipment, computer software
and hardware which are deemed to be fixtures (including, without limitation,
all air conditioning, plumbing, lighting, communications and elevator fixtures)
every kind and nature, whatsoever owned by Mortgagor, or in which Mortgagor has
or shall have an interest, now or hereafter located upon the Mortgaged Property
or any part thereof, or appurtenant thereto, and usable in connection with the
present or future operation and occupancy of the Mortgaged Property, enjoyment
and occupancy of the Mortgaged Property, and the proceeds of any sale or
transfer of the foregoing and all other property which under the Civil Code of
Puerto Rico may properly be characterized or classified as real or immovable
property either by nature or destination;--------------------------------------
- -------(f) All proceeds of and any unearned premiums on any insurance policies
covering the Mortgaged Property, including, without limitation, the right to
receive and apply the proceeds of any insurance, judgments, or settlements made
in lieu thereof, for damage to the Mortgaged Property or any part thereof;
- -------(g) all awards, compensations and payments in respect of any taking by
condemnation or eminent domain of any of the foregoing; and-------------------
- -------(h) all proceeds, products, offspring, rents, earnings, revenues, issue
and profits from any of the
   6
foregoing, including, without limitation, those from sale, exchange, transfer,
collection, loss, damage, disposition, substitution or replacement of any of
the foregoing.------------------------------------------------------------------

- ---FOURTH:  Condemnation.  In the event of a taking of all or any part of the
Mortgaged Property as a result of or in lieu or in anticipation of the exercise
of the right of condemnation or eminent domain, or a change of grade adversely
affecting the Mortgaged Property, Mortgagee shall be entitled to receive and to
be applied as described below, all awards and payments on account of such
taking not to exceed the amounts covered by this Mortgage. Mortgagor will pay
all costs and expenses (including, without limitation, reasonable attorneys'
fees and expenses) of Mortgagee in connection with any such taking and seeking
and obtaining any award or payment in respect thereof. All awards and payments
collected by Mortgagee, after the payment of costs and expenses (including,
without limitation, reasonable attorneys' fees and expenses) incurred in the
seeking and obtaining thereof, shall be applied by Mortgagee to the payment of
the Mortgage Note or of any notes or obligations for which the Mortgage Note
is assigned or pledged as security or in such other manner as may be provided
in the pledge agreement or other instrument under which the Mortgage Note is
assigned or pledged, or as otherwise agreed by Mortgagor and Mortgagee in
writing.------------------------------------------------------------------------

- ---FIFTH:  Insurance.  As provided in Article One Hundred Sixty (160) of the
Mortgage and Property Registry Act of Puerto Rico, Act Number One Hundred
Ninety-eight (198) of August ten (10), Nineteen Hundred
   7
Seventy-nine (1979), Thirty Laws of Puerto Rico Annotated Two Thousand Five
Hundred Fifty-six (30 L.P.R.A. 2556), this Mortgage shall be extensive to, and
shall cover, all indemnities to which the Mortgagor may be entitled under any
policy of insurance covering the Mortgaged Property or any part thereof, and
Mortgagee shall be entitled to receive directly from the underwriters all
payments which become due under any such policy(ies) of insurance. Such
payments, after deducting therefrom all costs and expenses (including, but
without limitation, reasonable attorneys' fees and expenses) incurred in the
collection thereof, shall be applied on account of the payment of the Mortgage
Note or of any notes or obligations for which the Mortgage Note may be assigned
or pledged as security or in such other manner as may be provided in the pledge
agreement or other instrument under which the Mortgage Note is assigned or
pledged, or as otherwise agreed by Mortgagor and Mortgagee in writing.----------

- ---SIXTH:  Additional Advances.  If Mortgagor should fail to make punctual
payment of all Impositions (as defined in paragraph TWELFTH hereof), or should
fail to maintain insurance coverage on the Mortgaged Property as required
under the pledge agreement or other instrument under which the Mortgage Note is
assigned or pledged to the Mortgagee or as required under any other written
agreement between Mortgagor and Mortgagee, or if Mortgagor should fail to
discharge any mortgage, lien, encumbrance or charge upon the Mortgaged
Property, or any part thereof, which is prohibited by the terms hereof or of
the pledge agreement or other instrument under which the Mortgage Note is
assigned or pledged or by the terms of any
   8
other written agreement between Mortgagor and Mortgagee, or should fail to
maintain the Mortgaged Property in good condition, normal wear and tear excepted
or should fail to perform any other term or covenant hereof or of such pledge
agreement or other instrument or written agreement, then Mortgagee, after
written notice to Mortgagor (provided, however, that failure by Mortgagee to
give such notice to the Mortgagor shall not affect its rights under this
Article) and without waiving or releasing any obligation or default, may (but
shall be under no obligation to) at any time thereafter advance such funds as
may in Mortgagee's reasonable judgment be needed for the purpose of performing
such terms or covenants, and Mortgagee may, in such event, take such other and
further action in the premises as it may consider necessary or appropriate for
such purposes. All sums so advanced or paid by Mortgagee and all costs and
expenses (including, without limitation, reasonable attorneys' fees and
expenses) so incurred, together with interest thereon at the rate set forth in
the Mortgage Note from the date of payment or incurring, shall constitute
additional indebtedness secured by this Mortgage and shall be paid by Mortgagor
to Mortgagee on demand.--------------------------------------------------------

- ---SEVENTH:  Further Assurances; Additional Security.  Mortgagor, at its
expense, will execute, acknowledge, deliver and record all such instruments and
take all such action as Mortgagee from time to time may reasonably request for
better assuring to Mortgagee the properties and rights hereby mortgaged and
assigned or intended so to be. Without notice to or consent of Mortgagor, and
without impairment of the lien of and
   9
rights under this Mortgage, Mortgagee may take (but Mortgagor shall not be
obligated to furnish) from Mortgagor or from any other person or persons
additional security for the Mortgage Note or for the obligations secured by the
assignment or pledge of the Mortgage Note; and neither the giving of this
Mortgage nor the acceptance of any such additional security shall prevent
Mortgagee from resorting first to such additional security, or to the security
created by this Mortgage, in either case without affecting Mortgagee's lien and
rights under this Mortgage.-------------------------------------------

- ---EIGHTH:  Default.  In case the Mortgagor shall fail to pay any principal of
or accrued interest on the Mortgage Note on demand by the Mortgagee, or shall
fail to pay any principal of or accrued interest when due on any obligation for
which the Mortgage Note or this Mortgage shall have been assigned or pledged as
security, or there shall be any breach of any other condition or covenant under
the pledge agreement or other instrument under which the Mortgage Note is
assigned or pledged to the Mortgagee, or an Event of Default ("Causa de
Incumplimiento" o "Evento de Incumplimiento") (as such term is defined in the
pledge agreement or other instrument under which the Mortgage Note is assigned
or pledged to the Mortgagee) shall have occurred and be continuing, then at any
time thereafter Mortgagee may, at its election:-------

- -----(i) proceed to enforce the payment of the Mortgage Note and/or to
foreclose the lien of this Mortgage as against all or any part of the Mortgaged
Property (by summary proceedings or otherwise) and to have the same sold under
the judgment or decree of a court of competent jurisdiction;-------------------
   10
- -----(ii) to the extent permitted by law, enter upon and take possession of the
Mortgaged Property or any part thereof, by force, summary proceedings,
ejectment or otherwise, remove Mortgagor and all other persons and any and all
properties therefrom, hold, operate and manage the same and receive all
earnings, income, rents, issue and proceeds accruing with respect thereto or
any part thereof. In connection with any of the foregoing, Mortgagee shall as a
matter of right and without regard to the solvency of the Mortgagor or the
adequacy of the security for the indebtedness from Mortgagor to Mortgagee,
be entitled to the appointment of a receiver for all or any part of the
Mortgaged Property, whether such receivership be incidental to a proposed sale
of the Mortgaged Property or otherwise, and Mortgagor hereby consents to the
appointment of such a receiver and agrees that it will not oppose any such
appointment. Said receiver shall have the broadest powers and faculties
usually granted to a receiver by the court and his appointment shall be made
by the court as a matter of absolute right granted to the Mortgagee.-----------

- ---NINTH:  Foreclosure Valuation. In compliance with Article One Hundred
Seventy-nine (179) of the Mortgage and Property Registry Act of Puerto Rico,
Act Number One Hundred Ninety-eight (198) of August ten (10), Nineteen Hundred
Seventy-nine (1979), Thirty Laws of Puerto Rico Annotated Two Thousand Five
Hundred Seventy-five  30  L.P.R.A.  2575), Mortgagor hereby declares and agrees
that the value of the Mortgaged Property is as set forth in paragraph
SEVENTEENTH hereof under the title "Foreclosure Valuation".--------------------
   11
- ---TENTH:  Foreclosure. In the event that the Mortgage Note is assigned or
pledged or otherwise encumbered as collateral security for the payment of any
other note or obligation of the Mortgagor or of any other person, the Mortgagor
agrees:------------------------------------------------------------------------

- -----(a) That Mortgagee may foreclose this Mortgage and may exercise all other
rights, remedies, powers and privileges provided herein or now or hereafter
existing at law, in equity, by statute, or otherwise, without first foreclosing
the pledge or other lien so constituted upon the Mortgage Note, to the same
extent and with the same force and effect as if the Mortgage Note had been
assigned or transferred directly to Mortgagee rather than assigned or pledged
as collateral security, provided that nothing contained in this paragraph TENTH
shall relieve Mortgagee from the obligation to comply with the terms of the
pledge agreement or other instrument under which the Mortgage Note is assigned
or pledged.--------------------------------------------------------------------

- -----(b) That Mortgagor will not exercise any right which it may have to cancel
the recordation of the Mortgage by reason of lapse of time counted from the
date of the constitution of the Mortgage either under the provisions of Article
One Hundred Forty-five (145) of the Mortgage Law of Puerto Rico, Act Number One
Hundred Ninety-eight (198) of August ten (10), Nineteen Hundred Seventy-nine
(1979), Thirty Laws of Puerto Rico Annotated Two Thousand Four Hundred
Sixty-nine (30 L.P.R.A.  2469) or otherwise and further agrees, whenever
requested by the Mortgagee, to execute and file in the appropriate Registry, at
Mortgagor's cost and expense, any and all supplemental instruments which may be
necessary or convenient for the preservation
   12
of the lien of the Mortgage until full payment of the Mortgage Note and the
note or obligations secured by the pledge or assignment of the Mortgage Note.
Without limiting the generality of the foregoing, Mortgagor agrees that, unless
the Mortgagee shall consent in writing to the cancellation of the Mortgage at
an earlier date, the Mortgage shall be conclusively presumed to subsist for a
period of twenty-five (25) years from the date of its constitution; and the
Mortgagor does hereby waive any right which it may otherwise have under said
Article One Hundred Forty-Five (145) of the Mortgage Law to apply for an
earlier cancellation of the record of the Mortgage.----------------------------
- ---ELEVENTH: Expenses. All costs and expenses of this Deed, of a certified copy
or copies thereof, and of the registration of this instrument in the proper
public registry; all expenses of such additional documentation as may hereafter
be required, including the registration thereof in a proper public registry, if
such be required; and all expenses of all documents of cancellation, including
the cost of registration thereof, shall be for the account of Mortgagor.-------
- ---TWELFTH: Definitions. As used in this Mortgage, the term "Impositions"
shall mean all real estate and other taxes, all assessments (including, without
limitation, all assessments for public improvements or benefits, whether or not
commenced or completed prior to the date hereof or while this Mortgage is in
force), water, sewer, electricity, utility and other rents, rates and charges,
excises, levies, license fees, permit fees, inspection fees and other
authorization fees and other charges, in each case
   13
whether general or special, ordinary or extraordinary, or foreseen or
unforeseen, of every character (including all penalties or interest thereon),
which at any time may be assessed, levied, confirmed or imposed on or in
respect of or be a lien upon (a) the Mortgaged Property or any part thereof or
any rents, issues, income, profits or earnings therefrom or any estate, right
or interest therein, or (b) any occupancy, use or possession of or sales from
the Mortgaged Property or any part thereof, or  (c) this Mortgage, any interest
herein or any payments due from the Mortgagor under the terms of this Mortgage
or the Mortgage Note; excepting, however, the income taxes now or hereafter
imposed by the United States under the Internal Revenue Code of Nineteen
Hundred Eighty-six (1986), as amended, and by the Commonwealth of Puerto Rico
under the Puerto Rico Internal Revenue Code of Nineteen Hundred Ninety-four
(1994), as amended, or under any other Act of Congress or Act of the
Legislature of Puerto Rico of the same nature, modifying, amending, or
substituting the statutes above mentioned.------------------------------------
- ---THIRTEENTH: Miscellaneous. All of the terms of this Mortgage shall apply to
and be binding upon the successors and assigns of Mortgagor and all persons
claiming under or through Mortgagor or any such successor or assign, and shall
inure to the benefit of Mortgagee. Neither this Mortgage nor any term hereof
may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by Mortgagor and Mortgagee, notice of which is
endorsed on the Mortgage Note.-------------------------------------------------
   14
- ---FOURTEENTH: Other Terms and Conditions. The following terms and conditions
are made a part of this Mortgage and shall apply to and be binding upon the
successors and assigns of Mortgagor and all persons claiming under or through
Mortgagor or any such successors or assigns, and shall inure to the benefit of
Mortgagee. Additionally, if any of the terms and conditions contained in this
paragraph shall be inconsistent or contrary to any other terms and conditions
contained in this Deed, the terms and conditions of this paragraph shall
prevail.-----------------------------------------------------------------------
- -----(a) Representations and Warranties. In addition to all other
representations made by the Mortgagor to the Mortgagee, the Mortgagor hereby
represents and warrants to the Mortgagee as follows:---------------------------
- -------(i) No Leases. There are presently in effect no leases of the Mortgaged
Property or any part thereof other than those which have been disclosed in
writing to the Mortgagee.------------------------------------------------------
- -------(ii) Execution, Delivery and Enforceability. Mortgagor is duly authorized
to make and enter into this Mortgage and to carry out the transactions
contemplated by this Mortgage and the Mortgage Note. This Mortgage and the
Mortgage Note have been duly executed and delivered by Mortgagor and are the
legal, valid and binding obligations of Mortgagor, enforceable in accordance
with their respective terms.---------------------------------------------------
- -------(iii) Compliance with Law. Except as otherwise disclosed in writing by
Mortgagor to Mortgagee, the Mortgaged Property is in compliance in all material
respects with all applicable laws and governmental regulations, including but
not limited to those governing zoning, land use, subdivision control,

   15
health, safety, fire protection and protection of the
environment.-------------------------------------------------- (iv) No
Conflicts. The execution and delivery of this Mortgage does not, and the
performance and observance of the terms hereof will not, contravene in any
material respect any provision of existing law or governmental regulations, and
will not conflict with or result in any breach of any material terms, conditions
or provisions of, or constitute a default under or result in or permit the
creation or imposition of any charge or encumbrance upon any of the properties
of Mortgagor pursuant to any indenture, mortgage or other agreement or
instrument to which Mortgagor is a party or by which its properties are bound.
- ------------------------------- (v) Governmental Approvals. No approval,
authorization or other action by, or filing with, any federal, state, or local
commission, board or agency, is required under existing law in connection with
the execution and delivery by Mortgagor of this Mortgage, except for a filing of
a certified copy hereof in the appropriate Section of the Registry of Property
of Puerto Rico. ---------------------------------------------------- (vi) Title.
Mortgagor is the owner of the Mortgaged Property in fee simple ("pleno dominio")
and to all rights and titles appertaining thereto. ----------------- (vii) Liens
and Encumbrances. Except as may be otherwise stated in paragraph SIXTEENTH of
this Deed, the Mortgaged Property is free and clear of all liens and
encumbrances whatsoever on a parity with or superior to the lien of this
Mortgage. ---------------------------------- (viii) Impositions. All Impositions
required to have been paid on the Mortgaged Property on or prior to the date of
this Deed have been paid, except to the


   16



extent that the validity thereof is being contested in good faith by proper
proceedings and with respect to which adequate reserves have been made and set
aside for the payment thereof. ----------------------------- (b) Certain
Covenants and Conditions. Mortgagor covenants and agrees as follows:------------
- ------------------------------------------------------------------------------
(i) Provision for Payment of Governmental Charges and Other Obligations. To
assure the payment of all Impositions, taxes, charges, sewer use fees, water
rates, ground rents and assessments of every name and nature, or any other
obligation which may have or acquire priority over this Mortgage, and which are
assessed or payable with regard to the Mortgaged Property, the Mortgagor, if so
requested by the Mortgagee, shall deposit with the Mortgagee, on the first day
of each month, a sum determined by the Mortgagee to be sufficient to provide, in
the aggregate, a fund adequate to pay any such amounts at least ten (10) days
before the same become delinquent; and whenever the Mortgagee determines sums
accumulated under the provisions of this section to be insufficient to meet the
obligation for which such deposits were made, the Mortgagor shall pay, upon
demand by the Mortgagee, any amount required to cover the deficiency therein.
Every such deposit may, at the option of the Mortgagee, be applied directly
against the obligation with reference to which it was made, or, to the fullest
extent permitted by law, any other obligation the Mortgagor secured hereby. Such
deposits may, to the fullest extent permitted by law, be commingled with other
assets of the Mortgagee and, in the discretion of the Mortgagee, invested by the
Mortgagee for its own account, without any obligation to pay income from


   17




such investment, or interest on such deposits, to the Mortgagor, or to account
to Mortgagor for such income in any manner.-------------------------------------
- ------------------------------------------- (ii) Maintenance of Mortgaged
Property: Alterations. Mortgagor shall keep and maintain the Mortgaged Property
in good repair and condition (ordinary wear and tear excepted), shall make all
such necessary and proper repairs, replacements, additions and improvements
thereto as shall be reasonably necessary for the proper conduct of its business
thereon, and shall not permit or commit waste on the Mortgaged Property.
Mortgagor shall make or cause to be made, as and when the same shall become
reasonably necessary, all structural and non-structural, exterior and interior,
ordinary and extraordinary, repairs, renewals and replacements reasonably
necessary to that end. Mortgagor shall not permit any removal or alteration of
anything which constitutes a part of the Mortgaged Property, without the prior
written consent of the Mortgagee. Mortgagor shall permit the Mortgagee to enter
the Mortgaged Property, at any reasonable time, to determine whether Mortgagor
is in compliance with its obligations under this Mortgage. All construction on
the Mortgaged Property shall comply with, and each and every part of the
Mortgaged Property shall be maintained and used in accordance with, all
applicable federal, state, commonwealth and local laws and governmental
regulations, and any lawful private restrictions or other requirements or
provisions, relating to the maintenance or use thereof.
- ----------------------------------- Notwithstanding the above, the Mortgagor
shall have the right, at any time and from time to time, to remove and dispose
of machinery and equipment on, or forming





   18
        a part of, the Mortgaged Property that may have become obsolete or unfit
        for use or that is no longer useful in the operation of the building now
        or hereafter constituting a portion of the Mortgaged Property or in the
        business conducted thereupon. The Mortgagor agrees promptly to replace
        such machinery and equipment with other machinery and equipment which is
        substantially of the same character and of equal usefulness and quality,
        free of superior title, liens or claims, except as otherwise permitted
        or agreed by the Mortgagor and the Mortgagee in writing.----------------
        -------- (c) Environmental Assessments. In addition to the Mortgagee's
        rights provided hereunder, the Mortgagee may, at its election, obtain
        one or more environmental assessments of the Mortgaged Property
        prepared by a geohydrologist, an independent engineer or other
        qualified consultant or expert approved by the Mortgagee evaluating or
        confirming (i) whether any hazardous substances or other toxic
        substances are present in the soil or water at or adjacent to the
        Mortgaged Property and (ii) whether the use and operation of the
        Mortgaged Property comply with all Applicable Environmental Law (as
        defined hereinafter) relating to air quality, environmental control,
        release of oil, hazardous materials, hazardous wastes and hazardous
        substances, and any and all other applicable environmental laws.
        Environmental assessments may include detailed visual inspections of
        the Mortgaged Property including, without limitation, any and all
        storage areas, storage tanks, drains, dry wells and leaching areas, and
        the taking of soil samples, surface water samples and ground water
        samples, as well as such other investigations or analysis as are
        necessary or


   19


        appropriate for a complete determination of the compliance of the
        Mortgaged Property and the use and operation thereof with all Applicable
        Environmental Laws. The Mortgagor shall be responsible for payment of
        the cost and expense of any such environmental assessment. Mortgagee
        shall minimize interference with Mortgagor's ongoing business on the
        Mortgaged Property during any such environmental assessments.----------
        -------------------(d) Hazardous Substances. Mortgagor represents that
        neither Mortgagor nor, to the best of its knowledge, any other person
        has (1) used or installed any Hazardous Materials (hereinafter defined)
        on, from, or affecting the Mortgaged Property in violation of any
        Applicable Environmental Law (as defined below); or (ii) received any
        notice from any governmental authority with regard to Hazardous
        Materials on, from or affecting the Mortgaged Property. Mortgagor
        covenants that the Mortgaged Property shall be kept free of Hazardous
        Materials and shall not be used to generate, manufacture, refine,
        transport, treat, store, handle, dispose, transfer, produce or process
        Hazardous Materials in violation of any Applicable Environmental Laws
        (as defined below), and Mortgagor shall not cause or permit, as a result
        of any intentional or unintentional act or omission on the part of
        Mortgagor or any tenant or subtenant, the installation of Hazardous
        Materials in or on the Mortgaged Property or a release of Hazardous
        Materials onto the Mortgaged Property or suffer the presence of
        Hazardous Materials on the Mortgaged Property in violation of any
        Applicable Environmental Laws (as defined below). Mortgagor shall
        comply with and take all necessary steps to ensure compliance in all
        material respects


   20


       by all tenants and subtenants with all applicable federal, state and
       local laws, ordinances, rules and regulations, with respect to Hazardous
       Materials, and shall keep the Mortgaged Property free and clear of any
       liens imposed pursuant to any federal, state, or local environmental law,
       ordinance, rule, or regulation including, without limitation, the
       Comprehensive Environmental Response, Compensation, and Liability Act of
       1980, as amended (42 U.S.C. Section 9601, et seq.), the Hazardous
       Materials Transportation Act, as amended (49 U.S.C. Sections 1801, et
       seq.), the Resource Conservation and Recovery Act, as amended (42 U.S.C.
       Sections 6901 et seq.) (all of the foregoing being collectively referred
       to as "Applicable Environmental Laws") and the regulations adopted and
       publications promulgated pursuant thereto at any time. In the event that
       Mortgagor receives any notice from any governmental authority with regard
       to Hazardous Materials on, from or affecting the Mortgaged Property, or
       any notice of violation of Applicable Environmental Laws, Mortqagor shall
       promptly notify Mortgagee. Mortgagor shall conduct and complete all
       investigations, studies, sampling, and testing, and all remedial,
       removal, and other actions necessary to clean up and remove all Hazardous
       Materials on, from or affecting the Mortgaged Property as required by the
       Applicable Environmental Laws and to the reasonable satisfaction of
       Mortgagee. For purposes of this paragraph, "Hazardous Materials" shall
       include, without limitation, any flammable explosives, radioactive
       materials, hazardous materials, hazardous wastes, hazardous or toxic
       substances, or related materials, asbestos or any material containing
       asbestos, or any







   21


other substance or material regulated under any Applicable Environmental Laws.
Mortgagor shall indemnify, defend and hold Mortgagee harmless from and against
any losses, reasonable expenses, liabilities and claims arising from any breach
or default by Mortgagor of its representations, obligations and/or covenants
under this paragraph, including, without limitation, enforcing the obligations
of the Mortgagor under this paragraph and including, without limitation,
reasonable attorneys' fees. The obligations, liabilities, and indemnification
agreement of Mortgagor under this paragraph shall survive the foreclosure,
expiration or sooner termination of this Mortgage or the execution of a Deed in
lieu of foreclosure. The obligations, liabilities and indemnification agreement
of Mortgagor under this paragraph are specifically excepted from any limitation
of liability provision contained in this or any other loan document with
Mortgagee.----------------------------------------------------------------------

- --------(e) Notice of Condemnation. Mortgagor, immediately upon obtaining
knowledge of the institution of any proceeding for the condemnation or
requisition of the Mortgaged Property or any portion thereof, shall notify the
Mortgagee of the pendency of such proceeding. The Mortgagee may participate in
such proceeding, and the Mortgagor from time to time shall deliver to the
Mortgagee all instruments requested by the Mortgagee to permit such
participation.------------------------------------------------------------------

- --------(f) Prior Mortgages. Nothing contained in this Deed is intended, nor
shall it be deemed to consititute, consent by the Mortgagee to a subordination
of the lien of this Mortgage to any other mortgage or lien.-------------------


   22



- --------(g) Expenses. Mortgagor shall pay when due all fees and charges
(including reasonable attorneys' fees) incurred by the Mortgagee incident to the
transactions evidenced by the obligations (including, without limitation, the
Mortgage Note) secured by this Mortgage, the assurance of the security
represented by this Mortgage, and incident to the enforcement of said
obligations and this Mortgage, and such fees and charges shall be secured by the
lien of this Mortgage.-------------------------------------------------------

- --------(h) Priority of Lien; After-Acquired Mortgaged Property. This Mortgage
is and will be maintained as a valid mortgage lien on the Mortgaged Property
subject only to the liens and encumbrances that have been otherwise permitted in
writing by the Mortgagee. All property of every kind acquired by the Mortgagor
after the date hereof which, by the terms hereof, is required or intended to be
subjected to the lien of this Mortgage shall, immediately upon the acquisition
thereof by the Mortgagor, and without any further mortgage, conveyance,
assignment or transfer, become subject to the lien of this Mortgage. The
Mortgagor will at its sole cost and expense do, execute, acknowledge and deliver
all and every such further acts, conveyances, mortgages, and assurances as the
Mortgagee shall reasonably require for accomplishing the purposes of this
Mortgage.----------------------------------------------------------------------

- --------(i) Recovery Proceedings. If any action or proceeding shall be
instituted to recover possession of the Mortgaged Property or for the
foreclosure of any other mortgage or for any other purpose affecting the
Mortgaged Property or this Mortgage, the Mortgagor will immediately, upon
service thereof on or by the Mortgagor, deliver to the Mortgagee a true copy of
each


   23


petition, summons, complaint, notice of motion, order to show cause, and all
other process, pleadings and papers, however designated, served in any such
action or proceeding.-----------------------------------------------------------
- ---------(j) Waiver and Modification; Fees and Expenses in Event of Redemption
or Foreclosure. Whether or not for additional interest or other consideration
paid or payable to the Mortgagee, no forbearance on the part of the Mortgagee or
extension of the time for the payment of the whole or any part of the
obligations secured hereby, whether oral or in writing, or any other indulgence
given by the Mortgagee to Mortgagor or to any other party claiming any interest
in or to the Mortgaged Property, shall operate to release or in any manner
affect the original liability of Mortgagor, or the priority of this Mortgage or
to limit, prejudice or impair any right of the Mortgagee, including, without
limitation, the right to realize upon the security, or any part thereof, for the
obligations secured hereby or any of them; notice of any such extension,
forbearance or indulgence being hereby waived by Mortgagor and all those
claiming by, through or under Mortgagor. No consent or waiver, express or
implied, by the Mortgagee to or of any default by Mortgagor shall be construed
as a consent or waiver to or of any further default in the same or any other
term, condition, covenant or provision of this Mortgage or of the obligations
secured hereby. In any case pursuant to the laws of the Commonwealth of Puerto
Rico redemption is had by Mortgagor after foreclosure proceedings have begun,
the Mortgagee shall be entitled to collect all reasonable costs, charges and
expenses incurred up to the time of redemption.---------------------------------


   24
- -----(k) Right of Mortgagee to Cure Default. If a default shall occur and be
continuing hereunder or under the Mortgage Note beyond any applicable grace
period, the Mortgagee shall have the right, but without any obligation so to
do, to cure such default for the account of Mortgagor. Without limiting the
generality of the foregoing, Mortgagor hereby authorizes the Mortgagee to pay,
at its option, all taxes, sewer use fees, water rates and assessments and other
Impositions, with interest, costs and charges accrued thereon, which may at any
time be a lien upon the Mortgaged Property, or any part thereof; to pay the
premiums for any insurance required hereunder; to incur and pay reasonable
expenses in protecting its rights hereunder and the security hereby granted; to
pay any balance due and delinquent under any security agreement on any fixtures
and equipment included as a part of the Mortgaged Property; and the payment of
all amounts so incurred shall be secured hereby as fully and effectually as
any other obligation of Mortgagor secured hereby.------------------------------
- -----(m) Certain Terms of Foreclosure Sale. To the extent permitted by law, at
any foreclosure sale, any combination, or all, of the Mortgaged Property or
security given to secure the indebtedness and obligations secured hereby, may
be offered for sale for one total price, and the proceeds of such sale
accounted for in one account without distinction between the items of security
or without assigning to them any proportion of such proceeds, or be offered at
more than one foreclosure sale in parts or parcels, Mortgagor hereby waiving
the application of any doctrine of marshaling; and, in case the Mortgagee,
   25
in the exercise of the power of sale herein given, elects to sell in parts or
parcels, said sales may be held from time to time, and the power shall not be
fully executed until all of the Mortgaged Property or security not previously
sold shall have been sold.
- -----(n) Notices. All notices, requests and other communications made or
required to be given pursuant to this Mortgage shall be in writing and shall be
delivered in hand, mailed by United States registered or certified first-class
mail, postage prepaid, or sent by telegraph, telex or telecopy confirmed by
letter, at such address as Mortgagor and Mortgagee may have furnished in
writing to each other, respectively.-------------------------------------------
- -----(o) Successors and Assigns; Joint and Several Liability; Partial
Invalidity. All the covenants and agreements of Mortgagor herein contained
shall be binding upon Mortgagor and, if applicable, the heirs, executors,
administrators, successors and assigns of Mortgagor; and, where more than one
person constitutes Mortgagor, the liability of such persons under this Mortgage
for the obligations set forth herein shall be joint and several ("solidaria").
In case any one or more of the provisions of this Mortgage may be found to be
invalid, or unenforceable for any reason or in any respect, such invalidity or
unenforceability shall not limit or impair enforcement of any other provision
thereof.-----------------------------------------------------------------------
- -----All benefits and agreements of Mortgagee herein contained shall be binding
upon Mortgagee, its successors, assigns and future holders of the Mortgage
Note.--------------------------------------------------------------------------
- -----(p) Modification. No change, amendment, modification, cancellation or
discharge of this Mortgage, or
   26
any part hereof, shall be valid unless in writing and signed by the parties
hereto or their respective successors and assigns, and notice of which shall be
endorsed on the Mortgage Note.-------------------------------------------------
- -----(q) Insurance. Mortgagor shall, at all times, provide, maintain and keep
in force policies of insurance with respect to the Mortgaged Property in such
amounts, containing such coverage, terms and conditions and with such companies
as required hereunder or under the pledge agreement or other instruments under
which the Mortgage Note is assigned or pledged to the Mortgagee or as required
under any other written agreement between Mortgagor and Mortgagee.-------------
- -----(r) Impositions. Mortgagor shall promptly pay as they become due all
Impositions on the Mortgaged Property, except to the extent that the validity
thereof is being contested in good faith by proper proceedings and with respect
to which adequate reserves have been made and set aside for the payment
thereof.-----------------------------------------------------------------------
- -----(s) Governing Law. This Mortgage shall be governed by and construed in
accordance with the laws of the Commonwealth of Puerto Rico.-------------------
- -----(t) Captions. Section headings are inserted for convenience of reference
only and shall be disregarded for purposes of the interpretation of the terms
of this Mortgage.--------------------------------------------------------------
- ---FIFTEENTH: The Mortgage Note. The Mortgage Note referred to in paragraph
SECOND of this Deed is literally transcribed herein as follows:----------------

- ----------------------------"MORTGAGE NOTE-------------------------------------

- -----VALUE: $3,700,000.00------------------------------------------------------
- -----DUE DATE: ON DEMAND-------------------------------------------------------
   27
- ---FOR VALUE RECEIVED, on demand, the undersigned promises to pay to the order
of BANCO BILBAO VIZCAYA PUERTO RICO (the "Payee") the principal sum of THREE
MILLION SEVEN HUNDRED THOUSAND DOLLARS ($3,700,000.00) with interest on the
unpaid balance at the rate per annum of TWELFTH PERCENT (12%) from the date
hereof until payment in full.--------------------------------------------------

- ---Interest and principal hereunder shall be payable on demand, and payments of
interest and principal shall be made at such place as the Payee may from time
to time designate in writing.--------------------------------------------------

- ---In case the Payee of this Note shall take recourse to the courts in order to
collect the whole or a portion of the amount of the Mortgage Note, the
undersigned agrees to pay a liquidated amount equivalent to THREE HUNDRED
SEVENTY THOUSAND DOLLARS ($370,000.00), for court expenses, disbursements and
attorney's fees which may be incurred.-----------------------------------------

- ---The undersigned hereby waives presentment, protest, demand and notice of
non-payment.-------------------------------------------------------------------

- --This Mortgage Note is secured by a mortgage constituted as appears from Deed
Number Forty Three (43) executed on the date hereof, before the undersigned
Notary, and the holder of this Mortgage Note is entitled to the benefit and
security of all of the provisions and conditions set forth in said Deed of
Mortgage.----------------------------------------------------------------------

- ---In San Juan, Puerto Rico, this twenty third (23rd) day of June, 2000.-------

- --------------------CADENA ESTEREOTEMPO, INC.----------------------------------
- --------------------By: /s/ Joseph A. Garcia-----------------------------------
- --------------------Name: Joseph A. Garcia-------------------------------------
- --------------------Title: Chief Financial Officer-----------------------------
- --------------------and Executive Vice President-------------------------------
- -----Affidavit No. 1486--------------------------------------------------------

- ---Acknowledged and subscribed before me by Joseph A. Garcia, also known as
Jose Antonio Garcia Sobrino, of legal age, married, business executive and
resident of Miami, Florida, in his capacity as Chief Financial Officer and
Executive Vice President of CADENA ESTEREOTEMPO, INC., to me personally known
in San Juan, Puerto Rico, this twenty third (23rd) day of June, 2000.----------

- ----------(signed): /s/ Juan C. Salichs Pou------------------------------------
- -----------------------Notary Public"------------------------------------------
- -----(Notarial Seal)-----------------------------------------------------------

- ---SIXTEENTH: Description and Recording Information of the Mortgaged Property.
The Parcel referred to in Section THIRD of this Deed, the Parcel's recording
information and its liens and encumbrances are
   28
described and set forth in Exhibit A attached hereto.

