ENTERCOM COMMUNICATIONS CORP, S-1/A, 1998-12-08

ENTERCOM COMMUNICATIONS CORP
S-1/A, 1998-12-08
RADIO BROADCASTING STATIONS

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 8, 1998

REGISTRATION NO. 333-61381
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

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

AMENDMENT NO. 2

TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------

ENTERCOM COMMUNICATIONS CORP.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S> <C> <C>
PENNSYLVANIA 4832 23-1701044
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
</TABLE>

401 CITY AVENUE, SUITE 409
BALA CYNWYD, PENNSYLVANIA 19004
(610) 660-5610
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------

JOSEPH M. FIELD
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
ENTERCOM COMMUNICATIONS CORP.
401 CITY AVENUE, SUITE 409
BALA CYNWYD, PENNSYLVANIA 19004
(610) 660-5610
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------------
COPIES TO:

<TABLE>
<S> <C> <C>
JAMES W. MCKENZIE, JR., ESQ. JOHN C. DONLEVIE, ESQ. JEREMY W. DICKENS, ESQ.
MORGAN, LEWIS & BOCKIUS LLP EXECUTIVE VICE PRESIDENT WEIL, GOTSHAL & MANGES LLP
1701 MARKET STREET AND GENERAL COUNSEL 100 CRESCENT COURT, SUITE 1300
PHILADELPHIA, PENNSYLVANIA 19103 ENTERCOM COMMUNICATIONS CORP. DALLAS, TEXAS 75201
(215) 963-5000 401 CITY AVENUE, SUITE 409 (214) 746-7700
BALA CYNWYD, PENNSYLVANIA 19004
(610) 660-5610
</TABLE>

------------------------

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: As soon as
practicable after this registration statement becomes effective.

If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]

If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
- ---------------

If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
- ---------------

If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
- ---------------

If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. [ ]
------------------------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

SUBJECT TO COMPLETION, DATED DECEMBER 8, 1998

[ENTERCOM LOGO]
Entercom Communications Corp.
CLASS A COMMON STOCK
($.01 par value)
------------------

Of the shares of Class A Common Stock, par value $.01 per share (the "Class A
Common Stock"), of Entercom Communications Corp., a Pennsylvania corporation
(the "Company" or "Entercom"), offered hereby, shares are being sold by
the Company and shares are being sold by the Selling Shareholder named
herein under "Principal and Selling Shareholders" (the "Offering"). The Company
will not receive any of the proceeds from the shares of Class A Common Stock
sold by the Selling Shareholder. Prior to the Offering, there has been no public
market for the Class A Common Stock. It is anticipated that the initial public
offering price per share will be between $ and $ per share. For
information relating to the factors to be considered in determining the initial
public offering price to the public, see "Underwriting."

The Company's authorized common stock consists of Class A Common Stock, Class B
Common Stock, par value $.01 per share ("Class B Common Stock"), and Class C
Common Stock, par value $.01 per share ("Class C Common Stock" and, together
with the Class A Common Stock and the Class B Common Stock, the "Common
Stock"). The rights of each share of Common Stock are essentially identical
other than with respect to voting rights. The Class A Common Stock
entitles the holders thereof to one vote per share, the Class B Common
Stock entitles the holders thereof to ten votes per share subject to
certain exceptions and the Class C Common Stock has no voting rights,
except as otherwise required by law. Upon completion of the Offering
(assuming no exercise of the over-allotment option), (i) the holders
of Class A Common Stock will have approximately % of the total
voting power of the outstanding Common Stock, (ii) Joseph M.
Field, the Company's Chairman of the Board and Chief Executive
Officer, and David J. Field, the Company's President and Chief
Operating Officer, will beneficially own all the outstanding
shares of Class B Common Stock, representing approximately % of
the total voting power of the outstanding Common Stock and
(iii) the Selling Shareholder, which is an affiliate of Chase
Capital Partners, will own % of the outstanding Class A
Common Stock, representing approximately % of the total
voting power of the outstanding Common Stock. See
"Recapitalization, Chase Conversion and Former S
Corporation Status." Subject to any necessary approval of
the Federal Communications Commission (the "FCC"), the
Class B Common Stock and the Class C Common Stock are
convertible in whole or in part at any time into
Class A Common Stock on a share-for-share basis. See
"Description of Capital Stock."

The Class A Common Stock has been approved for listing on the New York Stock
Exchange

under the symbol "ETM," subject to official notice of issuance.

FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION WITH
AN INVESTMENT IN THE CLASS A COMMON STOCK, SEE "RISK FACTORS" BEGINNING ON PAGE
13 HEREIN.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
UNDERWRITING PROCEEDS TO
PRICE TO DISCOUNTS AND PROCEEDS TO SELLING
PUBLIC COMMISSIONS COMPANY(1) SHAREHOLDER
-------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
Per Share............................................ $ $ $ $
Total(2)............................................. $ $ $ $
</TABLE>

- ---------------
(1) Before deduction of expenses, all of which are payable by the Company,
estimated at $ .

(2) The Company and the Selling Shareholder have granted to the Underwriters an
option, exercisable by Credit Suisse First Boston Corporation for 30 days
from the date of this Prospectus, to purchase a maximum of
additional shares of Class A Common Stock from the Company and
additional outstanding shares of Class A Common Stock from the Selling
Shareholder at the Price to Public less underwriting discounts and
commissions to cover over-allotments, if any. If the option is exercised in
full, the total Price to Public will be $ , Underwriting Discounts
and Commissions will be $ , Proceeds to Company will be $ and
Proceeds to Selling Shareholder will be $ . See "Underwriting."

The shares of Class A Common Stock are offered by the several Underwriters
when, as and if delivered to and accepted by the Underwriters and subject to
their right to reject orders in whole or in part. It is expected that the shares
will be ready for delivery on or about , 1998 against payment in
immediately available funds.

Credit Suisse First Boston
BT Alex. Brown
Goldman, Sachs & Co.
Morgan Stanley Dean Witter

Prospectus dated , 1999

<PAGE> 3

[INSIDE COVER ART]

CERTAIN PERSONS PARTICIPATING IN THE OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE SECURITIES
OFFERED HEREBY, INCLUDING OVER-ALLOTMENT, STABILIZING TRANSACTIONS, SYNDICATE
SHORT COVERING TRANSACTIONS AND PENALTY BIDS. FOR A DESCRIPTION OF THESE
ACTIVITIES, SEE "UNDERWRITING."
------------------
<PAGE> 4

CERTAIN DEFINITIONS

Unless otherwise indicated herein, (i) market ranking by radio advertising
revenue, market radio advertising revenue, market revenue share and the number
of viable radio stations per market have been obtained from Duncan's Radio
Market Guide (1998 ed.) ("Duncan's"); (ii) the Company's revenue rank in the
radio broadcasting industry is derived from Duncan's, as adjusted to reflect the
CBS Transactions (as defined) and assumes the completion of all other announced
mergers in the radio broadcasting industry, (iii) all audience share data and
audience rankings, except where specifically stated to the contrary, have been
derived from surveys of persons, listening Monday through Sunday, 6 a.m. to 12
midnight, in the indicated demographic, as reported by 1998 Summer Arbitron,
Radio Market Reports, The Arbitron Company (copyright 1998) ("Arbitron") and
(iv) all data regarding radio stations assumes the completion of the Completed
Transactions and the CBS Transactions. Duncan's defines "viable stations" as
stations which are active and viable competitors for advertising dollars in
their market.

Unless otherwise indicated herein, (i) "broadcast cash flow" consists of
operating income before depreciation, amortization, net expenses (income) of any
time brokerage agreement (a "TBA") and corporate expenses, (ii) "EBITDA before
net expense (income) from TBA fees" consists of operating income before
depreciation, amortization and net expense (income) from TBA fees, (iii) "pro
forma income before extraordinary items" consists of the Company's income before
extraordinary items as adjusted to reflect the Company's income during the
relevant periods as if the Company had been a corporation subject to taxation
under Subchapter C (a "C Corporation") of the Internal Revenue Code of 1986, as
amended (the "Code"), assuming an effective tax rate of 38% per annum, instead
of a corporation subject to Subchapter S of the Code (an "S Corporation"), such
taxes hereinafter referred to as "pro forma income taxes" and (iv) "after-tax
cash flow" consists of pro forma income before extraordinary items minus net
gain on sale of assets (net of tax) plus depreciation, amortization, and the
deferred tax provision (or minus the deferred tax benefit). Although broadcast
cash flow, EBITDA before net expense (income) from TBA fees and after-tax cash
flow are not measures of performance or liquidity calculated in accordance with
generally accepted accounting principles ("GAAP"), management believes that
these measures are useful to an investor in evaluating the Company because they
are widely used in the broadcast industry to measure a radio company's operating
performance. Nevertheless, none of these measures should be considered in
isolation or as a substitute for operating income, cash flows from operating
activities or any other measure for determining the Company's operating
performance or liquidity that is calculated in accordance with GAAP. Moreover,
because these measures are not calculated in accordance with GAAP, they are not
necessarily comparable to similarly titled measures employed by other companies.

Unless otherwise indicated, pro forma results of operations for the year
ended September 30, 1998 give effect to the following transactions as if each
had occurred on October 1, 1997:

- the Recapitalization of the Company, effecting a for one stock split
and the exchange of the Company's prior common stock for Class A Common
Stock and Class B Common Stock as described on page 20,

- the Completed Transactions described on pages 24 through 26,

- the CBS Transactions described on page 24,

- the S Corporation Distribution described on pages 20 through 21,

- the Chase Conversion described on page 20, and

- the Offering and the application of the net proceeds to the Company as
described in "Use of Proceeds."

2
<PAGE> 5

Pro forma balance sheet data as of September 30, 1998 give effect to any
such events not yet consummated on that date as if each had occurred on that
date.

The Completed Transactions, other than the WREN-AM Transaction, the First
Boston Transaction and the Tampa Transaction will be completed prior to the
Offering, while the Recapitalization and the Chase Conversion will be completed
concurrent with the Offering. The S Corporation Distribution will be declared
concurrent with the Offering but paid subsequent to the Offering. The Second
Boston Transaction and the WREN-AM Transaction will be completed subsequent to
the Offering. The Recapitalization, the S Corporation Distribution and the Chase
Conversion are contingent upon the consummation of the Offering, while the
Completed Transactions and the CBS Transactions will occur whether the Offering
is consummated or not.

FORWARD-LOOKING STATEMENTS

Certain statements made in this Prospectus under the captions "Prospectus
Summary," "Risk Factors," "Management's Discussion and Analysis of Financial
Condition and Results of Operations," "Business" and elsewhere in this
Prospectus are forward-looking statements that are not historical facts but
rather reflect the Company's current expectations concerning future results and
events. The words "believes," "expects," "intends," "plans," "anticipates,"
"likely," "will" and similar expressions identify such forward-looking
statements. These forward-looking statements are subject to risks, uncertainties
and other factors, some of which are beyond the Company's control, that could
cause actual results to differ materially from those forecast or anticipated in
such forward-looking statements.

Such risks, uncertainties and factors include, but are not limited to: (i)
the highly competitive nature of, and new technologies in, the radio
broadcasting industry; (ii) the Company's dependence upon its Seattle radio
stations; (iii) management's continued control over the Company's operations;
(iv) the risks associated with the Company's acquisition strategy; (v) the
Company's vulnerability to changes in federal legislation or FCC regulatory
policy; and (vi) the factors described in "Risk Factors."

Readers are cautioned not to place undue reliance on these forward-looking
statements which reflect management's view only as of the date of this
Prospectus. The Company undertakes no obligation to update such statements or
publicly release the result of any revisions to these forward-looking statements
which it may make to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.

3
<PAGE> 6

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by, and should be read
in conjunction with, the more detailed information and financial statements,
including the notes thereto, appearing elsewhere in this Prospectus.

THE COMPANY

Entercom, founded in 1968, is the sixth largest radio broadcasting company
in the United States, based on pro forma 1997 gross revenues. The Company owns
and operates 42 stations, 25 FM and 17 AM, in eight markets, including five of
the country's top 30 radio advertising markets. The Company has built the
largest radio station clusters, based on gross revenues, in Seattle and Kansas
City, and one of the three largest clusters in Boston, Portland, Sacramento and
Rochester. On a pro forma basis, the Company would have had net revenues of
$171.4 million, operating income of $29.2 million and net income of $9.0 million
for the year ended September 30, 1998. In addition, pro forma broadcast cash
flow (as defined in "Certain Definitions") during the same period would have
been $53.0 million.

The Company's net revenues and broadcast cash flow have grown significantly
on both a total and same-station basis. Over the past three fiscal years, net
revenues grew at a compound annual rate of 68.4% from an actual $35.9 million in
fiscal 1995 to a pro forma $171.4 million in fiscal 1998. Broadcast cash flow
grew at a compound annual rate of 64.8% from an actual $11.8 million in fiscal
1995 to a pro forma $53.0 million in fiscal 1998. During this same period the
Company's same station net revenues and broadcast cash flow grew at average
annual rates of 15.0% and 36.4%, respectively. In addition, the Company's
after-tax cash flow grew at a compound annual rate of 71.5% during these three
fiscal years.

The Company has built a highly consolidated portfolio of radio stations
concentrated primarily in top 30 markets with above average growth
characteristics. The Company generated 94.0% of its pro forma fiscal 1998 net
revenues from the five top 30 markets in which it operates. Radio advertising
revenues in these five markets have grown at an average annual rate of 10.8%
from 1993 to 1997, which exceeded the average annual growth rate of both the
aggregate radio industry and the top 30 markets. Furthermore, the Company
generated 98.7% of its pro forma fiscal 1998 net revenues from superduopolies,
which the Company defines as clusters of four or more stations in one market.
Management believes that Entercom's superduopolies enable the Company to (i)
amass greater resources to penetrate and capture additional local radio
advertising revenues, (ii) consolidate administrative, engineering and
management functions to reduce costs and (iii) be more flexible in adjusting
formats to serve changing listener needs. In addition, the Company believes that
superduopolies enhance its stations' ability to compete for advertising and
promotional dollars with other media, including television and newspaper.

The following table sets forth certain information about the markets in
which the Company operates:

<TABLE>
<CAPTION>
1993-1997 1997
1997 RADIO MARKET COMPANY'S STATIONS COMPANY
RADIO MARKET AVERAGE ------------------- MARKET
MARKET(1) REVENUE RANK(2) REVENUE GROWTH(2) FM AM TOTAL REVENUE SHARE(2)
- --------- --------------- ----------------- -- -- ----- ----------------
<S> <C> <C> <C> <C> <C> <C>
Boston................ 10 13.7% 2 3 5 19.4%(3)
Seattle(4)............ 13 10.5 5(4) 3 8(4) 40.4(4)
Portland.............. 21 11.8 4 3 7 25.8
Sacramento............ 28 6.7 4 1 5 20.9
Kansas City........... 29 11.3 3 4 7 33.8
--- --- --
Top 30 Markets...... 18 14 32
Rochester............. 55 8.1 3 1 4 21.7
Gainesville/Ocala..... 124 6.5 2 0 2 23.8

Longview/Kelso........ n/a n/a 2 2 4 n/a
--- --- --
All Markets......... 25 17 42
</TABLE>

- ---------------
(1) The Company's stations are in some instances licensed to communities other
than the named principal community for the market.

(2) Source: Duncan's.

(3) Does not include the revenues of WWTM-AM, which competes in the adjacent
Worcester market.

(4) The Company also sells substantially all the advertising time of a sixth FM
station under a joint sales agreement and the revenue from such sales are
included in the Company's Market Revenue Share.