- ---SEVENTEENTH: Various Sums.--------------------------------------------------

- -----(i) The amount of the mortgage credit constituted and created to secure
payment of the Mortgage Note is THREE MILLION SEVEN HUNDRED THOUSAND DOLLARS
($3,700,000.00), the principal amount of the Mortgage Note.--------------------

- -----(ii) The "Interest Credit" is an amount equal to five (5) annuities of
interest on the principal amount of the Mortgage Note pursuant to the
provisions of Article One Hundred Sixty-six (166) of the Mortgage Law of Puerto
Rico.--------------------------------------------------------------------------

- -----(iii) The "Credit for Additional Advances" is THREE HUNDRED SEVENTY
THOUSAND DOLLARS ($370,000.00).------------------------------------------------

- -----(iv) The "Credit for Liquidated Damages" is THREE HUNDRED SEVENTY THOUSAND
DOLLARS ($370,000.00).---------------------------------------------------------

- -----(v) The "Foreclosure Valuation" is THREE MILLION SEVEN HUNDRED THOUSAND
DOLLARS ($3,700,000.00).-------------------------------------------------------

- ------------------------ACCEPTANCE AND WARNINGS--------------------------------

- ---The appearing parties to this Deed accepts the same as drafted because it
has been drawn up in accordance with their stipulations, terms and conditions.
I, the Notary, do hereby certify that the appearing parties can read and
understand the English language and that I, the Notary, made to the appearing
parties the necessary legal warnings concerning the execution of this Deed and
they were fully advised by me thereon. Specifically, I advised the appearing
party of the following:--------------------------------------------------------

- -----(a) That any liens or encumbrances affecting title to the Mortgaged
Property that may be filed for recordation prior to the filing of this Deed may
be
   29
legally binding and could take precedence over this Mortgage.------------------

- -----(b) That this Deed was prepared in accordance with a title abstract dated
the second (2nd) day of June, Two Thousand (2000), prepared by Hato Rey Title
Insurance Agency, Inc. (the "Title Abstract"), an entity engaged in such
business, and not by the undersigned Notary, and Mortgagee is relying on such
abstract.----------------------------------------------------------------------

- -----(c) That a certified copy of this Deed must be filed and recorded in the
appropriate Section of the Registry of the Property of Puerto Rico.------------

- -----(d) That there may exist and be pending unrecorded statutory liens and
real property taxes (including the statutory legal mortgage in favor of the
Commonwealth of Puerto Rico).--------------------------------------------------

- -------------------------------EXECUTION---------------------------------------

- ---The appearing parties waived the right which I advised them, they have to
have witnesses to the execution of this Deed but, upon my advice, made use of
their right to read the same, and finding it drafted to their entire
satisfaction, having been advised by me, the Notary, of the pertinent legal
warnings and reservations, proceed to sign before me, and to affix their
initials on each folio of the same.--------------------------------------------

- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------
   30
   To all of which, as well as to everything contained or related in this Deed,
I, the Notary, CERTIFY, ATTEST AND GIVE FAITH.----------------------------------



                                     [SIG]

                                     [SIG]

                                     [SIG]

                                     [SIG]

   31

                                                                       EXHIBIT A

                             DESCRIPTION OF THE PARCEL

DESCRIPTION:--------------------------------------------------------------------

- ----URBANA: Parcela de terreno identificada con el numero cuarenta y dos guion D
(42-D) del Centro de Distribucion Amelia radicada en el Barrio Pueblo Viejo del
Municipio de Guaynabo, Puerto Rico, con una cabida superficial de Siete Mil
Doscientos Treinta y Seis punto Sesenta y Nueve metros cuadrados (7,236.69
m.c.), equivalentes a uno punto ocho mil cuatrocientas doce cuerdas (1.8412
cdas.); y en lindes por el Norte, con lote de terreno identificado con el
numero treinta y cuatro (34) y con el lote de terreno identificado con el
numero treinta y tres guion A (33-A) del Centro de Distribucion Amelia; por el
Sur, con lote de terreno identificado con el numero cuarenta y uno (41) del
Centro de Distribucion Amelia; por el Este, con lote de terreno identificado con
el numero treinta y tres guion A (33-A) del Centro de Distribucion Amelia; y por
el Oeste, con la Calle F antes, hoy Calle Frances del Centro de Distribucion
Amelia.-------------------------------------------------------------------------

RECORDING INFORMATION:----------------------------------------------------------

- ---As per Deed Number Forty-five (45) executed in San Juan, Puerto Rico on the
fifteenth (15th) day of March, Two Thousand (2000) before Notary Public Waldemar
Del Valle Armstrong, as clarified by deed number one hundred forty five (145)
executed in San Juan, Puerto Rico on the twenty second (22nd) day of June, two
thousand (2000) before notary public Waldemar Del Valle Armstrong, a certified
copy of both deeds will be presented at the Registry of Property of Puerto Rico,
Section of Guaynabo, the Parcel was formed by the consolidation of the following
two (2) properties: (i) Parcel of land identified as Lot Number Forty-two hyphen
A (42-A) of the Amelia Distribution Center, which is the remnant of Lot Number
Forty-two (42) of the Amelia Distribution Center, in turn segregated from
property number 335 recorded at page 123 of volume 712 of Guaynabo, Registry of
Property of Puerto Rico, Section of Guaynabo (hereinafter referred to as
"Property Number 335"); and (ii) a strip of land consisting of one thousand
twenty four point fifteen square meters (1,024.15 sq. mts.), segregated from a
parcel of land identified as Lot Number Forty-two hyphen B (42-B) of the Amelia
Distribution Center, which in turn was segregated from Lot Forty-two (42) of the
Amelia Distribution Center as per Deed Number Twenty-six (26) executed in San
Juan, Puerto Rico on the second (2nd) day of March, nineteen Hundred
Ninety-eight (1998) before Notary Public Waldemar Del Valle Armstrong, a
certified copy of which has been presented and is pending recordation at entry
209 of volume 325 of the Book of Daily Entries of the Registry of Property of
Puerto Rico, Section of Guaynabo.

TITLE:--------------------------------------------------------------------------

- ---Mortgagor acquired the Parcel pursuant to Deed Number One (1) executed in San
Juan, Puerto Rico on the twenty third (23rd) day of June, Two Thousand (2000)



   32




before Notary Public Ruben M. Medina Lugo, a certified copy of which shall be
presented at the Registry of Property of Puerto Rico, Section of Guaynabo,
simultaneously with a certified copy of this Deed.------------------------------

LIENS AND ENCUMBRANCES:---------------------------------------------------------

- ------The Parcel is subject by its origin to restrictive covenants and by
itself, to the following liens: (i) Mortgage securing the payment of a Mortgage
Note in the principal amount of NINE HUNDRED THOUSAND DOLLARS ($900,000.00) with
interest at prime rate, payable on demand to the order of Banco Popular de
Puerto Rico, constituted pursuant to Deed Number Three (3) executed in San Juan,
Puerto Rico on the eighteenth (18th) day of February, Nineteen Hundred
Ninety-three (1993) before Notary Public Luis E. Lopez Correa, a certified copy
of which has been presented and is pending recordation at entry 481 of volume
234 of the Book of Daily Entries of the Registry of Property of Puerto Rico,
Section of Guaynabo. This Mortgage has been increased ("ampliada") to secure an
additional mortgage note in the principal amount of One Million Ninety Thousand
Six Hundred Forty Eight Dollars ($1,090,648.00) with interest at the rate of one
and a half percent (1.50%) over and above the prime rate, payable on demand to
the order of Banco Popular de Puerto Rico, as per Deed Number Nine (9), executed
in San Juan, Puerto Rico on the twentieth (20th) day of August, Nineteen Hundred
Ninety-three (1993) before Notary Public Ruben M. Medina Lugo, which has been
presented and is pending recordation at entry 129, volume 242 of the Book of
Daily Entries of the Registry of Property of Puerto Rico, Section of Guaynabo.
This mortgage and the two (2) mortgage notes that it secures have been canceled
by Deed Number Forty Five (45) executed in San Juan, Puerto Rico on even date
herewith before Notary Public Francisco Pujol Meneses, a certified copy of which
shall be presented at the Registry of Property of Puerto Rico, Section of
Guaynabo, simultaneously with a certified copy of this Deed; (ii) mortgage
securing the payment of a mortgage note in the principal amount of ONE MILLION
FIVE HUNDRED THOUSAND DOLLARS ($1,500,000.00) with interest at prime rate,
payable on demand to the order of Banco Popular de Puerto Rico, constituted
pursuant to Deed Number Thirty-three (33) executed in San Juan, Puerto Rico on
the twentieth (20th) day of April, Nineteen Hundred Ninety-five (1995) before
Notary Public Luis E. Lopez Correa, a certified copy of which has been presented
and is pending recordation at entry 123 of volume 272 of the Book of Daily
Entries of the Registry of Property of Puerto Rico, Section of Guaynabo. This
Mortgage has been constituted as a first mortgage lien together with the above
first mortgage securing the mortgage notes of NINE HUNDRED THOUSAND DOLLARS
($900,000.00) and ONE MILLION NINETY THOUSAND SIX HUNDRED FORTY EIGHT DOLLARS
($1,090,648.00), described hereinabove as per Deed Number Thirty-two (32),
executed on the twentieth (20th) day of April, Nineteen Hundred Ninety-five
(1995) before Notary Public Luis E. Lopez Correa, a certified copy of which has
been presented and is pending recordation at entry 123 of volume 272 of the
Book of Daily Entries of the Registry of Property of Puerto Rico, Section of
Guaynabo. This

EX-10.50

   1
                                                                   Exhibit 10.50




                                LEASE AGREEMENT


                                   LANDLORD:

                             IRRADIO HOLDINGS, LTD.
                         a Florida limited partnership


                                    TENANT:

                       SPANISH BROADCASTING SYSTEM, INC.
                             a Florida corporation



                             SUITE NO. PENTHOUSE II



                       DATE: _____________________, 2000
   2
                             IRRADIO HOLDINGS, LTD.
                        OFFICE BUILDING LEASE AGREEMENT

                   LESSEE: SPANISH BROADCASTING SYSTEM, INC.

                               TABLE OF CONTENTS



Contents                                               Page
- --------                                               ----
                                                
 1.01     Leased Premises                                1
 1.02     Use of Additional Areas                        1
 1.03     Term                                           2
 2.01     Fixed Minimum Annual Rent                      2
 2.02     Additional Rent and Operating Expenses         3
 2.03     Additional Rent                                6
 3.01     Control of Common Areas by Landlord            6
 3.02     Licenses                                       7
 4.01     Services                                       8
 4.02     Directories                                    9
 5.00     Use                                            9
 6.01     Liability Insurance                            9
 6.02     Contents Insurance                             9
 6.03     Special Policy Provisions                      9
 6.04     Increase in Fire Insurance Premium            10
 6.05     Indemnification                               10
 6.06     Mutual Waiver of Subrogation                  10
 7.01     Fire or Other Casualty                        11
 7.02     Condemnation                                  13
 8.01     Events of Default                             15
 8.02     Landlord's Remedies and Obligations in
          Event of Tenant's Default                     15
 8.03     Landlord's Lien                               18
 8.04     Waiver of Defenses and Jury Trial             18
 8.05     Rights Cumulative                             19
 8.06     Attorneys' Fees                               19
 8.07     Notice of Default                             19
 8.08     Expenses of Enforcement                       19
 8.09     Surrender and Holding Over                    20
 9.00     Alterations                                   20
10.00     Trade Fixtures                                21
11.00     Quiet Enjoyment                               21
12.00     Maintenance                                   21
13.00     Signs                                         22
14.00     Parking                                       23







                                       2
   3
Table of Contents
Page Two

15.01     Memorandum of Lease                          23
15.02     Notices                                      24
15.03     Access to Leased Premises                    25
15.04     Assignment and Subletting                    25
15.05     Subordination and Attornment                 26
15.06     Mechanic's Lien                              27
15.07     Entire Agreement                             28
15.08     No Partnership                               28
15.09     Captions and Section Numbers                 28
15.10     Partial Invalidity                           28
15.11     Governing Law                                28
15.12     Waiver                                       29
15.13     Accord and Satisfaction                      29
15.14     Successors and Assigns                       29
15.15     Brokerage Indemnity                          29
15.16     Condition of Leased Premises                 30
15.17     Taxes                                        30
15.18     Prior Occupancy                              30
15.19     Time and Consent                             30
15.20     Leasehold Improvements                       30
15.21     Security Deposit                             31
15.22     Hazardous Waste                              32
15.23     Approval of Lender                           32
15.24     Estoppel Statement                           32
15.25     Rules and Regulations                        33
15.26     Guaranty                                     33
15.27     Radon Gas Disclosure                         33

Exh. A    Floor Plan
Exh. B    Legal Description
Exh. C    Work Letter
Exh. D    Rules and Regulations
Exh. E    Guaranty







                                       3
   4
                        OFFICE BUILDING LEASE AGREEMENT

     THIS LEASE AGREEMENT is made this 14 day of December, 2000, by and between
IRRADIO HOLDINGS, LTD., a Florida limited partnership, having its principal
place of business at 2601 South Bayshore Drive, 9th Floor, Miami, Florida 33133
("Landlord"), and SPANISH BROADCASTING SYSTEM, INC., a Florida corporation
("Tenant").

                                   ARTICLE I

                             BASIC LEASE PROVISIONS

     Section 1.01 Leased Premises:

     Subject to and upon the terms, provisions, covenants and conditions
hereinafter set forth, and each in consideration of the duties, covenants and
obligations of the other hereunder, Landlord does hereby lease, demise and let
to Tenant and Tenant does hereby lease, demise and let from Landlord those
certain premises (hereinafter called the "Leased Premises") located in the
building known as the Terremark Centre (hereinafter called the "Building")
located at 2601 South Bayshore Drive, Miami, Florida, 33133, subject Leased
Premises being more particularly described as follows:

     Penthouse II on the 20th Floor, the approximate boundaries and location of
which are shown on the floor plan attached hereto as Exhibit "A" and made a
part hereof.

     The parties agree that the Leased Premises consist of Thirteen Thousand
Nine Hundred Fifty-three (13,953) square feet of leasable space. The Leased
Premises are located upon a portion of that real property legally described in
Exhibit "B", attached hereto and made a part hereof (hereinafter called the
"Land"). The Land also includes Townhouse improvements which are not part of
the Building (the "Townhouses"). The Building includes an adjoining garage but
the garage (the "Garage") is not included in Building leasable square footage.

     Section 1.02 Use of Additional Areas:

     The use and occupation by Tenant of the Leased Premises shall include the
non-exclusive use, in common with others entitled thereto, of the common areas,
employees' parking areas, service roads, loading facilities, sidewalks and
visitor car parking areas as such common areas now exist or as such common
areas may hereafter be altered, modified, reduced or constructed, and other
facilities as may be designated from time to time by Landlord, subject however
to the terms and conditions of this Lease and to the Rules and Regulations for
the use thereof as prescribed from time to time by Landlord and the


                                                 Please Initial:
                                                 /s/ [illegible]

                                                 Landlord: /s/ B   /s/
                                                         _______      ______

                                                 Tenant: /s/ Jay   /s/
                                                       _________      ______

                               Page 1 of 42 Pages



   5
security rights of other tenants

     Section 1.03  Term:

     The term of this Lease shall be for ten years commencing on November 1,
2000 ("Commencement Date") and ending on October 31, 2010 hereinafter called
the "Lease Term" or "Term"). This Lease may be sooner terminated as provided
herein.

                               A R T I C L E  II

                                      RENT

     Section 2.01  Fixed Minimum Annual Rent:  (See Addendum to Lease)

     (a) Tenant shall pay Landlord as Fixed Minimum Annual Rent the sum of Four
Hundred Eighteen Thousand Five Hundred Ninety and 00/100 Dollars ($418,590.00)
per annum, (subject to increases as provided in Section 2.01(b) hereof),
payable to Landlord in twelve (12) equal monthly installments initially, of,
Thirty Four Thousand Eight Hundred Eighty-two and 50/100 Dollars ($34,882.50)
(subject to increases as provided in Section 2.01(b) hereof), plus applicable
Florida Sales Tax, on or before the first (1st) day of each month in advance,
at the office of Landlord, above designated, or to such other recipient or
place as shall be designated by Landlord from time to time, without any prior
demand therefor, and without any deduction, offset or counterclaim whatsoever,
except as specifically herein permitted.

                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                               Page 2 of 42 Pages

   6
     (c) Tenant shall pay the Fixed Minimum Annual Rent in twelve (12) equal
installments, due on the first (1st) day of each month. If the Fixed Minimum
Annual Rent and the Additional Rent under this Lease is due on a day other than
the first (1st) day of a month, Tenant shall pay such rent for the fractional
month on a per diem basis (calculated on the basis of a thirty (30) day month)
payable on the day Fixed Minimum Annual Rent is due under the terms of this
Lease. Any rental payment hereunder for any other fractional month shall
likewise be calculated and paid on a per diem basis.

     Section 2.02 Additional Rent and Operating Expenses:

     (a) Definitions: For purposes of this Section and other provisions of this
Lease:

         (1) The term "Tenant's Proportionate Share" shall mean that fraction,
the denominator of which is the total number of leasable square feet in the
Building, which is deemed to be a total of Two Hundred Ninety Four Thousand
(294,000) square feet, and the numerator of which is (13,953) which is the total
number of square feet which is hereby deemed to be leased and allocated to
Tenant and which includes an allocation for common areas of the Building. 4.746

         (2) The term "Additional Rent" shall include Tenant's Proportionate
Share of "Excess Operating Expenses" (as such term is defined is subparagraph
"(c)" hereof).

     (b) For purposes of this Section, the Building's Operating Expenses shall
mean all expenses paid or incurred by Landlord or on Landlord's behalf with
respect to the repair, maintenance and operation of the Land and Building,
including, but not limited to, the following: (i) salaries, wages, medical,
surgical, union


                                        Please Initial:

                                        Landlord:  Illegible
                                                  -----------------------

                                        Tenant:    Illegible
                                                  -----------------------




                               Page 3 of 42 Pages
   7
and general welfare benefits (including, without limitation, group life
insurance) and pension payments of full-time employees of Landlord engaged
exclusively in the repair, operation and maintenance of the Land or the
Building; (ii) payroll taxes, worker's compensation, uniforms and related
expenses for employees; (iii) the cost of all charges for security systems,
alarm systems, guard service, shuttle service, garbage collection, water, sewer,
gas, heat, ventilation, air-conditioning, electricity and other utilities,
including any taxes on such utilities; (iv) the cost of all charges for casualty
and liability insurance carried by Landlord with regard to the Land and Building
and maintenance or operation thereof; (v) the cost of supplies (including,
without limitation, cleaning supplies), tools, materials and equipment and sales
and other taxes thereon; (vi) depreciation of hand tools and other movable
equipment used in repair, maintenance or operation  of the Building; (vii) the
cost of all charges for window and other cleaning and janitorial and security
services furnished by Landlord; (viii) amounts charged to Landlord by
contractors for services, materials and supplies furnished in connection with
the operation, maintenance or repair of any part of the Building or the heating,
air conditioning, ventilating, plumbing, electrical, elevator, and other systems
of the Building; (ix) non-capitalized repairs, replacements, alterations and
improvements to the Building or the Land in accordance with generally accepted
accounting principles; (x) management fees not to exceed four percent (4%) of
gross receipts; (xi) the cost of any capital improvements to the Building or of
any machinery or equipment installed in the Building which is made or becomes
operational, as the case may be, after the expiration of the first (1st) lease
year, to the extent of such cost, amortized over the useful life of the
improvement, machinery or equipment (as reasonably estimated by Landlord); (xii)
legal, accounting and other professional fees incurred in connection with the
operation, maintenance and management of the Land and Building; (xiii) painting,
refurbishing, recarpeting or redecorating any portion of the Building; (xiv)
Taxes; and (xv) all other charges allocable to the repair, replacement,
operation, maintenance and management of the Building or the Land in accordance
with generally accepted accounting principles.


     (c) Notwithstanding the above, the following are excluded from the
definition of Operating Expenses: (i) depreciation (except as provided above);
(ii) interest on and amortization of debts; (iii) leasehold improvements made
for tenants of the Building; (iv) income taxes; (v) refinancing costs; (vi) the
cost of any work or services performed for or separately charged to any
tenant(s) of the Building (including Tenant); (vii) the cost of any repair or
replacement (other than those described in (ix) and (xi) above) which would be
required to be capitalized under generally accepted accounting principles;
(viii) salaries and fringe benefits for executives of Landlord; (ix) cost of
repair or replacement incurred by reason of fire or other casualty, or caused
by condemnation to the extent reimbursed by insurance or condemnation award;
(x) advertising and promotional expenditures; (xi) any cost or expense for
which Landlord is reimbursed by any other tenant or by insurance or condemnation
proceeds or otherwise; and (xii) leasing commissions. Notwithstanding anything
to the contrary contained herein, any cost of Landlord to make improvements in
tenants' spaces shall not be deemed to be an Operating Expense.

     (d) The term "Taxes" shall mean: (i) the aggregate amount for which the
Building and the Land are


                                                           Please initial:

                                                           Landlord: [illegible]
                                                                     -----------
                                                           Tenant: [illegible]
                                                                   -------------

                               Page 4 of 42 pages
   8
assessed by Miami-Dade County and/or the City of Miami for the purpose of
imposition of real estate taxes, and (ii) any expenses incurred by Landlord in
contesting such taxes or assessments, or the assessed value of the Building or
the Land, which expense shall be allocated to the calendar year to which such
expenses relate. Any special or other assessment or levy which is imposed upon
the Land or the Building shall be added to the amount so determined and shall be
deemed to be included within the term "Taxes" for the purposes hereof. If at any
time during the term of this Lease, the methods of taxation prevailing on the
date thereof shall be altered, such additional or substitute tax, assessment,
levy, imposition, or charge, shall be deemed to be included within the term
"Taxes" for the purposes hereof. To the extent that Landlord receives a tax
refund, thereby reducing the Operating Expenses for a year in which an increase
in Operating Expenses have been paid by Tenant, such refund shall be applied
against the next Fixed Minimum Annual Rent payment becoming due under this
Lease.

     (e) Additional Rent - First Calendar Year -
         (or fraction):

     Within one hundred twenty (120) days after the end of the first (1st)
calendar year of the Term, Landlord will submit to Tenant an operating statement
(the "Operating Statement") showing actual Operating Expenses incurred for the
preceding year. Tenant shall, within ten (10) days after receipt of written
demand, pay to Landlord Tenant's Proportionate Share of Operating Expenses in
excess of "Base Year Operating Expenses," which term shall refer to the
Operating Expenses for the Building for the calendar year 2000, adjusted to
reflect 100% occupancy. The excess amount described in the preceding sentence
shall be referred to as the "Excess Operating Expenses".

     (f) Future Additional Rent - Landlord's Estimate of Operating Expenses:

     For all calendar years of the Term, Landlord shall, within one hundred
twenty (120) days after the end of each calendar year of the Term, furnish to
Tenant Landlord's Estimate of Operating Expenses for the coming year. Tenant
shall then pay to Landlord, on the first (1st) day of each calendar month as
Additional Rent, an amount equal to one-twelfth (1/12) of Tenant's Proportionate
Share of Landlord's good faith estimate of the Excess Operating Expenses of that
year. Until Landlord shall furnish such estimate to Tenant, Tenant shall pay to
Landlord, on the first (1st) day of each such month, an amount equal to the
Additional Rent payable in the preceding month, if any. If there shall be any
increase or decrease in the Operating Expenses for any year, whether during or
after such year, Landlord shall furnish to Tenant a revised estimate and the
Additional Rent (if any) shall be adjusted and paid, as the case may be. If the
calendar year for which such estimate is furnished ends after the termination of
this Lease, the Additional Rent payable hereunder shall be prorated to
correspond to that portion of the calendar year occurring within the Term of
this Lease. Provided, however, in no event shall Tenant receive a refund if the
Operating Expenses of the Building are less than the Base Year Operating
Expenses.


                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                               Page 5 of 42 Pages
   9
     (g) Future Additional Rent - Statement of Actual Costs:

     Landlord shall also furnish to Tenant within one hundred twenty (120) days
after the end of each calendar year, an Operating Statement showing actual
Operating Expenses incurred for the preceding year. If the Operating Statement
shows that the sums paid by Tenant pursuant to subparagraphs (e) & (f) above,
exceed Tenant's Proportionate Share of Excess Operating Expenses, Landlord shall
promptly permit Tenant to credit the amount thereof against subsequent payments
of Additional Rent under this Article; and if the Operating Statement shows that
the sums paid by Tenant were less than Tenant's Proportionate Share of Excess
Operating Expenses, Tenant shall pay the amount of such deficiency within ten
(10) days after receipt of written demand. Failure or delay of Landlord to
submit to Tenant the written statement referred to herein shall not be a waiver
of any rights of Landlord. Tenant shall have the right to verify each Operating
Statement furnished by Landlord by an examination and audit at Tenant's expense
at Landlord's main offices in Miami-Dade County, Florida, so long as Tenant
commences each audit within six (6) months of its receipt of the Operating
Statement. Failure to commence an audit within such six month period shall be
deemed a waiver of Tenant's right to challenge, object to or audit the Operating
Statement.

     (h) Townhouses:

     The expenses of maintaining, operating, repairing, replacing and managing
the Townhouses shall be separately accounted for by Landlord. If such expenses
are attributable to both the Townhouses and the Building and/or other property,
Landlord shall determine the appropriate allocation to the Townhouses or other
property (other than the Land and/or Building) by comparative square footage or
other reasonable method and exclude such share of the expenses from Operating
Expenses.

     Section 2.03 Additional Rent.

     Any and all sums of money or charges required to be paid by Tenant under
this Lease, whether or not the same be so designated, shall be considered
"Additional Rent". If such amounts or charges are not paid at the time provided
in this Lease, they shall, nevertheless, be collectible as Additional Rent with
the next installment of Fixed Minimum Annual Rent thereafter falling due
hereunder, but nothing herein contained shall be deemed to suspend or delay the
payment of any amount of money or charges as the same become due and payable
hereunder, or limit any other remedy of Landlord.


                                  ARTICLE III

                        COMMON USE AREAS AND FACILITIES




                                        Please Initial:

                                        Landlord:  Illegible
                                                  -----------------------

                                        Tenant:    Illegible
                                                  -----------------------




                               Page 6 of 42 Pages
   10
     Section 3.01 Control of Common Areas by Landlord

     All facilities furnished by Landlord in the Building and designated for the
general use in common of occupants of the Building, including Tenant hereunder,
its officers, agents, employees and invitees, including, but not limited to
parking areas, streets, sidewalks, canopies, roadways, loading platforms,
washrooms, shelters, ramps, landscaped areas, stairways, corridors, lobbies,
elevators, and other similar facilities, shall at all times be subject to the
exclusive control and management of Landlord, and Landlord shall have the right
from time to time to change, improve, reduce or otherwise alter the area, level,
location and arrangement of such parking areas and other facilities above
referred to; and to make all Rules and Regulations pertaining to and necessary
for the proper operation and maintenance of the common facilities. Tenant
hereunder, and any other sub-tenants and licenses, shall comply with all Rules
and Regulations made by Landlord pertaining to the operation and maintenance of
said common facilities, including, but not limited to, such reasonable
requirements pertaining to sanitation; handling of trash and debris; loading and
unloading of trucks and other vehicles; and safety and security against fires,
theft, vandalism, personal injury or other hazards.

     Landlord shall have the right to close all or any portion of said areas or
facilities to such extent as may, in the opinion of Landlord's counsel, be
legally sufficient to prevent a dedication thereof, or the accrual of any rights
to any person or the public therein; and to do and perform such other acts in
and to said areas and improvements as, in the use of good business judgment,
Landlord shall determine to be advisable. Landlord will cooperate and maintain
the common facilities referred to above in such manner as Landlord, in its
sole discretion, shall determine from time to time. Without limiting the scope
of such discretion, Landlord shall have the full right and authority to employ
all personnel and to make all Rules and Regulations pertaining to and necessary
for the first-class operation and maintenance of the common areas and
facilities.

     Section 3.02 Licenses:

     All common areas and facilities not within the Leased Premises, which
Tenant may be permitted to use and occupy, are to be used and occupied under a
revocable license, and if any such license is revoked, or if the amount of such
area is diminished, Landlord shall not be subject to any liability nor shall
Tenant be entitled to any compensation or diminution or abatement of Fixed
Minimum Annual Rent or Additional Rent, nor shall such revocation or diminution
of such area be deemed constructive or actual eviction.

                                   ARTICLE IV

                                    SERVICES

     Section 4.01:

     Landlord will furnish the following services to Tenant, at no additional
cost or expense to Tenant.


                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------




                               Page 7 of 42 Pages
   11
from Monday through Friday, except for legally recognized holidays.

     Cleaning services, of standard office quality. No carpet shampooing shall
be included.

     Heat and air conditioning from 8:00 A.M. to 6:00 P.M., on Monday through
Friday, and between the hours of 8:00 A.M. and 1:00 P.M. on Saturdays. Heat and
air-conditioning services for hours in excess of those described above will be
charged to Tenant, based on the actual cost of utilities and additional cost of
wages paid to personnel directly associated with the operation of the overtime
air-conditioning and/or ventilating system.

     Landlord shall furnish extermination services from time to time and shall
furnish automatically operated elevator service, electrical current for normal
office use and water for normal drinking and lavatory use at all times and on
all days throughout the year.

     No electric current shall be used except that furnished or approved by
Landlord, nor shall electric cable or wire be brought into the Leased Premises,
except upon the written consent and approval of Landlord. Tenant shall use only
office machines and equipment which do not overload the Building's circuits
from which tenant obtains electric current. The cost of any consumption of
electric current in excess of that considered by Landlord to be usual, normal
and customary for office use, or which requires special circuits or equipment
(the installation of which shall be at Tenant's expense after approval in
writing by Landlord), shall be paid for by Tenant to Landlord as Additional
Rent in an amount to be determined by Landlord based upon Landlord's estimated
cost of such excess electric current consumption or based upon the actual cost
thereof if such excess electric current consumption is separately metered.

     Such services shall be provided as long as Tenant is not in default under
any of the terms, provisions, covenants and conditions of this Lease, subject
to interruption caused by repairs, renewals, improvements, changes of services,
alterations, strikes, lockouts, labor controversies, inability to obtain fuel
or power, accidents, breakdowns, catastrophes, national or local emergencies,
acts of God and conditions and causes beyond the control of Landlord and upon
such happening, no claim for damages or abatement of Fixed Minimum Annual Rent
or Additional Rent for failure to furnish any such services shall be made by
Tenant or allowed by Landlord.

     Section 4.02 Directories:

     Space shall be provided on the Building directory board in the lobby and on
any other general Building directory board for Tenant. Landlord shall pay the
cost of initial directory listings. At Tenant's request, Landlord shall make
changes in such directory listings and Tenant will reimburse Landlord for the
actual cost of such service if not included in the Building's Operating
Expenses. The number of spaces

                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------



                               Page 8 of 42 Pages



   12
requested by Tenant shall not be unreasonable and Landlord reserves the right to
promulgate such Rules and Regulations with respect to the allocation of such
spaces.


                                   ARTICLE V

                                      USE

     Tenant shall not use, permit or suffer the use of the Leased Premises or
any part thereof, for any purpose other than as a business office and for no
other purpose. Tenant further agrees that the Leased Premises are leased
exclusively for business purposes and may never be used at any time for
residential or other purposes.


                                   ARTICLE VI

                            INSURANCE AND INDEMNITY

     Section 6.01 Liability Insurance:

     Tenant shall, during the entire Term, keep in full force and effect, a
policy of public liability and property damage insurance with respect to the
Leased Premises and the business operated by Tenant, and any permitted
sub-tenant of Tenant in the Leased Premises, in which the limits of public
liability are a single limit for liability per incident, per person and property
damage of no less than One Million Dollars ($1,000,000.00) and such greater
amount from time to time determined by Landlord which is customary for tenancies
of comparable size, space and business use.

     Section 6.02 Contents Insurance:

     Tenant shall maintain fire insurance, naming Landlord and Tenant as
insured, in an amount adequate to cover the cost of replacement of all
decorations, fixtures, contents and Leasehold Improvements (as that term is
defined in Article VII) in the Leased Premises in the event of fire, windstorm,
vandalism, mischief, and/or casualties including special extended coverage, and
said insurance shall include but not be limited to, coverage against all water
damage to contents and/or personal property of Tenant and the Leasehold
Improvements.

     Section 6.03 Special Policy Provisions:

     All insurance policies which Tenant is required to secure and maintain
pursuant to this Article VI, shall be written by companies acceptable to the
Landlord, shall name Landlord, any persons, firms or



                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------



                               Page 9 of 42 Pages
   13
corporations designated by Landlord, and Tenant as insureds, and shall contain a
clause that the insurer will not cancel or change the insurance without first
giving Landlord thirty (30) days prior written notice. Further, said policies
shall contain an express waiver of any right of subrogation against Landlord and
other named insureds, designated by Landlord. Tenant will further deposit the
policies, or certificates thereof, with Landlord together with evidence of
payment of the premium, at all times, commencing with the date Tenant first
enters upon the Leased Premises for any purpose. In no event shall the limits of
any insurance policies required herein be considered as limiting the liability
of Tenant under this Lease.

     Section 6.04 Increase of Fire Insurance Premium:

     In addition, Tenant agrees that it will not keep, use, sell or offer for
sale in or upon the Leased Premises any article which may be prohibited by the
standard form of fire insurance policy. Tenant agrees to pay any increase in
premiums for fire and extended coverage insurance that may be charged during the
Term of this Lease or the amount of such insurance which may be carried by
Landlord on the Leased Premises or the Building of which they are a part
resulting from any acts or omissions of Tenant or any change in use by Tenant.
In determining whether increased premiums are the result of Tenant's use of the
Leased Premises, a schedule, issued by the organization in making the insurance
rate on the Leased Premises, showing the various components of such rate, shall
be conclusive evidence of the several items and charges which make up the fire
insurance rate for the Leased Premises.

     In the event that Tenant's occupancy causes any increase of the premium for
the fire and/or casualty rates on the Leased Premises or any part thereof above
the rate for the least hazardous type of occupancy legally permitted in the
Leased Premises, Tenant shall pay the additional premium on the fire and/or
casualty insurance policies by reason thereof. Tenant also shall pay in such
event any additional premium necessitated by the character of Tenant's use of
the Leased Premises on such rent insurance policy as may be carried by Landlord
for its protection against rent loss through fire. Bills for such additional
premiums shall be rendered by Landlord to Tenant at such times as Landlord may
elect, and shall be due from and payable by Tenant when rendered, and the amount
thereof shall be deemed to be, and shall be paid as Additional Rent.

     Section 6.05 Indemnification:

     Tenant will indemnify Landlord and save it harmless from and against any
and all claims, actions, damages, liability, and expense in connection with loss
of life, personal injury and/or damage to property occurring in or about, or
arising from or out of the Leased Premises and adjacent sidewalks and loading
platforms or other areas occasioned wholly or in part by any act or omission of
Tenant, its agents, contractors, invitees, or employees. In case Landlord shall,
without fault on its part, be made a party to any litigation commenced by or
against Tenant, then Tenant shall protect and hold Landlord harmless and shall
pay all costs, expenses and reasonable attorneys' fees incurred or paid by
Landlord in connection with such


                                        Please Initial:
                                        ---------------

                                        Landlord: /s/ [illegible]
                                                  ------------------

                                        Tenant:   /s/ [illegible]
                                                  ------------------



                              Page 10 of 42 Pages
   14
litigation at all levels and such fees incurred in enforcing this indemnity.

     Section 6.06 Mutual Waiver of Subrogation:

     Notwithstanding anything set forth in this Lease to the contrary, Landlord
and Tenant each hereby waive any and all right of recovery, claim, action or
cause of action against the other, their respective agents, officers and
employees (a) for any loss or damage that may occur to the Leased Premises, the
Building, or any of the improvements thereto, by reason of fire, the elements or
any other cause which could be insured against under the terms of a standard
fire and extended coverage insurance policy or policies, with vandalism,
malicious mischief and all-risk coverage, or (b) for which landlord or Tenant
may be reimbursed as a result of insurance coverage affecting any loss suffered
by either party, regardless of cause or origin, including the negligence of
Landlord or Tenant or their respective agents, officers and employees. In
addition, all insurance policies carried by either party covering the Leased
Premises, the Building or contents, shall expressly waive any right on the part
of the insurer against the other party for damage to or destruction of the
Leased Premises, the Building or contents, resulting from the acts, omissions or
negligence of the other party.

                                  ARTICLE VII

                          DESTRUCTION AND CONDEMNATION

     Section 7.01 Fire or Other Casualty:

     (a) For purposes of this section and this Lease Agreement generally, the
following definitions are applicable:

     "Leasehold Improvements" refers to those interior improvements, whether
made at Landlord's or Tenant's expense, made to that portion of the Building
which is included within the Leased Premises in order to make the Leased
Premises habitable, functional or in accordance with Tenant's needs or wants,
including but not limited to electrical fixtures, plumbing fixtures, HVAC,
interior walls and partitions, built-ins, doors, wall coverings, flooring and
carpet, window coverings, wiring for telephone, computer and similar systems,
ceilings, air handlers and appliances which are affixed to the Leased Premises.
Leasehold Improvements do not include Tenants furniture, equipment or trade
fixtures which are not "fixtures" to the real estate as defined by Florida
common law.

     "Leased Premises" refers to the total of all space under lease by the
Tenant, including the Leasehold Improvements and that portion of the Building
which is within the boundaries of the Leased Premises as set forth in Section
1.01 of this Lease Agreement, but excluding all common areas.


                                        Please Initial:

                                        Landlord: [illegible]
                                                 --------------------

                                        Tenant:   [illegible]
                                                 --------------------


                              Page 11 of 42 Pages
   15
     "Building" refers to the structure located at 2601 South Bayshore Drive,
including the parking garage and all common areas, but excluding the townhouses
and all Leasehold Improvements. In any particular Leased Premises, the Building
is that portion which is not included within the scope of the Leasehold
Improvements, including but not limited to the exterior walls, structural
supports, elevator shafts, common area restrooms and exterior windows.

     "Casualty Loss" refers to any loss or damage to any property by windstorm,
fire, flood, theft, or other casualty normally covered by policies of fire and
extended coverage insurance.

     "Original Condition" refers to substantially the same condition any
personal property, fixtures or real property was in immediately before any
Casualty Loss.

     (b) In the event of a casualty loss to any part or all of the Leasehold
Improvements, Landlord shall be entitled to all insurance proceeds for such
loss, including those from the insurance required to be maintained by Tenant on
the Leasehold Improvements as set forth in section 6.02 of this Lease
Agreement. Other than the obligations with specifically imposed on Landlord in
this Article VII, Landlord shall have no duty to account to Tenant for the use
of such proceeds or in any way share or deliver any or all of such proceeds
with or to Tenant.

     (c) In the event of a Casualty Loss to the Leased Premises which Casualty
Loss does not render the Leased Premises untenable in any significant part,
there shall be no rent abatement and the Landlord shall repair the Leased
Premises and restore the Leasehold Improvements to their Original Condition,
all within 180 days of the occurrence of the Casualty Loss.

     (d) In the event of a Casualty Loss to the Leased Premises which Casualty
Loss does not render the Leased Premises more than 50% untenable, Landlord
shall have the following options, one of which must be exercised by delivery of
notice to Tenant no later than 120 days from the occurrence of the Casualty
Loss:

     (i) Tenant shall receive an abatement of rent in proportion to that part
of the Leased Premises which is untenable retroactive to the date of such
Casualty Loss and Landlord shall restore the Leased Premises to their Original
Condition within 18 months of the date of the occurrence of the Casualty Loss,
or

     (ii) Landlord may terminate this Lease Agreement and neither party shall
have any further obligation to the other, except that Tenant shall be entitled
to a refund of all rent paid from the date of the occurrence of the Casualty
Loss to the date of Landlord's notice of the exercise of this option and
Landlord shall still be entitled to collect and keep all insurance proceeds to
which it is entitled under this Lease Agreement.


                                                 Please initial:
                                                 ---------------

                                                 Landlord: /s/ [illegible]
                                                          -------------------

                                                 Tenant:   /s/ [illegible]
                                                          -------------------

                              Page 12 of 42 Pages
   16
     (e) In the event of a Casualty Loss to the Leased Premises which Casualty
Loss renders the Leased Premises 50% or more untenable, Landlord shall have the
following options, one of which must be exercised by delivery of notice to
Tenant no later than 180 days from the occurrence of the Casualty Loss:

     (i) If Landlord elects to rebuild the Leased Premises, Tenant shall receive
a complete abatement of all rent if it vacates the Leased Premises or an
abatement of rent in proportion to that amount of the Leased Premises it does
not vacate, for the time it takes Landlord to restore the Leased Premises to
their Original Condition, which restoration must be accomplished within 18
months of the date of the occurrence of the Casualty Loss, or

     (ii) Landlord may terminate this Lease Agreement and neither party shall
have any further obligation to the other, except that Tenant shall be entitled
to a refund of all rent paid from the date of the occurrence of the Casualty
Loss to the date of Landlord's notice of the exercise of this option and
Landlord shall still be entitled to collect and keep all insurance proceeds to
which it is entitled under this Lease Agreement.

     (f) For purposes of this Article VII, any determination of the portion of
the Leased Premises which are tenable shall be made, in the first instance, by a
licensed engineer retained by Landlord. The results of such determination shall
be provided to Tenant. In the event Tenant disagrees with such determination,
Tenant may retain its own licensed engineer who shall make his/her own
determination and provide the results to Landlord. If the assessments differ by
less than 5%, Landlord's assessment shall control. If the assessments differ by
more than 5%, Tenant may either accept Landlord's assessment or require the two
engineers to select a third engineer, whose assessment shall be binding and
whose costs and fees shall be paid by whichever party's assessment was closest
to that of the third engineer. If the first two engineers are incapable of
selecting a third, the chief judge of the Circuit Court shall be requested to do
so. All time frames set forth for Landlord to make any decision or take any
action in this Article VII shall be extended by the same amount of time that
elapses from the delivery of Landlord's assessment to Tenant until resolution of
the assessment issue in accordance with this subparagraph.

     (g) In no event shall Landlord be obligated to spend more to repair any
Casualty Loss under this Article VII than is available to Landlord in insurance
proceeds for such Casualty Loss from policies of insurance maintained by
Landlord and Tenant. All time frames for Landlord to make any decision or take
any action under this Article VII shall be extended commensurate with any delays
Landlord encounters in its dealings with the various insurance companies, so
long as such delays are not the result of Landlord's lack of diligence or
Landlord's negligence.

     (h) Tenant hereby waives any and all right of recovery which it might
otherwise have against Landlord, its agents and employees, for any loss or
damage to Tenant's contents, furniture, furnishings, fixtures and any other
property of the Tenant, regardless of whether such loss or damage was caused in



                                        Please Initial:

                                        Landlord: [Illegible]
                                                  ------------------

                                        Tenant:   [Illegible]
                                                  ------------------



                              Page 13 of 42 Pages
   17
whole or in part by the negligence or fault of Landlord or its agents in the
design or maintenance of the Building, the Leased Premises or the Leasehold
Improvements, or any other negligence or fault of Landlord or its agents.

     Section 7.02 Condemnation:

     If the whole of the Leased Premises shall be acquired or condemned by
eminent domain for any public or quasi-public use or purpose (a sale in lieu of
condemnation to be deemed a taking for the purposes of this paragraph), then the
Term of this Lease shall cease and terminate as of the date of possession being
required by the condemning authority and all Fixed Minimum Annual Rent and
Additional Rent shall be paid through that date.

     If any part of the Leased Premises shall be acquired or condemned by
eminent domain for any public or quasi-public use or purpose, and in the event
that such partial taking or condemnation shall render the Leased Premises
reduced by thirty percent (30%) or more and Landlord cannot provide comparable
substitute space in the Building or shall render the Leased Premises unsuitable
for office use, then the Term of this Lease shall cease and terminate as of the
date of possession being required by the condemning authority.

     In the event of a partial taking or condemnation, which is not extensive
enough to render the Lease terminable as provided above, then Landlord shall
promptly restore the Leased Premises to a condition comparable to the condition
at the time of such condemnation, less the portion lost in the taking, and this
Lease shall continue in full force and effect, except that the Fixed Minimum
Annual Rent and Tenant's Proportionate Share hereunder shall be equitably
adjusted.

     If the whole or a substantial portion of the common parking areas in the
Building shall be acquired or condemned by eminent domain for any public or
quasi-public use or purpose, then at Tenant's election the Term of this Lease
shall cease and terminate as of the date of possession being required by the
condemning authority unless Landlord shall take immediate steps to provide other
parking facilities substantially equal to the previously existing parking areas
and such substantially equal parking facilities shall be provided by Landlord at
its own expense. In the event that Landlord shall provide such other
substantially equal parking facilities, then this Lease shall continue in full
force and effect.

     Although all damages in the event of any condemnation are to belong to
Landlord, whether such damages are awarded as compensation for diminution in the
value of the leasehold or the fee, Tenant shall have the right to claim and
recover from the condemning authority, but not from Landlord, such compensation
as may be separately awarded or recoverable by Tenant in Tenant's own right on
account of any and all damages to Tenant's business by reason of the
condemnation and for or on account of any cost or



                                        Please Initial:

                                        Landlord: [Illegible]
                                                  ------------------

                                        Tenant:   [Illegible]
                                                  ------------------



                              Page 14 of 42 Pages

   18
loss to which Tenant might be put in removing Tenant's merchandise, furniture,
fixtures, leasehold improvements and equipment to the extent any such awards do
not diminish the awards otherwise payable to Landlord.


                                  ARTICLE VIII

                             DEFAULTS AND REMEDIES

     Section 8.01 Events of Default:

     The occurrence of any of the following shall constitute an Event of
Default hereunder:

     (a) The filing of a petition by or against Tenant for adjudication as a
bankrupt or insolvent, for its reorganization or for the appointment of a
receiver or trustee of Tenant's property, if not vacated within thirty (30)
days from the date of filing;

     (b) An assignment by Tenant for the benefit of creditors; or the taking of
possession of the property of Tenant by any governmental officer or agency
pursuant to statutory authority for the dissolution or liquidation of Tenant;

     (c) Failure of tenant to pay any installment of Fixed Minimum Annual Rent
or Additional Rent ("Rent"), due hereunder, or any other sum herein required to
be paid by Tenant, when due on the first of each month during the term of the
Lease, or as required hereunder;

     (d) Tenant's failure to perform any other covenant or condition of this
Lease within ten (10) days after written notice and demand, unless the failure
is of such a character as to require more than ten (10) days to cure, in which
event Tenant's failure to proceed diligently to cure such failure and to
accomplish such cure within thirty (30) days after such notice and demand shall
constitute an Event of Default;

     (e) Seizure under any levy, execution, attachment or other process of
court where the same shall not be promptly vacated or stayed on appeal or
otherwise or if Tenant's interest in the Leased Premises is sold by judicial
sale and the sale is not promptly vacated or stayed on appeal or otherwise;

     (f) Tenant vacates or abandons substantially all of the Leased Premises;
and

     (g) The occurrence of any Event of Default by Tenant prior to the
Commencement Date of the Term of this Lease.


                                                         Please initial:

                                                         Landlord: [illegible]
                                                                   -----------

                                                         Tenant: [illegible]
                                                                 -------------


                              Page 15 of 42 Pages


   19
     Section 8.02 Landlord's Remedies and Obligations in Event of Tenant's
                  Default:

     Landlord and Tenant, each having been advised by respective counsel as to
their respective rights and obligations under the existing statutory and
decisional law of the State of Florida, and each being desirous of obtaining
rights and obligations that might otherwise be unavailable under the existing
law, have bargained for, and do hereby mutually agree, to the following
remedies and procedures which shall apply in the event of an Event of Default.

     (a) Landlord shall have the right to elect to terminate Tenant's right to
possession of the Leased Premises or to terminate this Lease. In the event
Landlord so elects, Landlord shall give Tenant three (3) days written notice of
Landlord's election and thereupon, at the expiration of said three (3) days
(unless such Event of Default has then been cured), Tenant's right to
possession of the Leased Premises shall terminate, whereupon Tenant shall
immediately quit and surrender the Leased Premises to Landlord and Tenant
further agrees that failure by Tenant to immediately surrender the Leased
Premises following an Event of Default and said three (3) day notice shall
render Tenant subject to the immediate issuance of a writ of possession by a
court of competent jurisdiction. In the event Landlord terminates Tenant's
right to possession or terminates this Lease as described in this Section
8.02(a), Tenant shall nonetheless remain liable for Rent under the terms of
this Lease as though Tenant's possession and/or this Lease had continued.
Landlord may, but shall have no obligation to relet the Leased Premises.
Landlord may make such alterations and repairs as may be necessary in order to
relet the Leased Premises, and relet said Leased Premises or any part thereof
for such term or terms (which may be for a term extending beyond the term of
this Lease) and at such rent and upon such other terms and conditions as
Landlord in its sole discretion may deem advisable. Landlord, in attempting to
relet the Leased Premises, may grant concessions of free rent, and may, at
Landlord's option, make such alterations, repairs, replacements and/or
decorations in the Leased Premises, as Landlord, in Landlord's sole judgment,
considers advisable and necessary for the purposes of reletting the Leased
Premises; and the making of such alterations and/or decorations shall not
operate or be construed to release Tenant from liability hereunder as
aforesaid. Landlord shall in no event be liable in any way whatsoever for
failure to relet the Leased Premises, or in the event that the Leased Premises
are relet, for failure to collect the rent therefrom under such reletting. The
failure or unreasonable refusal of Landlord to relet the Leased Premises or any
part or parts thereof shall not release or affect Tenant's liability for
damages or Rent for the balance of the stated Term. Upon each such reletting,
all rents received by Landlord from such reletting shall be applied, first, to
the payment of any costs and expenses of such reletting, including brokerage
fees and attorney's fees and costs of such alterations and repairs; second, to
the payment of Rent due and unpaid hereunder, and the residue, if any, shall be
held by Landlord and applied in payment of future Rent as the same may become
due and payable hereunder. If such rents received from such reletting during
any month shall be less than that to be paid during that month by Tenant
hereunder, Tenant shall pay any such deficiency to Landlord. Such deficiency
shall be calculated and paid monthly or may be accelerated and/or collected as
described in Section 8.02(d)(iii) hereof, at Landlord's sole election. No such
reentry or taking


                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                              Page 16 of 42 Pages


   20
possession of the Leased Premises by Landlord shall be construed as an election
on its part to terminate this Lease unless a written notice of such intention be
given to Tenant or unless the termination thereof be decreed by a court of
competent jurisdiction. Notwithstanding any such reletting without termination,
Landlord may at any time thereafter elect to terminate this Lease or pursue any
other remedy for such previous breach. Should Landlord at any time terminate
this Lease for any breach, in addition to any other remedies it may have, it may
recover from Tenant all damages it may incur by reason of such breach, including
the cost of recovering the Leased Premises, reasonable attorneys' fees, and
including an amount equivalent to the Rent reserved in this Lease for the
remainder of the stated Term, all of which amounts shall be immediately due and
payable from Tenant to Landlord.

     (b) As an alternative to Landlord's rights and obligations set forth in
Section 8.02(a), Landlord shall have the option not to terminate Tenant's right
to possession or terminate this Lease upon an Event of Default, but rather to
take no action, with this Lease continuing in full force and effect, and to
enforce all of Landlord's rights under this Lease (exclusive of the rights and
obligations set forth above in Section 8.02(a)), including without limitation
the right to sue for and recover Rent as it become due, as well as the right to
terminate this Lease.

     (c) In addition to the remedies available to Landlord as described above in
Section 8.02(a) and 8.02(b), Landlord shall also have the right to enforce any
other rights or remedies otherwise applicable by operation of law and Tenant
expressly waives any and all right to assert against Landlord any legal or
equitable defenses and/or doctrines (however, denominated) which would limit or
prohibit Landlord's right to sue for and obtain judgment against Tenant for
monies due by virtue of Landlord's having prosecuted a prior suit which did not
seek to collect the same monies (in whole or part) being sought in a subsequent
suit. In the event of a breach or threatened breach by Tenant of any of the
covenants or provisions hereof, Landlord shall have the rights of injunction and
the right to invoke any remedy allowed at law or in equity as if reentry,
unlawful detainer proceedings and other remedies were not herein provided for.

     (d) In the event of termination of this Lease or termination of Tenants'
right to possession (as a result of an uncured Event of Default or pursuant to
Section 8.02), Landlord shall have:

     (i) The right to remove any and all persons and property from the Leased
Premises, with legal process, and pursuant to such rights and remedies as the
laws of the State of Florida shall then provide or permit, but Landlord shall
not be obligated to effect such removal. Said property may, at Landlord's
option, be stored or otherwise dealt with as provided within this Lease or as
such laws may then provide or permit, including but not limited to the right of
Landlord to sell or otherwise legally dispose of the same or to store the same,
or any part thereof, in a warehouse or elsewhere at the expense and risk of and
for the account of Tenant.


                                        Please Initial:

                                        Landlord: [Illegible]
                                                  ------------------

                                        Tenant:   [Illegible]
                                                  ------------------



                              Page 17 of 42 Pages
   21
     (ii)  The right to recover from Tenant upon termination of this Lease or
termination of Tenant's right to possession under the terms of this Lease the
unpaid Rent and other sums due to Landlord from Tenant which are unpaid, earned
or accrued as of the effective date of termination, plus interest upon such
sums as provided in Section 8.08, calculated from the due date of each such
unpaid, earned or accrued item to the date of payment of such item.

     (iii) The right to recover from Tenant upon termination of Tenant's right
to possession under the terms of this Lease or on termination of this Lease:

     (x)  The amount by which Rent due to Landlord from Tenant under this Lease
for the balance of the stated Term (which is the Term had this Lease not been
terminated) exceeds the lesser of:

     A.   The amount of Rent loss that Tenant proves could reasonably have been
avoided by Landlord through commercially reasonable leasing activities for
such period (in accordance with the reletting standards described in Section
8.02(a) above); or

     B.   The net proceeds received or to be received by Landlord for such
period from reletting of the Leased Premises, if any, as provided in Section
8.02(a) if the Leased Premises are relet in whole or in part pursuant to
Section 8.02(a), during the portion of the Term to which Landlord's claim of
Rent pertains.

     Section 8.03 Landlord's Lien:

     Landlord shall have a first lien and security interest, paramount to all
others, on every right and interest, of Tenant in and to this Lease, and upon
any improvements which may hereafter be placed on the Leased Premises, and on
any furnishings and equipment, including fixtures or personal property of every
kind thereon, which lien and security interest is granted for the purpose of
securing the performance of each and every of the covenants, conditions and
obligations of this Lease to be performed and observed by Tenant. Landlord
shall have at all times a valid lien for all Rent and other sums of money
becoming due hereunder from Tenant, upon all goods, wares, inventory,
equipment, fixtures, furniture and other personal property and effects of
Tenant situated on the Leased Premises, and such property shall not be removed
therefrom without the consent of Landlord until all arrearage in Rent shall
first have been paid and discharged. Upon the occurrence of an Event of Default
by Tenant, Landlord may, in addition to any other remedies provided herein or
by law, enter upon the Leased Premises and take possession of any and all
goods, wares, equipment, fixtures, furniture and other personal property and
effects of Tenant situated on the Leased Premises without liability for
trespass or conversion, and sell the same at public or private sale, with or
without having such property at the sale, at which Landlord or his assigns may
purchase, and apply the proceeds thereof, less any and all expenses connected
with the taking of possession and sale of the property, as a credit against any
sums due by Tenant and Tenant agrees to pay any deficiency forthwith. Tenant
agrees


                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                              Page 18 of 42 Pages


   22
that the said lien and security interest may be enforced by distress,
foreclosure or otherwise, at the election of Landlord, that Landlord shall have
all of the remedies of a secured party under the Uniform Commercial Code, and
that Tenant shall execute such financing statements as shall be necessary to
perfect such interest. The statutory lien for rent, if any, is not hereby waived
and the express contractual lien herein granted is in addition thereto and
supplementary thereto.

     Section 8.04 Waiver of Defenses and Jury Trial:

     IT IS MUTUALLY AGREED BY AND BETWEEN LANDLORD AND TENANT THAT THE
RESPECTIVE PARTIES HERETO SHALL AND THEY HEREBY DO WAIVE TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO
AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT, TENANT'S USE
OR OCCUPANCY OF THE LEASED PREMISES AND/OR ANY CLAIM OF INJURY OR DAMAGE, AND
ANY EMERGENCY OR OTHER STATUTORY REMEDY. IT IS FURTHER AGREED THAT TENANT WAIVES
ANY AND ALL RIGHTS IT MAY HAVE TO ASSERT ANY COUNTERCLAIM, OTHER THAN ONE WHICH
IS COMPULSORY UNDER APPLICABLE LAW, AGAINST LANDLORD IN ANY LEGAL PROCEEDINGS
BROUGHT BY LANDLORD WHICH ARISE OUT OF OR ARE IN ANY WAY RELATED TO THIS LEASE.

     Section 8.05 Rights Cumulative:

     The rights and remedies given to Landlord in this Lease are distinct,
separate and cumulative remedies, and no one of them, whether or not exercised
by Landlord, shall be deemed to be in exclusion of any of the others.

     Section 8.06 Attorneys' Fees:

     Tenant further agrees that in the event its default in the performance of
any of the terms, conditions, or covenants of this Lease requires Landlord, in
the exercise of its sole discretion, to use the services of an attorney to
attempt to or successfully remedy such default, that Tenant will reimburse
Landlord for any and all reasonable expenses incurred in the use of such
attorney and in any action which said attorney may take, whether suit be
instituted or not. Such expenses shall include, but not be limited to legal
fees, court costs, costs of filing and serving summons and/or complaint, etc.