4
<PAGE> 7

ACQUISITION STRATEGY

The Company, through a disciplined acquisition strategy, seeks to (i) build
market leading clusters of stations principally in large growth markets and (ii)
acquire underdeveloped properties that offer the potential for significant
improvements in revenues and broadcast cash flow through the application of the
Company's operational, administrative and/or engineering expertise. As part of
its strategy, the Company has strategically redeployed its asset base by
swapping relatively mature stations in markets where the Company believed it
would be difficult to build leading station clusters in exchange for
underperforming stations in other markets that management believed offered
stronger growth and clustering opportunities. For example, in 1997 the Company
exchanged one station in Houston plus $5.0 million for three stations in Seattle
and four stations in Kansas City. The Seattle acquisitions solidified the
Company's position as the leading radio operator in that market while the four
stations acquired in Kansas City enabled the Company to enter a new large market
with a significant presence.

The Company has a track record of structuring acquisitions in creative
ways, including being a pioneer of multi-party station swaps. Since October 1,
1996, the Company, in 19 transactions, has acquired or agreed to acquire 37
radio stations and has divested or agreed to divest, for strategic reasons, nine
radio stations. As a result of these transactions, the Company has divested its
stand-alone stations while establishing the largest clusters in Seattle and
Kansas City and building superduopolies in Boston, Portland, Sacramento and
Rochester. The Company believes that its proven record of consummating creative
transactions with many of the leading radio broadcast companies positions it
well to continue to participate in the consolidation occurring in its industry.

OPERATING STRATEGY

The principal components of the Company's operating strategy are set forth
below.

- ENHANCE OPERATIONS OF NEWLY ACQUIRED UNDERPERFORMING STATIONS. The
Company has built a long-term track record of acquiring and developing
underperforming stations enabling the Company to achieve superior
same-station revenue and broadcast cash flow growth over the past several
years. The Company's current portfolio includes a significant number of
recently acquired stations which management believes are underdeveloped.
Among the 33 stations which the Company acquired, agreed to acquire or
commenced operations under TBAs since January 1, 1997, 16 operated with
broadcast cash flow margins below 20%, 11 with margins between 20% and
40% and six with margins over 40% during calendar 1997. By comparison,
among the nine stations which the Company owned or operated prior to
1997, two operated with margins under 20%, one between 20% and 40% and
six over 40% during calendar 1997.

- LEVERAGE STATION CLUSTERS TO CAPTURE GREATER SHARE OF ADVERTISING
REVENUE. The Company believes radio will continue to gain revenue share
from other media by capitalizing on its enhanced competitive platform. As
a result of deregulation in the radio broadcasting industry, operators
can now create radio station clusters that have the critical mass of
audience reach and marketing resources necessary to pursue incremental
advertising and promotional revenues more aggressively. The Company has
begun to capitalize on this opportunity by developing specialized teams
in Seattle, Portland, Sacramento and
5
<PAGE> 8

Kansas City to work with non-traditional radio advertisers to create and develop
marketing programs and solutions.

COMPLETED AND CBS TRANSACTIONS

Since October 1, 1996, the Company, in 19 transactions, has acquired or
agreed to acquire 37 radio stations and, for strategic reasons, has divested or
agreed to divest, nine radio stations. These transactions consist of the
Completed Transactions and the CBS Transactions. See "Completed Transactions"
for a complete list of the Completed Transactions.

In August 1998, the Company entered into three agreements with CBS Radio,
Inc. ("CBS") under which it will: (i) purchase WRKO-AM and WEEI-AM in Boston for
$82.0 million in cash (the "First Boston Transaction"); (ii) sell WLLD-FM and
WYUU-FM in Tampa for $75.0 million in cash (the "Tampa Transaction"); and (iii)
purchase WAAF-AM and WEGQ-FM in Boston and WWTM-AM in Worchester for $58.0
million in cash (the "Second Boston Transaction" and, together with the First
Boston Transaction, the "Boston Transactions"). Collectively, the Tampa
Transaction and the Boston Transactions are referred to as the "CBS
Transactions." The Boston Transactions will enable the Company to establish a
strong Boston presence with a 19.4% market share. The Company anticipates
closing the First Boston Transaction and the Tampa Transaction prior to the
consummation of the Offering. The Company anticipates that the Second Boston
Transaction will close by August of 1999. The Company began operating the Boston
stations and CBS began operating the Tampa stations under time brokerage
agreements in September 1998. See "CBS Transactions."

RISK FACTORS

Prospective purchasers of Class A Common Stock should consider carefully
all of the information set forth in this Prospectus and, in particular, should
evaluate the specific factors set forth under the caption "Risk Factors"
beginning on page 13 of this Prospectus. These factors include, among other
things: (i) the highly competitive nature of, and new technologies in, the radio
broadcasting industry; (ii) the Company's dependence upon its Seattle radio
stations; (iii) management's continued control over the Company's operations;
(iv) the risks associated with the Company's acquisition strategy; and (v) the
Company's vulnerability to changes in federal legislation or FCC regulatory
policy.

6
<PAGE> 9

THE OFFERING

<TABLE>
<S> <C> <C>
Class A Common Stock offered hereby....... shares by the Company(1)
shares by the Selling Shareholder
---------
shares of Class A Common Stock
=========
Common Stock to be outstanding after the
Offering................................ shares of Class A Common Stock(1)(2)
shares of Class B Common Stock
---------
shares of Common Stock
=========
</TABLE>

Voting Rights................. The Class A Common Stock and the Class B Common
Stock vote together as a single class on all
matters submitted to a vote of shareholders.
Each share of Class A Common Stock is entitled
to one vote and each share of Class B Common
Stock is entitled to ten votes, except (i) any
share of Class B Common Stock not voted by
either Joseph M. Field or David J. Field, in
their own right or by proxy, is entitled to
only one vote, (ii) the holders of Class A
Common Stock, voting as a separate class, are
entitled to elect two directors (the "Class A
Directors"), (iii) with respect to any proposed
"going private" transaction (as defined in Rule
13e-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act")), each
share of Class A Common Stock and Class B
Common Stock shall be entitled to one vote and
(iv) as otherwise required by law. The Class C
Common Stock has no voting rights except as
otherwise required by law. Upon completion of
the Offering, the holders of the Class A Common
Stock will have approximately % of the
total voting power of the outstanding Common
Stock, and the Class B Common Stock will be
held solely by Joseph M. Field and David J.
Field, who will have approximately % of
the total voting power of the outstanding
Common Stock. See "Risk Factors -- Control of
the Company," "Description of Capital Stock"
and "Principal and Selling Shareholders."

Other Rights.................. Each class of Common Stock has the same rights
to dividends and distributions upon
liquidation. Subject to prior FCC approval in
certain circumstances, shares of Class B Common
Stock and Class C Common Stock are convertible
in whole or in part at any time into shares of
Class A Common Stock on a share-for-share
basis. Shares of Class B Common Stock
automatically convert into shares of Class A
Common Stock on a share-for-share basis upon a
transfer to any person other than Joseph M.
Field, David J. Field or a Field Shareholder
(as defined). Any shares of Class A Common
Stock owned by a Regulated Entity (as defined)
may be converted at the option of the holder
into shares of Class C Common Stock on a
share-for-share basis. See "Description of
Capital Stock."
- ---------------
(1) Excludes shares of Class A Common Stock issuable pursuant to the
Underwriters' over-allotment option.

(2) Includes shares of Class A Common Stock issued in the Chase
Conversion. Excludes shares of Class A Common Stock currently
issuable upon exercise of the outstanding stock options issued under the
Company's 1998 Equity Compensation Plan (as defined) at a weighted average
exercise price of $ per share. See "Management -- 1998 Equity
Compensation Plan."

7
<PAGE> 10

Dividend Policy............... The Company intends to retain future earnings
for use in the Company's business and does not
anticipate declaring or paying any cash or
stock dividends on shares of its Common Stock
in the foreseeable future. In addition, the
Company's ability to declare dividends is
restricted under the Credit Facility (as
defined).

Use of Proceeds............... To repay revolving indebtedness of the Company.
See "Use of Proceeds."

Proposed NYSE Ticker Symbol... "ETM"

8
<PAGE> 11

SUMMARY HISTORICAL FINANCIAL DATA

The following table presents summary historical financial data of the
Company for the periods indicated. The following financial information should be
read in conjunction with the Consolidated Financial Statements of the Company
and the related notes included elsewhere in this Prospectus.

The comparability of the historical financial data reflected herein has
been significantly impacted by acquisitions and dispositions. The information
presented below is qualified in its entirety by, and should be read in
conjunction with "Management's Discussion and Analysis of Financial Condition
and Results of Operations," and "Unaudited Pro Forma Financial Information,"
and, in each case, the related notes included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
FISCAL YEAR ENDED SEPTEMBER 30,
---------------------------------------
1996 1997 1998
---------- ---------- -----------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
OPERATING DATA:
Net revenues.............................................. $ 48,675 $ 93,862 $ 132,998
Station operating expenses................................ 31,659 61,280 88,599
Depreciation and amortization............................. 2,960 7,685 13,066
Corporate general and administrative expenses............. 2,872 3,249 4,527
Net expense (income) from TBA fees........................ (879) (476) 2,399
Operating income.......................................... 12,063 22,124 24,407
Interest expense.......................................... 5,196 11,388 14,663
Gain on sale of assets.................................... 119 197,097 8,661
Income before income taxes and extraordinary items........ 7,053 206,329 18,733
Pro forma income taxes(1)................................. 2,680 78,405 7,119
Pro forma income before extraordinary items(1)............ 4,373 127,924 11,614
Pro forma earnings per share before extraordinary
items(1)(2).............................................
Pro forma weighted average common shares outstanding(2)

BALANCE SHEET DATA (AT END OF PERIOD):
Cash and cash equivalents................................. $ 5,292 $ 3,626 $ 6,666
Intangibles and other assets.............................. 119,269 300,029 428,763
Total assets.............................................. 150,575 364,743 522,945
Long-term debt, including current portion................. 136,642 144,427 283,136
Total shareholders' equity................................ 5,079 208,089 220,881
OTHER DATA:
Broadcast cash flow(3).................................... $ 17,016 $ 32,582 $ 44,399
Broadcast cash flow margin(4)............................. 35.0% 34.7% 33.4%
EBITDA before net expense (income) from TBA fees(5)....... $ 14,144 $ 29,333 $ 39,872
After-tax cash flow(1)(6)................................. 7,923 16,590 21,028
Cash flows related to:
Operating activities.................................... 12,773 8,859 23,019
Investing activities.................................... (96,502) (13,695) (153,651)
Financing activities.................................... 87,457 3,170 133,672
</TABLE>

- ---------------
(1) Throughout the periods presented, the Company had elected to be taxed under
Subchapter S of the Code, and comparable provisions of certain state tax
laws. The amounts shown reflect pro forma provisions for state and federal
income taxes (at an assumed combined rate of 38% per annum) as if the
Company had been taxed under Subchapter C of the Code throughout the periods
presented. The Company intends to revoke its election to be taxed as an S
Corporation immediately prior to the consummation of the Offering.

(2) Reflects the effect of the for one stock split to be effected as part of
the Recapitalization.

(3) Broadcast cash flow consists of operating income before depreciation,
amortization, net expense (income) from TBA fees and corporate expenses.
Although broadcast cash flow is not a measure of performance or liquidity
calculated in accordance with GAAP, management believes that it is useful to
an investor in evaluating the Company because it is a measure widely used in
the broadcast industry to measure a radio company's operating performance.
Nevertheless, it should not be considered in isolation or as a substitute
for operating income, cash flows from operating activities or any other
measure for determining the Company's operating performance or liquidity
that is calculated in accordance

9
<PAGE> 12

with GAAP. Moreover, because broadcast cash flow is not a measure calculated
in accordance with GAAP, this measure is not necessarily comparable to
similarly titled measures employed by other companies.

(4) Broadcast cash flow margin represents broadcast cash flow as a percentage of
net revenue.

(5) EBITDA before net expense (income) from TBA fees consists of operating
income before depreciation, amortization and net expense (income) from TBA
fees. Although EBITDA before net expense (income) from TBA fees is not a
measure of performance or liquidity calculated in accordance with GAAP,
management believes that it is useful to an investor in evaluating the
Company because it is a measure widely used in the broadcast industry to
measure a radio company's operating performance. Nevertheless, it should not
be considered in isolation or as a substitute for operating income, cash
flows from operating activities or any other measure for determining the
Company's operating performance or liquidity that is calculated in
accordance with GAAP. Moreover, because EBITDA before net expense (income)
from TBA fees is not a measure calculated in accordance with GAAP, this
measure is not necessarily comparable to similarly titled measures employed
by other companies.

(6) After-tax cash flow consists of pro forma income before extraordinary items
minus net gain on sale of assets (net of tax) and plus depreciation,
amortization, and the deferred tax provision (or minus the deferred tax
benefit). Although after-tax cash flow is not a measure of performance or
liquidity calculated in accordance with GAAP, management believes that it is
useful to an investor in evaluating the Company because it is a measure
widely used in the broadcast industry to measure a radio company's operating
performance. Nevertheless, it should not be considered in isolation or as a
substitute for operating income, cash flows from operating activities or any
other measure for determining the Company's operating performance or
liquidity that is calculated in accordance with GAAP. Moreover, because
after-tax cash flow is not a measure calculated in accordance with GAAP,
this measure is not necessarily comparable to similarly titled measures
employed by other companies.

10
<PAGE> 13

SUMMARY PRO FORMA FINANCIAL DATA

The following table presents summary historical and pro forma financial
data of the Company for the periods indicated. The pro forma operating and other
data reflect adjustments to the summary historical data of the Company to
illustrate the effects of the Recapitalization, the Completed and CBS
Transactions, the S Corporation Distribution, the Chase Conversion, the Offering
and the application of the net proceeds therefrom as described in "Use of
Proceeds" as if each had occurred on October 1, 1997. The pro forma balance
sheet data as of September 30, 1998 give effect to any such events not yet
consummated on that date as if each had occurred on that date. The summary pro
forma financial data are not necessarily indicative of either future results of
operations or the results that would have occurred if those transactions had
been consummated on the indicated dates. The following financial information
should be read in conjunction with the Consolidated Financial Statements, the
Unaudited Pro Forma Financial Information and, in each case, the related notes
included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
FISCAL YEAR ENDED
SEPTEMBER 30, 1998
-----------------------
HISTORICAL PRO FORMA
---------- ---------
(IN THOUSANDS,
EXCEPT PER SHARE DATA)
<S> <C> <C>
OPERATING DATA:
Net revenues.............................................. $132,998 $171,415
Station operating expenses................................ 88,599 118,388
Depreciation and amortization............................. 13,066 19,271
Corporate general and administrative expenses............. 4,527 4,527
Net expense (income) from TBA fees........................ 2,399 --
Operating income.......................................... 24,407 29,229
Interest expense.......................................... 14,663 15,101
Gain on sale of assets.................................... 8,661 161
Income before income taxes and extraordinary items........ 18,733 14,552
Pro forma income taxes(1)................................. 7,119 5,530
Pro forma income before extraordinary items(1)............ 11,614 9,022
Pro forma earnings per share before extraordinary
items(1)(2)............................................ $ $
Pro forma weighted average common shares outstanding(2)...
BALANCE SHEET DATA (AT END OF PERIOD):
Cash and cash equivalents................................. $ 6,666 $ 6,514
Intangibles and other assets.............................. 428,763 561,456
Total assets.............................................. 522,945 662,391
Long-term debt, including current portion................. 283,136 219,135
Total shareholders' equity................................ 220,881 339,545
</TABLE>

<TABLE>
<CAPTION>
FISCAL YEAR ENDED
SEPTEMBER 30, 1998
-----------------------
HISTORICAL PRO FORMA
---------- ---------
(IN THOUSANDS)
<S> <C> <C>
OTHER DATA:
Broadcast cash flow(3).................................... $ 44,399 $ 53,027
Broadcast cash flow margin(4)............................. 33.4% 30.9%
EBITDA before net expense (income) from TBA fees(5)....... $ 39,872 $ 48,500
After-tax cash flow(1)(6)................................. 21,028 --
Cash flows related to:
Operating activities................................... 23,019 30,238
Investing activities................................... (153,651) (215,674)
Financing activities................................... 133,672 188,366
</TABLE>

11
<PAGE> 14

(2) Reflects the effect of the for one stock split to be effected as
part of the Recapitalization.

(4) Broadcast cash flow margin represents broadcast cash flow as a percentage of
net revenue.

(6) After-tax cash flow consists of pro forma income before extraordinary items
minus net gain on sale of assets (net of tax) and plus depreciation,
amortization and the deferred tax provision (or minus the deferred tax
benefit). Although after-tax cash flow is not a measure of performance or
liquidity calculated in accordance with GAAP, management believes that it is
useful to an investor in evaluating the Company because it is a measure
widely used in the broadcast industry to measure a radio company's operating
performance. Nevertheless, it should not be considered in isolation or as a
substitute for operating income, cash flows from operating activities or any
other measure for determining the Company's operating performance or
liquidity that is calculated in accordance with GAAP. Moreover, because
after-tax cash flow is not a measure calculated in accordance with GAAP,
this measure is not necessarily comparable to similarly titled measures
employed by other companies.

12
<PAGE> 15

RISK FACTORS

This Prospectus contains forward-looking statements. The words
"anticipate," "believe," "expect," "plan," "intend," "estimate," "project,"
"foresee," "will," "could," "may" and similar expressions are intended to
identify such forward-looking statements. Such statements reflect the Company's
current views with respect to future events and financial performance and
involve risks and uncertainties, including without limitation the risks
described in "Risk Factors." Should one or more of these risks or uncertainties
occur, or should underlying assumptions prove incorrect, actual results may vary
materially from those indicated. Investors should consider carefully the
following risk factors, in addition to the other information contained in this
Prospectus, before purchasing the shares of Class A Common Stock offered hereby.

COMPETITION

Radio broadcasting is a highly competitive business. The Company's radio
stations compete for audiences and advertising revenues within their respective
markets directly with other radio stations, as well as with other media, such as
newspapers, magazines, television, outdoor advertising and direct mail. Audience
ratings and market shares are subject to change, and any adverse change in a
particular market could have a material adverse effect on the revenue of
stations located in that market. While the Company already competes in some of
its markets with other stations with similar programming formats, if another
radio station in a market were to convert its programming format to a format
similar to one of the Company's stations, if a new station were to adopt a
comparable format or if an existing competitor were to strengthen its
operations, the Company's stations could suffer a reduction in ratings and/or
advertising revenue and could incur increased promotional and other expenses.
Other radio broadcasting companies may enter into the markets in which the
Company operates or may operate in the future. Such companies may be larger and
have more financial resources than the Company. Although the Company believes
that substantially all of its radio stations are positioned to compete
effectively in their respective markets, there can be no assurance that any such
station will be able to maintain or increase its current audience ratings and
advertising revenues.

BUSINESS RISKS

Future operations are further subject to many business risks which could
have a material adverse effect on the Company. These variables include the
following: economic conditions, both generally and relative to the radio
broadcasting industry; shifts in population and other demographics; the level of
competition for advertising dollars with other radio stations, television
stations and other entertainment and communications media; fluctuations in
operating costs; technological changes and innovations; changes in labor
conditions; and changes in governmental regulations and policies and actions of
federal regulatory bodies, including the United States Department of Justice
("DOJ"), the Federal Trade Commission (the "FTC") and the FCC. Given the
inherent unpredictability of these variables, the Company cannot, with any
degree of certainty, predict what effect, if any, these variables will have on
future operations.

NEW TECHNOLOGIES

Radio broadcasting is subject to competition from new media technology that
are being developed or introduced, including, without limitation, the delivery
of audio programming by cable television systems, digital audio radio services
("DARS"), the Internet, satellite, television, personal communications services
("PCS") and the possible authorization by the FCC of a new service of
microbroadcasting (low powered, limited coverage radio stations). DARS plans to
deliver by satellite to nationwide audiences multi-channel, multi-format digital
radio services with sound quality equivalent to compact discs. The Company
cannot predict the effect, if any, that any such new technology may have on the
radio broadcasting industry or the Company. See "Business -- Competition;
Changes in Broadcasting Industry."

IMPORTANCE OF SEATTLE RADIO STATIONS

In the fiscal year ended September 30, 1998, the Company's eight radio
stations in Seattle and the activities of the Company pursuant to a joint sales
agreement ("JSA") for a ninth radio station generated

13
<PAGE> 16

approximately 47.6% of the Company's net revenues and 52.7% of the Company's
broadcast cash flow. On a pro forma basis after giving effect to the Completed
and CBS Transactions, the Seattle radio stations would have generated
approximately 36.7% of the Company's net revenues and 44.1% of the Company's
broadcast cash flow in the fiscal year ended September 30, 1998. A significant
decline in net revenues and broadcast cash flow from the Company's stations in
this market, as a result of a ratings decline or otherwise, could have a
material adverse effect on the Company's financial position and results of
operations. In addition, given the relatively high percentage of the Company's
total revenue and broadcast cash flow derived from the Seattle area, adverse
events or conditions that affect the Seattle economy could have a more adverse
effect on the profitability of the Company than if the Company's operations were
more geographically diverse.

RISKS OF ACQUISITION STRATEGY

The Company pursues growth, in part, through the acquisition of individual
radio stations and groups of radio stations. Consummation of future acquisitions
is subject to various conditions, including the FCC and other regulatory
approval, and intense scrutiny under federal and state antitrust laws. The
Company cannot predict whether it will be successful in identifying future
acquisition opportunities, consummating such acquisitions or what the
consequences of any acquisitions will be. Accordingly, no assurances can be
given that any pending or future acquisitions (including the CBS Transactions)
will be consummated or that, if completed, they will be successful. The
Company's acquisition strategy involves numerous risks, including increasing
debt service requirements, difficulties in the integration of operations and
systems and the management of a large and geographically diverse group of
stations, the diversion of management's attention from other business concerns
and the potential loss of key employees of acquired stations. There can be no
assurance that the Company's management will be able to manage effectively the
resulting business or that such acquisitions will benefit the Company. Depending
on the nature, size and timing of future acquisitions, the Company may be
required to raise additional financing necessary to consummate the future
acquisitions. There can be no assurance that such financing will be permitted
under the agreements that govern the outstanding indebtedness of the Company or
any other loan agreements or indebtedness to which the Company may become a
party. Moreover, there can be no assurance that such additional financing will
be available to the Company on terms acceptable to its management. Radio
broadcasting is a rapidly consolidating industry, with many companies seeking to
consummate acquisitions and increase their market share. In this environment,
the Company competes and will continue to compete with many other buyers for the
acquisition of radio stations. Some of those competitors may be able to outbid
the Company for acquisitions because they have greater financial resources. As a
result of these and other factors, there can be no assurance that future
acquisitions will be available on attractive terms. The Company's failure to
implement its acquisition strategy as a result of the factors described above,
or for any reasons, could have a material adverse effect on the value of the
Class A Common Stock or the Company's operations as a whole. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources."

CONTROL OF THE COMPANY

Upon completion of the Offering, the purchasers of the Class A Common Stock
offered hereby will own approximately % of the outstanding Class A Common
Stock, representing approximately % of the total voting power of the
outstanding Common Stock ( % of the outstanding Class A Common Stock,
representing % of the total voting power if the Underwriters'
over-allotment option is exercised in full). Upon completion of the Offering,
Joseph M. Field, the Company's Chairman of the Board and Chief Executive Officer
and David J. Field, the Company's President and Chief Operating Officer, will
beneficially own all of the outstanding Class B Common Stock, representing
approximately % of the total voting power of the outstanding Common Stock
( % of the total voting power if the Underwriters' over-allotment option is
exercised in full). Shares of Class B Common Stock are transferable only to
Field Shareholders, and upon any other transfer they convert automatically into
shares of Class A Common Stock on a share-for-share basis. Shares of Class B
Common Stock shall be entitled to ten votes only when they are voted by Joseph
M. Field or David J. Field, subject to certain exceptions where they are
entitled to one vote. Joseph M. Field will be able to control the vote on all
matters submitted to the vote of shareholders and therefore, will be able to

14
<PAGE> 17

direct the management and policies of the Company, except with respect to those
matters where the shares of Class B Common Stock are only entitled to one vote
and those matters requiring a class vote under the provisions of the Company's
Articles of Incorporation, bylaws or applicable law, including, without
limitation, the election of the two Class A directors. In addition, without the
approval of Joseph M. Field, the Company will be unable to consummate
transactions involving an actual or potential change of control of the Company,
including transactions in which the holders of Class A Common Stock might
otherwise receive a premium for their shares over then current market prices.
See "Principal and Selling Shareholders," and "Description of Capital Stock."

ABILITY TO INCUR SUBSTANTIAL INDEBTEDNESS

The Company has the ability to incur indebtedness that is substantial in
relation to its shareholders' equity. As of September 30, 1998, on a pro forma
basis after giving effect to the Offering, the Company would have had
approximately $219.1 million in long-term indebtedness (less current portions)
and shareholders' equity of approximately $339.5 million. However, under the
Credit Facility, the Company can increase its long-term indebtedness up to
$350.0 million, subject to compliance with certain financial ratios. See
"Capitalization," and "Management's Discussion and Analysis of Financial
Condition and Results of Operations -- Liquidity and Capital Resources."

If the Company were to incur a substantial amount of indebtedness under the
Credit Facility, it could have several important consequences to the holders of
Class A Common Stock, including, but not limited to, the following: (i) a
substantial portion of the Company's cash flow from operations could be
dedicated to debt service and would not be available for other purposes,
including for funding future expansion and ongoing capital expenditures; (ii)
the Company's ability to obtain additional financing for working capital,
capital expenditures, acquisitions and general corporate or other purposes could
be impaired; (iii) the Company's leveraged position and the covenants contained
in the Credit Facility could limit the Company's ability to compete, expand and
make capital improvements; (iv) the Company's level of indebtedness could make
it more vulnerable to economic downturns, limit its ability to withstand
competitive pressures and reduce its flexibility in responding to changing
business and economic conditions and (v) certain restrictive covenants contained
in the Credit Facility could limit the ability of the Company to pay dividends
and make other distributions to its shareholders.

EFFECT OF RESTRICTIVE COVENANTS

The Credit Facility contains certain covenants that restrict, among other
things, the ability of the Company to incur additional indebtedness, derive over
60% of its aggregate broadcast cash flow from any one market, acquire radio
stations that are not located in either one of the top 75 markets or in a market
in which the Company has existing operations, incur capital expenditures, invest
in non-related industries, pay dividends or make certain other restricted
payments, incur liens, consummate certain asset sales, enter into certain
transactions with affiliates, merge or consolidate with any other person or
sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of the assets of the Company. In addition, all of the assets
and the stock of the Company's subsidiaries are pledged to secure the debt under
the Credit Facility. The Credit Facility requires that the Company maintain
specified financial ratios; the ability of the Company to meet these financial
ratios can be affected by events beyond its control and there can be no
assurance that the Company will meet those ratios. A breach of any of these
covenants could result in a default under the Credit Facility. Upon an event of
default under the Credit Facility, the lenders thereunder could elect to declare
all amounts outstanding thereunder, together with accrued interest, to be
immediately due and payable. If the Company were unable to repay those amounts,
the lenders thereunder could proceed against the collateral granted to them to
secure that indebtedness. Any such event of default, therefore, could have a
material adverse effect on the Company. Even if the Company is able to comply
with the restrictive covenants contained in the Credit Facility, such covenants
could limit the Company's ability to capitalize on opportunities that would
otherwise be advantageous. In addition, the Credit Facility, in certain
circumstances, requires that the Company apply excess cash flow from operations,
net proceeds from asset sales, net equity proceeds and insurance proceeds to
reduce permanently the amount available under the Credit Facility.

15
<PAGE> 18

Pursuant to the terms of the Credit Facility, the Offering would constitute an
event requiring a permanent reduction in the principal amount of the Credit
Facility. The Company has received a waiver of this provision with respect to
the Offering. See "Management's Discussion and Analysis of Financial Condition
and Results of Operations -- Liquidity and Capital Resources," and "Description
of Capital Stock."

RADIO BROADCASTING INDUSTRY AND ECONOMIC CONDITIONS

The profitability of the Company's radio stations is subject to various
factors that influence the radio broadcasting industry as a whole. The Company's
radio stations may be affected by numerous factors, including changes in
audience tastes, competition from other radio stations and other communications
and entertainment media, priorities of advertisers, new laws, governmental
regulations and policies, changes in broadcast technical requirements,
technological changes and proposals to eliminate the tax deductibility of
expenses incurred by advertisers. The Company cannot predict which, if any, of
these or other factors might have a significant impact on the radio broadcasting
industry in the future, nor can it predict what impact, if any, the occurrence
of these or other events might have on the Company's operations. Generally,
advertising tends to decline during economic recession or downturn.
Consequently, the Company's advertising revenue is likely to be adversely
affected by a recession or downturn in the United States economy, the economy of
an individual geographic market in which the Company owns or operates radio
stations or other events or circumstances that adversely affect advertising
activity. See "-- Importance of Seattle Radio Stations."

GOVERNMENTAL REGULATION OF BROADCASTING INDUSTRY

The radio broadcasting industry is subject to extensive federal regulation
by the FCC under the Communications Act of 1934, as amended (the "Communications
Act"), that, among other things, requires approval by the FCC for the issuance,
renewal, transfer of control and assignment of broadcasting station operating
licenses and limits the number of broadcasting properties that the Company may
acquire in any market. In addition, the Communications Act and FCC rules impose
limitations on alien ownership and voting of the capital stock of, and
participation in the affairs of, the Company. The Company's business is
dependent upon maintaining its broadcasting licenses issued by the FCC, which
are ordinarily issued for a maximum term of eight years. Although it is rare for
the FCC to deny a license renewal application, there can be no assurance that
the future renewal applications of the Company will be approved or that such
renewals will not include conditions or qualifications that could adversely
affect the Company. The non-renewal, or renewal with substantial conditions or
modifications, of one or more of the Company's licenses could have a material
adverse effect on the Company. Moreover, governmental regulations and policies
may change over time and there can be no assurance that such changes would not
have a material adverse impact upon the Company.

As a result of the passage of the Telecommunications Act of 1996 (the
"Telecom Act"), radio broadcasting companies were permitted to increase their
ownership of stations within a single radio market from a maximum of four to a
maximum of between five and eight stations, depending on market size. The
Telecom Act creates significant new opportunities for broadcasting companies but
also creates uncertainties as to how the FCC and the courts will enforce and
interpret the Telecom Act. Compliance with the FCC's multiple ownership rules
may cause the Company and other radio broadcasters to forego acquisition
opportunities that they might otherwise wish to pursue. Compliance with these
rules by third parties may also have a significant impact on the Company by, for
example, precluding the consummation of swap transactions that would cause such
third parties to violate multiple ownership limitations. The consummation of
radio broadcasting acquisitions requires prior approval of the FCC with respect
to the transfer of control or assignment of the broadcast licenses of the
acquired stations. There can be no assurance that the FCC will approve future or
pending acquisitions or dispositions by the Company or will not impose
conditions or qualifications in connection with such acquisitions or
dispositions (including the CBS Transactions) by the Company. As a result of the
recent consolidation of ownership in the radio broadcast industry, the DOJ has
been giving closer scrutiny to acquisitions in the industry. The DOJ has stated
publicly that it has established certain revenue and audience share
concentration benchmarks with respect to radio station acquisitions, above which
a transaction may receive additional antitrust scrutiny. However, to date, the
DOJ has also investigated

16
<PAGE> 19

transactions that do not meet or exceed these benchmarks and has cleared
transactions that do exceed the benchmarks. The FCC is also reviewing
applications for transfers and assignment of licenses in instances where a
proposed transaction would result in a high degree of revenue concentration.
Although the Company has not encountered any problems in receiving clearance
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the
"HSR Act") and does not believe that its acquisition strategy as a whole will be
adversely affected in any material respect by antitrust review or by
divestitures that the Company may have to make as a result of antitrust review,
there can be no assurance that this will continue to be the case.