                                        Please Initial:

                                        Landlord: /s/ [Illegible]
                                                  ------------------

                                        Tenant:   /s/ [Illegible]
                                                  ------------------



                              Page 19 of 42 Pages
   23
     Section 8.07 Notice of Default; Service of Three-Day Notice:

     Tenant hereby agrees to designate                    , as its agent to
accept service of the statutory three (3) day notice. In addition, Tenant
hereby agrees that service of said notice upon any employee of Tenant within
the Leased Premises or by posting a copy of the same on the Leased Premises
shall constitute effective and binding service of the same, notwithstanding any
statutory requirements to the contrary.

     Section 8.08 Expenses of Enforcement:

     In the event any payment due Landlord under this Lease shall not be paid
on the due date, said payment shall bear interest at the rate of eighteen
percent (18%) per annum from the due date until paid, unless otherwise
specifically provided herein, but the payment of such interest shall not excuse
or cure any default by Tenant under this Lease. In the event that it shall be
necessary for Landlord to give more than one (1) written notice to Tenant
during the Term of this Lease of any violation of this Lease, Landlord shall be
entitled to make an administrative charge to Tenant of One Hundred Dollars
($100.00) for each such additional notice. Tenant recognizes and agrees that
the charges which Landlord is entitled to make upon the conditions stated in
this Section represent, at the time this Lease is made, a fair and reasonable
estimate and liquidation of the costs of Landlord in the administration of the
Building resulting from the events described which costs are not contemplated
or included in any Rent or other charges provided to be paid by Tenant to
Landlord in this Lease. Any charges becoming due under this Section of this
Lease shall be added and become due with the next ensuing monthly payment of
Fixed Minimum Annual Rent and shall be collectible as a part thereof.

     Section 8.09 Surrender and Holding Over:

     If Tenant or anyone claiming under Tenant shall remain in possession of
the Leased Premises or any part thereof after the expiration of the Term without
an agreement in writing between Landlord and Tenant with respect thereto, the
person remaining in possession shall be deemed a tenant at sufferance, and,
during such holding over, all Fixed Minimum Annual Rent and Additional Rent
payable under this Lease shall be payable at a rate twice the rate in effect
immediately prior to the expiration of the Term. In no event, however, shall
such holding over be deemed or construed to constitute an extension or renewal
of this Lease. Upon the expiration and termination of this Lease, either by
lapse of time or otherwise, Tenant shall surrender to Landlord the Leased
Premises in "broom clean" condition, and in good repair, reasonable wear and
tear excepted.

                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                              Page 20 of 42 Pages


   24
                                   ARTICLE IX

                                  ALTERATIONS

     Tenant shall not make any alterations, improvements, repairs, installations
or removals or additions ("Alterations") to the Leased Premises during the Term
of this Lease or any extension or renewal thereof, without first obtaining the
written consent of Landlord, which will not be unreasonably withheld, and it
shall not cut or drill into, or secure any fixture, apparatus or equipment of
any kind to any part of the Leased Premises without first obtaining the written
consent of Landlord. All Alterations made by Tenant as aforesaid shall remain
upon the Leased Premises at the expiration or earlier termination of this Lease
and shall become the property of Landlord, unless Landlord shall, prior to the
expiration or termination of this Lease, have given written notice to Tenant to
remove the same, in which event Tenant shall remove such Alterations and restore
the Leased Premises to the same good order and condition in which it was at the
commencement of this Lease. Should Tenant fail to do so, Landlord may do so,
collecting, at Landlord's option, the cost and expense thereof from Tenant as
Additional Rent.

     Tenant shall procure all necessary permits before making any Alterations.
Tenant agrees that all Alterations done by it at its request, or anyone claiming
under it, shall be done in a lien free and good and workmanlike manner of first
class institutional office building quality, that the same shall be done in
conformity with all laws, ordinances and regulations of all public authorities,
that the structure of the Leased Premises shall not be endangered or impaired
and that Tenant shall repair all damages caused by or resulting from any such
Alterations.

                                   ARTICLE X

                                 TRADE FIXTURES

     All trade fixtures installed by Tenant in the Leased Premises shall be new
or completely reconditioned and may remain the property of Tenant and shall be
removable at the expiration or earlier termination of this Lease, provided
Tenant shall not at such time be in default under any covenant or agreement
contained in this Lease; provided further, that in the event of such removal,
Tenant shall promptly restore the Leased Premises to their original order and
condition. Any such trade fixtures not removed at or prior to such termination
shall be and become the property of Landlord. All improvements and fixtures
installed by Tenant, (other than trade fixtures) including, but not limited to
heating equipment, lighting fixtures, air-conditioning equipment, ceiling, wall
treatment, floor covering, plumbing and electrical systems and fixtures, whether
or not installed by Tenant, shall not be removable by Tenant and shall become
the property of Landlord without any compensation therefor to Tenant, upon the
termination of this Lease.



                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                  ------------------

                                        Tenant:   /s/ [illegible]
                                                  ------------------



                              Page 21 of 42 Pages
   25
                               A R T I C L E  XI

                                QUIET ENJOYMENT

     Upon payment by Tenant of the Fixed Minimum Annual Rent and Additional
Rent herein provided, and upon the observance and the performance of all of the
covenants, terms and conditions on Tenant's part to be observed and performed,
Tenant shall peaceably and quietly hold and enjoy the Leased Premises for the
Term hereby demised without hindrance or interruption by Landlord or any other
person or persons lawfully or equitably claiming by, through or under Landlord,
subject, nevertheless to the terms and conditions of this Lease.

                               A R T I C L E  XII

                                  MAINTENANCE

     Tenant shall, at all times, keep the Leased Premises (including
maintenance of its entrances and all glass) and all interior partitions, doors,
fixtures and equipment in good order, condition and repair, except for the
structural portions and the lighting, (including replacement of standard lamps
and bulbs), heating, plumbing fixtures and air-conditioning system of the
Leased Premises, which shall be maintained by Landlord. Tenant further agrees
to replace promptly at its own expense with glass of a like kind and quality
any plate glass or window glass of the Leased Premises which may become cracked
or broken by reason of Tenant's negligence; not to place or maintain articles
in the vestibule or entry of the Leased Premises, in the hallway adjacent
thereto or elsewhere on the exterior thereof; not to permit accumulations of
garbage, trash, rubbish and other refuse, and to keep such refuse in proper
containers (or in trash room maintained by Tenant) in the interior of the
Leased Premises until removed; not to use or permit the use of any apparatus
for sound reproduction or transmission or of any musical instrument in such
manner that the sound so reproduced, transmitted or produced shall be audible
beyond the interior of the Leased Premises; to keep all mechanical apparatus
free of vibration and noise which may be transmitted beyond the confines of the
Leased Premises; not to cause or permit objectionable odors to emanate or be
dispelled from the Leased Premises; to comply with all laws and ordinances and
all valid rules and regulations of any Federal, State, Municipal or public
authority having jurisdiction over the Leased Premises and Landlord, and all
recommendations of any public or private agency having authority over insurance
rates with respect to the use or occupancy of the Leased Premises by Tenant;
and to conduct its business in the Leased Premises in all respects in a
dignified manner and in accordance with high standards of office operation. In
the event Landlord is required to make repairs to structural portions of the
Leased Premises by reason of Tenant's negligent acts or omissions to act,
Landlord may charge the actual cost of such repairs to Tenant and such cost
shall thereafter become due as Additional Rent.


                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                              page 22 of 42 Pages



   26
                                  ARTICLE XIII

                                     SIGNS

     Tenant hereby agrees that it will not place or suffer to be placed or
maintained on any exterior door, wall or window of the Leased Premises any
signs, awning, or canopy, or advertising matter or other thing of any kind, and
will not place or maintain any decoration, lettering or advertising matter on
the glass of any window or door of the Leased Premises which is not in
conformity with the Rules and Regulations of the Building as set forth by
Landlord without first obtaining Landlord's written approval and consent, which
shall not be unreasonably withheld. Landlord agrees and hereby consents to
Tenant placing Tenant's name on the entrance to the Leased Premises. Tenant
further agrees to maintain such sign, decoration, lettering, advertising matter
or other thing as may be approved or provided by Landlord in good condition and
repair at all times. Tenant further acknowledges that Landlord may regulate the
lettering, size, placement, color and design of Tenant's sign.

                                  ARTICLE XVI

                                    PARKING

     (a) For a period of ninety (90) days after the Commencement Date of the
Lease, Tenant shall be given the opportunity to obtain from Landlord and/or the
Garage operator the right to park a maximum of one (1) automobile for each four
hundred (400) square feet of premises leased hereunder (rounded to the nearest
whole number of parking spaces) in the Garage at the prevailing monthly rates
established by Landlord from time to time. Once exercised within the said ninety
(90) day period, this right, with respect to each designated automobile, or
designated substitute therefor, shall continue in effect during the Term of this
Lease so long as the applicable monthly parking fee shall continue to be paid to
Landlord or the Garage operator as the case may be.

     Tenant and its employees shall park only in those spaces which are
designated by Landlord for the use of tenants of the Building. The use of the
Garage shall be governed by rules and regulations adopted from time to time by
Landlord or the Garage operator.

     (b) Tenant shall furnish Landlord with a list of its employees' vehicle
license numbers within fifteen (15) days after taking possession of the Leased
Premises and Tenant shall thereafter notify Landlord of any change in such list
within five (5) days after such change occurs. Tenant agrees to assume
responsibility for compliance by its employees with the parking provisions
contained herein. Tenant further agrees that upon the second notice by Landlord
or its representative, that if any of Tenant's employees shall have parked its
vehicle in a portion of the parking area not designated for tenants of the
Building, then and in that event



                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                  ------------------

                                        Tenant:   /s/ [illegible]
                                                  ------------------



                              Page 23 of 42 Pages
   27
Landlord shall have the power and the right to require Tenant to pay to
Landlord the sum of twenty-five ($25.00) Dollars per day, per incident, for
each day the violation continues.

     (c) Landlord shall not be liable for any damage whatsoever to, or any
theft of, automobiles or other vehicles or the contents thereof, while in or
about the Building parking area.

                                   ARTICLE XV

                            MISCELLANEOUS PROVISIONS

     Section 15.01 Memorandum of Lease:

     The parties hereto agree that neither this Lease nor any notice thereof or
reference thereto shall be recorded in any public records, except that Landlord
only may request a memorandum of the pertinent portions hereof be recorded in
the public records of Miami-Dade County, Florida. Such memorandum shall in all
events contain the provisions of this Lease giving notice that Landlord's
interest in the Leased Premises shall not be subject to any mechanic's liens as
a result of any contracts entered into between Tenant and any third party, or
arising out of or related to any improvements made to the Leased Premises or
materials or services applied thereto which may be ordered by Tenant. In the
event of such a request by Landlord, Tenant shall join in the execution of such
memorandum for the purpose of recordation.

     Section 15.02 Notices:

     Wherever in this Lease it shall be required or permitted that notice or
demand be given or served by either party to this Lease to or on the other,
such notice or demand shall not be deemed to have been duly given or served
unless in writing, and either personally delivered or delivered by overnight
mail or forwarded by Certified Mail, Return Receipt Requested, postage prepaid,
addressed as follows:


     TO THE LANDLORD AT                 2601 South Bayshore Dr.
                                        Suite 900
                                        Miami, Florida 33133
                                        Attn: Brian K Goodkind
                                        Senior Vice President






                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------



                              Page 24 of 42 Pages


   28
TO THE TENANT AT:
                         -------------------------------------------

                         -------------------------------------------


     Such addresses may be changed from time to time by either party by serving
notices as above provided. No notice under this paragraph is effective until
actually delivered to the office of the addressee as listed above.

     Section 15.03 Access to Leased Premises:

     Landlord or Landlord's agents shall have the right to enter the Leased
Premises at all times to examine the same, and to show them to prospective
purchasers, mortgagees, or lessees of the Building, and to make such Alterations
as Landlord may deem necessary or desirable, and the Fixed Minimum Annual Rent
and Additional Rent reserved herein shall not abate while said Alterations are
being made by reason of loss or interruption of business of Tenant or otherwise.
However, nothing herein contained shall be deemed or construed to impose upon
Landlord any obligation, responsibility or liability whatsoever, for the care,
maintenance, or repair of the Building or any part thereof, except as otherwise
herein specifically provided. In the event of an emergency, if Tenant shall not
be personally present to open and permit an entry into said Leased Premises,
Landlord or Landlord's agents may forcibly enter the same, without rendering
Landlord or Landlord's agents liable therefore, and without in any manner
affecting the obligations and covenants of this Lease.

     Section 15.04 Assignment and Subletting:

     (a) Tenant shall not assign, mortgage, pledge or encumber this Lease, in
whole or in part, nor sublet the whole or any part of the Leased Premises, nor
permit the use of the whole or any part of the Leased Premises, by any licensee,
without first obtaining the written consent of Landlord in each instance, which
consent shall not be unreasonably withheld or delayed by Landlord, if (i) the
business to be conducted by such assignee and/or subtenant shall in all respects
be in accordance with the provisions of this Lease, including, without
limitation, the requirements relating to Tenant's permitted use of the Leased
Premises, (ii) such assignee and/or subtenant shall have a net worth which is
sufficient to fulfill all of Tenant's obligations under this Lease and an
operating history which is substantially similar to that of Tenant, and (iii)
such assignee and/or subtenant shall not be (x) an existing tenant of the Office
Building or other office buildings owned and/or managed by the Landlord, or (y)
an entity with which Landlord has engaged in negotiations for space in the
Office Building or other office buildings owned and/or managed by Landlord
within the previous twelve (12) months, or (z) any entity controlling,
controlled by, under common control with, or in


                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                  ------------------

                                        Tenant:   /s/ [illegible]
                                                  ------------------



                              Page 25 of 42 Pages
   29
any way related to the entities described in (x) and (y) above. This
prohibition shall be construed to include a prohibition against any assignments
or subletting by operation of law. In the event of any such assignment,
subletting or licensing made with the written consent of Landlord, as
aforesaid, Tenant will nevertheless remain liable for the performance of all of
the terms, conditions and covenants of this Lease. Any permitted assignment,
subletting or license shall be by an agreement in form and content acceptable
to Landlord.

     (b) If Landlord consents to any assignment, sublease or occupancy pursuant
to this Section, Tenant shall pay Landlord, as Additional Rent:

          (i)  in the case of each and every assignment, an amount equal to ALL
monies, property, and other consideration of every kind whatsoever paid or
payable to Tenant by the assignee for such assignment and for all property of
Tenant transferred to the assignee as part of the transaction (including, but
not limited to, fixtures, other leasehold improvements, furniture, equipment
and furnishings); and

          (ii) in the case of each and every sublease or occupancy arrangement,
ALL rent, additional rent, and/or other monies, property, and consideration of
every kind whatsoever paid or payable to Tenant by the subtenant under the
sublease or occupant under occupancy arrangement, LESS all Rent under this
Lease accruing during the term of the sublease or occupancy arrangement in
respect of the subleased or occupied space (as reasonably determined by
Landlord, taking into account the useable area of the Leased Premises demised
under the sublease or occupancy arrangement).

     (c) No such assignment, subletting or occupancy arrangement shall be
deemed a waiver of this covenant, or the acceptance of the assignee, subtenant
or occupant as Tenant, as a release of Tenant from the further performance by
Tenant of the covenants on the part of Tenant herein contained.

     (d) If Tenant is a corporation, and if at any time during the Lease Term,
without the written consent of Landlord, the person or persons who own majority
of its voting shares at the time of the execution of this Lease cease to own a
majority of such shares (except as a result of transfers by bequest or
inheritance), Tenant shall so notify Landlord and Landlord may terminate this
Lease by notice to Tenant given within Ninety (90) days thereafter. Any consent
by Landlord to an assignment or subletting of this Lease or occupancy
arrangement shall not constitute a waiver of the necessity of such consent to
any subsequent assignment, subletting or occupancy arrangement.

     Section 15.05 Subordination and Attornment:

     a) This Lease and all rights of Tenant hereunder are and shall be subject
and subordinate to the lien of and all terms and conditions of any and all
mortgages entered into by Landlord which may now or hereafter encumber the
Leased Premises and/or any or all portions of the Building, and to all renewals,




                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                              Page 26 of 42 Pages


   30
modifications, amendments, consolidations, replacements and extensions thereof
and to any and all ground lease(s) or master lease(s) of the Building or any
lien resulting from any method of financing or refinancing and all terms and
conditions thereunder, now or hereafter in force against the Land and Building
or upon any buildings hereafter placed upon the Land and to all advances made or
hereafter to be made upon the security thereof. This subordination shall be
self-operative and no further instrument of subordination shall be required for
its operation. Tenant agrees, however, upon demand, to execute promptly such
instruments, without expense to Landlord, as Landlord or a mortgagee may
reasonably request to further evidence the subordination of this Lease to any
existing or future mortgage or other security agreement, ground lease or master
lease.

     (b) In the event any proceedings are brought for the foreclosure of, or in
the event of exercise of the power of sale under any mortgage made by Landlord
covering the Leased Premises, or in the event a deed is given in lieu of
foreclosure of any such mortgage, or upon the assignment of this Lease by
Landlord, Tenant shall attorn to the purchaser or grantee in lieu of
foreclosure, upon any such foreclosure or sale, and recognize such purchaser or
grantee in lieu of foreclosure, as Landlord under this Lease. Notwithstanding
anything contained in this Lease to the contrary, such Landlord, mortgagee or
purchaser at said foreclosure sale, shall not be:

     (i)   Liable for any act or omission of any prior Landlord;

     (ii)  Subject to any offsets or defenses which Tenant may have against any
           prior Landlord;

     (iii) Bound by any Fixed Minimum Annual Rent or Additional Rent which
           Tenant may have paid to any prior Landlord for more than the current
           month; or,

     (iv)  Bound by any amendment, termination or modification to Tenant's Lease
           which was not approved by the then existing mortgagee.


     (c) Tenant shall execute promptly any such instruments or certificates
required to carry out the intent of this Section as shall be requested by
Landlord and/or Landlord's mortgagee and to impose such other terms and
conditions requested by Landlord or Landlord's mortgagee. Tenant hereby
irrevocably appoints Landlord as attorney in fact for Tenant with full power and
authority to execute and deliver in the name of Tenant, any such instruments or
certificates required pursuant to this Section. If within ten (10) days after
the date of a written request by Landlord to execute such instrument, Tenant
shall not have executed same, Landlord may, at its option, cancel this Lease
without incurring any liability on account therefor.



                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                  ------------------

                                        Tenant:   /s/ [illegible]
                                                  ------------------



                              Page 27 of 42 Pages

   31
     Section 15.06 Mechanic's Liens:

     Tenant shall not do any act, nor is Tenant authorized to make any contract
which may create or be the foundation for any lien or other encumbrance upon
any interest of Landlord or any ground or underlying landlord in any portion of
the Building. If, because of any act or omission (or alleged act or omission)
of Tenant, any mechanic's or other lien, charge or order for the payment of
money or other encumbrance shall be filed against Landlord, and/or any ground
or underlying landlord, and/or any mortgagee, and/or any portion of the
Building (whether or not such lien, charge, order or encumbrance is valid or
enforceable as such), Tenant shall, at its own cost and expense, cause the same
to be discharged of record or bonded within thirty (30) days after notice to
Tenant of the filing thereof; and Tenant shall indemnify and save harmless
Landlord, all ground and underlying landlord(s), and all mortgagees against and
from all costs, liabilities, suits, penalties, claims and demands, including
attorneys' fees and appellate attorneys' fees resulting therefrom. In the event
Tenant fails to comply with the foregoing provisions of this Section, Landlord
shall have the option of discharging or bonding any such lien, charge, order,
or encumbrance by payment or otherwise, and Tenant agrees to reimburse Landlord
for all costs, expenses and other sums of money in connection therewith (as
Additional Rent) with interest at the rate of eighteen percent (18%) per annum
promptly upon demand.

     Section 15.07 Entire Agreement:

     This Lease and the exhibits and addenda, if any, attached hereto and
forming a part hereof, set forth all the covenants, promises, agreements,
conditions and understandings between Landlord and Tenant concerning the Leased
Premises, and there are no covenants, promises, agreements, conditions or
understandings, either oral or written, between them other than as set forth
herein. Except as herein otherwise provided, no subsequent alteration,
amendment, change or addition to this Lease shall be binding upon Landlord or
Tenant unless reduced to writing and signed by each.

     Section 15.08 No Partnership:

     Landlord shall not, in any way or for any purpose, be deemed to become a
partner of Tenant, in the conduct of its business or otherwise, or joint
venturer or a member of a joint enterprise, with Tenant.

     Section 15.09 Captions and Section Numbers:

     The captions, section numbers, article numbers and table of contents
appearing in this Lease are inserted only as a matter of convenience and in no
way define, limit, construe or describe the scope or intent of such Sections or
Articles of this Lease, nor in any way affect this Lease.



                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                              Page 28 of 42 Pages


   32
     Section 15.10 Partial Invalidity:

     If any term, covenant or condition of this Lease, or the application
thereof to any person or circumstance shall to any extent be invalid or
unenforceable, the remainder of this Lease, or the application of such term,
covenant or condition to persons or circumstances other than those to which it
is held invalid or unenforceable, shall not be affected thereby and each other
term, covenant and condition of this Lease shall be valid and be enforced, to
the fullest extent permitted by law.

     Section 15.11 Governing Law:

     This Lease has been made and executed in the State of Florida and shall be
construed and enforced in accordance with the laws of the State of Florida.

     Section 15.12 Waiver:

     The waiver by Landlord of any breach of any term, covenant or condition
herein contained shall not be deemed to be a waiver of such term, covenant or
condition or any subsequent breach of the same or any other term, covenant or
condition herein contained. The subsequent acceptance of Rent hereunder by
Landlord shall not be deemed to be a waiver of any particular breach by Tenant
of any term, covenant or condition of this Lease, regardless of Landlord's
knowledge of such preceding breach at the time of the acceptance of such Rent.
No covenant, term or condition of this Lease shall be deemed to have been
waived by Landlord, unless such waiver be in writing by the Landlord.

     Section 15.13 Accord and Satisfaction:

     No payment by Tenant or receipt by Landlord of a lesser amount other than
the Rent herein stipulated shall be deemed to be other than on account of the
stipulated Rent, nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as Rent be deemed an accord and
satisfaction, and Landlord may accept such check or payment without prejudice
to Landlord's right to recover the balance of such Rent or pursue any other
remedy provided in this Lease.

     Section 15.14 Successors and Assigns:

     All rights, obligations and liabilities herein, given to, or imposed upon
the respective parties hereto shall extend to and bind the several and
respective heirs, executors, administrators, successors, sublessees and assigns
of said parties; provided, however, that the liability of Landlord hereunder
and any successor in interest and title to the Leased Premises shall be limited
to his or its interest in the Land and Building, and no other assets of
Landlord other than his or its interest in the Land and Building shall be
affected by reason of


                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------



                              Page 29 of 42 Pages
   33
any liability which Landlord or its successor in interest may have under this
Lease. Any and all such liability imposed on Landlord shall terminate upon
Landlord's transfer, sale, assignment or hypothecation of his or its interest in
the Land and Building. If there shall be more than one Tenant, they shall all be
bound jointly and severally by the terms, covenants and agreements herein and
the word "Tenant" shall be deemed and taken to mean each and every person or
party mentioned as a Tenant herein, be the same one or more; and if there shall
be more than one Tenant, any notice required or permitted by the terms of this
Lease, may be given by or to any one thereof and shall have the same force and
effect as if given by or to all thereof. No rights, however, shall inure to the
benefit of any assignee of Tenant unless the assignment to such assignee has
been approved by Landlord in writing as aforesaid.

     Section 15.15 Brokerage Indemnity:

     Landlord and Tenant each hereby represent and warrant to the other that
they have dealt with no broker, finder or similar agent, in connection with this
Lease. In the event that any broker or agent claims a brokerage fee in
connection with this transaction, the party who procured the services of such
broker or on whose behalf such broker was working if the former cannot be
determined, agrees to pay said fee and to indemnify and hold harmless the other
party from and against any and all liability and expense in connection with any
commissions, compensation or otherwise for the bringing about of this
transaction or the consummation thereof, including reasonable attorneys' fees
(in an effort to defend the brokerage claim), for the non-responsible party
should it be joined in litigation.

     Section 15.16 Condition of Leased Premises:

     Taking possession of the Leased Premises by Tenant shall be conclusive
evidence as against Tenant that the Leased Premises were in good and
satisfactory condition when possession was so taken.

     Section 15.17 Taxes:

     Tenant shall be responsible for and shall pay before delinquency all
municipal county or state taxes assessed during the Term of this Lease against
any occupancy interest or personal property of any kind, owned by or placed in,
upon or about the Leased Premises by Tenant.

     Tenant shall also pay to Landlord any sales, use or excise tax, or any
similar tax assessed or levied with respect to the Rent received by Landlord and
with respect to any amounts receivable by Landlord under this Lease or otherwise
as may be now or hereafter authorized by the laws of any governmental authority
having jurisdiction in the matter, whether federal, state, county or municipal.



                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                  ------------------

                                        Tenant:   /s/ [illegible]
                                                  ------------------



                              Page 30 of 42 Pages
   34
     Section 15.18 Prior Occupancy:

     If Tenant, with Landlord's consent, shall occupy the Leased Premises prior
to the beginning of the Lease Term specified in Section 1.03 hereof, all
provisions of this Lease shall be in full force and effect commencing upon such
occupancy, and Rent for such period shall be paid by Tenant at the rate herein
specified.

     Section 15.19 Time and Consent:

     It is understood and agreed hereto that time is of the essence regarding
all the terms, provisions, covenants and conditions of this Lease. Unless
otherwise provided herein to the contrary, whenever the consent of either party
shall be required hereunder such consent shall not be unreasonably withheld or
delayed.



                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------




                              Page 31 of 42 Pages



   35
     Section 15.21 Security Deposit:

     Tenant has deposited with Landlord the sum of $ None       as security for
the faithful performance and observance by Tenant of the terms, provisions and
conditions of this Lease. It is agreed that in the event tenant defaults in
respect of any of the terms, provisions and conditions of this Lease,
including, but not limited to, the payment of Rent, Landlord may use, apply or
retain the whole or any part of the security so deposited to the extent
required for the payment of any such Rent or any other sum as to which Tenant
is in default or for any sum which Landlord may expend or may be required to
expend by reason of Tenant's default in respect of any of the terms, covenants
and conditions of this Lease, including but not limited to, any damages or
deficiency in the reletting of the Leased Promises, whether such damages or
deficiency accrued before or after summary proceedings or other re-entry by
Landlord. In the event that Tenant shall fully and faithfully comply with all
of the terms, provisions, covenants and conditions of this Lease, the security
shall be returned to Tenant after the date fixed as the end of this Lease and
after delivery of entire possession of the Leased Premises to Landlord. In the
event of a sale of the Land and Building or lease thereof, Landlord shall have
the right to transfer the security to the vendee or Lessee and Landlord shall
thereupon be released by Tenant from all liability for the return of such
security, and term agrees to look to the new Landlord solely for the return of
said security, and it is agreed that the provisions hereof shall apply to every
transfer or assignment made of the security to a new Landlord. Tenant further
covenants that it will not assign or encumber or attempt to assign or encumber
the monies deposited herein as security and that neither Landlord nor its
successors or assigns shall be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance.

     In the event Landlord uses, applies or retains the whole or any part of
the security deposited with Landlord in accordance with this Section 15.21,
Tenant shall, within three (3) days of Landlord's demand, pay to Landlord the
sum so used, applied or retained which shall be added to the security deposit
so that the same shall be replenished to its former amount.

     Section 15.22 Hazardous Waste:

     Tenant shall not use, handle, store, display or generate in the Leased
Premises any materials which are toxic, ignitable, corrosive or reactive or any
other hazardous materials without compliance with any and all applicable
federal, state or local laws and regulations.

     Tenant shall indemnify, defend and hold harmless Landlord against and from
any and all liability, damages, judgments, costs, fees and expenses, including
without limitation thereto, reasonable attorneys' fees at all levels, which may
be incurred by Landlord in complying with, or curing a violation by Tenant of
this Section.



                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                              Page 32 of 42 Pages



   36
     Section 15.23 Approval of Lender:

     The terms and conditions of this Lease are subject to prior written
approval of Landlord's mortgagee. Further, Landlord and Tenant shall not,
without the prior written consent of Landlord's mortgagee, to the extent such
consent is required under then existing loan documents, voluntarily by
agreement terminate, cancel or surrender this Lease or any part thereof, except
as provided herein, or modify this Lease or accept or pay rent of more than one
month in advance of its due date.

     Section 15.24 Estoppel Statement:

     Tenant shall at any time and from time to time upon not less than ten (10)
days' prior written notice from Landlord execute, acknowledge and deliver to
Landlord a statement in writing certifying to Landlord or any current or
prospective purchaser, assignee, sublessees, mortgagee (or beneficiary under a
deed of trust) or underlying lessor: (a) that this Lease is unmodified and in
full force and effect (or, if modified, adequately identifying such modification
and certifying that this Lease as so modified is in full force and effect), (b)
the commencement and termination dates of the Lease Term and the dates on which
the Fixed Minimum Annual Rent, Additional Rent charges and other charges are
paid, (c) whether or not there is any default by Landlord or Tenant in the
performance of any term, covenant, condition, provision or agreement contained
in this Lease and further whether or not there are any setoffs, defenses or
counterclaims against enforcement of the obligations to be performed under this
Lease and, if there are, specifying each such default, setoff, defense or
counterclaim, and (d) such other matters as Landlord or Landlord's mortgagee may
reasonably request in writing. Any such statement may be conclusively relied
upon by any prospective purchaser, assignee, subtenant, landlord or encumbrancer
of this Lease or of all or any portion of the Building. Tenant's failure to
deliver such statement within such time shall be deemed a statement that this
Lease is in full force and effect, without modification except as may be
represented by Landlord in such request, that there are no uncured defaults in
Landlord's or Tenant's performance, and that not more than one month's Fixed
Minimum Annual Rent has been paid in advance. Furthermore, in the event Landlord
has agreed to make and has completed the Leasehold Improvements under the
applicable provisions of Sections 15.16 and 15.20 of the Leasehold Agreement,
the Tenant shall provide within the ten (10) day time period referred to above,
the Tenant Estoppel Certificate in the form attached hereto as Exhibit "C-1" or
as subsequently modified as required by Landlord's mortgagee.

     Section 15.25 Rules and Regulations:

     Tenant shall observe those Rules and Regulations reasonably promulgated by
Landlord the first of which are attached hereto as Exhibit "D" and made a part
hereof. Landlord agrees that it will not modify such Rules and Regulations so
as to in any way (a) reduce the obligations of Landlord under this Lease; (b)
interfere with Tenant's use or enjoyment of the Leased Premises for the uses
permitted hereunder or


                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------



                              Page 33 of 42 Pages


   37
negate its rights given hereunder; (c) interfere with the conduct of Tenant's
normal business; or (d) create any new material obligations or burdens upon
Tenant New Rules or Regulations shall not be effective for a reasonable period
of notice consistent with the nature of the matter being regulated. Landlord
shall not be liable to Tenant for violation of any of said Rules and
Regulations, or the breach of any term, covenant, condition, provision or
agreement in any lease, by any other tenant or other party in the Building, but
Landlord shall operate, manage, maintain and repair the Building in accordance
with this Lease. The provisions of the Rules and Regulations provided for in
this Lease are qualified in the entirety by the provisions of this Lease and in
the event of conflict between this Lease and the Rules and Regulations, this
Lease shall govern.