The number of radio stations the Company may acquire in any market under
FCC rules may also vary depending upon whether the interests in other radio
stations or certain other media properties of certain persons or entities
affiliated with the Company are attributable to those persons or entities under
FCC rules. Under the FCC's cross-interest policy, the FCC in certain instances
may prohibit one party from acquiring an attributable interest in one media
outlet and a substantial non-attributable economic interest in another media
outlet in the same market, thereby prohibiting a particular acquisition by the
Company. The FCC generally applies its ownership limits to "attributable"
interests held by an individual, corporation, partnership or other association.
The interests of the Company's officers, directors, and shareholders who have
the right to vote 5% or more of the Company's voting stock are generally
attributable to the Company. If any such attributable broadcast interests
overlap with the Company's directly-held radio broadcast interests in the
Company's markets, such interests are combined with the Company's interests in
such markets when determining compliance with the multiple ownership
limitations. In addition, under the FCC's "one-to-a-market" rule, a party may
not have attributable interests in radio stations and a television station in
the same market unless a waiver is granted by the FCC. Although the Company's
current officers, directors and shareholders who have the right to vote 5% or
more of the Company's voting stock do not have attributable broadcast interests
limiting the number of radio stations that the Company may acquire or own, there
can be no assurance that such persons will not in the future hold such
attributable interests. The FCC's attribution and ownership rules are currently
under review and changes in those rules could affect the ability of the Company
to acquire stations in certain markets in the future. See "Business -- Federal
Regulation of Radio Broadcasting -- Proposed and Recent Changes." Applications
of, or changes to, the FCC policies described above could cause the Company to
lose valuable broadcasting licenses or force the Company to divest profitable
radio stations or abandon plans to acquire new, potentially profitable radio
stations. Any such occurrences could adversely affect the Company's operations
and consequently, the value of the Class A Common Stock.

DEPENDENCE ON KEY PERSONNEL

The Company's business depends upon the continued efforts, abilities and
expertise of its executive officers and other key executives, including Joseph
M. Field, its Chairman of the Board and Chief Executive Officer; David J. Field,
its President and Chief Operating Officer; and John C. Donlevie, Esq., its
Executive Vice President and General Counsel. The Company believes that the loss
of any of these individuals could have a material adverse effect on the Company.
See "Management."

SHARES ELIGIBLE FOR FUTURE SALE; REGISTRATION RIGHTS

Upon completion of the Offering, the Company will have
shares of Class A Common Stock and shares of Class B Common Stock
issued and outstanding. Of these shares, the shares of Class A
Common Stock sold in the Offering ( shares if the Underwriters'
over-allotment option is exercised in full) will be freely transferable without
restriction under the Securities Act by persons other than "affiliates" of the
Company within the meaning of Rule 144 promulgated under the Securities Act
("Rule 144"). The remaining shares of Class A Common Stock and
all shares of Class B Common Stock were issued in reliance on exemptions from
the registration requirements of the Securities Act, and those shares are
"restricted" securities under Rule 144. The number of such "restricted" shares
of Common Stock available for sale in the public market is limited by
restrictions under the Securities Act and lock-up agreements under which all of
the holders of such shares have agreed not to sell or otherwise dispose of their
shares for a period of 180 days after the date of this Prospectus (the "Lock-Up
Period") without the prior written consent of Credit Suisse First Boston

17
<PAGE> 20

Corporation. Because of these restrictions, on the date of this Prospectus, no
shares other than those offered hereby will be eligible for sale. Upon
expiration of the Lock-Up Period, all of the restricted securities will be
eligible for sale in the public market, subject to compliance with the
manner-of-sale, volume and other limitations of Rule 144.

Notwithstanding the foregoing, the Company executed a Registration Rights
Agreement, (the "Registration Rights Agreement") dated as of May 21, 1996, with
Chase Equity Associates, LP an affiliate of Chase Capital Partners (collectively
referred to as "Chase Capital") which grants Chase Capital the right to require
the Company, subject to certain limitations, to effect up to two "demand"
registrations under the Securities Act for the sale of Chase Capital's shares of
Common Stock. In connection with the Offering, however, Chase Capital has
entered into a lock-up agreement, under which it has agreed not to sell or
otherwise dispose of its shares or demand registration of such shares during the
Lock-Up Period.

Future sales of substantial amounts of Class A Common Stock, or the
perception that such sales could occur, may affect the market price of the Class
A Common Stock prevailing from time to time. See "Shares Eligible for Future
Sale" and "Underwriting."

DILUTION

Persons purchasing shares of Class A Common Stock in the Offering will
incur immediate dilution in the net tangible book value per share of Class A
Common Stock of approximately $ per share. In addition, the exercise of
vested stock options, if any, would result in further dilution. This dilution is
calculated based on an assumed initial public offering price of $ per share
(the midpoint of the estimated offering range). Dilution for this purpose
represents the difference between the per share initial public offering price of
the Class A Common Stock and the pro forma net tangible book value per share of
Class A Common Stock after giving effect to the Recapitalization, the Completed
and CBS Transactions, the S Corporation Distribution, the Chase Conversion, the
consummation of the Offering and the application of the net proceeds therefrom.
See "Dilution."

BENEFITS TO EXISTING SHAREHOLDERS AND AFFILIATES

In connection with the Offering and the associated revocation of the
Company's S Corporation status, the Company intends to declare a dividend
payable to its existing S Corporation shareholders in the amount of
$ million which the Company currently estimates will be the undistributed
balance of the Company's taxable income as of the Revocation Date, assuming a
January 31, 1999 Revocation Date, no interim distributions and the prior closing
of the First Boston and Tampa Transactions and all of the Completed Transactions
except the WREN-AM Transaction. All of such income up to the Revocation Date has
been taxed or will be taxed to the existing S Corporation shareholders. That
estimated amount includes $ for the estimated tax liability of the
Company's S Corporation shareholders with respect to the Tampa Transaction and
the other taxable income of the Company as of such Revocation Date for which
distribution by the Company has not yet occurred and $ , the estimated
balance of the undistributed taxable income of the Company as of such Revocation
Date. In addition, Chase Capital, the Selling Shareholder in the Offering, will
receive aggregate net proceeds of approximately $ from the sale of
shares of Class A Common Stock therein, constituting approximately % of the
shares of Class A Common Stock beneficially owned by Chase Capital following the
Chase Conversion. A general partner of Chase Capital Partners, Michael R.
Hannon, is also a director of the Company. See "Recapitalization, Chase
Conversion and Former S Corporation Status" and "Principal and Selling
Shareholders."

NO PRIOR PUBLIC MARKET

Prior to the Offering, there has been no public market for the Class A
Common Stock and there can be no assurance that an active public market will
develop or be sustained after the Offering or that the initial public offering
price will correspond to the price at which the Class A Common Stock will trade
in the public market subsequent to the Offering. The initial public offering
price for the Class A Common Stock will be determined by negotiations among the
Company and the representatives of the Underwriters based upon the consideration
of certain factors set forth herein under "Underwriting." Market conditions in
the radio

18
<PAGE> 21

broadcasting industry, the Company's future operating results and fluctuations
in the stock market generally may have an adverse impact on the market price of
the Class A Common Stock.

CERTAIN ANTITAKEOVER PROVISIONS

Certain provisions of Pennsylvania law could also make more difficult a
merger, tender offer or proxy contest involving the Company, even if such events
could be beneficial to the interests of the shareholders. Such provisions could
limit the price that certain investors might be willing to pay in the future for
shares of the Company's Class A Common Stock. See "Description of Capital
Stock -- Certain Provisions of the Amended and Restated Articles of
Incorporation and Amended and Restated Bylaws of the Company."

IMPACT OF YEAR 2000 ISSUES

The Company relies, directly and indirectly, on information technology
systems to operate its digital radio stations, provide its radio stations with
up-to-date news and perform a variety of administrative services including
accounting, financial reporting, advertiser spot scheduling, payroll and
invoicing. The Company also uses non-information technology systems, such as
microchips, for dating and other automated functions. Information and
non-information technology systems that do not properly recognize and process
date sensitive information when the year changes to "2000" or "00" could
generate erroneous data or cause such systems to fail ("Year 2000 Issues"). As a
result, Year 2000 Issues could have a material adverse effect on the operations
of the Company. In order to minimize the risk of Year 2000 related losses, the
Company is conducting a comprehensive assessment of its Year 2000 Issues.
However, there can be no assurance that the Company will resolve its Year 2000
Issues prior to the year 2000, or that the cost of remedying any Year 2000
Issues will not have a material adverse effect on the Company's business.
Furthermore, there can be no assurance that the systems of other companies with
which the Company's systems interact will be timely converted and, if not timely
converted, would not have a material adverse effect on the Company's business.
See "Management Discussion and Analysis of Financial Condition and Results of
Operation -- Impact of Year 2000 Issues."

19
<PAGE> 22

USE OF PROCEEDS

The net proceeds to the Company from the sale of the shares of Class A
Common Stock offered by it after deducting underwriting discounts and other
offering expenses, all of which are payable by the Company, are estimated to be
approximately $186 million (approximately $ million if the
Underwriters' over-allotment option is exercised in full), assuming an initial
public offering price of $ per share. The net proceeds of the Offering will
be used to repay revolving indebtedness of the Company. On December , 1998,
the Company had revolving indebtedness outstanding of approximately $
million; approximately $77.0 million of such indebtedness was incurred in
connection with the First Boston Transaction and the remainder was incurred to
fund the Sinclair Transaction, other acquisitions and general corporate
purposes. Following the Offering, the Company will fund the Second Boston
Transaction and a portion of the S Corporation Distribution with revolving
indebtedness under the Credit Facility.

As of September 30, 1998, on a pro forma basis, the Company would have had
approximately $219.1 million of indebtedness outstanding under the Credit
Facility. The final maturity date for the Credit Facility is February 13, 2006.
Interest on any outstanding principal accrues at a rate based, at the Company's
election, on either LIBOR plus a spread which ranges from 0.5% to 2.125%, or on
KeyBank N.A.'s base rate, plus a spread of up to 0.875%, in either case,
depending on the Company's total outstanding indebtedness. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources."

RECAPITALIZATION, CHASE CONVERSION AND FORMER S CORPORATION STATUS

Prior to the consummation of the Offering, the Company will engage in a
Recapitalization that will result in the Company having Class A Common Stock,
Class B Common Stock, Class C Common Stock and Preferred Stock authorized, and
Class A Common Stock and Class B Common Stock issued and outstanding. Prior to
the Offering, the Company was an S Corporation with voting and non-voting Prior
Common Stock authorized and issued. In connection with the Recapitalization, (i)
the Company will effect a for one stock split of the outstanding shares of
Prior Common Stock, (ii) each share of Prior Common Stock held by Joseph M.
Field, the Company's Chairman of the Board and Chief Executive Officer, and
David J. Field, the Company's President and Chief Operating Officer will be
exchanged for one share of Class B Common Stock, (iii) each share of Prior
Common Stock held by all other shareholders will be exchanged for one share of
Class A Common Stock and (iv) the Company will revoke its S Corporation status.

Chase Capital currently owns the 7% Subordinated Convertible Note. Chase
Capital, a global private equity organization with approximately $5 billion
under management, is an affiliate of The Chase Manhattan Corporation. Chase
Capital has substantial investment experience in the radio broadcasting sector,
including having co-founded American Radio Systems Corporation in 1993, and
currently has approximately 20% of its portfolio committed to the media and
telecommunications industry. A general partner of Chase Capital serves on the
Company's Board of Directors. Chase Capital has agreed with the Underwriters and
the Company that immediately prior to the Offering it will convert the 7%
Subordinated Convertible Note into Class A Common Stock. Upon the Chase
Conversion, Chase Capital will receive shares of Class A Common Stock.
After giving effect to the Offering, including Chase Capital's sale of shares of
Class A Common Stock therein, Chase Capital will beneficially own approximately
% of the Company's Class A Common Stock, representing % of the total voting
power of the Company's outstanding Common Stock (approximately % of the
Company's Class A Common Stock, representing % of the total voting power of
the Company's outstanding Common Stock, if the over-allotment option is
exercised in full).

The Company has been an S Corporation subject to taxation under Subchapter
S of the Code since October 1, 1987. As a result, the net income of the Company,
for federal and certain state and local tax purposes, has been reported by and
taxed directly to the Company's S Corporation shareholders, rather than to the
Company and will continue to be taxed to such shareholders until the S
Corporation election is revoked. In connection with the Recapitalization and
shortly before the consummation of the Offering, the Company will file a notice
with the Internal Revenue Service revoking its S Corporation status as of a date
immediately preceding the Offering (the "Revocation Date").

20
<PAGE> 23

As an S Corporation the Company has been subject to a single tax on its
income which is payable by its shareholders and the Company may distribute such
income to its shareholders without the imposition of a second tax. Therefore,
immediately prior to the Offering, in connection with the revocation of the
Company's S Corporation status, the Company intends to declare a dividend (the
"S Corporation Distribution") payable to its existing S Corporation shareholders
in the amount of $ million which the Company currently estimates will
be the undistributed balance of the Company's taxable income as of the
Revocation Date, assuming a January 31, 1999 Revocation Date, no interim
distributions and the prior closing of the First Boston and Tampa Transactions
and all of the Completed Transactions except the WREN-AM Transaction. All of
such income up to the Revocation Date has been taxed or will be taxed to the
existing S Corporation shareholders. That estimated amount includes
$ for the estimated tax liability of the Company's S Corporation
shareholders with respect to the Tampa Transaction and the other taxable income
of the Company as of such Revocation Date for which distribution by the Company
has not yet occurred and $ , the estimated balance of the undistributed
taxable income of the Company as of such Revocation Date. Said amount, less any
interim distributions which may have been made to the existing S Corporation
shareholders to defray taxes on the Company's income, will be paid within six
(6) months after the Offering and will be funded from the net proceeds from the
Tampa Transaction and borrowings under the Credit Facility. In order to provide
certainty to the purchasers in the Offering as to the amount of the S
Corporation Distribution, that amount shall be fixed and not subject to any
future adjustments; provided however, if the Company subsequently realizes an
economic benefit in connection with a reassessment of the Company's S
Corporation tax returns which results in an increase in the tax liability of its
S Corporation shareholders, then the Company shall reimburse those shareholders
pursuant to an indemnification agreement to the extent of such economic benefit.
See "Risk Factors -- Benefits to Existing Shareholders and Affiliates."

In addition, as a result of the revocation of its S Corporation status, the
Company will record an income tax expense and corresponding deferred income tax
liability (the "Deferred Tax Liability"), effective upon the Revocation Date.
The amount of the Deferred Tax Liability would have been approximately $82.1
million if the Revocation Date had been September 30, 1998, but the actual
amount will be adjusted to reflect the Company's actual financial position at
the Revocation Date.