     Section 15.26 Guaranty:


     Section 15.27 Radon Gas Disclosure:

     Radon is a naturally occurring radioactive gas that, when it has
accumulated in a building in sufficient quantities, may present health risks to
persons who are exposed to it over time. Levels of radon that exceed federal
and state guidelines have been found in buildings in Florida. Additional
information regarding radon and radon testing may be obtained from your county
public health unit.



                                        Please Initial:

                                        Landlord: /s/ [illegible]
                                                 --------------------

                                        Tenant: /s/ [illegible]
                                               ----------------------


                              Page 34 of 42 Pages
   38
     IN WITNESS WHEREOF, Landlord and Tenant have signed and sealed this Lease
as of the date and year first above written.


Witnessed in the Presence of:           LANDLORD:
                                        IRRADIO HOLDINGS, LTD.
                                        a Florida limited partnership
/s/ signature illegible                 By: Terremark Management Services, Inc.
- ----------------------------            a Florida corporation, Managing Agent
As to Landlord



/s/ signature illegible                 By /s/ William J. Biondi
- ----------------------------               -----------------------------
As to Landlord                              William J. Biondi, President



                                        TENANT:
/s/ signature illegible                 SPANISH BROADCASTING SYSTEM, INC.
- ----------------------------            a Florida corporation
As to Landlord



/s/ signature illegible                 By /s/ signature illegible
- ----------------------------               -----------------------------
As to Tenant




                                             Please Initial

                                             Landlord:  Initial illegible
                                                        ------------------
                                             Tenant:    Initial illegible
                                                        ------------------


                              Page 35 of 42 Pages
   39
                                  EXHIBIT "B"

                               LEGAL DESCRIPTION

     Lots 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22 and the
unnumbered Lot is also known as 32, in block 39, of the AMENDED PLAT OF NEW
BISCAYNE, according to the Plat thereof, as recorded in Plat Book "B", at Page
16, of the Public Records of Dade County, Florida.

     Lot 1, Block 39, of NEW BISCAYNE, according to the Plat thereof, as
recorded in Plat Book "B", at Page 16, of the Public Records of Dade County,
Florida, LESS a triangular strip of land described as follows:

     Beginning at the NE corner of said Lot 1, Block 39, running thence
Southwesterly along the South side of Tiger Trail Avenue, also known as Tiger
Tail Avenue, 40 feet for POINT OF BEGINNING, running thence Northeasterly along
the South side of Tiger Trail Avenue, also known as Tiger Tail Avenue, 40 feet
to the corner of Tiger Trail Avenue, also known as Tiger Tail Avenue and Trade
Street, thence running Southeasterly along the Westerly side of Trade Street 7
1/2 feet; thence Southwesterly to POINT OF BEGINNING.

     and

     All of the Lots 23, 24, 25, 26, 27, 28, 29, 30 and 31, Block 39, of NEW
BISCAYNE, according to the Plat thereof, as recorded in Plat Book "B", at Page
16, of the Public Records of Dade County, Florida.

     Lots 2, 3, and 4 Block 39, of AMENDED MAP OF NEW BISCAYNE, according to
the Plat thereof, as recorded in Plat Book "B", at Page 16, of the Public
Records of Dade County, Florida, together with improvements thereon.

     All of the foregoing parcel being particularly described as follows:

     BEGIN at the most southerly corner of Lot 4, Block 39, AMENDED PLAT OF NEW
BISCAYNE, according to the Plat thereof, as recorded in Plat Book "B," at Page
16, of the Public Records of Dade County, Florida; thence run North 24 20'44"
West along the Southwesterly boundary of said Lot 4 for a distance of 574.27
feet to the most Westerly corner thereof, thence run North 65 27'14" East along
the Northwesterly boundary of a portion of Lot 1 and Lots 2, 3 and 4 of Block
39, of said AMENDED PLAT OF NEW BISCAYNE for a distance of 209.57 feet to a
point of deflection; thence run North 76 04'31" East for a distance of 40.69
feet to the point of intersection with the Northeasterly boundary of said Lot
1, said point being on the Southwesterly Right-Of-Way Boundary of Aviation
Avenue (formerly known as Trade Avenue); thence run South 24 24'16" East along
the last described line, being also the Northeasterly boundary of portion of
Lot 1, Lots 7 through 31, both inclusive and the unnumbered Lot, Block 39, of
said AMENDED PLAT OF NEW BISCAYNE, for a distance of 577.62 feet to the most
Easterly corner of the unnumbered Lot, said corner being on the Northwesterly
Right-Of-Way boundary of South Bayshore Drive, thence run South 67 56'14" West
along the last described line, being also the Southeasterly boundary of said
unnumbered Lot and said Lots 2, 3 and 4, for a distance of 250.38 feet to the
POINT OF BEGINNING, containing an area of 144,683.72 square feet, more or less,
or 3.32 Acres, more or less.
   40
                       EXHIBIT D - RULES AND REGULATIONS


     1.   Tenant will refer all contractors, contractors' representatives and
installation technicians rendering any service for Tenant, to Landlord for
Landlord's supervision and/or approval before performance of any such
contractual services. This shall apply to all work performed in the Building
including, but not limited to, installation of telephones, telegraph equipment,
electrical devices and attachments, and installations of any and every nature
affecting floors, walls, woodwork trim, windows, ceilings, equipment or any
other physical portion of the Building. None of this work will be done by
Tenant without Landlord's written approval first had and obtained.


     2.   The work of the janitor or cleaning personnel shall not be hindered
by Tenant after 5:30 p.m., and such work may be done at any time when the
offices are vacant. The windows, doors, and fixtures may be cleaned at any
time. Tenant shall provide adequate waste and rubbish receptacles, cabinets,
book cases, map cases, etc., necessary to prevent unreasonable hardship to
Landlord in discharging its obligation regarding cleaning service.

     3.   Movement in or out of the Building of furniture or office equipment,
or dispatch or receipt by Tenant of any merchandise or materials which require
the use of elevators or stairways, or movement through the Building entrances or
lobby shall be restricted to the hours designated by Landlord from time to time.
All such movement shall be as directed by Landlord and in a manner to be agreed
upon between Tenant and Landlord by prearrangement before performance. Such
prearrangement initiated by Tenant shall include determination by Landlord and
subject to its decision and control for the time, method, and routing of
movement, limitations imposed by safety or other concerns which may prohibit any
article, equipment or any other item from being brought into the Building.
Tenant expressly assumes all risk of damage to any and all articles so moved, as
well as injury to any person or persons or the public engaged in or not engaged
in such movement, including equipment, property, and personnel of Landlord, if
damaged or injured as a result of any acts in connection with the performance of
this service for Tenant, from the time of entering the Building until completion
of the work, and Landlord shall not be liable for the act or acts of any person
or persons so engaged, or any damage or loss to any property or persons
resulting, directly or indirectly, from any act in connection with such service
performed by or for Tenant.

     No sign or signs will be allowed in any form on the exterior of the
Building or on any window or windows inside or outside of the Building and
no sign or signs, except in uniform location and uniform style fixed by
Landlord, will be permitted in the public corridors or on corridor doors or
entrance to Tenant's space. All sign will be contracted for by Landlord for
Tenant at the rate fixed by Landlord from time to time, and Tenant will be
billed and pay for such service accordingly. Written consent from Landlord is
an absolute prerequisite for any such sign or signs any Tenant may be so
permitted to use.




   41
     5.   Tenant shall not place, install or operate on the Leased Premises or
in any part of the Building, any engine, stove, machinery, or conduit
mechanical operation or cook thereon or therein, or place or use in or about
the Leased Premises any explosives, gasoline, kerosene, oil, acids, caustics,
or any other inflammable, explosive or hazardous material without the written
consent of Landlord first had and obtained. Landlord grants into Tenant the
right to utilize a microwave oven in the kitchen of the Leased Premises.

     6.   Landlord will not be responsible for any lost or stolen personal
property, equipment, money, or jewelry from Tenant's area or public rooms
regardless of whether or not such loss occurs when the area is locked against
entry.

     7.   No birds, animals, bicycles or vehicles shall be brought into or kept
in or about the Building.

     8.   No additional locks shall be placed upon any doors of the Leased
Premises and Tenant shall not permit any duplicate keys to be made, but if more
than two keys for any door or lock shall be desired, the additional number must
be obtained from Landlord and be paid for by Tenant; each Tenant must, upon the
termination of this Lease, leave the windows and doors in the Leased Premises in
like condition as of the date of said Lease, and must then surrender all keys to
Landlord. Landlord may permit entrance to Tenant's offices by use of passkeys
controlled by Landlord or employees, contractors, or service personnel
supervised or employed by Landlord.

     9.   None of the entries, passages, doors, elevators, elevator doors,
hallways or stairways shall be blocked or obstructed, nor shall any rubbish,
litter, trash, or material of any nature placed, emptied or thrown into these
areas, nor may such areas be used at any time except for access or egress by
Tenant, Tenant's agents, employees or invitees. Nothing shall be placed on the
outside of the Building, the windows, window-sills or projections.

     10.  Landlord shall have the right to determine and prescribe the weight
and proper position of any unusually heavy equipment, including safes, large
files, etc., that are to be placed in the Leased Premises, and only those which
in the opinion of Landlord might, without reasonable probability, damage to the
floors, structure and/or elevators may be moved into said Leased Premises or
the existence of same in the Leased Premises.

     11.  No portion of Tenant's area or any other part of the Building shall
at any time be used or occupied as sleeping or lodging quarters.


     12.  Without the prior written consent of Landlord, Tenant shall not sell
or permit the sale, at retail, of newspapers, magazines, lottery tickets,
periodicals or theater tickets, in or from its Leased Premises, nor shall
Tenant carry on or permit or allow any employee or other person to carry on the
business of stenography, typewriting or any similar business in or from its
Leased Premises for the service or accommodation of the occupants of any other
portion of the Building, or the business of a public barber shop or a
manicuring or chiropodist business or any business other than specifically
provided for in Tenant's Lease.

     13.  The sashes, sash-doors, windows, glass doors and any lights or
skylights that reflect or admit light


   42
into the halls or other places of the Building shall not be covered or
obstructed, nor shall anything be placed upon or hung from the window sills.
The water and wash closets and urinals shall not be used for any other purpose
than the purposes for which they were respectively constructed, and the expense
of any breakage, stoppage, or damage resulting from a violation of this rule
shall be borne by Tenant whose clerks, agents, servants or licensees shall have
caused it. Tenant shall not mark, paint, drill into or in any way deface the
walls, ceilings, partitions, floors, wood, stone or iron work. Tenant shall not
make or permit any improper noises in the Building.

     14.  Only persons authorized by Landlord will be permitted to furnish ice,
drinking water, towels and other similar services to Tenant, and only at hours
and under regulations fixed by Landlord. Tenant shall not employ any person or
persons, other than Landlord's janitor for the purpose of cleaning, or taking
charge of the Leased Premises. It is understood and agreed that Landlord shall
in no way be responsible to Tenant for any damage done to the furniture or
other effects of Tenant by the janitor or any of his employees, or any other
person, or for any loss of property of any kind whatsoever within the Leased
Premises, however occurring Tenant will see each day that the windows are
closed and the doors securely locked before leaving the Building.

     15.  No window shades will be placed on any of the windows, excepting the
shades approved by Landlord. No awnings will be allowed on any of the windows.

     16.  Landlord shall have the right to prohibit any advertising by Tenant,
which, in its opinion, tends to impair the reputation of the Building or its
desirability as a Building for offices or for financial, insurance or other
institutions and businesses of like nature; and upon written notice from the
Landlord, Tenant shall refrain from or discontinue such advertising.

     17.  Tenant shall have access to the halls, corridors, elevators and
stairways in the Building, and to the offices leased by it twenty four (24)
hours a day, seven (7) days a week. Regular access shall be available between
the hours of 8:00 A.M. and 6:00 P.M., Monday through Friday. Access during
other than the hours and/or days herein set forth may, however, be refused
unless the person seeking admission has a pass, is properly identified or has
otherwise been granted clearance by Landlord. Landlord shall in no case be
liable in damages for the admission or exclusion of any person from the
Building. In case of invasion, mob riot, public excitement or other commotion,
Landlord reserves the right to prevent access to the Building during the
continuance of the same by closing the doors or otherwise for the safety of the
tenants and protection of property in the Building.

     18.  Tenant agrees not to install food or drink vending machines, or any
other food service equipment.

     19.  Landlord reserves the right to designate parking spaces to be
assigned to Tenant and to control all of the parking areas with meters, gates,
patrolmen, or any other method at Landlord's sole discretion and to levy for
any space not allocated to Tenant.

     Landlord desires to maintain high standards of environment, comfort and
convenience for its tenants. It will be appreciated if any undesirable
conditions or lack of courtesy or attention by any of Landlord's employees is
reported directly to Landlord.

EX-10.51

   1
                                                                   Exhibit 10.51

                            FIRST ADDENDUM TO LEASE

     This is an Addendum ("First Addendum") to that certain Lease between
IRRADIO HOLDINGS, LTD., a Florida limited partnership ("Landlord") and SPANISH
BROADCASTING SYSTEM, INC., a Florida corporation ("Tenant"), said Lease dated
______________, 2000 ("Lease"). All defined terms in this First Addendum shall
have the same meaning as in the Lease, except if otherwise noted. Except as
amended and modified by this First Addendum, all of the terms, covenants,
conditions and agreements of the Lease shall remain in full force and effect. It
is the intention of Landlord and Tenant that in case of any conflict between the
terms of the Lease and this First Addendum, this First Addendum shall prevail
and any conflicting language, terms or provisions in the Lease shall be
inoperative. This First Addendum is executed by Landlord and Tenant in
compliance with Section 15.07 of the Lease, to-wit:

A.   FIXED MINIMUM ANNUAL RENT

     Section 2.01(b) is hereby deleted and replaced by the following:

     Beginning in Lease Year Two, the Fixed Minimum Annual Rent shall increase
at the rate of $1.00 per square foot pursuant to the following schedule:



                                       
Lease Year Two      $31.00 per square foot   $432,543.00 Annually
Lease Year Three    $32.00 per square foot   $446,496.00 Annually
Lease Year Four     $33.00 per square foot   $460,449.00 Annually
Lease Year Five     $34.00 per square foot   $474,402.00 Annually
Lease Year Six      $35.00 per square foot   $488,355.00 Annually
Lease Year Seven    $36.00 per square foot   $502,308.00 Annually
Lease Year Eight    $37.00 per square foot   $516,261.00 Annually
Lease Year Nine     $38.00 per square foot   $530,214.00 Annually
Lease Year Ten      $39.00 per square foot   $544,167.00 Annually


B.   ADDITIONAL RENT AND OPERATING EXPENSES

     Section 2.02(b) is hereby revised as follows:

     (i) The following is hereby added to the end of Section 2.02(b)(i):
"including the building manager but not above the level of building manager."

     (ii) Section 2.02(b)(xi) is hereby deleted in its entirety and replaced
with the following: "the cost of any capital improvements to the Building or of
any machinery or


                                       1
   2
equipment installed in the building which improves the operating efficiency of
the Building and which is made or becomes operational, as the case may be,
after the expiration of the first (1st) lease year, to the extent of such cost,
amortized over the useful life of the improvement, machinery or equipment (as
reasonably estimated by Landlord)."

     (iii)   Section 2.02(b)(xii) is hereby modified to add the following after
the word "legal:" "(to the extent incurred to enforce service contracts with
respect to the Building)."

     SECTION 2.02(c) IS HEREBY REVISED AS FOLLOWS:

     (i)     Section 2.02(c)(ii) is hereby amended and restated in its entirety
as follows: "interest, penalties and charges on and amortization of debt."

     (ii)    The following is hereby added to the end of Section 2.02(c):
"(xiii) rents under any superior lease or other lease and the cost of
consummating any superior lease or other lease, (xiv) the cost of any
installation and decoration incurred in connection with preparing space for any
other tenant of the Building, (xv) all brokerage commissions, (xvi) taxes and
assessments in respect of any air rights or development rights now or hereafter
appurtenant to, or used in connection with the construction of, the Building,
(xvii) costs incurred by Landlord as the result of a breach by Landlord of a
lease or other occupancy agreement covering space in the Building, (xviii) the
cost of installing, operating and maintaining any commercial concessions (other
than the garage) operated by Landlord in the Building or of installing,
operating and maintaining any specialty services, such as a Building cafeteria
or dining facility, or an athletic, luncheon or recreational club, (xix) all
additions to Building reserves, (xx) dues paid to trade associations and
similar expenses if there is no resulting benefit to the Building, (xxi) the
cost of removing Hazardous Substances in order to comply with Environmental
Laws, (xxii) the cost of preparing tax returns and financial statements,
(xxiii) the expense of operating and maintaining space outside the Building
used for management purposes, and (xxiv) the cost of curing any condition
existing on the date hereof which is a violation of any Requirement or
insurance requirement existing on the date hereof (other than the annual
expenses to fund the Building compliance plan with respect to the American With
Disabilities Act.)"

      SECTION 2.02(d) IS HEREBY REVISED AS FOLLOWS:

      (i)    Section 2.02(d)(ii) is hereby amended to insert the word
"reasonable" between the words "any" and "expenses".

      (ii)   The following is hereby inserted following the second complete
sentence of Section 2.02(d): "The amount of any assessment included in Taxes
shall, if payable in installments, be limited to the amount of the installment
due in respect of the applicable Tax Year, together with any interest payable
in connection therewith (other than interest payable by reason of the
delinquent payment of such installment). All income, estate, succession,
inheritance, transfer and franchise taxes shall be excluded from Taxes."

                                       2

   3
      (iii)  The last complete sentence of Section 2.02(d) is hereby amended
and restated in its entirety as follows: "To the extent that Landlord receives
a tax refund, thereby reducing the Operating Expenses for a year in which an
increase in Operating Expenses has been paid by Tenant, Tenant's proportionate
share of such refund (not to exceed the Operating Expenses paid by Tenant)
shall be applied against the next Fixed Minimum Annual Rent payments becoming
due under the Lease, or if such refund is received by Landlord after the Term
of this Lease (and any renewal term), Tenant's proportionate share of such
refund (not to exceed the Operating Expenses paid by Tenant) shall be promptly
refunded to Tenant. The foregoing provisions shall survive the expiration of
this Lease.

C.  COMMON USE AREAS AND FACILITIES

    SECTION 3.01 IS HEREBY REVISED AS FOLLOWS:

    The following is hereby added to the end of Section 3.01: "Notwithstanding
the foregoing, in no event shall the exercise of Landlord's rights under this
Section unreasonably interfere with the conduct of Tenant's business in the
Leased Premises, nor shall they materially impair access to the Leased
Premises."

    SECTION 3.02 IS HEREBY REVISED AS FOLLOWS:

    The following is hereby added to the end of Section 3.02: "Notwithstanding
the foregoing, Landlord agrees that provided Tenant is not in default hereunder
beyond all applicable notice and cure periods, no such license shall be revoked
if such revocation would serve to unreasonably interfere with the conduct of
Tenant's business in the Leased Premises, nor shall they materially impair
access to the Leased Premises."

D.  SERVICES

    SECTION 4.01 IS HEREBY REVISED AS FOLLOWS:

      (i)   The third sentence of the fifth full paragraph (next to last) is
hereby amended to insert the word "reasonably" between the words "that" and
"considered."

      (ii)  The following is hereby inserted after the word "Lease" in the
second line of the last full paragraph of Section 4.01: "beyond all applicable
notice and grace periods,"

      (iii) The following is hereby added to the end of the last full paragraph
of Section 4.01: "Notwithstanding the foregoing, in the event the failure to
provide any such service or services renders the Leased Premises untenantable
for the conduct of Tenant's business at the Leased Premises as reasonably
determined by Landlord for a period in excess of 10 consecutive business days
and Landlord has not commenced to cure such failure or is otherwise not
proceeding with due diligence to cure such failure, Tenant shall have the right
to a rent abatement for the period of time following such 10 business day
period until the Leased

                                       3

   4
Premises is rendered tenantable."

     SECTION 4.02 IS HEREBY REVISED AS FOLLOWS:

             The last sentence of Section 4.02 is hereby amended to insert the
following after the word "unreasonable:" "(and shall be at least Tenant's
Proportionate Share of such space)."

E.   USE

     ARTICLE V IS HEREBY REVISED AS FOLLOWS:

             The following is hereby inserted after the word "office" in the
first sentence: "(and legally permitted ancillary uses)."

F.   INSURANCE AND INDEMNITY

     SECTION 6.05 IS HEREBY REVISED AS FOLLOWS:

             The following is hereby inserted at the end of the first sentence
of Section 6.05: "except to the extent arising from the gross negligence or
wrongful act of Landlord and Landlord's agents, contractors or employees."

     A NEW SECTION 6.07 IS HEREBY ADDED AS FOLLOWS:

             Section 6.07 Landlord's Insurance.

             Landlord shall maintain, at all times during the Term:

              (a)  comprehensive general public liability insurance covering (i)
                   Landlord's liability with respect to any construction that
                   Landlord may perform in connection with the Building and (ii)
                   Landlord's liability for death, bodily injury or property
                   damage occurring in, on or about the Building, including
                   liability arising from any act or omission by Landlord or its
                   agent relating to the public portions of the Building. Such
                   insurance shall have a combined limit of not less than
                   $5,000,000 in respect of bodily injury, death or property
                   damage in any one occurrence. Such limit shall be increased
                   from time to time (but without obligation to do so more than
                   once every 5 years) so as to be consistent with the limits
                   for such insurance which is customarily carried by owners of
                   similar buildings in Miami, Florida. Such liability coverage
                   shall include a contractual liability endorsement with
                   respect to this Lease; and

              (b)   "all risk" property insurance covering the Building (but not
                    including any Tenant Improvements) in an amount which is
                    required by any mortgagee

                                       4

   5
               holding a mortgage encumbering the Building, or, to the extent
               not required by any such mortgagee, in an amount reasonably and
               customarily carried by owners of properties similar to the
               Building in Miami.

G.   DESTRUCTION AND CONDEMNATION

     Section 7.01(b) is hereby revised as follows:

          The words "casualty loss" in the first line are hereby replaced with
"Casualty Loss."

     Section 7.01(c) is hereby revised as follows:

          Section 7.01(c) is hereby amended and restated in its entirety as
follows: "In the event of a Casualty Loss to the Leased premises which Casualty
Loss does not render the Leased Premises untenantable for the operation of
Tenant's business, there shall be no rent abatement and the Landlord shall
repair the Leased Premises and restore the Leasehold Improvements to their
Original Condition, all within 180 days of the occurrence of the Casualty Loss."

     Section 7.01(d) is hereby revised as follows:

          (i)  The following is hereby inserted in the second line of Section
7.01(d) after the word "untenable": "for the operation of Tenant's business, as
reasonably determined by Landlord"

          (ii) Section 7.01(d) as hereby amended and restated as follows: "In
the event of a Casualty Loss to the Leased Premises which Casualty Loss does not
render more than fifty percent (50%) of the Building untenantable, as reasonably
determined by Landlord, provided (i) the Building may be repaired to its
Original Condition within eighteen (18) months from the date of the occurrence
of the Casualty Loss, and (ii) Landlord's mortgagee makes the insurance proceeds
available to Landlord, Landlord shall restore the Premises to its Original
Condition within eighteen (18) months of the date of the occurrence of the
Casualty Loss and Tenant shall receive an abatement of rent in proportion to
that part of the Leased Premises which is untenantable for the operation of
Tenant's business as reasonably determined by Landlord retroactive to the date
of such Casualty Loss until the Leased Premises are restored."

     Section 7.01(e) is hereby amended as follows:

          The first paragraph of Section 7.01(e) is hereby amended and restated
as follows: "In the event of a Casualty Loss to the Leased Premises (i) which
Casualty Loss renders more than fifty percent (50%) of the Building
untenantable, as reasonably determined by Landlord, (ii) which results in damage
to the Building which cannot be restored to its Original Condition within
eighteen (18) months following the date of the occurrence of the Casualty Loss,
or (iii) and the Landlord's mortgagee does not make the insurance proceeds
available to the Landlord


                                       5

   6
Landlord shall have the following options, one of which must be exercised by
delivery of notice to Tenant no later than 180 days from the occurrence of the
Casualty Loss:"

     SECTION 7.01(e) IS HEREBY REVISED AS FOLLOWS:

          The following is hereby inserted in the first line of Section 7.01(e)
after the Word "untenable": "for the operation of Tenant's business, as
reasonably determined by Landlord"

     SECTION 7.01(g) IS HEREBY REVISED AS FOLLOWS:

          The following is hereby inserted at the beginning of Section 7.01(g):
"Subject to Landlord's obligation to maintain the insurance required under
Section 6.07 of this Lease,"

H.  DEFAULTS AND REMEDIES

     SECTION 8.01 IS HEREBY REVISED AS FOLLOWS:

          (i)   Section  8.01(c) is hereby amended and restated in its entirety
as follows: "Failure of Tenant to pay any installment of Fixed Minimum Annual
Rent or Additional Rent ("Rent") due hereunder, or any other sum herein
required to be paid by Tenant which is not paid within five (5) days following
notice of demand for payment from Landlord; provided, however, that Tenant
shall not be entitled to receive notice more than twice in any one Lease Year,
and after the second notice is given in any one Lease Year, the aforestated
five (5) day grace period shall be calculated from the date payment is
otherwise due under this Lease."

          (ii)  Section 8.02(d) is hereby amended to replace "ten (10)" in the
first and second lines thereof with "thirty (30)"; and to replace "thirty (30)"
in the last line thereof with "sixty (60)."

          (iii) Section 8.01(f) is hereby deleted in its entirety.

          (iv)  Section 8.01(g) is hereby deleted in its entirety.

     SECTION 8.03 IS HEREBY REVISED AS FOLLOWS:

          The following is hereby added to the end of Section 8.03:
"Notwithstanding the foregoing, provided Tenant is not in default under this
Lease, Landlord agrees that the foregoing lien shall be automatically
subordinate to any lien held by an institutional lender or vendor providing
financing for leasehold improvements (which do not constitute fixtures),
furniture, trade fixtures, equipment and/or other personal property of Tenant
or a corporate institutional lender of Tenant who requires a lien on all of the
Tenant's assets."

     SECTION 8.07 IS HEREBY REVISED AS FOLLOWS:

                                       6

   7

          The second full sentence in Section 8.07 is hereby deleted in its
entirety.

     SECTION 8.08 IS HEREBY REVISED AS FOLLOWS:

          The reference to "eighteen percent (18%)" in the second line of
Section 8.08 is hereby replaced with "four (4) percentage points over the then
applicable "Prime Rate" as published in the Wall Street Journal."

     SECTION 8.09 IS HEREBY REVISED AS FOLLOWS:

          The reference to "twice" in the fifth line of Section 8.09 is hereby
replaced with "one and a half."

I.   ALTERATIONS

          (i)   The following is hereby inserted before the word "alterations"
in the first line of Article IX: "structural or material."

          (ii)  The following is hereby inserted following the first sentence
of Article IX: "The foregoing shall not be deemed to limit in any way Tenant's
rights to perform any non-structural or cosmetic alterations to the Leased
Premises, provided the same do not require a building permit."

          (iii) The following is hereby inserted at the end of the first
paragraph of Article IX: "Landlord shall inform Tenant in writing at the time
of the approval of any Alteration whether Landlord will require the removal of
such Alteration at the end of the Term. In the event Landlord fails to give
such notice or notifies Tenant that such Alteration need not be removed, then
Tenant shall have no obligation to remove said Alteration at the end of the
Term."

J.   TRADE FIXTURES

          The following is hereby deleted from the first sentence in Article X:
"shall be new or completely reconditioned and"

K.   QUIET ENJOYMENT

          Article XI is hereby amended and restated in its entirety as follows:
"Provided that the Tenant is not in default beyond all applicable notice and
cure periods under the Lease and the Lease otherwise remains in full force and
effect. Tenant shall peaceably and quietly hold and enjoy the Leased Premises
for the Term hereby demised without hindrance or interruption by Landlord or
any other person or persons lawfully or equitably claiming by, through or under
Landlord, subject, nevertheless to the terms and conditions of this Lease."


                                       7
   8
L.   MAINTENANCE

     The first sentence of Article XII is hereby amended and restated as
follows: "Tenant shall, at all times, keep the Leased Premises (including
maintenance of its entrances and all glass) and all interior partitions, doors,
fixtures and equipment in good order, condition and repair, except for the
structural portions of the Building and the lighting (including replacement of
standard lamps and bulbs), heating, plumbing fixtures, air conditioning system
and other mechanical systems and common areas in and about the Building, which
shall be maintained by Landlord."

M.   MISCELLANEOUS

     SECTION 15.03 IS HEREBY REVISED AS FOLLOWS:

          (i)   The following is hereby inserted following the words "Landlord
may" in the third line of Section 15.03: "reasonably." The words "or desirable"
are hereby deleted in the third line of Section 15.03 and are hereby replaced
with "or as may be otherwise permitted or required to be made under this Lease,"

          (ii)  The following is hereby inserted prior to the words "the Fixed
Minimum Annual Rent" in the third line of Section 15.03: "except as set forth
below."

          (iii) The following is hereby added to the end of Section 15.03:
"Notwithstanding the foregoing, if any such work by Landlord materially and
adversely interferes with Tenant's use and occupancy of the Leased Premises or
Tenant's access such that more than twenty five percent (25%) of the Leased
Premises shall be untenantable or inaccessible and is not able to be used by
Tenant for the conduct of its business for more than ten (10) consecutive
business days, Tenant shall receive an abatement of the fixed rent and
additional rent allocable to such untenantable or inaccessible portion of the
Leased Premises, for the period of such untenantability or inaccessibility
following such ten (10) business day period."

     SECTION 15.04 IS HEREBY REVISED AS FOLLOWS:

          The following is hereby added to the end of Section 15.04(a):
"Notwithstanding the foregoing, (i) the transfer of up to 49% of the outstanding
stock of Tenant or the transfer of shares of the Tenant that are publicly traded
on a recognized stock exchange shall not constitute an assignment under this
Lease, (ii) the Tenant may assign this Lease without Landlord's consent to any
entity controlling, controlled by or under common control with Tenant, provided
that no such assignment shall relieve Tenant from any liability under this
Lease, whether accrued to the date of such assignment or thereafter accruing,
and provided further that such assignee assumes, in writing, all of Tenant's
obligations under the Lease, in form and content reasonably acceptable to
Landlord, and (iii) the Tenant my assign this Lease without Landlord's consent
to a successor entity in connection with a merger or sale of the entire business
of Tenant provided (x) such successor entity has a net worth equal to or greater
than the net worth of the Tenant as of the date



                                       8
   9
of such assignment, (y) that no such assignment shall relieve Tenant from any
liability under this Lease, whether accrued to the date of such assignment or
thereafter accruing, and (z) that such assignee assumes, in writing, all of
Tenant's obligations under the Lease, in form and content reasonably acceptable
to Landlord."