DIVIDEND POLICY

The Company does not anticipate paying cash dividends on its Common Stock
in the foreseeable future because it intends to retain its earnings, if any, to
finance the expansion of its business and for general corporate purposes. Any
payment of future dividends will be at the discretion of the Board of Directors
and will depend upon, among other factors, the Company's earnings, financial
condition, capital requirements, level of indebtedness, contractual restrictions
with respect to the payment of dividends, including, without limitation, the
provisions of the Credit Facility that limit the Company's ability to pay
dividends and other considerations that the Board of Directors deems relevant.

21
<PAGE> 24

DILUTION

Dilution is the amount by which the initial public offering price paid by
the purchasers of the shares of Class A Common Stock will exceed the net
tangible book value per share of Common Stock after the Offering. The net
tangible book value per share of Common Stock is determined by subtracting the
total liabilities of the Company from the total book value of the tangible
assets of the Company and dividing the difference by the number of shares of
Common Stock deemed to be outstanding on the date as of which such book value is
determined.

At September 30, 1998, on a pro forma basis to reflect the
Recapitalization, the Completed and CBS Transactions, the S Corporation
Distribution and the Chase Conversion, the Company would have had a net tangible
book value (deficit) of approximately $ or $ per share (excluding
intangible book value of $ per share). After giving effect to the sale by
the Company of shares of Class A Common Stock offered hereby at
an assumed initial public offering price of $ per share (the mid-point of
the range set forth on the cover page of this Prospectus), and the application
of the estimated net proceeds therefrom, the pro forma net tangible book value
(deficit) of the Company as of September 30, 1998 would have been approximately
$ or $ per share. This represents an immediate increase in such net
tangible book value of $ per share to existing shareholders and an immediate
dilution to new investors of $ per share. The following table illustrates
this per share dilution:

<TABLE>
<S> <C> <C>
Assumed initial public offering price per share............. $
Net tangible book value per share after the
Recapitalization....................................... $
Decrease in net tangible book value from the Chase
Conversion, revocation of S Corporation status and S
Corporation Distribution...............................
Decrease in net tangible book value per share resulting
from Completed Transactions after September 30, 1998
and the CBS Transactions...............................
Increase in net tangible book value per share resulting
from the Offering......................................
-------
Pro forma net tangible book value per share.................
-------
Dilution per share to new investors(1)...................... $
=======
</TABLE>

- ---------------
(1) Determined by subtracting the pro forma as adjusted net tangible book value
per share after the Offering from the assumed initial public offering price
per share.

If the Underwriters' over-allotment option is exercised in full, the
increase in net tangible book value per share resulting from the Offering, pro
forma net tangible book value per share after the Offering, and dilution per
share to new investors would be $ , $ and $ ,
respectively.

The following table sets forth at September 30, 1998 after giving effect to
the Recapitalization, the Chase Conversion, the S Corporation Distribution and
the sale of the Class A Common Stock offered by the Company in the Offering: (i)
the number of shares of Class A Common Stock purchased by existing shareholders
from the Company and the total consideration and the average price per share
paid to the Company for such shares; (ii) the number of shares received by Chase
Capital in connection with the Chase Conversion and the total consideration and
the price per share paid by it for such shares; (iii) the number of shares of
Class A Common Stock purchased by new investors in the Offering from the Company
and the total consideration and the price per share paid by them for such
shares; and (iv) the percentage of shares purchased from the Company by existing
shareholders, Chase Capital and the new investors and the percentages of
consideration paid to the Company for such shares by existing shareholders and
new investors.

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
-------------------- -------------------- PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
-------- -------- -------- -------- ---------
<S> <C> <C> <C> <C> <C>
Existing shareholders (1)................. % $ % $
Chase Capital.............................
New investors.............................
-------- -------- -------- --------
Total........................... % $ %
======== ======== ======== ========
</TABLE>

- ---------------
(1) Does not include shares of Common Stock equal to % of the shares of
Class A Common Stock outstanding from time to time that are reserved for
issuance under the Company's 1998 Equity Compensation Plan, of which options
to purchase shares of Class A Common Stock are issued and
outstanding. See "Management -- 1998 Equity Compensation Plan" and
"Principal and Selling Shareholders."

22
<PAGE> 25

CAPITALIZATION

The following table sets forth as of September 30, 1998, in each case after
adjustment for the Recapitalization, (i) the historical capitalization of the
Company, (ii) the unaudited pro forma capitalization of the Company after giving
effect to the Completed Transactions not yet consummated on that date and the
CBS Transactions and (iii) the unaudited pro forma capitalization of the Company
after giving effect to the foregoing events and the S Corporation Distribution,
the Chase Conversion, the Offering and the application of the estimated net
proceeds therefrom as described in "Use of Proceeds." This table should be read
in conjunction with the Company's Consolidated Financial Statements and the
Unaudited Pro Forma Financial Information and the notes thereto included
elsewhere in this Prospectus.

<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1998
-----------------------------------------------
PRO FORMA AS
ADJUSTED FOR
THE COMPLETED
AND CBS
TRANSACTIONS,
THE S CORPORATION
PRO FORMA FOR DISTRIBUTION,
THE COMPLETED THE CHASE
AND CBS CONVERSION AND
ACTUAL TRANSACTIONS THE OFFERING(1)
-------- -------------- -----------------
(IN THOUSANDS)
<S> <C> <C> <C>
Cash and cash equivalents: $ 6,666 $ 6,514 $ 6,514
======== ======== ========
Short-term debt and current portion of long-term
debt............................................. $ 10 $ 10 $ 10
Long-term debt, less current portion:
Credit Facility.................................. 253,500 316,855 218,852
7% Subordinated Convertible Note................. 29,353 29,353
Other............................................ 273 273 273
-------- -------- --------
Total long-term debt..................... 283,126 346,481 219,125
Shareholders' equity:
Preferred Stock, $.01 par value per share,
25,000,000 shares authorized, no shares issued
and outstanding...............................
Class A Common Stock, $.01 par value per share,
200,000,000 shares authorized, shares
issued and outstanding actual and pro forma,
shares issued and outstanding pro forma as
adjusted...................................... 2 2
Class B Common Stock, $.01 par value per share,
75,000,000 shares authorized, shares
issued and outstanding actual and pro forma,
shares issued and outstanding pro forma
as adjusted................................... 4 4
Class C Common Stock, $.01 par value per share,
50,000,000 shares authorized, no shares issued
and outstanding...............................
Additional paid-in capital....................... 710 710 339,545
Retained earnings................................ 220,165 289,205
-------- -------- --------
Total shareholders' equity............... 220,881 289,921 339,545
-------- -------- --------
Total capitalization................ $504,017 $636,412 $558,680
======== ======== ========
</TABLE>

- ---------------
(1) Does not include shares of Common Stock equal to 10% of the shares of Class
A Common Stock outstanding from time to time that are reserved for issuance
under the Company's 1998 Equity Compensation Plan, of which options to
purchase shares of Class A Common Stock are issued and
outstanding. See "Management -- 1998 Equity Compensation Plan."

23
<PAGE> 26

CBS TRANSACTIONS

In August 1998, the Company entered into three agreements with CBS, the CBS
Transactions, pursuant to which it will (i) purchase WRKO-AM and WEEI-AM in
Boston for $82.0 million in cash, (ii) sell WLLD-FM and WYUU-FM in Tampa for
$75.0 million in cash and (iii) purchase WAAF-FM and WEGQ-FM in Boston and
WWTM-AM in Worchester for $58.0 million. Subject to satisfaction of necessary
conditions to closing, the Company currently anticipates that the First Boston
Transaction and the Tampa Transaction will close prior to the consummation of
the Offering, and that the Second Boston Transaction will close by August of
1999. As each of the three agreements with CBS has separate conditions to
closing and none of the transactions is conditioned on the closing of the other
two, there can be no certainty concerning when or whether each of the
transactions will close or the order in which they will close. The Company began
operating the Boston stations and CBS began operating the Tampa stations under
time brokerage agreements in September 1998. Upon completion of the Boston
Transactions, the Company will have a strong presence in the Boston market with
a 19.4% market share.

COMPLETED TRANSACTIONS

In March 1997, the Company acquired three stations in Seattle, KIRO-AM/FM
and KNWX-AM, and four stations in Kansas City, KCMO-AM/FM, KYYS-FM (formerly
KLTH-FM) and KMBZ-AM, from Bonneville International Corp. ("Bonneville") in
exchange for KLDE-FM in Houston plus $5.0 million (the "Bonneville
Transaction"). The three Seattle stations and a JSA for KING-FM in Seattle
complemented the Company's pre-existing holdings of five stations in Seattle,
provided the Company with the maximum permissible ownership in that market and
solidified the Company as the leading radio operator in Seattle. In addition,
the Bonneville Transaction enabled the Company to enter the Kansas City market
with a four-station cluster.

In April 1997, the Company acquired KLYK-FM and KEDO-AM in Longview/Kelso,
Washington from Rodney J. Etherton ("Etherton") for $1.8 million (the "Etherton
Transaction"). Longview/Kelso is a market located north of Portland, Oregon,
which management considers to be of strategic importance because of its
influence over the potential upgrade of certain Portland stations.

In May 1997, the Company acquired KLOU-FM in St. Louis plus $39.7 million
from Group W Broadcasting, Inc. ("Group W") in exchange for KITS-FM in San
Francisco (the "Group W Transaction").

In May 1997, the Company acquired KISW-FM in Seattle plus $32.5 million in
exchange for WDSY-FM and WJJJ-FM (formerly WNRQ-FM) in Pittsburgh in a three-way
transaction (the "Nationwide-Secret Transaction") with Nationwide
Communications, Inc. ("Nationwide") and Secret Communications L.P. ("Secret").
Prior thereto, in June 1996, the Company began operating and selling radio
advertising time on KISW-FM pursuant to a TBA. This acquisition added a third
rock station to the Company's Seattle cluster.

In June 1997, the Company acquired KRXQ-FM and KSEG-FM in Sacramento from
Citicasters Inc. ("Citicasters") for $45.0 million (the "Citicasters
Transaction") and KDND-FM (formerly KXOA-FM) in Sacramento from American Radio
Systems Corporation ("ARS") for $27.2 million (the "ARS-KXOA Transaction").
Prior thereto, in January 1997, the Company began operating and selling radio
advertising time on all three stations pursuant to TBAs. By purchasing three
stations, the Company gained a substantial share of the Sacramento market and
established a platform for further acquisitions.

In October 1997, the Company exchanged the broadcast frequency and
transmission facilities of its Kansas City station, KCMO-AM, for those of Kanza
Inc.'s ("Kanza") Kansas City station, WHB-AM (the "Kanza Transaction"). Each
party retained its call letters, formats and studio facilities. The signal swap
allowed the Company to enhance the 24-hour metro signal of KCMO-AM by providing
nighttime and winter drive time coverage of Johnson County, Kansas, in the
affluent and growing southwestern section of Kansas City. The transaction was
accounted for as a nonmonetary exchange of similar productive assets and no gain
or loss was recognized. The assets received were recorded at the historical cost
of the assets surrendered.

24
<PAGE> 27

In November 1997, the Company acquired KSSJ-FM (formerly KBYA-FM) in
Sacramento from Susquehanna Radio Corp ("Susquehanna") for $15.9 million (the
"Susquehanna Transaction"). KSSJ-FM was not on-the-air when the Company
announced the acquisition but became operational in December 1997.

In January 1998, the Company acquired WDAF-AM and KUDL-FM in Kansas City
plus $7.0 million from ARS in exchange for the Company's sole station in St.
Louis, KLOU-FM (the "ARS-Kansas City Transaction"). As a result of this
transaction, the Company became the leading radio station operator in Kansas
City.

In January 1998, the Company acquired KCTC-AM in Sacramento from ARS for
$4.0 million (the "ARS-KCTC Transaction") in order to make it possible, under
FCC ownership rules, for the Company to acquire a fifth FM station in that
market.

In May 1998, the Company acquired WSKY-FM (formerly WRRX-FM) in the
Gainesville/Ocala market from Gator Broadcasting, Inc. ("Gator") for $2.1
million, plus an additional payment of up to $1.0 million payable once the
authorized upgrade of the station from a Class A license to a Class C-2 license
becomes final (the "Gator Transaction"). The Company believes that this second
Gainesville station will permit it to solidify its leadership position in the
Gainesville/Ocala market.

In May 1998, the Company sold its rights to participate in a FCC licensing
procedure in the Vancouver, Washington radio market to Jacor for $10.0 million
(the "Vancouver Transaction").

In May 1998, the Company acquired KBAM-AM and KRQT-FM in the Longview/Kelso
market from Armak Broadcasters, Inc. ("Armak") for $1.0 million to bolster the
Company's competitive position in that market (the "Armak Transaction").

In June 1998, the Company acquired three stations, KRSK-FM (formerly
KKRH-FM), KKSN-FM and KKSN-AM in Portland, and four stations, WBEE-FM, WBBF-FM
(formerly WKLX-FM), WEZO-AM (formerly WBBF-AM) and WQRV-FM in Rochester, from
Sinclair Broadcasting Group ("Sinclair") for $126.5 million (the "Sinclair
Transaction"). Prior thereto, in March 1998, the Company began operating and
selling the radio advertising time of these stations under TBAs. The Portland
stations significantly enhanced the Company's position in that market by
increasing the number of the Company's stations to six and its market share to
approximately 25.8%. The acquisition of the Rochester stations enabled the
Company to enter that market with a 21.7% market share.

On September 16, 1998, the Company completed an agreement with American
Radio Systems, Inc, and American Radio Systems License Corp. (collectively
referred to as "ARS") to exchange certain assets used in the operation of radio
stations serving the Sacramento radio market. ARS provided KRAK-FM's license and
transmission facility to the Company in exchange for KRXQ's license and
transmission facility and $4.5 million. Each of the stations retained its own
call letters, programming format and studio and office property and equipment,
and the parties provided each other with reciprocal covenants against
programming competition on the respective frequencies for a period of two years.
ARS also transferred the intellectual property comprising the program format for
use by the Company on its recently acquired KBYA-FM in that market. The
transactions were accounted for as nonmonetary exchanges of similar productive
assets, and no gain or loss was recognized. The assets received were recorded at
the historical cost of the assets surrendered plus the $4.5 million paid to ARS.
In a related transaction, the Company sold the KRXQ-FM transmitter site,
including broadcast tower facilities, to ARS for $750,000, resulting in a loss
of $34,000.

In September 1998, the Company acquired from Capital Broadcasting, Inc.
("Capital") the assets and rental leases used in connection with the operation
of a tower facility serving the Kansas City market for $2.0 million (the "Kansas
City Tower Transaction").

In December 1998, the Company expects to close on the acquisition of
acquire KSLM-AM, a radio station serving the Salem, Oregon portion of the
Portland radio market, from Willamette Broadcasting Co. ("Williamette") for $0.6
million (the "KSLM-AM Transaction").

As of December 1998, the Company expects to enter into an agreement to
acquire WREN-AM Kansas City, Kansas from Mortenson Broadcasting Company of
Canton, LLC ("Mortenson") for the sum of $2.8

25
<PAGE> 28

million (the "WREN-AM Transaction") to add to the Company's strength in the
Kansas City market. It is anticipated that this transaction will close in the
first calendar quarter of 1999.

The Bonneville Transaction, the Etherton Transaction, the Group W
Transaction, the Nationwide-Secret Transaction, the Citicasters Transaction, the
ARS-KXOA Transaction, the Kanza Transaction, the Susquehanna Transaction, the
ARS-Kansas City Transaction, the ARS-KCTC Transaction, the Gator Transaction,
the Vancouver Transaction, the Armak Transaction, the Sinclair Transaction, the
Sacramento Frequency Exchange, the Kansas City Tower Transaction, the KSLM-AM
Transaction and the WREN-AM Transaction are referred to collectively as the
"Completed Transactions."

26
<PAGE> 29

UNAUDITED PRO FORMA FINANCIAL INFORMATION

The following unaudited pro forma financial information (the "Pro Forma
Financial Information") is based on the audited historical financial statements
of the Company and the related notes included elsewhere in this Prospectus and
the unaudited historical financial information of CBS, ARS Kansas City
Transaction, ARS-KCTC Transaction, Susquehanna, Vancouver, Armak, Gator,
Sinclair, Capital, Williamette and Mortenson.

The pro forma statement of income for the year ended September 30, 1998 has
been prepared to illustrate the effects of the Recapitalization, the Completed
Transactions which occurred subsequent to September 30, 1997, the CBS
Transactions, the S Corporation Distribution, the Chase Conversion, the Offering
and the application of the net proceeds thereof as described in "Use of
Proceeds" as if each had occurred on October 1, 1997. The pro forma balance
sheet data as of September 30, 1998 give effect to any such events not yet
consummated on that date as if each had occurred on that date. The Pro Forma
Financial Information and accompanying notes should be read in conjunction with
the consolidated financial statements and other financial information included
elsewhere herein pertaining to the Company, including "Capitalization" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations." The Pro Forma Financial Information is not necessarily indicative
of either future results of operations or the results that might have been
achieved if such transactions had been completed on the indicated dates.

The Pro Forma Financial Information has been prepared as if the Credit
Facility was entered into on October 1, 1997 at the terms currently in effect.
Additionally, it has been assumed that the Company's conversion from an S
Corporation to a C Corporation became effective on October 1, 1997.

All acquisitions given effect in the Pro Forma Financial Information are
accounted for using the purchase method of accounting. The aggregate purchase
price of each transaction is allocated to the tangible and intangible assets
acquired and liabilities assumed based on their respective fair values. The
allocation of the aggregate purchase price reflected in the Pro Forma Financial
Information is preliminary for transactions to be closed subsequent to September
30, 1998. The final allocation of the purchase price is contingent upon the
receipt of final appraisals of the acquired assets and the revision of other
estimates. Management does not expect such allocations to differ materially from
the preliminary allocation.

27
<PAGE> 30

ENTERCOM COMMUNICATIONS CORP.
UNAUDITED PRO FORMA STATEMENT OF INCOME

FOR THE YEAR ENDED SEPTEMBER 30, 1998

(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
ADJUSTMENTS FOR
THE OFFERING,
ADJUSTMENTS PRO FORMA THE
COMPLETED FOR THE FOR THE S CORPORATION
AND CBS COMPLETED COMPLETED DISTRIBUTION
THE TRANSACTIONS AND CBS AND CBS AND THE CHASE
COMPANY COMBINED(A) TRANSACTIONS TRANSACTIONS CONVERSION TOTAL PRO FORMA
-------- ------------ ------------ ------------ --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Net revenues................ $132,998 $38,417 -- $171,415 $171,415
Station operating
expenses.................. 88,469 34,154 $ (4,235)(B) 118,388 118,388
Depreciation and
amortization.............. 13,066 7,601 (1,396)(C) 19,271 19,271
Corporate general and
administrative expenses... 4,527 -- 4,527 4,527
Net expense (income) from
TBA fees.................. 2,399 45 (2,444)(D)
Other operating expenses.... 130 (130)
-------- ------- -------- -------- -------- --------
Operating income (loss)... 24,407 (3,253) 8,075 29,229 29,229
Interest expense............ 14,663 14 12,261(G) 26,938 $(11,837)(J) 15,101
Gain (loss) on sale of
assets.................... 8,661 (8) 8(H) 161 161
(8,500)(I)
Other (income) expense...... (328) 147 -- (181) (82)(E) (263)
-------- ------- -------- -------- -------- --------
Income (loss) before
income taxes and
extraordinary
items................... 18,733 (3,422) (12,678) 2,633 11,919 14,552
Income taxes................ 453 453 453
-------- ------- -------- -------- -------- --------
Income (loss) before
extraordinary items....... $ 18,280 $(3,422) $(12,678) $ 2,180 $ 11,919 $ 14,099
======== ======= ======== ======== ======== ========
Income (loss) before income
taxes and extraordinary
items..................... $ 18,733 $(3,422) $(12,678) $ 2,633 $ 11,919 $ 14,552
Pro forma income taxes(F)... 7,119 (1,300) (4,818) 1,001 4,529 5,530
-------- ------- -------- -------- -------- --------
Pro forma income (loss)
before extraordinary
items..................... $ 11,614 $(2,122) $ (7,860) $ 1,632 $ 7,390 $ 9,022
======== ======= ======== ======== ======== ========
Pro forma earnings per share
before extraordinary
items.....................
Shares used to compute pro
forma earnings per
share.....................
</TABLE>

See accompanying notes to pro forma financial information.
28
<PAGE> 31

ENTERCOM COMMUNICATIONS CORP.
UNAUDITED PRO FORMA BALANCE SHEET

AS OF SEPTEMBER 30, 1998

(IN THOUSANDS)

<TABLE>
<CAPTION>
ADJUSTMENTS PRO FORMA ADJUSTMENTS FOR
COMPLETED FOR THE FOR THE THE OFFERING,
AND CBS COMPLETED COMPLETED THE S CORPORATION
THE TRANSACTIONS AND CBS AND CBS DISTRIBUTION AND
COMPANY COMBINED(K) TRANSACTIONS TRANSACTIONS CHASE CONVERSION TOTAL PRO FORMA
-------- ------------ ------------ ------------ ----------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents.... $ 6,666 $ (152) $ -- $ 6,514 $ 6,514
Accounts receivable, net..... 32,524 8,638 (9,276)(L) 31,886 31,886
Due from CBS................. 5,000(M)
(5,000)(N)
Prepaid expenses and other... 6,625 872 (893)(L) 6,604 $ 3,182(Q) 9,786
Assets held for sale......... 5,310 5,310 5,310
-------- ------- -------- -------- --------- --------
Total current assets....... 51,125 9,358 (10,169) 50,314 3,182 53,496
Property and equipment, net.... 43,057 8,233 (3,851)(M) 47,439 47,439
Intangible and other assets,
net.......................... 428,763 32,580 101,083(M) 562,426 (970)(R) 561,456
-------- ------- -------- -------- --------- --------
Total Assets............... $522,945 $50,171 $ 87,063 $660,179 $ 2,212 $662,391
======== ======= ======== ======== ========= ========
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current Liabilities:
Accounts payable and other
accrued expenses........... $ 16,751 $ 2,823 $ (2,984)(L) $ 21,590 $ 21,590
5,000(M)
Current portion of long-term
debt....................... 10 35 (35)(L) 10 10
-------- ------- -------- -------- --------- --------
Total current
liabilities.............. 16,761 2,858 1,981 21,600 21,600
Long-term debt, less current
portion...................... 283,126 3,355 140,000(O) 346,481 $(186,000)(S) 219,125
(75,000)(P) (29,353)(R)
(5,000)(N) 72,001(T)
15,996(U)
Other long-term liabilities.... 2,177 -- -- 2,177 82,138(Q) 82,121
(2,194)(V)
-------- ------- -------- -------- --------- --------
Total liabilities.......... 302,064 6,213 61,981 370,258 (47,412) 322,846
Shareholders' Equity:
Common Stock -- Nonvoting.... 2 2 2
Common Stock -- Voting....... 4 4 4
Additional Paid in Capital... 710 710 338,829(W) 339,539
Retained Earnings............ 220,165 43,958 (49,918)(L) 289,205 (78,956)(Q) 0
75,000(P) 186,000(S)
28,383(R)
(72,001)(T)
(15,996)(U)
2,194(V)
(338,829)(W)
Total Shareholders'
Equity................... 220,881 43,958 25,082 289,921 49,624 339,545
-------- ------- -------- -------- --------- --------
Total liabilities and
shareholders' equity..... $522,945 $50,171 $ 87,063 $660,179 $ 2,212 $662,391
======== ======= ======== ======== ========= ========
</TABLE>

See accompanying notes to pro forma financial information.

29
<PAGE> 32

NOTES TO THE UNAUDITED PRO FORMA FINANCIAL INFORMATION

(DOLLARS IN THOUSANDS)

(A) The schedule below gives effect to the Completed and CBS Transactions for
the period from October 1, 1997 through September 30, 1998.

COMPLETED AND CBS TRANSACTIONS COMBINED

<TABLE>
<CAPTION>
COMPLETED TRANSACTIONS CBS TRANSACTIONS
--------------------------------------- -----------------------
HISTORICAL COMPLETED
OTHER AND CBS
HISTORICAL HISTORICAL TRANSACTIONS HISTORICAL HISTORICAL TRANSACTIONS
SINCLAIR(1) ARS(2) COMBINED(3) BOSTON(4) TAMPA(5) COMBINED(6)
----------- ---------- ------------ ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Net revenues...................... $ 6,460 $1,847 $ (762) $35,322 $(4,450) $38,417
Station operating expenses........ 3,498 1,554 (202) 32,932 (3,628) 34,154
Depreciation and amortization..... 4,316 165 466 3,025 (371) 7,601
Corporate general and
administrative expenses.........
Net expense (income) from TBA
fees............................ 45 45
Other operating expenses.......... (130) (130)
------- ------ ------- ------- ------- -------
Operating income (loss)......... (1,354) 128 (896) (635) (496) (3,253)
Interest expense.................. 14 14
Gain (loss) on sale of assets..... (8) (8)
Other expense..................... 147 147
------- ------ ------- ------- ------- -------
Income (loss) before income tax
expense....................... (1,354) 128 (1,043) (657) (496) (3,422)
Income taxes......................
------- ------ ------- ------- ------- -------
Net income (loss)............... $(1,354) $ 128 $(1,043) $ (657) $ (496) $(3,422)
======= ====== ======= ======= ======= =======
</TABLE>

- ---------------

(1) The column represents the results of operations of KKSN-AM/FM and
KRSK-FM (formerly KKRH-FM) in Portland and WBBF-FM (formerly WKLX-FM),
WBEE-FM, WQRV-FM and WEZO-AM (formerly WBBF-AM) in Rochester from
October 1, 1997 through February 28, 1998, the date the Company began
operating the stations under TBAs.

(2) The column represents the results of operations of WDAF-AM and KUDL-FM
in Kansas City and KCTC-AM in Sacramento from October 1, 1997 through
December 31, 1997, prior to the dates of the ARS-Kansas City
Transaction and the ARS-KCTC Transaction, respectively.

(3) The column represents the historical results of operations for the
following transactions which were, or will be, consummated prior to the
date of the Offering: (i) the acquisitions of WSKY-FM (formerly
WRRX-FM) in Gainesville, KSSJ-FM (formerly KBYA-FM) in Sacramento,
KBAM-AM and KRQT-FM in Longview/Kelso, KSLM-AM in Salem, Oregon and
WREN-AM in Kansas City, (ii) the disposition of KLOU-FM in St. Louis,
(iii) the Kansas City Tower Transaction and (iv) the Sacramento
Frequency Exchange.

(4) The column represents the results of operations of (i) WEEI-AM and
WRKO-AM in Boston from October 1, 1997 through September 20, 1998 and
(ii) WEGQ-FM and WAAF-FM in Boston and WWTM-AM in Worcester from
October 1, 1997 through September 22, 1998, prior to the dates the
Company began operating the stations under TBAs.

(5) The column represents the results of operations of WYUU-FM and WLLD-FM
in Tampa from October 1, 1997 through September 21, 1998, prior to the
date of the TBA with CBS.

(6) All stations acquired in the Completed and CBS Transactions have
December 31 year ends. Amounts derived for these transactions for the
year ended September 30, 1998 were computed by adding fourth quarter
1997 results to interim period results for the first, second and third
quarters of 1998.

30
<PAGE> 33
NOTES TO THE UNAUDITED PRO FORMA FINANCIAL INFORMATION -- (CONTINUED)

(B) In connection with the CBS Transaction, the Company acquired certain loss
contracts and recorded a liability amounting to $5.0 million. Pursuant to
the purchase agreement, CBS will pay $5.0 million to the Company to offset
these losses. For purposes of the unaudited pro forma statement of income
for the year ended September 30, 1998, this adjustment reflects the
elimination of the actual losses related to those loss contracts for the
year ended September 30, 1998.

(C) This adjustment represents the change in depreciation and amortization
arising from an increase in property, equipment, FCC licenses and
intangibles, offset by a decrease in those assets, as a result of the
various acquisitions and dispositions described herein, as well as
establishing the estimated useful lives of the acquired assets. The
adjustment consists of a decrease of $1,501 in depreciation related to
property and equipment, an increase of $212 in amortization related to
intangibles, and a decrease of $107 in amortization related to other
intangibles. Under the Company's normal accounting policies, property and
equipment are depreciated over periods of five to twenty years, and FCC
licenses and intangibles are amortized over forty years.

(D) The adjustment reflects the net expense (income) from TBA fees received or
paid related to the operations of the stations under TBAs while pending the
consummation of purchase or sale of the Completed and CBS Transactions.

(E) The adjustment reflects the elimination of the income attributable to a 1%
limited partnership interest held by an affiliate of the Company, ECI
Investors Corporation ("Investors"), as a result of the contribution of the
stock of such affiliate to the Company, which will occur immediately prior
to the Offering.

(F) The adjustment reflects the income tax expense (benefit) related to the
income (loss) that would have been generated by the Company during the pro
forma period based on the assumption that the conversion from an S
Corporation to a C Corporation occurred on October 1, 1997. A combined
federal and state income tax rate of 38% was used for this calculation.

(G) The adjustment reflects interest expense under the current Credit Facility,
based on the rate of 7.86%, and 7% Subordinated Convertible Note as if the
Completed and CBS Transactions were completed on October 1, 1997, net of the
historical interest expense. The calculation of interest expense assumes an
outstanding indebtedness under the Credit Facility of $316,855 (consisting
of $253,500 of previously incurred indebtedness, plus the $135,000 in
additional indebtedness incurred to fund the Boston Transactions, less the
$75,000 reduction in indebtedness following the application of proceeds from
the sale of WYUU-FM and WLLD-FM in Tampa, plus the $605 in additional
indebtedness incurred to fund the acquisition of KSLM-AM in Salem, Oregon,
plus the $2,750 in additional indebtedness incurred to fund the WREN-AM
acquisition in Kansas City). A change in interest rates of 1/8% will
increase or decrease interest expense by $396.

<TABLE>
<S> <C>
Credit Facility............................................. $ 24,904
7% Subordinated Convertible Note............................ 2,019
Other indebtedness.......................................... 15
--------
Pro forma interest expense................................ 26,938
Historical interest expense................................. (14,677)
--------
Net adjustment............................................ $ 12,261
========
</TABLE>

(H) The adjustment represents the elimination of the historical loss on asset
sale recorded by CBS.

(I) The adjustment reflects the elimination of the gain on the sale of the
Vancouver license rights.

(J) The adjustment reflects (i) the interest expense savings resulting from the
use of proceeds from the Offering, (ii) the Chase Conversion and (iii) an
$87,997 increase in outstanding indebtedness as a result

31
<PAGE> 34

NOTES TO THE UNAUDITED PRO FORMA FINANCIAL INFORMATION -- (CONTINUED)

of the S Corporation Distribution, all net of pro forma interest expense as
adjusted for the Completed and CBS Transactions (see Note (G)). The
remaining indebtedness incurs assumed interest expense at a rate of 6.90%,
based on the current terms of the Credit Facility. The net adjustment
figure includes $6,141 of interest on the $87,997 indebtedness incurred to
fund the S Corporation Distribution.