     SECTION 15.05 IS HEREBY REVISED AS FOLLOWS:

     A new section 15.05(d) is hereby added as follows: "Landlord shall obtain a
non-disturbance agreement in favor of Tenant from its existing mortgagee on such
mortgagee's customary form, and Tenant shall execute such form to evidence the
subordination of the Lease and attornment to the mortgagee. With respect to
any future mortgagee's, Landlord shall use its best efforts to obtain a
non-disturbance agreement in favor of Tenant from its mortgagee on such
mortgagee's customary form and Tenant shall execute such form to evidence the
subordination of the Lease and attornment to the mortgagee. Notwithstanding
anything herein to the contrary, the subordination of this Lease to any
particular mortgage granted by Landlord on the Leased Premises and/or the
Building shall be subject to and conditioned on Tenant's receipt of a
non-disturbance agreement from the particular mortgagee as provided above."

     SECTION 15.16 IS HEREBY REVISED AS FOLLOWS:

     Section 15.16 is hereby amended and restated in its entirety as follows:
"Taking possession of the Leased Premises by Tenant shall be conclusive evidence
as against Tenant that (other than latent defects) the Leased Premises were in
good and satisfactory condition when possession was so taken."

     SECTION 15.20 IS HEREBY DELETED IN ITS ENTIRETY.

     SECTION 15.22 IS HEREBY REVISED AS FOLLOWS:

     The following is hereby inserted at the end of Section 15.22: "other than
products (e.g. cleaning products and copier toner) customarily used in premises
similar to the Leased Premises which are used in compliance with all applicable
laws."

     SECTION 15.24 IS HEREBY REVISED AS FOLLOWS:

     The following is hereby added to the end of Section 15.24: "Provided Tenant
requests such certificate for a legitimate business purpose, Landlord shall be
obligated to deliver to Tenant the estoppel certificate information required
herein of Tenant within the time periods required of Tenant upon written request
therefor."

     SECTION 15.25 IS HEREBY REVISED AS FOLLOWS:

     The following is hereby inserted after 15.25(d): "or (c) apply the Rules or
Regulations in a discriminatory manner."




                                       9

   10
     SECTION 15.26 IS HEREBY DELETED IN ITS ENTIRETY.

M.   RULES AND REGULATIONS

     RULE 1 IS HEREBY REVISED AS FOLLOWS:

     The following is hereby add to the end of the first sentence in rule 1:
"which will not be unreasonably withheld or delayed."

     RULE 4 IS HEREBY REVISED AS FOLLOWS:

     The following is hereby inserted at the beginning of rule 4: "Except as
set forth in the Lease,"

     RULE 16 IS HEREBY REVISED AS FOLLOWS:

     The following is hereby inserted before the word "opinion" in rule 16:
"reasonable."

N.   OPTION TO RENEW

          THE FOLLOWING IS HEREBY ADDED TO THE LEASE:

               Provided Tenant has complied with all the terms and conditions
          of the Lease and is not in default or breach of its obligations
          thereunder, Landlord grants to Tenant the option to renew the term
          of the Lease for two additional (5) year periods ("Renewal Term(s)")
          to commence at the end of the Lease Term or Renewal Term. Tenant must
          exercise its option to renew by delivering written notice of such
          election to Landlord at its place of business at least One Hundred
          Eighty (180) days prior to the expiration of the current Lease Term or
          the First Renewal Term, as the case may be. The terms and conditions
          of the Renewal Term shall be on the same terms set forth in the Lease
          except that all rent, including but not limited to, all Additional
          Rent and other charges payable during the Lease Term shall be at the
          then current prevailing market rate (the "Prevailing Market Rate") at
          the time the applicable Renewal Term commences and there shall be no
          additional Renewal Terms other than those provided above. Prevailing
          Market Rate shall be computed as of the date in question with
          consideration being given to then-current annual basic rental charges
          and other additional rent for new leases then currently, or within
          the preceding twelve (12) month period, being or that have been
          negotiated or executed in comparable space located in the Building,
          or if no new leases are then currently, or within the preceding twelve
          (12) month period, being or that have been negotiated or executed
          then the comparison shall be made based on comparable space located
          elsewhere in first-class office buildings comparably aged and equipped
          located in Coconut Grove

                                       10

   11
or, if no comparables are available, in Miami's Central Business District.

     Notwithstanding anything to the contrary herein contained, the parties
hereby agree that, at the time Landlord gives its initial determination of any
Prevailing Market Rate, Landlord shall have the right, exercisable by written
notice to Tenant: (i) to change the base taxes to an amount equal to the actual
amount of taxes for the immediately preceding tax year for which Landlord has
actual tax data, and (ii) to change base operating expenses and/or building
energy utility cost base from the respective amounts to an amount or amounts, as
the case may be, equal to the actual amount of operating expenses and/or the
actual amount of building energy/utility costs, as the case may be, for the
immediately preceding operating year. In determining Prevailing Market Rate, the
amount of base taxes, base operating expenses and/or building energy utility
cost base and electricity shall be taken into account and given effect.

     Landlord shall initially designate a Prevailing Market Rate and shall
furnish data in support of such designation to Tenant (the "Landlord's
Designated Amount"). If Tenant disagrees with Landlord's Designated Amount, then
Tenant shall have the right by written notice given within thirty (30) days
after Tenant has been notified of Landlord's Designated Amount, to submit to
Landlord the amount that Tenant considers to be the Prevailing Market Rate,
together with data in support thereof (the "Tenant's Designated Amount").
Thereafter, the parties shall have a period of thirty (30) days to engage in
discussions for purposes of arriving at a mutually acceptable amount. If the
parties are unable to do so, then promptly following the expiration date of such
thirty (30) day period, the parties shall submit Landlord's Designated Amount
and Tenant's Designated Amount to the nearest local office of the American
Arbitration Association (the "Association") so that either Landlord's Designated
Amount or Tenant's Designated Amount is selected as the amount which will
constitute the Prevailing Market Rate under the Lease. In that regard, it is
understood and agreed that no amount other than the Landlord's Designated Amount
or the Tenant's Designated Amount may be selected by the Association. Each party
shall equally share the costs of arbitration hereunder. The decision of the
Association shall be binding on the parties and shall be incorporated into the
terms of the Lease. In the event the matter is submitted to the Association for
resolution, then during the pendency of the dispute, Tenant shall pay rent under
the Lease to the Landlord in an amount equal to Tenant's Designated Amount (the
"Tenant's Rent Payment") and Tenant shall pay the difference, on the same due
date as the rent is due under the Lease, between Tenant's Designated Amount and
Landlord's Designated Amount into the trust account of Tenant's counsel ("Escrow
Agent") to be held pending resolution of the dispute.

     Upon resolution of the dispute and determination of the Prevailing Market
Rate by the Association and in the event the Prevailing Market Rate set by the


                                       11
   12
     Association differs from the Tenant's Rent Payment, the Tenant shall pay
     and/or cause Escrow Agent to pay to Landlord any deficiency in unpaid rent
     or Landlord shall pay to Tenant any overpaid rent within five (5) business
     days of the Association's written decision and a failure to pay such amount
     during such time period shall be deemed a default of such party's
     obligations under the Lease. Furthermore, in the event either Landlord or
     Tenant fails to pay 1/2 of the arbitration costs within five (5) business
     days from the earlier of (i) any invoice due date or (ii) any request for
     payment made by the Association or any arbitrator, the same shall be a
     default of that party's obligations under the Lease.

O.   STORAGE SPACE:

          Tenant shall have the right to the use of that certain storage space
     located on the 7th floor of the building's garage hereby designated as
     Storage Space No 12 per the attached plan (Exhibit F) consisting of 911
     rentable square feet at the rate of $10.00 square feet or Seven Hundred
     Fifty Nine and 16/100 Dollars ($759.16) per month plus applicable sales
     tax. Said rate shall increase annually by $0.50 per square foot.

P.   SIGNAGE

          Provided that Tenant is not in default of any term, condition or
     covenant of the Lease beyond all applicable notice and grace periods,
     Tenant shall have the right, at its sole cost and expense, to install
     rooftop signage on the building. Prior to installation, Tenant shall submit
     its proposed signage plans (including design, content, location and
     electrical plans) for Landlord's approval, which may be withheld in
     Landlord's sole and absolute discretion. Said signage must comply with
     Landlord's signage criteria and all relevant municipal codes and
     regulations. Tenant shall be responsible, at Tenant's sole cost and
     expense, for obtaining all permits and approvals required to erect and
     maintain said signage. Additionally, Tenant, at its sole cost and expense,
     shall maintain and remove signage, if necessary. Upon the expiration or
     earlier termination of this Lease, if requested by Landlord, Tenant shall,
     at Tenant's sole cost and expense, remove such signage.


                 [SIGNATURE BLOCK CONTINUED ON FOLLOWING PAGE]


                                       12
   13
     IN WITNESS WHEREOF, the parties hereto have executed this First Addendum
as of this 14 day of December, 2000.

/s/ MARIA SHEFFY                  LANDLORD:
- -----------------------           IRRADIO HOLDINGS, LTD.
AS TO LANDLORD                    A FLORIDA LIMITED PARTNERSHIP

/s/ KIM TAYLOR                    BY: TERREMARK MANAGEMENT SERVICES,
- -----------------------           INC., A FLORIDA CORPORATION,
AS TO LANDLORD                    MANAGING AGENT

                                  BY: /s/ WILLIAM J. BIONDI
                                      ------------------------------
                                      WILLIAM J. BIONDI
                                      PRESIDENT


                                  TENANT:
                                  SPANISH BROADCASTING SYSTEM,
                                  INC., A FLORIDA CORPORATION

/s/ illegible                     /s/ JOSEPH S. GARCIA
- -----------------------           ----------------------------------
AS TO TENANT

/s/ illegible
- -----------------------
AS TO TENANT



                                       13

   14
                                  EXHIBIT "F"

                                  (Blueprint)

   15
                                  (Blueprint)

EX-10.52

   1


                                                                   EXHIBIT 10.52









                                   ASSET PURCHASE AGREEMENT

                                        BY AND BETWEEN

                         INTERNATIONAL CHURCH OF THE FOURSQUARE GOSPEL

                                              AND

                               SPANISH BROADCASTING SYSTEM, INC.

                                          DATED AS OF

                                       NOVEMBER 2, 2000



   2





                                       TABLE OF CONTENTS




                                                                                          Page
                                                                                          ----

                                                                                    
ARTICLE I      DEFINED TERMS.................................................................1
               Section 1.01. Certain Defined Terms...........................................1
               Section 1.02. Other Defined Terms.............................................4

ARTICLE II     PURCHASE AND SALE.............................................................5
               Section 2.01. Purchase and Sale of Assets.....................................5
               Section 2.02. Excluded Assets.................................................6
               Section 2.03. Assumption and Exclusion of Liabilities.........................6
               Section 2.04. Assignment of Governmental Licenses.............................7
               Section 2.05. Purchase Price.  ...............................................8

ARTICLE III    CLOSING.......................................................................8
               Section 3.01. Closing.........................................................8
               Section 3.02. Conditions to the Closing.......................................9
               Section 3.03. Closing Deliveries by Seller...................................10
               Section 3.04. Closing Deliveries by Purchaser................................11

ARTICLE IV     REPRESENTATIONS AND WARRANTIES OF SELLER.....................................11
               Section 4.01. Organization; Good Standing....................................12
               Section 4.02. Qualification..................................................12
               Section 4.03. Due Authorization; Execution and Delivery......................12
               Section 4.04. Noncontravention...............................................12
               Section 4.05. Governmental Approvals.........................................13
               Section 4.06. Title to Assets................................................13
               Section 4.07. Condition of Assets............................................13
               Section 4.08. FCC Licenses...................................................13
               Section 4.09. Litigation.....................................................14
               Section 4.10. Absence of Certain Changes.....................................14
               Section 4.11. Tax Matters....................................................14
               Section 4.12. Compliance with Laws...........................................15
               Section 4.13. Real Property.  ...............................................15
               Section 4.14. Leased Property................................................15
               Section 4.15. Certain Payments...............................................15
               Section 4.16. Labor Agreements and Actions...................................16
               Section 4.17. Environmental..................................................16
               Section 4.18. Insurance......................................................18
               Section 4.19. Brokerage Fees.................................................18

ARTICLE V      REPRESENTATIONS AND WARRANTIES OF PURCHASER..................................18
               Section 5.01. Organization and Good Standing.................................18
               Section 5.02. Due Authorization; Execution and Delivery......................18


                                       i
   3

                                                                                    
               Section 5.03. Governmental Consents..........................................19
               Section 5.04. Litigation.....................................................19
               Section 5.05. Brokerage Fees.................................................19
               Section 5.06. Qualification..................................................19

ARTICLE VI     CERTAIN COVENANTS AND OTHER AGREEMENTS.......................................20
               Section 6.01. Conduct and Preservation of Business...........................20
               Section 6.02  Permitted Use..................................................20
               Section 6.03  Financial Statements...........................................21
               Section 6.04  Access to Records and Properties...............................21
               Section 6.05  Taxes; Other Charges...........................................21
               Section 6.06  Best Efforts...................................................21
               Section 6.07  Public Announcements...........................................22
               Section 6.08  Compliance with Covenants......................................22
               Section 6.09  Notification...................................................22
               Section 6.10  No Negotiation.................................................22

ARTICLE VII    INDEMNIFICATION..............................................................23
               Section 7.01. Survival.......................................................23
               Section 7.02. Indemnification by Seller......................................23
               Section 7.03. Indemnification by Purchaser...................................23
               Section 7.04. Indemnification Procedures.....................................24
               Section 7.05. Certain Tax Matters............................................26

ARTICLE VIII   TERMINATION..................................................................27
               Section 8.01. Termination....................................................27
               Section 8.02. Certain Remedies Not Exclusive.................................28
               Section 8.03. Specific Performance...........................................28

ARTICLE IX     MISCELLANEOUS PROVISIONS.....................................................28
               Section 9.01. Expenses.......................................................28
               Section 9.02. Amendment......................................................28
               Section 9.03. Notices........................................................28
               Section 9.04. Assignment.....................................................29
               Section 9.05. Counterparts...................................................29
               Section 9.06. Headings.......................................................29
               Section 9.07. Entire Agreement...............................................29
               Section 9.08. Waiver.........................................................30
               Section 9.09. Arbitration/Governing Law......................................30
               Section 9.10. Severability...................................................30
               Section 9.11. Intended Beneficiaries.........................................31
               Section 9.12. Mutual Contribution............................................31




                                       ii
   4






Exhibits
- --------
                  
Exhibit 3.02(c)        Agreement regarding transmission facilities
Exhibit 3.03(d)        Form of Certificate of Non-Foreign Status
Exhibit 3.03(c)        Form of Legal Opinion


Schedules
- ---------

Schedule 2.01(a)       FCC Licenses
Schedule 2.01(b)       Tangible Personal Property
Schedule 2.01(c)       Real Property
Schedule 2.01(d)       Leases
Schedule 2.01(f)       Permits/Governmental Licenses
Schedule 2.02(f)       Intangible Property
Schedule 4.02          Qualifications
Schedule 4.04          Noncontravention Consents and Approvals
Schedule 4.05          Governmental Approvals
Schedule 4.10          Absence of Certain Changes
Schedule 4.11          Tax Matters
Schedule 4.17          Environmental Matters
Schedule 4.18          Insurance Policies



                                      iii


   5






                            ASSET PURCHASE AGREEMENT

        This ASSET PURCHASE AGREEMENT ("AGREEMENT"), dated as of November 2,
2000, by and between INTERNATIONAL CHURCH OF THE FOURSQUARE GOSPEL a California
nonprofit religious corporation ("SELLER"), and SPANISH BROADCASTING SYSTEM,
INC., a Delaware corporation ("PURCHASER").

                              W I T N E S S E T H :

        WHEREAS, Seller desires to sell and assign to Purchaser, and Purchaser
desires to purchase and assume from Seller, Radio Station KFSG-FM (Los Angeles,
California) (the "STATION") and certain associated assets and liabilities,
including without limitation, certain contracts and leases and, subject to the
approval of the Federal Communications Commission (the "COMMISSION" or the
"FCC"), to accept assignment from Seller of certain licenses and other
authorizations issued by the Commission to Seller;

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

ARTICLE 1      DEFINED TERMS

        Section 1.1.   Certain Defined Terms.  As used in this Agreement, the
following terms shall have the following meanings:

        "ACTION" shall mean any claim, action, suit, arbitration, inquiry,
proceeding or investigation by any Governmental Authority or other third party.

        "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.

        "CODE" shall mean the United States Internal Revenue Code of 1986, as
amended.

        "ENCUMBRANCES" shall mean liens, charges, pledges, options, mortgages,
deeds of trust, security interests, claims, restrictions (whether on voting,
sale, transfer, disposition or otherwise), easements and other encumbrances of
every type and description, whether imposed by Law, agreement, understanding or
otherwise.

        "ENVIRONMENTAL COSTS" shall mean, without limitation, any actual or
potential cleanup costs, remediation, removal, or other response costs (which
without limitation shall include costs to cause the Seller to come into
compliance with Environmental Laws), investigation costs (including without
limitation fees of consultants, counsel, and other experts in connection with
any environmental investigation, testing, audits or studies), losses,
liabilities or obligations (including without limitation, liabilities or
obligations under any lease or other contract), payments, damages (including
without limitation any actual, punitive or consequential

   6

damages under any statutory laws, common law cause of action or contractual
obligations or otherwise, including without limitation damages (a) of third
parties for personal injury or property damage, or (b) to natural resources),
civil or criminal fines or penalties, judgments and amounts paid in settlement
arising out of or relating to or resulting from any Environmental Matter; and

        "ENVIRONMENTAL LAW" shall mean any law, ordinance, or regulation,
whether national, Federal, state, local or other, pertaining to the protection
of human health or the environment, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Sections 11001, et seq., and the Resource Conversation and Recovery Act, 42
U.S.C. Sections 6901, et seq.

        "ENVIRONMENTAL MATTER" shall mean any matter arising out of, relating
to, or resulting from pollution, contamination, protection of the environment,
human health or safety, health or safety of employees, sanitation, and any
matters relating to emissions, discharges, disseminations, releases or
threatened releases, of Hazardous Materials into the air (indoor and outdoor),
surface water, ground water, soil, land surface or subsurface, buildings,
facilities, real or personal property or fixtures or otherwise arising out of,
relating to, or resulting from the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, handling, release or threatened release
of Hazardous Materials.

        "GOVERNMENTAL AUTHORITY" shall mean any United States federal, state or
local or any foreign government, governmental, regulatory or administrative
authority, agency or commission or any court, tribunal or arbitral body.

        "GOVERNMENTAL ORDER" shall mean any claim, action, suit, arbitration,
order, writ, judgment, injunction, decree, stipulation, determination or award
entered into by or with any Governmental Authority.

        "HAZARDOUS MATERIALS" shall mean any waste or substance that is listed,
defined, designated, or classified as, or otherwise determined to be, hazardous,
radioactive, or toxic or a pollutant or a contaminant under or pursuant to any
Environmental Law, including any admixture or solution thereof, and specifically
including petroleum and all derivatives thereof or synthetic substitutes
therefor and asbestos or asbestos-containing materials.

        "LAW" shall mean any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, Governmental Order, permit, franchise, agent,
authorization, easement, consent, certificate or requirement or rule of common
law of any Governmental Authority.

        "LIABILITIES" shall mean any and all debts, liabilities and obligations,
whether accrued or fixed, absolute or contingent, matured or unmatured, or
determined or undeterminable, including, without limitation, those arising under
any Law (including, without limitation, any Environmental Law), Action or
Governmental Order and those arising under any contract agreement, arrangement,
commitment or undertaking.

        "MATERIAL ADVERSE EFFECT" shall mean a single event, occurrence or fact
that (together with all other events, occurrences and facts that could
reasonably be expected to result



                                       2
   7


in a loss) would have, or might reasonably be expected to have, a material
adverse effect on a Person's assets subject to this Agreement, or that might
reasonably be expected to prevent such Person from consummating the transactions
contemplated by this Agreement.

        "PERMITTED ENCUMBRANCES" shall mean any and all of the following
Encumbrances:

                (1)     Liens for taxes and assessments which are not yet due
and payable;

                (2)     Rights existing under applicable laws or operating
agreements or similar contracts to assert liens against the relevant assets or
properties, but not including liens and other rights which have actually been
asserted, unless the relevant Person disputes the validity of any such lien or
the amount claimed to be owed in connection therewith, or such lien or other
right is not enforceable against the interest of such Person;

                (3)     Any obligations or duties affecting any property to any
municipality or public authority with respect to any franchise, grant, license
or permit and all applicable laws, rules and order of any Governmental
Authority;

                (4)     Any other Encumbrance that is not substantial in
character, amount or extent and does not materially detract from the value of
the property subject thereto;

                (5)     Any Encumbrance created by or in favor of Purchaser or
any of its Affiliates; and

                (6)     Such Encumbrances or impairments to the quality of title
arising as a result of the sale to Purchaser of the Assets pursuant to this
Agreement.

        "PERSON" shall mean 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 Authority.

        "SUBSIDIARY" shall mean any corporation or other Person of which
securities or other interests having the power to elect a majority of that
corporation's or other person's board of directors or similar governing body, or
otherwise having the power to direct the business and policies of that
corporation or other Person (other than securities or other interests having
such power only upon the happening of a contingency that has not occurred) are
held on the date in question by such Person or one or more of its Subsidiaries;
when used without reference to a particular Person, "Subsidiary" means a
Subsidiary on the date in question of Seller.

        "TAX" shall mean any federal, state, local or foreign tax (including,
without limitation, any income tax, franchise tax, doing business tax, branch
profits tax, capital gains tax, value-added tax, ad valorem tax, excise tax,
transfer tax, employment tax, social security tax, sales tax, use tax, property
tax, or any other kind of tax or payment in lieu of tax no matter how
denominated), levy, assessment, tariff, duty (including any customs 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 Authority or



                                       3
   8

payable 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" shall mean 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 Authority 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.

        "WARN ACT" means the Worker Adjustment and Retraining Notification Act
of 1988, as amended.

        Section 1.2. Other Defined Terms. The following terms shall have the
meanings defined for such terms in the Sections of this Agreement set forth
below:



- --------------------------------------------------------------------------------
Term                                            Section
- ----                                            -------
                                             
Agreement                                       Preamble
Allocation                                      Section 2.05
Ancillary Documents                             Section 4.03
Assets                                          Section 2.01
Assumed Liabilities                             Section 2.03 (a)
Assignment Application                          Section 2.04(a)
Basket Amount                                   Section 7.04(d)
Closing                                         Section 3.01
Closing Date                                    Section 3.01
Commission                                      Preamble
Communications Act                              Section 2.04(a)
Earnest Money Deposit                           Section 2.06
Environmental Actions                           Section 4.17(c)
Environmental Permits                           Section 4.17(a)
Excluded Assets                                 Section 2.02
Excluded Tax Liabilities                        Section 2.03(b)
Excluded Liabilities                            Section 2.03(c)
FCC                                             Preamble
FCC Licenses                                    Section 2.01(a)
FCC Orders                                      Section 2.04(a)
Final Orders                                    Section 2.04(a)
Governmental Licenses                           Section 2.01(d)
HSR Act                                         Section 2.04(b)
Income Taxes                                    Section 7.05
Intangible Property                             Section 2.01(g)
IRS                                             Section 4.11
Losses                                          Section 7.02(a)
Permits                                         Section 2.01(d)
Proprietary Information                         Section 4.16




                                       4
   9

                                             
Purchase Price                                  Section 2.05
Purchaser                                       Preamble
Real Property                                   Section 4.13
Seller                                          Preamble
Seller's Broker                                 Section 4.21
Station                                         Preamble
STL                                             Section 2.01(b)
Straddle Period                                 Section 7.05
Tangible Personal Property                      Section 2.01(b)
Transfer Taxes                                  Section 6.05

- --------------------------------------------------------------------------------



ARTICLE 2      PURCHASE AND SALE

        Section 2.1.    Purchase and Sale of Assets. Upon the terms and subject
to the conditions set forth in this Agreement, at the Closing, Seller shall
sell, assign, transfer, convey and deliver to Purchaser, and Purchaser shall
purchase from Seller, the following assets (the "ASSETS"), free and clear of all
debts and Encumbrances:

                (1)     the FCC licenses, permits and other authorizations,
including any temporary waiver or special temporary authorization, issued to or
held by Seller exclusively in connection with the conduct of the business and
operation of the Station, including any pending applications therefor, as set
forth in Schedule 2.01(a) (the "FCC LICENSES");

                (2)     subject to Permitted Encumbrances, all of Seller's
right, title and interest in and to all equipment including, broadcast
equipment, transmitters and related equipment, broadcast tower, electrical
devices, antennae, cables, tools, hardware, office furniture and fixtures,
office materials and supplies, inventory, spare parts and other tangible
personal property of every kind and description which are held for use
principally, used or usable in the operation of the Station and located at the
broadcast tower site, and two Studio Transmitter Link ("STL") antennae located
at 1910 West Sunset Blvd., Los Angeles, California 90026, which shall be removed
at Purchaser's expense following Closing, including the items set forth on
Schedule 2.01(b), except any retirements or dispositions thereof made between
the date hereof and the Closing in the ordinary course of business and
consistent with past practices of Seller (the "TANGIBLE PERSONAL PROPERTY");

                (3)     the Station's public inspection files, filings with the
FCC related to the Station, and such technical information, engineering data,
rights under manufacturers' warranties as exist at Closing and relate to the
assets of the Station being conveyed hereunder;

                (4)     the governmental licenses, permits and authorities,
other than the FCC Licenses, issued to or held by Seller exclusively in
connection with the conduct of the business and operation of the Station,
including any pending applications therefor as set forth in Schedule 2.01(d)
(the "PERMITS", and, together with the FCC Licenses, the "GOVERNMENTAL
LICENSES").



                                       5
   10

        The Assets shall be delivered without any representation or warranty by
Seller except as expressly set forth in this Agreement, and Purchaser
acknowledges that it has not relied on or been induced to enter into this
Agreement by any representation or warranty other than those expressly set forth
in Article IV hereof.

        Section 2.2.    Excluded Assets. The following property will not be
purchased by Purchaser and shall remain the property of Seller (collectively,
the "EXCLUDED ASSETS"):

                (1)     corporate minute books, stock books and income tax
returns of Seller;

                (2)     investments of Seller in subsidiaries, partnerships and
other entities;

                (3)     the assets of Seller which are not specifically
described in Section 2.01 as part of the Assets, including, without limitation,
studio broadcast equipment and spare parts, studio office furniture, fixtures,
materials, supplies, and inventory, motor vehicles, and all other tangible
personal and real property held for use in Seller's business ;

                (4)     the accounts receivables of Seller held or invoiced
prior to the Closing Date;

                (5)     the cash and cash equivalents of Seller as of the
Closing Date; and

                (6)     all of Seller's right, title, and interest in and to the
Station's call letters and the trademarks, trade names, service marks,
franchises, copyrights, computer software programs and programming material,
jingles, slogans, logos, internet web site KFSG.com, and other intangible
property which are used in the operation of the Station (the "INTANGIBLE
PROPERTY"), as set forth in Schedule 2.02 (f).

        Section 2.3.    Assumption and Exclusion of Liabilities.

                (1)     On the terms and subject to the conditions of this
Agreement, from and after the Closing Date, Purchaser shall assume and shall
pay, perform and discharge when due only the following specified liabilities and
obligations, and no others (collectively, the "ASSUMED LIABILITIES"):
Liabilities arising out of Purchaser's ownership after the Closing Date of the
Assets to the extent such obligations were incurred or arose after the Closing.

                (2)     Subject to Section 6.03, Purchaser shall not assume any
Liabilities of Seller in respect of any Taxes arising from the use, ownership or
operation of the Station or the Assets up to, and including, the Closing Date or
resulting from the transactions contemplated by this Agreement (collectively,
"EXCLUDED TAX LIABILITIES").

                (3)     Except as specifically set forth in Section 2.03(a),
Purchaser shall not assume or be responsible for any Liabilities of Seller,
whether fixed, contingent or otherwise and whether known or unknown, including,
without limitation, all liabilities and obligations to any persons at any time
employed by the Seller or its predecessors-in-interest at any time or to any
such person's spouses, children, other dependents or beneficiaries, related to,
arising from or



                                       6
   11

based on incidents, events, exposures or circumstances occurring at any time
during the period or periods of any such persons' employment by the Seller or
its predecessors-in-interest, whenever such claims mature or are asserted,
including, without limitation, all liabilities and obligations arising (i) under
any benefit plan, (ii) under any employment, labor relations, leave, wages,
hours, unemployment compensation, equal opportunity, discrimination, plant
closing or immigration and naturalization laws, (iii) under any collective
bargaining Laws, agreements, awards or arrangements, (iv) in connection with any
workers' compensation or any other employee health, accident, disability or
safety claims, or (v) under the WARN Act (such excluded liabilities, being
referred to herein collectively as the "EXCLUDED LIABILITIES").

        Section 2.4.    Assignment of Governmental Licenses.

                (1)     In order to consummate the transfer of the Assets,
Purchaser and Seller will file within five (5) business days after the execution
and delivery of this Agreement assignments of license applications requesting
FCC consent to the assignment to Purchaser of all FCC Licenses relating to the
operation of the Station (the "ASSIGNMENT APPLICATION"). The parties agree to
prosecute the Assignment Application in good faith and with due diligence. Each
party will be solely responsible for the expenses incurred by it in the
preparation, filing and prosecution of the Assignment Application (it being
agreed that each of Seller and Purchaser will pay one-half of the FCC filing
fee). As used herein, the term "FCC ORDERS" shall mean that the FCC has granted
or given its consent, without any condition materially adverse to Purchaser, to
the Assignment Application; the term "FINAL ORDERS" shall mean that the FCC
Orders shall have become final, that such FCC Orders are not reversed, stayed,
enjoined or set aside, and with respect to such FCC Orders, no timely request
for stay, reconsideration, review, rehearing or notice of appeal is pending, and
as to which FCC Orders the time set forth in the FCC rules or the Communications
Act of 1934, as amended (the "COMMUNICATIONS ACT"), for filing any such request,
petition or notice of appeal or for review by the FCC staff on its own motion
has expired.

                (2)     Purchaser and Seller shall make or cause to be made any
and all necessary filings under the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended (the "HSR ACT") with respect to the transactions
contemplated by this Agreement. Purchaser shall pay any notification filing fee
associated with the filing under the HSR Act.