<TABLE>
<S> <C>
Credit Facility............................................. $ 15,101
7% Subordinated Convertible Note............................ 0
--------
Pro forma interest expense................................ 15,101
Pro forma interest expense as adjusted for the Completed and
CBS Transactions.......................................... (26,938)
--------
Net adjustment............................................ $(11,837)
========
</TABLE>

(K) The column represents the combined balance sheets as of September 30, 1998
of the Completed and CBS Transactions not yet consummated on that date as if
all such transactions were consummated on that date.

COMPLETED AND CBS TRANSACTIONS COMBINED

<TABLE>
<CAPTION>
COMPLETED
TRANSACTIONS
------------
HISTORICAL CBS TRANSACTIONS
OTHER ----------------------- COMPLETED AND
TRANSACTIONS HISTORICAL HISTORICAL CBS TRANSACTIONS
COMBINED(1) BOSTON(2) TAMPA(3) COMBINED
------------ ---------- ---------- ----------------
<S> <C> <C> <C> <C>
ASSETS
Current Assets:
Cash................................. $ $ (152) $ (152)
Accounts receivable, net............. 9,276 (638) 8,638
Prepaid expenses and other........... $ 893 (21) 872
------ ------- ------- -------
Total current assets.............. 10,169 (811) 9,358
Property and equipment, net.......... 625 10,381 (2,773) 8,233
Intangible and other assets, net..... 2,730 32,387 (2,537) 32,580
------ ------- ------- -------
Total assets................. $3,355 $52,937 $(6,121) $50,171
====== ======= ======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and other accrued
liabilities....................... $ 2,984 $ (161) $ 2,823
Long-term debt, current portion...... 35 35
------ ------- ------- -------
Total current liabilities......... 3,019 (161) 2,858
Long-term debt, less current
portion........................... $3,355 3,355
Other long-term liabilities.......... --
------ ------- ------- -------
Total liabilities................. 3,355 3,019 (161) 6,213
Shareholders' equity................. 0 49,918 (5,960) 43,958
------ ------- ------- -------
Total liabilities and
shareholders' equity....... $3,355 $52,937 $(6,121) $50,171
====== ======= ======= =======
</TABLE>

- ---------------

(1) The column reflects the combined balance sheets of the following
transactions consummated subsequent to September 30, 1998, but prior to
the Offering: (i) the KSLM-AM Transaction and (ii) the WREN-AM
Transaction.

32
<PAGE> 35

NOTES TO THE UNAUDITED PRO FORMA FINANCIAL INFORMATION -- (CONTINUED)

(2) The column represents the combined balance sheet of WEEI-AM, WRKO-AM,
WEGQ-FM, WAAF-FM in Boston and WWTM-AM in Worcester as the CBS
Transactions will be consummated subsequent to September 30, 1998.

(3) The column represents the combined balance sheet of WYUU-FM and WLLD-FM
in Tampa as the Tampa Transaction will be consummated subsequent to
September 30, 1998.

(L) The adjustment represents the elimination of the historical CBS balance as
this amount will not be acquired or assumed by the Company, as the case may
be, in the asset purchase agreement.

(M) The adjustment reflects the estimated allocation of the purchase price of
the Boston Transactions to the assets acquired resulting in adjustments to
the property and equipment and intangibles and other assets to their
estimated fair values associated with the acquisition as follows:

<TABLE>
<CAPTION>
ESTIMATED
ALLOCATION OF CARRYING
PURCHASE PRICE VALUE ADJUSTMENTS
-------------- -------- -----------
<S> <C> <C> <C>
Due from CBS (see Note (N))................... $ 5,000 $ -- $ 5,000
Property and equipment, net................... 6,530 10,381 (3,851)
Intangible and other assets, net
FCC Licenses................................ 133,240 32,387 100,853
Other Intangibles........................... 230 -- 230
-------- ------- --------
Total intangible and other assets........... 133,470 32,387 101,083
Loss contracts assumed........................ (5,000) (5,000)
-------- ------- --------
Total purchase price................ $140,000 $42,768 $ 97,232
======== ======= ========
</TABLE>

Intangible and other assets are amortized over a period of 40 years.

(N) The adjustment reflects the amount received from CBS to offset prospective
losses from certain contracts acquired in the CBS Transactions and the
concurrent paydown of debt.

(O) The adjustment reflects the increase in debt necessary to fund the Boston
Transactions.

(P) The adjustment reflects the proceeds received for WYUU-FM and WLLD-FM in
the Tampa Transaction.

(Q) The adjustment represents the recording of the current deferred tax assets
and the deferred tax liabilities related to the conversion from an S
Corporation to a C Corporation.

(R) The adjustment reflects the Chase Conversion.

(S) The adjustment reflects assumed proceeds to the Company of $186.0 million
from the Offering, net of estimated fees and expenses.

(T) The adjustment reflects the portion of the S Corporation Distribution
related to the estimated taxed but undistributed income of the Company
through the Revocation Date (including the income from the Tampa
Transaction).

(U) The adjustment reflects the portion of the S Corporation Distribution which
is the estimated tax liability of the Company's existing S Corporation
shareholders on the income of the Company through the Revocation Date
(including the income from the Tampa Transaction) net of prior distributions
to such shareholders for such taxes.

(V) The adjustment reflects the effect of the contribution of the stock of ECI
Investors Corporation, which will occur immediately prior to the Offering.

(W) The adjustment reclassifies the remaining Retained Earnings balance to
Additional Paid in Capital as a result of the Offering.

33
<PAGE> 36

SELECTED HISTORICAL FINANCIAL DATA

The operating and other data in the following table have been derived from
audited financial statements of the Company for the years ended September 30,
1996, 1997 and 1998, all of which are included elsewhere in this Prospectus, and
from audited financial statements for the years ended September 30, 1994 and
1995. The selected balance sheet data in the following table have been derived
from audited financial statements of the Company as of September 30, 1997 and
1998, which are included elsewhere in this Prospectus, and from audited
financial statements of the Company as of September 30, 1994, 1995 and 1996.

The comparability of the historical financial data reflected herein has
been significantly impacted by acquisitions and dispositions. The information
presented below is qualified in its entirety by, and should be read in
conjunction with the "Audited Financial Statements," "Management's Discussion
and Analysis of Financial Condition and Results of Operations," and the
"Unaudited Pro Forma Financial Information," and, in each case, the related
notes included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
FISCAL YEAR ENDED SEPTEMBER 30,
--------------------------------------------------
1994 1995 1996 1997 1998
------- ------- -------- -------- --------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
OPERATING DATA:
Net revenues.......................................... $29,137 $35,893 $ 48,675 $ 93,862 $132,998
Station operating expenses............................ 21,520 24,061 31,659 61,280 88,599
Depreciation and amortization......................... 2,248 2,225 2,960 7,685 13,066
Corporate general and administrative expenses......... 2,300 2,535 2,872 3,249 4,527
Net expense (income) from TBA fees.................... 603 (879) (476) 2,399
Operating income...................................... 3,069 6,469 12,063 22,124 24,407
Interest expense...................................... 1,648 1,992 5,196 11,388 14,663
Gain on sale of assets................................ 20,545 228 119 197,097 8,661
Income before income taxes and extraordinary items.... 21,531 4,805 7,053 206,329 18,733
Pro forma income taxes(1)............................. 8,182 1,826 2,680 78,405 7,119
Pro forma income before extraordinary items(1)........ 13,349 2,979 4,373 127,924 11,614
Pro forma earnings per share before extraordinary
items(1)(2).........................................
Pro forma weighted average common shares
outstanding(2)......................................

BALANCE SHEET DATA (AT END OF PERIOD):
Cash and cash equivalents............................. $ 1,513 $ 1,564 $ 5,292 $ 3,626 $ 6,666
Intangibles and other assets.......................... 5,552 29,548 119,269 300,029 428,763
Total assets.......................................... 19,368 52,209 150,575 364,743 522,945
Long-term debt, including current portion............. 15,250 46,554 136,642 144,427 283,136
Total shareholders' equity............................ 427 828 5,079 208,089 220,881
</TABLE>

<TABLE>
<CAPTION>
FISCAL YEAR ENDED SEPTEMBER 30,
-----------------------------------------------------
1994 1995 1996 1997 1998
-------- -------- -------- -------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
OTHER DATA:
Broadcast cash flow(3)............................. $ 7,617 $ 11,832 $ 17,016 $ 32,582 $ 44,399
Broadcast cash flow margin(4)...................... 26.1% 33.0% 35.0% 34.7% 33.4%
EBITDA before net expense (income) from TBA
fees(5).......................................... $ 5,317 $ 9,297 $ 14,144 $ 29,333 $ 39,872
After-tax cash flow(1)(6).......................... 2,047 4,172 7,923 16,590 21,028
Cash flows related to:
Operating activities............................. 3,950 1,182 12,773 8,859 23,019
Investing activities............................. 23,787 (28,636) (96,502) (13,695) (153,651)
Financing activities............................. (27,161) 27,505 87,457 3,170 133,672
</TABLE>

34
<PAGE> 37

Company had been taxed under Subchapter C of the Code throughout the periods
presented. The Company intends to revoke its election to be taxed as an S
Corporation immediately prior to the consummation of the Offering.

(2) Reflects the effect of the for one stock split to be effected as part
of the Recapitalization.

(4) Broadcast cash flow margin represents broadcast cash flow as a percentage of
net revenue.

35
<PAGE> 38

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

The following discussion and analysis of financial condition and results of
operations of the Company should be read in conjunction with the consolidated
financial statements and related notes thereto of the Company included elsewhere
in this Prospectus. Periodically, the Company may make statements about trends,
future plans and the Company's prospects. Actual results may differ materially
from those described in such forward looking statements based on the risks and
uncertainties facing the Company, including but not limited to, the following:
business conditions, competition and growth in the radio broadcasting industry
and the general economy; changes in interest rates; the failure or inability to
renew one or more of the Company's broadcasting licenses; and the factors
described in "Risk Factors."

Historically, the Company has operated with an October 1st to September
30th fiscal year. All references herein, with the exception of specific
references to calendar year periods, are based on the Company's fiscal year.

A radio broadcasting company's revenues are derived primarily from the sale
of broadcasting time to local and national advertisers. Those revenues are
largely determined by the advertising rates that a radio station is able to
charge and the number of advertisements that can be broadcast without
jeopardizing listener levels. Advertising rates are primarily based on three
factors: (i) a station's audience share in the demographic groups targeted by
advertisers, as measured principally by quarterly reports issued by Arbitron;
(ii) the number of radio stations in the market competing for the same
demographic groups; and (iii) the supply of and demand for radio advertising
time. In 1998, 76.2% of the Company's revenues were generated from local
advertising (which is sold primarily by each individual local radio station's
sales staff), and 22.6% were generated from national spot advertising (which is
sold by independent advertising sales representatives). The balance of 1998
revenues were generated principally by network advertising and rental income
from tower sites.

Revenues recognized under a TBA or JSA for stations operated by the Company
prior to acquiring the stations are included in net revenues, while operating
expenses associated with these stations are reflected in station operating
expenses. Consequently, there is no difference in the method of revenue and
operating expense recognition between a station operated by the Company under a
TBA or JSA and a station owned and operated by the Company.

Several factors may adversely affect a radio broadcasting company's
performance in any given period. In the radio broadcasting industry, seasonal
revenue fluctuations are common and are due primarily to variations in
advertising expenditures by local and national advertisers. Typically, revenues
are lowest in the first calendar quarter of the year. The Company generally
incurs advertising and promotional expenses to increase "listenership" and
Arbitron ratings. However, since Arbitron reports ratings quarterly, any
increased ratings and therefore increased advertising revenues tend to lag
behind the incurrence of such advertising and promotional spending.

In the broadcasting industry, radio stations often utilize trade (or
barter) agreements to reduce expenses by exchanging advertising time for goods
or services. The Company, in order to maximize cash revenue from its spot
inventory, minimizes its use of trade agreements and during the past five years
has held barter revenues under 2.0% of the Company's gross revenues and barter
related broadcast cash flow under 0.4% of the Company's broadcast cash flow.

In the following analysis, management discusses broadcast cash flow and
EBITDA before net expense (income) from TBA fees. Neither broadcast cash flow
nor EBITDA before net expense (income) from TBA fees purports to represent net
income, operating income or net cash provided by operating activities, as those
terms are defined under GAAP, and they should not be considered in isolation or
as a substitute for such measurements. Broadcast cash flow consists of operating
income before depreciation, amortization, net expense (income) from TBA fees and
corporate expenses. EBITDA before net expense (income) from TBA

36
<PAGE> 39

fees consists of operating income before depreciation, amortization and net
expense (income) from TBA fees. In part due to the non-capital intensive nature
of the radio broadcasting industry and the high level of non-cash depreciation
and amortization expense, broadcast cash flow and EBITDA before net expense
(income) from TBA fees are frequently used as bases for evaluating radio
broadcasting businesses, although the Company's measures of broadcast cash flow
and EBITDA before net expense (income) from TBA fees may not be comparable to
similarly titled measures of other companies.

The Company calculates "same station" growth by (i) comparing the
performance of stations operated by the Company throughout a relevant quarter to
the performance of those same stations (whether or not operated by the Company)
in the prior year's corresponding quarter, excluding the effect of barter
revenues and expenses and discontinued operations and (ii) averaging such growth
rates for the period presented. "Same station broadcast cash flow margin" is the
broadcast cash flow margin of the stations included in the Company's same
station calculations. For purposes of the following discussion, pro forma net
income before extraordinary items represents historical net income before
extraordinary items adjusted as if the Company were treated as a C Corporation
during all relevant periods at an effective tax rate of 38%.

Because of the Company's significant acquisition and divestiture
activities, the Company's pro forma 1998 results differ materially from its
actual 1998 results. Entercom's actual results for 1998 do not reflect a full
year of operations of the Company's current portfolio of radio stations; and
include a partial year of operating results for a station which the Company
divested during the year. For the year ended September 30, 1998, pro forma net
revenues were $171.4 million and pro forma broadcast cash flow was $53.0
million. Pro forma broadcast cash flow margin was 30.9% for the year ended
September 30, 1998.

RESULTS OF OPERATIONS

Fiscal Year Ended September 30, 1998 Compared to Fiscal Year Ended September
30, 1997

Net Revenues. Net revenues increased 41.7% to $133.0 million for the year
ended September 30, 1998 from $93.9 million for the year ended September 30,
1997. Of the increase, $20.3 million is attributable to stations acquired or in
the process of being acquired during the year, offset by $5.8 million for
stations divested or in the process of being divested during the same period. On
a same station basis, net revenues for the period increased 16.3% to $128.5
million in 1998 from $110.5 million in 1997, largely due to stronger selling
efforts and radio advertising market growth. Same station revenue growth was led
by substantial increases in Seattle, Kansas City and Portland.

Station Operating Expenses. Station operating expenses increased 44.6% to
$88.6 million for the year ended September 30, 1998 from $61.3 million for the
year ended September 30, 1997. Of the increase, $13.2 million is attributable to
stations acquired or in the process of being acquired during this period, offset
by $4.4 million for stations divested or in the process of being divested during
the same period. On a same station basis, station operating expenses increased
11.2% to $84.7 million for the year ended September 30, 1998 from $76.2 million
for the year ended September 30, 1997.

Corporate General and Administrative Expenses. Corporate general and
administrative expenses increased 40.6% to $4.5 million for the year ended
September 30, 1998 from $3.2 million for the year ended September 30, 1997. This
increase was primarily due to the higher administrative expenses associated with
supporting the Company's growth.