        Section 2.5.    Purchase Price. The purchase price for the Assets shall
be Two Hundred Fifty Million Dollars ($250,000,000) in immediately available
funds (the "PURCHASE PRICE"). In addition, Purchaser shall assume at Closing,
and thereafter perform, the Assumed Liabilities. The aggregate amount of the
Purchase Price and the Assumed Liabilities (that are properly included in
Purchaser's tax basis for the Assets) shall be allocated among the Assets in the
manner to be mutually agreed upon (the "ALLOCATION"). Seller and Purchaser shall
file all information and Tax Returns (and any amendments thereto) in a manner
consistent with this Section 2.05 (including, without limitation, IRS Form 8594
or any successor form). If, contrary to the intent of the parties hereto as
expressed in this Section 2.05, any taxing authority makes or proposes an
allocation different from the Allocation determined under this Section 2.05,
Seller and Purchaser shall cooperate with each other in good faith to contest
such taxing authority's allocation (or proposed allocation), provided, however,
that, after consultation with the party adversely affected by such allocation
(or proposed allocation), another party hereto may file such



                                       7
   12
protective claims or returns but only as may be reasonably required to reserve
a claim which may be barred by the statute of limitations.

        Section 2.6.    Earnest Money Deposit. Purchaser will deposit with
Escrow Solutions, att: JoAnne Erros, Manager, 2172 Dupont Drive, Suite 22,
Irvine, CA 92612, phone: (949) 757-1010, fax: (949) 757-0671 ("Escrow Agent"),
an earnest money deposit of Five Million Dollars ($5,000,000) (the "EARNEST
MONEY DEPOSIT") when this Agreement is executed. Pending the Closing, the
Earnest Money Deposit shall be held in an interest bearing account in the name
of Escrow Agent at an FDIC insured California financial institution acceptable
to Seller and Purchaser, and subject to withdrawal only upon the consent of
Escrow Agent, Seller, and Purchaser. The Earnest Money Deposit, including
interest thereon accruing to the account of Purchaser, will be payable to Seller
at the Closing as a portion of the Purchase Price for the Assets. If Purchaser
fails to close for reasons other than as a result of a failure of Seller to
perform its obligations to satisfy closing conditions under this Agreement (as
set forth herein), then the Earnest Money Deposit, including interest earned
thereon, will be paid to Seller as liquidated damages which will be Seller's
sole and exclusive remedy.

ARTICLE 3      CLOSING

        Section 3.1.    Closing. Subject to the terms of this Agreement, the
sale and purchase of the Assets and the assumption of the Assumed Liabilities
contemplated by this Agreement shall take place at a closing of the transactions
contemplated hereby (the "CLOSING") to be held at the offices of Kaye, Scholer,
Fierman, Hays & Handler, LLP, 1999 Avenue of the Stars, Suite 1600, Los Angeles,
California, at such time and date as Seller and Purchaser may mutually agree
upon in writing, but in no event later than December 31, 2001 (the day on which
the Closing takes place being the "CLOSING DATE").

Section 3.2.   Conditions to the Closing.

                (1)     Obligations of Seller and Purchaser. The obligations of
Seller and Purchaser hereunder shall be subject to the satisfaction or written
waiver on or prior to the Closing Date of the following conditions:

                        (1)     The waiting period (and any extension thereof),
if any, applicable to the transactions contemplated by this Agreement under the
HSR Act, shall have been terminated or shall have expired, and no restrictive
order or other requirements pursuant to the HSR Act shall have been placed on
the parties.

                        (2)     The FCC shall have approved the Assignment
Application (and such other applications as may be required by applicable law,
rule or regulation to permit the transfer to the Purchaser of the Assets to be
filed with respect to the transactions contemplated by this Agreement).

                        (3)     No temporary restraining order, preliminary or
permanent injunction or other order issued by any court of competent
jurisdiction or other legal restraint or prohibition preventing the consummation
of the transactions contemplated hereby shall be in effect, nor shall any
proceeding by or with any Governmental Authority or third party seeking



                                       8
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any of the foregoing be pending (excluding, in each case, any such matter
initiated by Seller, Purchaser or any of their Affiliates). There shall not be
any Action taken, or any Law enacted, entered, enforced or deemed applicable to
the transactions contemplated hereby, which makes the consummation of such
transactions illegal (excluding, in each case, any such matter initiated by
Seller, Purchaser or any of their Affiliates).

                (2)     Obligations of Seller. The obligations of Seller to
consummate the transactions contemplated by this Agreement shall be subject to
the fulfillment on or prior to the Closing Date of each of the following
conditions:

                        (1)     All the representations and warranties of
Purchaser contained in this Agreement, and in any agreement, instrument or
document delivered pursuant hereto or in connection herewith on or prior to the
Closing Date that are not qualified by materiality, Material Adverse Effect or a
dollar threshold shall be true and correct in all material respects, and all
other representations and warranties of Purchaser shall be true and correct, as
of the date made and (having been deemed to have been made again on and as of
the Closing Date) shall be true and correct in all material respects on and as
of the Closing Date, except to the extent that any such representation or
warranty is made as of a specified date, in which case such representation or
warranty shall have been true and correct as of such specified date.

                        (2)     Purchaser shall have performed and complied
with, in all material respects, all covenants and agreements required by this
Agreement, and any agreement, instrument or document delivered pursuant thereto
or in connection herewith on or prior to the Closing Date, to be performed or
complied with by it on or prior to the Closing Date.

                (3)     Obligations of Purchaser. The obligations of Purchaser
to consummate the transactions contemplated by this Agreement shall be subject
to the fulfillment on or prior to the Closing Date of each of the following
conditions:

                        (1)     All the representations and warranties of Seller
contained in this Agreement, and in any agreement, instrument, or document
delivered pursuant hereto or in connection herewith on or prior to the Closing
Date, that are not qualified by materiality, Material Adverse Effect or a dollar
threshold, shall be true and correct in all material respects, and all other
representations and warranties of Seller shall be true and correct, as of the
date made and (having been deemed to have been made again on and as of the
Closing Date) shall be true and correct in all material respects on and as of
the Closing Date, except to the extent that any such representation or warranty
is made as of a specified date, in which case such representation or warranty
shall have been true and correct as of such specified date.

                        (2)     Seller shall have performed and complied with in
all material respects all covenants and agreements required by this Agreement,
and any agreement, instrument, or document delivered pursuant hereto or in
connection herewith on or prior to the Closing Date, to be performed or complied
with by it on or prior to the Closing Date.

                        (3)     Seller shall have entered into an agreement with
Purchaser, in form and substance reasonably satisfactory to Purchaser for the
purpose of enabling Purchaser to maintain transmission facilities for the
Station, substantially equivalent to the transmission



                                       9
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facilities currently held by the Seller and including, without limitation, the
provisions set forth on Exhibit 3.02(c) attached hereto.

        Section 3.3.    Closing Deliveries by Seller. In addition to any
delivery requirements of Seller set forth in Article IV of this Agreement, at
the Closing, Seller shall execute, acknowledge (where appropriate) and deliver,
or cause to be executed, acknowledge (where appropriate) and delivered, to
Purchaser the following:

                (1)     Copies of any governmental approvals (as listed on
Schedule 4.05) required, to transfer the Assets to Purchaser, which are
reasonably obtainable prior to the Closing.

                (2)     Such instruments, in form and substance reasonably
satisfactory to Purchaser, as may be reasonably requested by Purchaser to
transfer the Assets to Purchaser or evidence such transfer on the public
records.

                (3)     A certificate, executed by an officer of Seller, dated
as of the Closing Date, certifying that (i) the representations and warranties
of Seller in this Agreement that are not qualified by materiality, Material
Adverse Effect or a dollar threshold are true and correct in all material
respects, and all other representations and warranties of Seller are true and
correct in each case, as of the Closing Date, with the same effect as though
made as of such date (or, in the case of representations and warranties which
address matters only as of a particular date, as of such particular date), (ii)
each covenant or agreement of Seller in this Agreement to be complied with at or
prior to Closing shall have been complied with in all material respects and
(iii) no Action (excluding any such matter initiated by Purchaser or any of its
Affiliates) is pending or, to Seller's knowledge, threatened before, and no
injunction has been issued by, any Governmental Authority seeking to enjoin or
restrain or prohibit, delay, or restrain the performance of or to obtain damages
or other relief in connection with this Agreement, or the consummation of the
transactions contemplated hereby.

                (4)     A certificate of Seller certifying that Seller is not a
"foreign person" within the meaning of Section 1445 of the Code in substantially
the form of Exhibit 3.03(d).

                (5)     A legal opinion from Seller's counsel, substantially in
the form attached hereto as Exhibit 3.03(e).

                (6)     an executed copy of the agreement referenced in Section
3.02(c)(iii) hereof.

        Section 3.4.    Closing Deliveries by Purchaser. At the Closing,
Purchaser shall execute, acknowledge (where appropriate) and deliver, or cause
to be executed, acknowledged (where appropriate) and delivered, to Seller the
following:

                (1)     Such assignment and assumption agreements and similar
instruments, in form and substance reasonably satisfactory to Seller, relating
to the assumption of the Assumed Liabilities and the transfer of the Assets, as
may reasonably be requested by Seller.



                                       10
   15

                (2)     The Purchase Price.

                (3)     A certificate, executed by the duly authorized officer
of Purchaser, dated as of the Closing Date, certifying that (i) the
representations and warranties of Purchaser in this Agreement not qualified by
materiality, Material Adverse Effect or a dollar threshold are true and correct
in all material respects, and all other representations and warranties of
Purchaser are true and correct, in each case, as of the Closing Date, with the
same effect as though made as of such date (or, in the case of representations
and warranties which address matters only as of a particular date, as of such
particular date), (ii) each covenant or agreement of Purchaser in this Agreement
to be complied with at or prior to Closing shall have been complied with in all
material respects and (iii) no Action (excluding any such matter initiated by
Seller or any of its Affiliates) is pending or, to Purchaser's knowledge,
threatened before, and no injunction has been issued by, any Governmental
Authority seeking to enjoin or restrain or prohibit, delay, or restrain the
performance of or to obtain damages or other relief in connection with this
Agreement, or the consummation of the transactions contemplated hereby.

ARTICLE 4      REPRESENTATIONS AND WARRANTIES OF SELLER

        Seller represents and warrants to Purchaser that:

        Section 4.1.    Organization; Good Standing. Seller is a corporation
duly formed and validly existing under the laws of California and has all
requisite power and authority to own and lease its properties and the Assets and
to carry on its business as currently conducted.

        Section 4.2.    Qualification. Seller is duly qualified or licensed to
do business as a foreign corporation or other entity in each of the
jurisdictions set forth opposite its name on Schedule 4.02, and is in good
standing in each of such jurisdictions, which are all the jurisdictions in which
such qualification or licensing is required for the conduct of its business and
the ownership and leasing of its properties and the Assets, except jurisdictions
in which the failure to be so qualified or licensed would not, individually or
in the aggregate, have a Material Adverse Effect on the Seller.

        Section 4.3.    Due Authorization; Execution and Delivery. Subject to
the issuance of the Final Orders, and any required compliance with the HSR Act,
Seller has full corporate power and authority to enter into and perform this
Agreement and any documents or instruments to be entered into as contemplated or
required by this Agreement (collectively, the "ANCILLARY DOCUMENTS") and to
which Seller is a party, and to carry out the transactions contemplated hereby
and thereby. Prior to the Closing, Seller will have taken all requisite action
to approve the execution and delivery of this Agreement and the Ancillary
Documents to which it is a party and the transactions contemplated hereby and
thereby. This Agreement and each of the Ancillary Documents to which Seller is a
party 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
(whether such rights are considered at law or in equity).

        Section 4.4.    Noncontravention. The execution, delivery and
performance by Seller of this Agreement and the Ancillary Documents to which it
is a party, and the consummation by it



                                       11
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of the transactions contemplated hereby and thereby, do not and will not (i)
conflict with or result in a violation of any provision of the charter or bylaws
of Seller, (ii) conflict with or result in a violation of any provision of, or
constitute (with or without the giving of notice or the passage of time or both)
a default under, or give rise (with or without the giving of notice or the
passage of time or both) to any right of termination, cancellation or
acceleration under, or require any consent, approval, authorization or waiver
of, or notice to, any party to, any bond, debenture, note, mortgage or
indenture, or any material agreement, including but not limited to the Leases,
or other material instrument or obligation to which Seller is a party or by
which Seller or any of the Assets may be bound, or any FCC Licenses held by
Seller, (iii) result in the creation or imposition of any Encumbrance upon any
of the Assets, except for Encumbrances in favor of Purchaser, or (iv) assuming
compliance with the matters referred to in Section 4.05, violate any material
Law binding upon Seller, the Station or any of the Assets, except for (A) such
consents, approvals, authorizations and waivers that have been obtained and are
unconditional and in full force and effect and such notices that have been duly
given and (B) such consents, approvals, authorizations, waivers and notices that
are disclosed on Schedule 4.04.

        Section 4.5.    Governmental Approvals. No material approval,
authorization, consent, order or other action of, or filing with, any
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 or those under the HSR Act, and other than
(i) filings with, or approvals by other Governmental Authorities to occur in the
ordinary course following the consummation of the transactions contemplated by
this Agreement, and (ii) filings, with, or approvals of, Governmental
Authorities which may be necessary due to the status of Purchaser or any
Affiliate of Purchaser. Each of the filings and approvals included in clauses
(i) and (ii) above is described on Schedule 4.05.

        Section 4.6.    Title to Assets. As of the Closing Date, Seller will
have good and marketable title to all of the Assets it owns, and valid leasehold
rights to all of the Assets it leases, free and clear of all debts and
Encumbrances other than Permitted Encumbrances.

        Section 4.7.    Condition of Assets. As of the Closing Date, the
buildings, plants, structures and equipment, if any, of Seller which are
included in the Assets will be (i) in reasonably good operating condition,
ordinary wear and tear excepted, and will have been maintained by Seller in
accordance with standard industry practice, (ii) suitable for the purposes used
and (iii) adequate and sufficient for the normal operation of the Station, as
presently conducted.

        Section 4.8.    FCC Licenses.

                (1)     Schedule 2.01(a) accurately identifies each of the FCC
Licenses (including each of the applications therefor) as to the licensee, city
of license, and call sign (or, with respect to applications therefor, the file
number assigned by the Commission to such application). Seller has delivered to
Purchaser copies of each of the FCC Licenses (including any and all amendments
and other modifications thereto and all applications for additional such
licenses). The FCC Licenses identified on Schedule 2.01(a) comprise all of the
licenses, permits and other authorizations required from the Commission for the
normal and lawful broadcast operations of the Station in the manner now
conducted.



                                       12
   17

                (2)     No action or proceeding is pending or threatened before
the Commission or other Governmental Authority for the cancellation or material
adverse modification of the FCC Licenses. The public files which are required by
the Commission to be maintained by the licensee of the Station are current and
contain all information required to be included therein. Seller is current with
all reports, filings and other matters that it is required to file with the
Commission and is not delinquent in the payment of any fees and charges due to
the Commission. The material required by 47 C.F.R. Section 73.3526 to be kept in
the public inspection file of the Station is in such file.

                (3)     As of the Closing Date, Seller shall be the authorized
legal holder of each of the FCC Licenses. The FCC Licenses are in full force and
effect and no action or proceeding is pending or threatened before the
Commission for the cancellation of the FCC Licenses. Each of the Station, its
physical facilities, electrical and mechanical systems and transmitting and
studio equipment is being operated in material compliance with the terms of each
FCC License and is in substantial and material compliance with the rules and
regulations of the Commission.

                (4)     Schedule 2.01(d) accurately identifies each of the
Permits held by Seller. The Permits identified on Schedule 2.01(d) comprise all
of the licenses, permits and other authorizations required for the normal and
lawful operations of the Station in the manner now conducted, except for the FCC
Licences.

        Section 4.9.    Litigation. There are no Governmental Orders and no
Actions pending or, to Seller's knowledge, threatened against or affecting the
Assets or which challenges the validity or propriety of any of the transactions
contemplated by this Agreement.

        Section 4.10.   Absence of Certain Changes. Except as disclosed on
Schedule 4.10, since December 31, 1999 (i) there has not been any event or
condition that might reasonably be expected to result in a Material Adverse
Effect on the Assets or any material portion thereof; (ii) Seller has not
suffered any material loss, damage, destruction or other casualty to any of the
Assets (whether or not covered by insurance); (iii) Seller has not, in respect
of the Station, taken any of the actions set forth in Section 6.01, except as
permitted thereunder; and (iv) no adverse change with respect to the FCC
Licenses has occurred.

        Section 4.11.   Tax Matters. Except as disclosed on Schedule 4.11,
Seller has (and as of the Closing Date will have) (i) duly filed all Tax Returns
required to be filed by or with respect to it with the Internal Revenue Service
(the "IRS") or other applicable taxing authority (other than Tax Returns where
the failure to file would not be, in the aggregate, material), (ii) paid all
Taxes due, or claimed by any taxing authority to be due, from or with respect to
it (other than Taxes where the failure to pay would not be, in the aggregate,
material), except Taxes that are being contested in good faith and for which
adequate reserves have been set aside as disclosed on Schedule 4.11, and (iii)
made all material deposits required with respect to Taxes. All Tax Returns
referred to in the preceding sentence were, and in the case of Tax Returns not
yet filed, will be, true, correct and complete in all material respects when
filed. All material Taxes that Seller is or was required to withhold or collect
have been duly withheld or collected, including, without limitation, all
employment related Taxes and withholdings, and, to the extent required, have
been or will be timely paid to the proper governmental body. To the knowledge of
Seller,



                                       13
   18

there has been no issue raised or adjustment proposed (and none is pending) by
the IRS or any other taxing authority in connection with any Tax Returns
relating to the Assets, the Station or the Seller. No waiver or extension of any
statute of limitations as to any federal, state, local or foreign tax matter
relating to the Assets, the Station or the Seller has been given by or requested
from Seller. There are no tax liens upon any of the properties or assets of
Seller, including, without limitation, the Assets, other than liens for Taxes
not yet due and payable. None of the Assets (i) is "tax-exempt use property"
within the meaning of Section 168(h) of the Code, (ii) is subject to a tax
benefit transfer lease subject to the provision of former Section 168(f)(8) of
the Internal Revenue Code of 1954 or (iii) secures any debt the interest on
which is exempt from tax under Section 103 of the Code.

        Section 4.12.   Compliance with Laws. Seller has complied with all
material Laws (including without limitation the rules, regulations and practices
of the Commission), and Seller has not received any written notice of any claim,
which has not been dismissed or otherwise disposed of, that Seller has not so
complied.

        Section 4.13.   Real Property.

                (1)     Schedule 2.01(c) hereto sets forth a list of the real
property (the "Real Property") owned by the Seller subject to the agreement
referred to in Section 3.02(c)(iii) hereof.

                (2)     The Seller has good, valid and marketable fee simple
title to the Real Property listed on Schedule 2.01(c) hereto as being owned by
it and the Real Property is free and clear of all Liens other than (i) those
listed on Schedule 2.01(c) hereto. Seller has not been notified and has no
knowledge that it is in violation of any local zoning or similar land use laws
or governmental regulations except where such violation would not have a
Material Adverse Effect. The Seller is not in violation of or in noncompliance
with any covenant, condition, restriction, order or easement affecting the Real
Property owned by the Seller, except where such violation or noncompliance would
not have a Material Adverse Effect.

                (3)     The Real Property owned by the Seller constitutes all
the real property used or held for use by the Seller in the operation of the
Station's broadcast tower site.

                (4)     Seller has not been notified and has no knowledge that
the whole nor any portion of the Real Property is subject to any governmental
decree or order to be sold or is being condemned, expropriated or otherwise
taken by any Governmental Authority, body or other Person with or without
payment of compensation therefor, nor, to the Seller's knowledge, has any such
condemnation, expropriation or taking been proposed.

        Section 4.14.   Intentionally Left Blank.

        Section 4.15.   Certain Payments. Since the inception of Seller, none of
Seller or its Subsidiaries, or any director, officer, employee, or, to the
knowledge of Seller, any agent (or employee thereof) of Seller or any Subsidiary
or any other Person associated with or acting for or on behalf of Seller or any
Subsidiary, other than Purchaser or any Affiliate of Purchaser, has directly or
indirectly (a) made any illegal contribution, gift, bribe, rebate, payoff,
influence payment, kickback or other payment to any Person, private or public,
regardless of form, whether



                                       14
   19

in money, property or services (i) to obtain favorable treatment in securing
business, (ii) to pay for favorable treatment for business secured or (iii) to
obtain special concessions or for special concessions already obtained, for or
in respect of Seller or any of its Subsidiaries.

        Section 4.16.   Labor Agreements and Actions. The Assets are not bound
by or subject to any written or oral, express or implied, contract, commitment
or arrangement with any labor union, and no labor union has requested or, to the
knowledge of Seller, has sought to represent any of the employees,
representatives or agents of Seller. There is no strike or other labor dispute
involving the Assets pending, or, to the knowledge of Seller, threatened, nor is
Seller aware of any labor organization activity involving employees of Seller.

        Section 4.17.   Environmental.

                (1)     To Seller's knowledge, and without independent inquiry,
Seller holds all permits, consents, licenses, approvals, registrations,
certifications and authorizations required under Environmental Laws
("ENVIRONMENTAL PERMITS") necessary for the operation of the Assets as presently
conducted. All such Environmental Permits are in full force and effect and the
Seller has made all appropriate filings and registrations where necessary for
the issuance or renewal of such Environmental Permits. Schedule 4.17 hereto
specifies (A) the nature of each Environmental Permit now held, (B) the
governmental entity which has jurisdiction with respect to such Environmental
Permit, (C) the entity which is required to hold such Environmental Permit and
(D) the duration of such Environmental Permit. To Seller's knowledge, and
without independent inquiry, Seller is, and in the past has been, in material
compliance with all terms and conditions of all Environmental Permits and all
Environmental Laws as then applicable.

                (2)     To Seller's knowledge, and without independent inquiry,
consummation of the transactions contemplated hereby will not require the
Purchaser or the Seller to provide notice, obtain governmental approval or take
any other actions in order to enable the Purchaser to continue to hold all
Environmental Permits and to remain in compliance with the terms and conditions
of all Environmental Permits and all Environmental Laws.

                (3)     Except as set forth on Schedule 4.17, there is not
pending against the Seller any civil, criminal or administrative action, suit,
summons, citation, complaint, claim, notice of violation, demand, judgment,
order, lien, proceeding or hearing or, to the knowledge of the Seller, any
study, inquiry, proceeding or investigation involving the Assets (collectively,
"ENVIRONMENTAL ACTIONS"), based on or related to any Environmental Permit or any
Environmental Law or the presence, manufacture, generation, processing,
distribution, use, sale, treatment, recycling, receipt, storage, disposal,
transport, arranging for transportation, treatment or disposal, or handling, or
the emission, discharge, release or threatened release into the environment, of
any Hazardous Material, nor, to the knowledge of the Seller, has any such
Environmental Action been threatened within the last five years.

                (4)     To the knowledge of Seller, without independent inquiry,
neither Seller nor any predecessor has at any time manufactured, generated,
processed, distributed, used, sold, treated, recycled, received, stored,
disposed of, transported, arranged for transportation, treatment or disposal of,
handled, or conducted any other activity involving, any Hazardous Material at,
on,


                                       15
   20

or about, under or within the Real Property, except in compliance in all
material respects with Environmental Laws and Environmental Permits, except as
set forth on Schedule 4.17.

                (5)     To the knowledge of Seller, without independent inquiry,
all of the Real Property (including improvements thereon) is free of any
Hazardous Materials (except those authorized pursuant to and in accordance with
Environmental Permits held by the Seller) and free of all contamination,
including but not limited to groundwater contamination, arising from relating
to, or resulting from any such Hazardous Material, except as set forth in
Schedule 4.17.

                (6)     To the knowledge of Seller, without independent inquiry,
there are no past or present conditions, events, circumstances, facts,
activities, practices, incidents, actions, omissions or plans involving the
Assets: (1) that may interfere with or prevent continued compliance by the
Seller with Environmental Laws and the requirements of Environmental Permits, or
(2) that may give rise to any liability or other obligation under any
Environmental Laws that may require the Seller or the Purchaser to incur any
actual or potential Environmental Costs, or (3) that may form the basis of any
claim, action, suit, proceeding, hearing, investigation or inquiry against or
involving the Seller or the Purchaser based on or related to any Environmental
Matter or which could require the Seller to incur any Environmental Costs,
except as set forth in Schedule 4.17.

                (7)     To the knowledge of Seller, without independent inquiry,
there are no aboveground or underground storage tanks, incinerators or surface
impoundments at, on, or about, under or within the Real Property, except as set
forth in Schedule 4.17. Schedule 4.17 also lists all underground or aboveground
storage tanks and incinerator that to Seller's knowledge, without independent
inquiry, were removed from such Real Property.

                (8)     Seller has not received any written notice or other
communication that it is or may be a potentially responsible person or otherwise
liable, in connection with any waste disposal site containing any Hazardous
Materials at, on, or about, under or within the Real Property.

                (9)     To Seller's knowledge, without independent inquiry, and
except as set forth in Schedule 4.17, there has been no release or other
dissemination at any time of any Hazardous Materials at, on, or about, under or
within the Real Property (other than pursuant to and in accordance with
Environmental Permits held by the Seller).

                (10)    Except as set forth on Schedule 4.17, the Seller has not
been requested or required by any Governmental Authority or any other person to
perform any investigatory or remedial activity or other action in connection
with any Environmental Matter.

                (11)    The Seller has delivered to Purchaser true, accurate and
complete information in its possession or control pertaining to all of the
matters set forth in paragraphs (a) through (j) hereof, including all documents
and information pertaining to all environmental audits or assessments prepared
by or for the Seller, any governmental entity or any third party (including any
financial institution) and including all reports of environmental audits or site
assessments.



                                       16
   21

        Section 4.18.   Insurance. Seller maintains the insurance policies
described on Schedule 4.18. All such policies are in full force and effect and
all premiums have been paid in full to the extent payment was due.

        Section 4.19.   Brokerage Fees. Neither Seller nor any of its affiliates
has retained any financial advisor, broker, agent, or finder or paid or agreed
to pay any financial advisor, broker, agent, or finder on account of this
Agreement or any transaction contemplated hereby, except for Sterling Associates
("SELLER'S BROKER"). Purchaser shall pay a fee of $2,500,000 to Seller's Broker
in accordance with agreements therewith. Except as set forth above, Seller shall
indemnify and hold Purchaser harmless from and against any and all losses,
claims, damages and liabilities (including legal and other expenses reasonably
incurred in connection with investigating or defending any claims or actions)
with respect to any finder's fee, brokerage commission or similar payment in
connection with any transaction contemplated hereby asserted by any person on
the basis of any act or statement made or alleged to have been made by Seller or
any of its Affiliates.

ARTICLE 5      REPRESENTATIONS AND WARRANTIES OF PURCHASER

        Purchaser hereby represents and warrants to Seller as follows:

        Section 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 corporate power and authority to
own and lease its properties and carry on its business as currently conducted.

        Section 5.2.    Due Authorization; Execution and Delivery. Subject to
the issuance of the Final Orders and any required compliance with the HSR Act,
Purchaser has full power and authority to enter into this Agreement and the
Ancillary Documents to which it is a party and to carry out its obligations
hereunder. The execution and delivery by Purchaser of this Agreement and the
Ancillary Documents to which it is a party and the consummation by it of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of Purchaser. This Agreement and the Ancillary
Documents to which Purchaser is a party have been duly executed and delivered by
Purchaser and constitute the legal, valid and binding obligations of Purchaser,
enforceable against it in accordance with their respective terms, except as may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors' rights generally or general equitable
principles. Neither the execution and delivery by Purchaser of this Agreement or
the Ancillary Documents to which it is a party, nor the consummation of the
transactions contemplated hereby and thereby will: (i) conflict with or result
in a breach of the organizational documents of Purchaser; (ii) subject to the
issuance of the Final Orders, violate any law, statute, rule or regulation or
any order, writ, injunction or decree of any court or governmental authority; 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 or any of its
Affiliates is a party or by which it or any of its Affiliates is bound or
affected.

        Section 5.3.    Governmental Consents. No consent, approval,
authorization, license, exemption of, filing or registration with any court,
Governmental Authority or administrative



                                       17
   22

agency is required by Purchaser in connection with the execution and delivery of
this Agreement or the consummation by it or any transaction contemplated hereby,
other than the consent of the FCC or under the HSR Act.

        Section 5.4.    Litigation. There is no order of any court, governmental
agency or authority and no action, suit, proceeding or investigation, judicial,
administrative or otherwise that is pending or, to Purchaser's knowledge,
threatened against or affecting Purchaser which challenges the validity or
propriety of any of the transactions contemplated by this Agreement.

        Section 5.5.    Brokerage Fees. No broker, finder, financial advisor or
investment banker is entitled to any brokerage, finder's or other fee,
commission or expense reimbursement in connection with the transactions
contemplated by this Agreement as a result of any agreement or action of
Purchaser, except as set forth in Section 4.19. Except as set forth above,
Purchaser shall indemnify and hold Seller harmless from and against any and all
losses, claims, damages and liabilities (including legal and other expenses
reasonably incurred in connection with investigating or defending any claims or
actions) with respect to any finder's fee, brokerage commission or similar
payment in connection with any transaction contemplated hereby asserted by any
person on the basis of any act or statement made or alleged to have been made by
Purchaser or any of its Affiliates.

        Section 5.6.    Qualification. Purchaser is legally, financially and
otherwise qualified to be the licensee of, acquire, own and operate the Station
under the Communications Act and the rules, regulations and policies of the FCC.
There are no facts that would, under existing law and the existing rules,
regulations, policies and procedures of the FCC, disqualify Purchaser as an
assignee of the FCC Licenses or as the owner and operator of the Station. No
waiver of any FCC rule or policy is necessary for the FCC Consents to be
obtained. There is no action, suit or proceeding pending or, to the knowledge of
Purchaser, threatened against Purchaser which questions the legality or
propriety of the transactions contemplated by this Agreement or could materially
adversely affect Purchaser's ability to perform its obligations hereunder.

ARTICLE 6      CERTAIN COVENANTS AND OTHER AGREEMENTS

Section 6.1.            Conduct and Preservation of Business.

                (1)     Except as expressly provided in this Agreement, during
the period from the date hereof to the Closing, Seller shall not, without the
prior written consent of Purchaser:

                        (1)     make any material change in the ongoing
operations of the Station;

                        (2)     incur, guarantee or assume any indebtedness for
borrowed money in respect of the Assets;

                        (3)     mortgage or pledge any of the Assets to any
person, or create or suffer to exist any Encumbrance thereupon, other than the
Permitted Encumbrances;

                        (4)     sell, lease, transfer or otherwise dispose of,
directly or indirectly, any material part of the Assets;



                                       18
   23

                        (5)     amend, modify or change any existing material
lease, contract, FCC License or agreement relating to the Assets;

                        (6)     permit any current insurance or reinsurance
policies to be canceled or terminated or any of the coverage thereunder to lapse
if such policy covers Assets, or insures risk, contingencies or liabilities of
the Station, unless simultaneously with such cancellation, termination or lapse,
replacement policies providing coverage equal to or greater than the coverage
canceled, terminated or lapsed are in full force and effect and written copies
thereof have been provided to Purchaser;

                        (7)     take any action which would or might make any of
the representations or warranties of Seller contained in this Agreement untrue
or inaccurate as of any time from the date of this Agreement to the Closing or
would or might result in any of the conditions set forth in this Agreement not
being satisfied;

                        (8)     allow any Assumed Contract to be terminated or
to be materially modified prior to the full term of the contract; or

                        (9)     authorize or propose, or agree in writing or
otherwise to take, any of the actions described in this Section.

        Section 6.02    Permitted Use. Purchaser shall be entitled to a
nonexclusive, payment free, license to continue to maintain the STLs subject to
this Agreement in their current location at 1920 West Sunset Blvd, Los Angeles,
California until twenty-four (24) months following the Closing. During such
period Purchaser shall pay all utility and maintenance costs pertaining to such
STLs, and shall maintain comprehensive liability insurance in an amount not less
than two million dollars per occurrence and property insurance covering the STLs
for their full replacement value. Seller shall be designated as an additional
insured on such insurance policies, which at all times shall be primary and
waive the right to contribution by Seller except in the event of Seller's sole
negligence. In the event Purchaser is unable to obtain the approval of the FCC
to relocate the STLs to another location within such period, despite reasonable
efforts by Purchaser to obtain such approval, Seller agrees to grant Purchaser a
nonexclusive license at fair market value, and on similar terms, to maintain the
STLs in their current location for one additional twelve (12) month period.

        Section 6.03    Financial Statements. Seller shall use its best efforts
to (i) cooperate with and assist Purchaser and (ii) cause its Subsidiaries to
cooperate with and assist Purchaser, in Purchaser's preparation of financial
information necessary to enable Purchaser to fulfill Purchaser's financial
reporting requirements under Regulation S-X of the Securities Act of 1933, as
amended, with respect to the acquisition of the Assets pursuant to this
Agreement, including, without limitation, (A) requesting Seller's accountants or
the accountants of any of Seller's Subsidiaries that conducted the Seller's
business during the applicable periods to cooperate with Purchaser and (B)
requesting the appropriate officers of Seller or any Subsidiary of Seller
engaged in Seller's business during the applicable periods to sign management
representation letters (reasonably acceptable in form and substance to Seller)
if reasonably requested by the accountants preparing such financial information
for Purchaser.



                                       19
   24

        Section 6.04    Access to Records and Properties. Subject to
requirements of confidentiality imposed by contract or by law, and reasonable
advance notice, Seller will make available to Purchaser, its accountants,
counsel and other representatives, during normal business hours (a) the
properties, books and records of Seller pertaining to the assets subject to this
Agreement, (b) copies of all such contracts, books and records, and other
existing documents and data relating to the assets subject to this Agreement,
and (c) such additional financial, operating, and other data and information
relating to the assets subject to this Agreement as Purchaser may reasonably
request.

        Section 6.05    Taxes; Other Charges. All sales, use, value-added,
transfer, registration, stamp, deed and similar Taxes ("TRANSFER TAXES")
resulting from the consummation of the transactions contemplated hereby shall be
borne by Seller and Purchaser equally. The parties shall cooperate in obtaining
all exemptions from such Transfer Taxes. The party bearing responsibility under
applicable law shall file all necessary documentation with respect to, and make
all payments of, such Transfer Taxes on a timely basis, with the cooperation of
the other party.

        Section 6.06    Best Efforts. 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 all necessary consents and approvals of other persons and Governmental
Authorities required to enable it to consummate the transactions contemplated by
this Agreement, including the consent of the FCC and any necessary filings and
consents under the HSR Act. 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 (it
being understood that Purchaser shall pay all filing fees in connection with
notification filings under the HSR Act). Each party shall promptly make all
filings, applications, statements and reports to all governmental agencies or
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. If the FCC
determines that the transactions contemplated hereby or a portion thereof are
inconsistent or violative of FCC rules or regulations, the parties agree that
they will, to the extent practicable, negotiate in good faith for a period not
to exceed sixty (60) days following written notice of such determination by the
FCC to amend, modify or restructure the transactions contemplated hereby so as
to be consistent with FCC rules and regulations.

        Section 6.07    Public Announcements. Prior to the Closing Date, all
notices to third parties and other publicity relating to the transactions
contemplated by this Agreement shall be jointly planned by Seller and Purchaser;
it being understood by Seller that Purchaser is a public company subject to
disclosure requirements, and this covenant shall be subject to Purchaser's
requirements thereunder. Upon the occurrence of the Closing, Seller and
Purchaser agree to issue a press release only upon mutual consent.

        Section 6.08    Compliance with Covenants. Between the date hereof and
the Closing, Seller will comply in all material respects with all covenants, and
shall cause its Affiliates to comply in all material respects with all covenants
set forth in this Agreement.



                                       20
   25

        Section 6.09    Notification. Between the date hereof and the Closing,
Seller will promptly notify Purchaser in writing if Seller becomes aware of any
fact or condition that causes or constitutes a breach of any Seller's
representations and warranties as of the date hereof, or if Seller becomes aware
of the occurrence after the date hereof of any fact or condition that would
(except as expressly contemplated by this Agreement) cause or constitute a
breach of any such representation or warranty had such representation or
warranty been made as of the time of occurrence or discovery of such fact or
condition. During the same period, Seller will promptly notify Purchaser of the
occurrence of any breach of any covenant of Seller in this Article VI or of the
occurrence of any event that may make the satisfaction of the conditions in
Article III impossible or unlikely. During the same period, Purchaser will
promptly notify Seller of the occurrence of any breach of any covenant of
Purchaser in this Article VI or of the occurrence of any event that may make the
satisfaction of the conditions in Article III impossible or unlikely.

        Section 6.10    No Negotiation. Until such time, if any, as this
Agreement is terminated pursuant to Article VIII, Seller will not directly or
indirectly solicit, initiate, or encourage any inquiries or proposals from,
discuss or negotiate with , or provide any non-public information to any person
(other than Purchaser) relating to any transaction involving the sale of the
Assets, or any of the capital stock of Seller, or any merger, consolidation,
business combination, or similar transaction involving Seller. ARTICLE 7
INDEMNIFICATION

        Section 7.1.    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 twelve months after the Closing Date except for
(i) representations provided in Sections 4.01, 4.03, 4.04(i), 4.17 and 4.19,
which shall survive indefinitely.

        Section 7.2.    Indemnification by Seller. Subject to the limitations
set forth in Sections 7.01 and 7.04, Seller shall indemnify and hold harmless
Purchaser and its officers, directors, employees, agents, permitted assigns,
Affiliates and successors thereof from, against, for and in respect of:

                (1)     any and all damages, losses, settlement payments,
obligations, liabilities, claims, actions or causes of action and encumbrances
(collectively, "LOSSES") suffered, sustained, incurred or required to be paid by
Purchaser and arising from the breach of any written representation, warranty,
agreement or covenant of Seller contained in this Agreement;

                (2)     any Losses arising from any acts of Seller and its
officers and employees occurring prior to Closing;

                (3)     all Excluded Liabilities, including but not limited to,
the Excluded Tax Liabilities, and all liabilities arising from or in connection
with the maintenance by Seller or any affiliate of Seller of any employee
benefit plan (as defined in Section 3(3) of ERISA); and

                (4)     all reasonable costs and expenses (including, without
limitation, reasonable attorneys' fees, interest and penalties) incurred by
Purchaser in connection with any action, suit,



                                       21
   26

proceeding, demand, assessment or judgment incident to any of the matters
indemnified against in this Section 7.02.

        THE PROVISIONS OF THIS INDEMNITY SHALL NOT BE THE SOLE REMEDY IN THE
CASE OF INTENTIONAL MISREPRESENTATIONS, FRAUD, WILLFUL MISCONDUCT OR GROSS
NEGLIGENCE.

        Section 7.3.    Indemnification by Purchaser. Subject to the limitations
set forth in Sections 7.01 and 7.04, Purchaser shall indemnify and hold Seller
and the officers, directors, employees, trustees, agents, permitted assigns,
Affiliates and successors thereof harmless from, against, for and in respect of:

                (1)     any and all Losses suffered, sustained, incurred or
required to be paid by Seller and arising from the breach of any written
representation, warranty, agreement or covenant of Purchaser contained in this
Agreement, or the ownership and operation by Purchaser of the Assets after the
Closing;

                (2)     any and all Assumed Liabilities arising from and after
the Closing Date; and

                (3)     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 7.03.

        THE PROVISIONS OF THIS INDEMNITY SHALL NOT BE THE SOLE REMEDY IN THE
CASE OF INTENTIONAL MISREPRESENTATIONS, FRAUD, WILLFUL MISCONDUCT OR GROSS
NEGLIGENCE.

        Section 7.4.    Indemnification Procedures. 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:

                (1)     The indemnified party shall give prompt written notice
(which is no event shall exceed 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 Article
VII hereof, stating the nature and basis of said claims and the amounts thereof,
to the extent known. The failure to so notify, or any delay in so notifying, the
indemnifying party will not relieve the indemnifying party of its obligations
under this Article VII, except solely to the extent that the indemnifying party
can demonstrate that such failure actually and materially prejudice the defense
of the Action by the indemnifying party. Within 10 days of delivery of such
notice, the indemnifying party shall advise the indemnified party (i) whether it
disputes the claim for indemnification and (ii) whether the indemnifying party
desires at its sole costs and expense to defend such Action.


                                       22
   27

                (2)     In the event that the indemnifying party notifies the
indemnified party within the notice period specified in clause (a) of this
Section 7.04 that the indemnifying party does not dispute the indemnifying
party's obligation to indemnify hereunder and desires to defend the indemnified
party against such claim and, except as hereunder provided, the indemnifying
party shall have the right to defend by appropriate proceedings, which
proceedings shall be promptly settled or prosecuted by the indemnifying party to
final conclusion; provided that, unless the indemnified party otherwise agrees,
the indemnifying party may not compromise or settle any matter (in whole or in
part) (i) without obtaining a complete and unconditional release of the
indemnified party, (ii) unless the sole relief provided is monetary damages that
are paid in full by the indemnifying party, and (iii) unless there is no finding
or admission of any violation of law or any violation of the rights of any other
Person and no effect on any claims that may be made against the indemnified
party. If the indemnifying party elects not to defend the indemnified party
against such claim, whether by failure of the indemnifying party to give the
indemnified party timely notice as provided above or otherwise, then the
indemnified party may assume the defense thereof, shall have the right to
undertake the defense of, compromise or settle such proceedings and the
indemnifying party shall, upon request of the indemnified party, pay to such
indemnified party, in accordance with the terms of this Article VII, the amount
of Losses resulting from such proceeding; provided, however, that such
proceeding shall not be compromised or settled without the written consent of
the indemnifying party, which consent shall not be unreasonably withheld.
Notwithstanding the foregoing, the indemnifying party's right to object to any
proposed compromise or settlement shall be conditioned upon such indemnifying
party acknowledging to the indemnified party that such indemnifying party shall
be solely responsible (as between the indemnifying party and the indemnified
party) for all liabilities and obligations arising from the matter proposed to
be compromised or settled. 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 Article VII hereof, the
Action, suit or proceeding shall, upon the written acknowledgment by the
indemnifying party that is obligated to indemnify under such indemnity
agreement, be defended (including all proceeding on appeal or for review which
counsel for the indemnified party shall deem appropriate) by the indemnifying
party. The indemnified party shall have the right to employ its own counsel in
any such case, but the fees and expenses of such counsel shall be at the
indemnified party's own expense unless (i) the employment of such counsel and
the payment of such fees and expenses both shall have been specifically
authorized in writing by the indemnifying party in connection with the defense
of such Action, suit or proceeding, or (ii) counsel to such indemnified party
shall have reasonably concluded and specifically notified the indemnifying party
that there may be specific defenses available to it which are different from or
additional to those available to the indemnifying party or that such Action,
suit or proceeding involves or could have an effect upon matters beyond the
scope of the indemnity agreements contained in Article VI hereof, in any of
which events the indemnifying party, to the extent made necessary by such
defenses, shall not have the right to direct the defense of such Action, suit or
proceeding on behalf of the indemnified party. In the latter such case only that
portion of such fees and expenses of the indemnified party's separate counsel
reasonably related to matters covered by the indemnity agreements contained in
Article VII hereof shall be borne by the indemnifying party. 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.



                                       23
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                (3)     The defending party shall make available to the
non-defending party and its attorneys and accountants all books and records of
the non-defending 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.

                (4)     There shall be no indemnification recoverable against a
party otherwise obligated to provide indemnification therefor under this Article
VII (other than the payment of Taxes relating to the Straddle Period) until the
Losses by the party seeking such indemnification exceed $100,000 in the
aggregate (the "BASKET AMOUNT"), and once all such Losses exceed the Basket
Amount, such party shall only be obligated to the other party for Losses in
excess of the Basket Amount (other than payment of Taxes relating to the
Straddle Period).

                (5)     A waiver of a condition to Closing hereunder shall not
preclude the waiving party from being indemnified hereunder.

        Section 7.5.    Certain Tax Matters. For purposes of Section 2.03(b) and
7.02(b), Seller's allocable portion of Taxes with respect to a taxable period
which includes (but does not end on) the Closing Date (the "STRADDLE PERIOD")
shall be (x) in the case of any Taxes other than Taxes based upon or related to
income or receipts, an amount equal to the Tax for the entire period multiplied
by a fraction, the numerator of which is the number of days in the period for
which such Taxes are paid ending on the Closing Date and the denominator of
which is the number of days in the entire taxable period; and (y) in the case of
any Taxes based upon or related to income or receipts, the amount that would be
payable if the taxable period ended on the Closing Date. The party that has the
primary obligation to do so under applicable law shall file any Tax Return that
is required to be filed in respect of Taxes described in Section 7.02, and that
party shall pay the Taxes shown on such Tax Return and the other party shall
reimburse the filing party for its share of such Tax as determined under Section
7.02 by wire transfer of immediately available funds no later than ten days
after receipt of written notice that such Tax has been paid to the applicable
governmental body. For purposes of Taxes based upon or measured by net income
("INCOME TAXES"), Seller shall include the net income attributable to Seller,
the Station and the Assets in its income through the Closing Date and shall file
the appropriate Tax Returns. Subject to the provisions of Section 6.03, Seller
shall be responsible for the payment of all Taxes, including, without
limitation, Income Taxes imposed on Seller, if any, as a result of the transfer
of the Station and the Assets to Purchaser. Seller and Purchaser shall provide
each other with such cooperation and information as either of them reasonably
may request of the other with respect to Seller, the Station or the Assets in
filing any Tax Return, amended return or claim for refund, determining a
liability for Taxes or a right to refund of Taxes or in conducting any audit or
other proceeding in respect of Taxes with respect to Seller, the Station or the
Assets. Such cooperation and information shall include, without limitation,
providing copies of all relevant portions of Tax Returns with respect to Seller,
together with accompanying schedules and related work papers, documents relating
to rulings or other determinations by taxing authorities and records concerning
the ownership and tax basis of property, which either party may possess. Each
party shall make its employees available on a mutually convenient basis to
provide explanation of any documents or information provided hereunder. The
party requesting assistance hereunder shall reimburse the other for any
reasonable out-of-pocket costs incurred in providing any return, document or
other written information, and shall compensate the other for any reasonable
costs (excluding wages



                                       24
   29

and salaries) of making employees available, upon receipt of reasonable
documentation of such costs. Each party shall retain all returns, schedules and
work papers and all material records or other documents relating thereto, until
the expiration of the statute of limitations (including extensions) of the
taxable years to which such returns and other documents relate and, unless the
relevant portions of such returns and other documents are offered to the other
party, until the final determination of any payments which may be required in
respect of such years under this Agreement. Any information obtained under this
Section 7.05 shall be kept confidential, except as may be otherwise necessary in
connection with the filing of any Tax Returns or claims for refund or in
conducting any audit or other proceeding and shall be used solely for the
purposes set forth in this Section 7.05.

ARTICLE 8      TERMINATION

        Section 8.1.    Termination. This Agreement may be terminated and the
transactions contemplated hereby abandoned at any time prior to the Closing in
the following manner:

                (1)     by mutual written consent of Seller and Purchaser; or

                (2)     by either Seller or Purchaser if the Closing shall not
have occurred by December 31, 2001, unless such failure to close shall be due to
a breach of this Agreement by the party seeking to terminate this Agreement
pursuant to this clause (b); or

                (3)     by either Seller or Purchaser if there shall be any Law
that makes consummation of the transactions contemplated hereby illegal or
otherwise prohibited or a Governmental Authority shall have issued an order,
decree or ruling or taken any other action permanently restraining, enjoining or
otherwise prohibiting the consummation of the transactions contemplated hereby,
and such order, decree, ruling or other action shall have become final and
nonappealable; or (1)

                (4)     by Seller if (i) any of the material representations and
warranties of Purchaser contained in this Agreement shall not be true and
correct in any material respect, when made or at any time prior to the Closing
as if made at and as of such time (except to the extent that any such
representation or warranty is made as of a specified date, in which case such
representation or warranty shall have been true and correct in all material
respects as of such specified date), in any respect which is material to
Purchaser of the ability of Purchaser to consummate the transactions
contemplated hereby, or (ii) Purchaser shall have failed to fulfill in any
material respect any of its material obligations under this Agreement, which
failure is material to the obligations of Purchaser under this Agreement, and,
in the case of each of clauses (i) and (ii), such misrepresentation, breach of
warranty, or failure (provided it can be cured) has not been cured within 30
days after written notice thereof from Seller to Purchaser; provided that
Purchaser shall have no opportunity to cure its failure to timely pay the
Purchase Price; or

                (5)     by Purchaser, if (i) any of the material representations
and warranties of Seller contained in this Agreement shall not be true and
correct in any material respect, when made or at any time prior to the Closing
as if made at and as of such time (except to the extent that any such
representation or warranty is made as of a specified date, in which case such
representation or warranty shall have been true and correct in all material
respects as of such



                                       25
   30

specified date), in any respect which is material to Seller or the ability of
Seller to consummate the transactions contemplated hereby, or (ii) Seller shall
have failed to fulfill in any material respect any of its material obligations
under this Agreement, which failure is material to the obligations of Seller
under this Agreement, and, in the case of each of clauses (i) and (ii), such
misrepresentation, breach of warranty, or failure (provided it can be cured) has
not been cured within 30 days after written notice thereof from Purchaser to
Seller.

        Section 8.2.    Certain Remedies Not Exclusive. Except as specifically
set forth herein, the rights and remedies herein provided shall be cumulative
and not exclusive of any rights or remedies provided by law. The rights and
remedies of any party based upon, arising out of or otherwise in respect of any
inaccuracy in or breach of any representation, warranty, covenant or agreement
contained in this Agreement shall in no way be limited by the fact that the act,
omission, occurrence or other state of facts upon which any claim of any such
inaccuracy or breach is based may also be the subject matter of any other
representation, warranty, covenant or agreement contained in this Agreement (or
in an other agreement between the parties) as to which there is no inaccuracy or
breach.

        Section 8.3.    Specific Performance. It is understood and agreed that
money damages would not be sufficient remedy for Seller's or Purchaser's failure
to perform under this Agreement and the Ancillary Documents, including Seller's
failure to transfer, assign, convey, sell or deliver the Assets to Purchaser and
Purchaser's payment of the Purchase Price, that Purchaser or Seller, as the case
may be, would be irreparably harmed by such a breach and that Purchaser and
Seller shall be entitled to specific performance and injunctive relief as
remedies for any such breach.

ARTICLE 9      MISCELLANEOUS PROVISIONS

        Section 9.1.    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, including, but not limited to,
legal and accounting fees. 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, arbitration expenses and reasonable attorneys'
fees.

        Section 9.2.    Amendment. This Agreement may be amended at any time but
only by an instrument in writing signed by the parties hereto.

        Section 9.3.    Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given if (i) mailed by certified mail,
return receipt requested, or delivered 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 (ii) sent by
facsimile to the number set forth below (or such other number for a party as
shall be specified by proper notice hereunder) or (iii) sent by email to the
email address set forth below (or such other email address for a party as shall
be specified by proper notice hereunder):

        If to Purchaser, to:

                   Spanish Broadcasting System, Inc.


                                   26
   31

                   3191 Coral Way
                   Miami, Florida  33145
                   Attention:  Joseph A. Garcia
                   Facsimile:  (305) 446-5148
                   Email:  bgerdts@sbscorporate.com
                           ------------------------

        with copies (which shall not constitute notice) to:

                   Kaye, Scholer, Fierman, Hays & Handler, LLP
                   901 Fifteenth Street, N.W.
                   Washington, D.C.  20005
                   Attention:  Jason L. Shrinsky
                   Facsimile:  (202) 682-3580
                   Email:  jshrinsky@kayescholer.com
                           -------------------------

        If to Seller, to:

                   International Church of the Foursquare Gospel, Inc.
                   1910 W. Sunset Boulevard
                   Los Angeles, CA  90026-0176
                   Attention:  Brent R. Morgan
                   Facsimile:  (213) 989-4565 [After Public Announcement Only]
                   Email: bmorgan@foursquare.org
                           ---------------------

        with copies (which shall not constitute notice) to:

                   Farrand Cooper, P.C.
                   235 Montgomery Street, Suite 905
                   San Francisco, CA  94104
                   Attention:  Stephen R. Farrand, Esq.
                   Facsimile:  (415) 677-2950
                   Email: sfarrand@fcblaw.com
                          -------------------

        Section 9.4.    Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors,
heirs and permitted assigns. This Agreement may not be assigned by either party
without the prior written consent of the other, except that Purchaser may assign
to any wholly owned subsidiary of Purchaser any of Purchaser's rights, interests
or obligations hereunder, upon notice to Seller; provided that no such
assignment shall relieve Purchaser of its obligations hereunder or delay
Closing.

        Section 9.5.    Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but together shall
constitute one and the same instrument.

        Section 9.6.    Headings. The headings of the Sections of this Agreement
are inserted for convenience only and shall not constitute a part hereof.

        Section 9.7.    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.



                                       27
   32

        Section 9.8.    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.

        Section 9.9.    Arbitration/Governing Law. ANY DISPUTE ARISING OUT OF OR
IN ANY WAY RELATING TO THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE SUBSTANTIVE AND PROCEDURAL LAW OF THE STATE OF CALIFORNIA
(WITHOUT REGARD TO ITS CONFLICT OF LAWS RULES) AND SHALL BE RESOLVED AT LOS
ANGELES, CALIFORNIA BY ARBITRATION BEFORE A RETIRED JUDGE OF THE CALIFORNIA
COURTS ASSOCIATED WITH JAMS MUTUALLY ACCEPTABLE TO THE PARTIES, OR, FAILING
AGREEMENT BY THE PARTIES, APPOINTED BY THE PRESIDING JUDGE OF THE COURT OF
GENERAL JURISDICTION IN THE COUNTY OF LOS ANGELES, CALIFORNIA. SUCH ARBITRATION
SHALL BE COMMENCED UPON THE WRITTEN REQUEST OF ANY PARTY, AND SHALL BE CONDUCTED
ON A CONFIDENTIAL BASIS. WITHOUT LIMITING ANY OTHER POWERS OF THE ARBITRATOR,
THE ARBITRATOR SHALL HAVE THE AUTHORITY OF A JUDGE PRO TEM WITH THE AUTHORITY TO
ISSUE EQUITABLE ORDERS, INCLUDING ANY EX PARTE ORDERS, DEEMED NECESSARY OR
APPROPRIATE UNDER THE CIRCUMSTANCES. ARBITRATION SHALL BE CONDUCTED AS A TRIAL
BY THE COURT APPLYING THE SUBSTANTIVE AND PROCEDURAL LAW OF THE STATE OF
CALIFORNIA (WITHOUT REGARD TO ITS CONFLICT OF LAW RULES) WITH A WRITTEN
STATEMENT OF DECISION. JUDGMENT UPON THE ARBITRATOR'S AWARD MAY BE ENTERED IN
ANY COURT OF COMPETENT JURISDICTION. BOTH PARTIES EXPRESSLY SUBMIT AND AGREE TO
THE JURISDICTION AND VENUE AS PROVIDED HEREIN. THE PARTIES SHALL EQUALLY SHARE
AND PAY THE ARBITRATOR'S FEES AND RELATED COSTS. EACH PARTY SHALL BEAR ITS OWN
ATTORNEYS' FEES AND COSTS INCURRED IN CONNECTION WITH ANY SUCH ARBITRATION AND
ANY APPEAL THEREFROM.


             -------------------            ---------------------
               Seller-initials              Purchaser - initials

        Section 9.10.   Severability. If any term or other provision of this
Agreement is held invalid, illegal or incapable of being enforced under any rule
or law, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in a materially adverse
manner with respect to either party. Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the parties
hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable
manner to the end that transactions contemplated hereby are fulfilled to the
extent possible.

        Section 9.11.   Intended Beneficiaries. The rights and obligations
contained in this Agreement are hereby declared by the parties hereto to have
been provided expressly for the



                                       28
   33

exclusive benefit of such entities as set forth herein and shall not benefit,
and do not benefit, any unrelated third parties.

        Section 9.12.   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 each caused this Agreement
to be duly executed as of the date first above written by their respective
officers thereunto duly authorized.

                                  "SELLER"
                                     INTERNATIONAL CHURCH OF
                                     THE FOURSQUARE GOSPEL

                                  By: /s/ [Signature]
                                     -----------------------------------------
                                     Name:
                                     Title: President

                                  By: /s/ Brent Morgan
                                     -----------------------------------------
                                     Name:
                                     Title: Treasurer


                                  "PURCHASER"SPANISH BROADCASTING
                                  SYSTEM, INC.


                                  By:  /s/ Joseph A. Garcia
                                      ----------------------------------------
                                      Joseph A. Garcia
                                      Executive Vice President

                                  By:  /s/ Luis Diaz-Albertini
                                      ----------------------------------------
                                      Name: Luis Diaz-Albertini
                                      Title: Vice President




                                       29

EX-21.1

   1
                                                                    Exhibit 21.1


                          Subsidiaries of the Company


                                                    
Subsidiary Name                                        State of Incorporation

Spanish Broadcasting System of Greater Miami, Inc.     Delaware

Spanish Broadcasting System of Illinois, Inc.          Delaware

Spanish Broadcasting System Inc.                       New Jersey

Spanish Broadcasting System of San Antonio, Inc.       Delaware

JuJu Media, Inc.                                       New York

Alarcon Holdings, Inc.                                 New York

Spanish Broadcasting System of California, Inc.        California

Spanish Broadcasting System of Puerto Rico, Inc.       Delaware

Spanish Broadcasting System of Florida, Inc.           Florida

SBS of Greater New York, Inc.                          New York

SBS Funding, Inc.                                      Delaware

Spanish Broadcasting System of Puerto Rico, Inc.       Puerto Rico

Spanish Broadcasting System Network, Inc.              New York

Spanish Broadcasting System Finance Corporation        Delaware

Spanish Broadcasting System Holding Company, Inc.      Puerto Rico

SBS Promotions, Inc.                                   New York

WRMA Licensing, Inc.                                   Delaware

WXDJ Licensing, Inc.                                   Delaware

WLEY Licensing, Inc.                                   Delaware

WSKQ Licensing, Inc.                                   Delaware

KLEY Licensing, Inc.                                   Delaware

WCMQ Licensing, Inc.                                   Delaware

KLAX Licensing, Inc.                                   Delaware

WPAT Licensing, Inc.                                   Delaware

WCMA Licencing, Inc.                                   Delaware

WEGM Licencing, Inc.                                   Delaware

WMEG Licencing, Inc.                                   Delaware

WLDI, Inc.                                             Puerto Rico

WZNT, Inc.                                             Puerto Rico

WRPC, Inc.                                             Puerto Rico

WI0, Inc.                                              Puerto Rico

WOYE, Inc.                                             Puerto Rico

WOQI, Inc.                                             Puerto Rico

Cadena Estereotempo, Inc.                              Puerto Rico

Portorican American Broadcasting, Inc.                 Puerto Rico

Spanish Broadcasting System Group of                   Puerto Rico
 Puerto Rico, Inc.

Rodriquez Communications, Inc.                         Delaware

RCI (Alameda) Acquisition, Inc.                        Delaware


   2
                                                              
Subsidiary Name                                                  State of Incorporation

WPAT Licensing, Inc.                                             Delaware

WCMA Licensing, Inc.                                             Delaware

WEGM Licensing, Inc.                                             Delaware

WMEG Licensing, Inc.                                             Delaware

WLDI, Inc.                                                       Puerto Rico

WZNT, Inc.                                                       Puerto Rico

WRPC, Inc.                                                       Puerto Rico

WIO, Inc.                                                        Puerto Rico

WOYE, Inc.                                                       Puerto Rico

WOQI, Inc.                                                       Puerto Rico

Cadena Estereotempo, Inc.                                        Puerto Rico

Portorican American Broadcasting, Inc.                           Puerto Rico

Spanish Broadcasting System Group of Puerto Rico, Inc.           Puerto Rico

Rodriguez Communications, Inc.                                   Delaware

RCI (Alameda) Acquisition, Inc.                                  Delaware



                                       2

EX-27

 

<ARTICLE> 5
<CIK>  0000927720
<NAME> SPANISH BROADCASTING SYSTEM, INC.

                             
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          SEP-24-2000
<PERIOD-START>                             SEP-27-1999
<PERIOD-END>                               SEP-24-2000
<CASH>                                      59,558,729
<SECURITIES>                                         0
<RECEIVABLES>                               33,346,294
<ALLOWANCES>                                 8,082,275
<INVENTORY>                                          0
<CURRENT-ASSETS>                            88,685,130
<PP&E>                                      40,443,214
<DEPRECIATION>                              18,767,975
<TOTAL-ASSETS>                             634,690,823
<CURRENT-LIABILITIES>                       27,347,268
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                         6,022
<OTHER-SE>                                           0
<TOTAL-LIABILITY-AND-EQUITY>               634,690,823
<SALES>                                    122,668,415
<TOTAL-REVENUES>                                     0
<CGS>                                                0
<TOTAL-COSTS>                                        0
<OTHER-EXPENSES>                                     0
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                        (19,495,083)
<INCOME-PRETAX>                             11,459,847
<INCOME-TAX>                                 4,914,479
<INCOME-CONTINUING>                          6,545,368
<DISCONTINUED>                                       0
<EXTRAORDINARY>                           (17,150,918)
<CHANGES>                                            0
<NET-INCOME>                              (10,675,550)
<EPS-BASIC>                                          0
<EPS-DILUTED>                                    (.67)