Depreciation and Amortization. Depreciation and amortization increased
70.1% to $13.1 million for the year ended September 30, 1998 from $7.7 million
for the year ended September 30, 1997. This increase was primarily attributable
to the Company's acquisitions during 1997 and 1998.

Interest Expense. Interest expense increased 29.0% to $14.7 million for
the year ended September 30, 1998 from $11.4 million for the year ended
September 30, 1997. This increase was primarily due to indebtedness incurred in
connection with the Company's acquisitions.

Income before income taxes and extraordinary item. Income before income
taxes and extraordinary item for the year ended September 30, 1998 was $18.7
million, including a gain of $8.7 million from the sale of

37
<PAGE> 40

assets. This compares to income before income taxes and extraordinary item of
$206.3 million for the year ended September 30, 1997, which includes a gain of
$197.1 million. The gain on the assets in 1997 is primarily attributable to the
Company's disposition of stations in the Houston, San Francisco and Pittsburgh
radio markets. The Company does not expect such significant gains on the sale of
assets to continue in the future.

Extraordinary item. The extraordinary item in 1998 resulted from the
write-off of $2.4 million of unamortized finance charges due to the early
extinguishment of debt, which resulted from the refinancing of the Company's
credit facility. There were no extraordinary items in 1997.

Pro Forma Net Income. Pro forma net income consists of the Company's
historical income as adjusted to reflect state and federal income taxes as if
the Company had been taxed under Subchapter C of the Code at an effective rate
of 38% throughout the years ended September 30, 1998 and 1997, respectively. As
a result of the factors described above, pro forma net income for the year ended
September 30, 1998 was $10.1 million, including a gain of $5.4 million, net of
taxes, on the sale of assets. This compares to pro forma net income of $127.9
million for the year ended September 30, 1997, which included a gain of $122.2
million, net of taxes, on the sale of assets. The decrease in gain on the sale
of assets is primarily attributable to the Company's disposition of stations in
the Houston, San Francisco and Pittsburgh radio markets during the year ended
September 30, 1997. The Company used the proceeds from these dispositions to
acquire stations in markets where it believed there was greater potential for
establishing clusters. The Company does not expect such significant gains on the
sale of assets to continue in the future.

Broadcast Cash Flow. As a result of the factors described above, broadcast
cash flow increased 36.2% to $44.4 million for the year ended September 30, 1998
from $32.6 million for the year ended September 30, 1997. On a same station
basis, broadcast cash flow increased 27.7% to $43.8 million for the year ended
September 30, 1998 from $34.3 million for the year ended September 30, 1997.

The Company's broadcast cash flow margin (defined as broadcast cash flow as
a percentage of net revenues) declined to 33.4% for the year ended September 30,
1998 from 34.7% for the year ended September 30, 1997. This decline was
primarily attributable to the Company's 1997 exchange of relatively mature
stations in San Francisco and Houston, which operated at higher broadcast cash
flow margins but were located in markets where management believed there were
limited growth and clustering opportunities, for less developed properties in
Seattle, Kansas City and Sacramento, which collectively operated with lower
broadcast cash flow margins but offered stronger growth and clustering
opportunities. On a same station basis, the Company's broadcast cash flow margin
increased to 34.1% for the year ended September 30, 1998 from 31.1% for the year
ended September 30, 1997.

EBITDA Before Net Expense (Income) from TBA Fees. As a result of the
factors described above, EBITDA before net expense (income) from TBA fees
increased 36.2% to $39.9 million for the year ended September 30, 1998, from
$29.3 million for the year ended September 30, 1997.

Fiscal Year Ended September 30, 1997 Compared to Fiscal Year Ended September
30, 1996

Net Revenues. Net revenues increased 92.8% to $93.9 million for the year
ended September 30, 1997 from $48.7 million for the year ended September 30,
1996. Of the increase, $32.3 million is attributable to stations acquired during
this period, offset by $8.8 million for stations divested during the same
period. On a same station basis, net revenues increased 14.2% to $86.6 million
for the year ended September 30, 1997 from $75.8 million for the year ended
September 30, 1996. Same station revenue growth was led by substantial increases
in Seattle, Kansas City, Portland, Houston and St. Louis.

Station Operating Expense. Station operating expenses increased 93.6% to
$61.3 million for the year ended September 30, 1997 from $31.7 million for the
year ended September 30, 1996. Of the increase, $16.3 million is attributable to
stations acquired during this period, offset by $4.7 million for stations
divested during the same period. On a same station basis, station operating
expenses decreased 0.4% to $55.0 million for the year ended September 30, 1997
from $55.2 million for the year ended September 30, 1996. This decrease was
attributable to cost savings measures implemented by the Company in connection
with its acquisitions.

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<PAGE> 41

Corporate General and Administrative Expenses. Corporate general and
administrative expenses increased 13.1% to $3.2 million for the year ended
September 30, 1997 from $2.9 million for the year ended September 30, 1996. This
increase was primarily due to higher administrative expenses associated with
supporting the Company's growth.

Depreciation and Amortization. Depreciation and amortization increased
159.6% to $7.7 million for the year ended September 30, 1997 from $3.0 million
for the year ended September 30, 1996. This increase was primarily attributable
to the Company's 1996 and 1997 acquisitions and was partially offset by the net
effect of stations sold during the same period.

Interest Expense. Interest expense increased 119.2% to $11.4 million for
the year ended September 30, 1997 from $5.2 million for the year ended September
30, 1996. This increase was primarily due to indebtedness incurred in connection
with the Company's acquisitions.

Income before income taxes and extraordinary item. Income before income
taxes and extraordinary item for the year ended September 30, 1997 was $206.3
million, including a gain of $197.1 million from the sale of assets. This
compares to income before income taxes and extraordinary item of $7.1 million
for the year ended September 30, 1996, which includes a gain of $0.1 million.
The increase in gain on the sale of assets is primarily attributable to the
Company's disposition of stations in the Houston, San Francisco and Pittsburgh
radio markets. The Company used the proceeds from these dispositions to acquire
stations in markets where it believed there was greater potential for
establishing clusters. The Company does not expect such significant gains on the
sale of assets to continue in the future.

Extraordinary Item. There were no extraordinary items in 1997. The
extraordinary item in 1996 resulted from the write-off of $0.5 million of
unamortized finance charges due to the early extinguishment of debt, which
resulted from the refinancing of the Company's credit facility.

Broadcast Cash Flow. As a result of the factors described above, broadcast
cash flow increased 91.5% to $32.6 million for the year ended September 30, 1997
from $17.0 million for the year ended September 30, 1996. On a same station
basis, broadcast cash flow increased 53.3% to $31.6 million for the year ended
September 30, 1997 from $20.6 million for the year ended September 30, 1996.
Broadcast cash flow margin declined to 34.7% for fiscal 1997 from 35.0% for
fiscal 1996. This decline was primarily attributable to the Company's exchange
in fiscal 1997 of relatively mature stations in San Francisco and Houston, which
operated at higher broadcast cash flow margins but were located in markets where
management believed there were limited growth and clustering opportunities, for
less developed properties in Seattle, Kansas City and Sacramento, which
collectively operated with lower broadcast cash flow margins, but offered
stronger growth and clustering opportunities. On a same station basis, broadcast
cash flow margins increased to 36.5% for the year ended September 30, 1997 from
27.2% for the year ended September 30, 1996.

EBITDA Before Net Expense (Income) from TBA Fees. As a result of the
factors described above, EBITDA before net expense (income) from TBA fees
increased 107.4% to $29.3 million for the year ended September 30, 1997, from
$14.1 million for the year ended September 30, 1996.

LIQUIDITY AND CAPITAL RESOURCES

The Company has used a significant portion of its capital resources to
consummate acquisitions. These acquisitions were or will be funded from one or a
combination of the following sources: (i) the Credit Facility (described below),
(ii) the 7% Subordinated Convertible Note (described below), (iii) the swapping
of Company owned radio stations in qualified sec.1031 transactions and (iv)
internally-generated cash flow. Net proceeds from the Offering will be used to
repay a portion of the Company's outstanding indebtedness under the Credit
Facility. See "Use of Proceeds."

Net cash flows provided by operating activities were $23.0 million, $8.9
million, and $12.8 million for the years ended September 30, 1998, 1997 and
1996, respectively. Changes in the Company's net cash flow from operating
activities are primarily a result of changes in advertising revenues and station
operating expenses which are affected by the acquisition and dispositions of
stations during those periods.

39
<PAGE> 42

Net cash flows used in investing activities were $153.7 million, $13.7
million, and $96.5 million for the years ended September 30, 1998, 1997 and
1996, respectively. Net cash flows provided by financing activities were $133.7
million, $3.2 million and $87.5 million for the years ended September 30, 1998,
1997 and 1996, respectively. These cash flows reflect the acquisitions
consummated in the relevant periods and the related borrowings.

In addition to debt service, the Company's principal liquidity requirements
will be for working capital and general corporate purposes, including capital
expenditures, and, if appropriate opportunities arise, acquisitions of
additional radio stations. For calendar 1999, management anticipates maintenance
capital expenditures to be between $1.0 million and $1.5 million and total
capital expenditures to be between $3.5 million and $5.0 million. Management
believes that cash from operating activities, together with available revolving
credit borrowings under the Credit Facility, should be sufficient to permit the
Company to meet its financial obligations and fund its operations. The Company
may require additional financing for future acquisitions, if any, and there can
be no assurance that it would be able to obtain such financing on terms
considered to be favorable by management.

The Company entered into a Loan Agreement, dated as of February 13, 1998 as
amended October 8, 1998, with several banks, including Key Corporate Capital,
Inc. and Bank of America NT&SA for a $350 million revolving credit facility (the
"Credit Facility"), subject to compliance with certain financial ratios. The
Credit Facility was established to: (i) refinance existing indebtedness of the
Company, (ii) provide working capital and (iii) fund corporate acquisitions. At
the Company's election, interest on any outstanding principal accrues at a rate
based on either LIBOR plus a spread which ranges from 0.5% to 2.125% or on
KeyBank N.A.'s base rate plus a spread of up to 0.875%, depending on the
Company's leverage ratio. Although the Company may borrow, repay and reborrow
under the Credit Facility, the aggregate maximum amount that the Company can
have outstanding at any one time is reduced throughout the term of the Credit
Facility. The final maturity date for the Credit Facility is February 13, 2006.
As of September 30, 1998, on a pro forma basis after giving effect to the
Offering, the Company would have had approximately $219.1 million of borrowings
outstanding under the Credit Facility. As of November 30, 1998, the Company had
approximately $251.5 million of borrowings outstanding under the Credit
Facility.

The Credit Facility prohibits the Company from maintaining a total leverage
ratio (defined as the ratio of the Company's total debt to operating cash flow)
greater than 7.0 to 1.0, at any time through March 31, 1999 with a reducing
permitted ratio in subsequent periods. In addition, the Credit Facility
prohibits the Company from maintaining a senior leverage ratio (defined as the
ratio of the principal amount outstanding under the Credit Facility to operating
cash flow) greater than 6.5 to 1.0, at any time through March 31, 1999 with a
reducing permitted ratio in subsequent periods. Currently, the Company is in
compliance with the total and senior leverage ratio obligations imposed by the
Credit Facility.

The Credit Facility also requires the Company to (i) maintain a fixed
charge coverage ratio (defined as the ratio of operating cash flow to the sum of
the Company's debt service, capital expenditures, taxes and capital
distributions, over any four quarter period) greater than 1.05 to 1.00 and (ii)
maintain an interest coverage ratio (defined as the ratio of operating cash flow
to interest expense over any four quarter period) greater than 2.0 to 1.0.
Currently, the Company is in compliance with each of these financial ratio
obligations imposed by the Credit Facility.

The Company entered into the Chase Agreement with Chase Capital on May 21,
1996 pursuant to which the Company issued the 7% Subordinated Convertible Note
in the original principal amount of $25.0 million. Interest accrues on the 7%
Subordinated Convertible Note at a rate of seven percent. However, payment of
interest is deferred until May 21, 2003. As of September 30, 1998, the total
amount of principal and interest owed by the Company under the Chase Agreement
was $29.4 million.

Chase Capital has agreed with the Underwriters and the Company that,
immediately prior to the Offering, it will convert the 7% Subordinated
Convertible Note into Class A Common Stock. Upon the Chase Conversion, Chase
Capital will receive shares of Class A Common Stock. After giving
effect to the Offering, including Chase Capital's sale of shares of Class A
Common Stock therein, Chase Capital will beneficially own approximately %
of the Company's Class A Common Stock, representing % of the
40
<PAGE> 43

total voting power of the Company's outstanding Common Stock (approximately
% of the Company's Class A Common Stock, representing % of the total
voting power of the Company's outstanding Common Stock, if the over-allotment
option is exercised in full). See "Principal and Selling Shareholders" and "Risk
Factors -- Benefits to Existing Shareholders and Affiliates."

The Credit Facility requires the Company to protect itself from interest
rate fluctuations through the use of derivative rate hedging instruments. As a
result, the Company has entered into various convertible rate cap and interest
rate swap transactions with various banks (the "Rate Hedging Transactions")
designed to mitigate the Company's exposure to significantly higher floating
interest rates. A rate cap agreement establishes an upper limit or "cap" for the
base LIBOR rate. Swap agreements require that the Company pay a fixed rate of
interest on the notional amount to a bank and the bank pays to the Company a
variable rate equal to three-month LIBOR. In the future, the Company expects to
continue executing Rate Hedging Transactions only to the extent required under
the Credit Facility and does not anticipate holding derivative securities for
speculative or investment purposes. The following table sets forth certain
information regarding the Rate Hedging Transactions which the Company had
entered into as of September 30, 1998.

<TABLE>
<CAPTION>
UNRECOGNIZED GAINS (LOSSES) AS OF
-----------------------------------
SEPTEMBER 30,
CONVERTIBLE CAP SWAP -----------------------------------
NOTIONAL AMOUNT INTEREST RATE INTEREST RATE EXPIRATION DATE 1996 1997 1998
- --------------- --------------- ------------- ----------------- --------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
$20 million 6.77% May 16, 2000 $(208,000) $(351,000) $ (652,000)
$25 million* 6.72% 5.89% July 29, 2003 (117,000) (212,000) (1,057,000)
$25 million 7.50% 6.05% August 8, 2000 15,000 (103,000) (1,069,000)
$15 million 5.61% January 10, 2005 -- -- (525,000)
$14 million 5.86% January 10, 2005 -- -- (705,000)
$30 million 5.77% February 27, 2008 -- -- (1,793,000)
</TABLE>

* This cap was converted by the bank into an interest rate swap effective
October 29, 1998.

No gains or losses have been recognized by the Company during the periods
indicated.

RECENT PRONOUNCEMENTS

In June 1998, the FASB issued SFAS No. 133 entitled "Accounting for
Derivative Instruments and Hedging Activities," which establishes accounting and
reporting standards for derivative instruments, including certain derivative
instruments embedded in other contracts, (collectively referred to as
"derivatives") and for hedging activities. It requires that an entity recognize
all derivatives as either assets or liabilities in the statement of financial
position and measure those instruments at fair value. The accounting for changes
in the fair value of a derivative depends on the intended use of the derivative
and the resulting designation. This statement is effective for all fiscal
quarters of fiscal years beginning after June 15, 1999, and should not be
applied retroactively to financial statements of prior periods. Management has
not yet determined what effect, if any, this statement will have on the Company.

IMPACT OF YEAR 2000 ISSUES

In order to minimize the risk of Year 2000 related losses, the Company is
conducting a comprehensive assessment of its Year 2000 Issues. This assessment
consists of (i) an analysis of all of the information and non-information
technology systems that the Company uses, including the circulation of Year 2000
compliance questionnaires to the chief engineers of each of the Company's
stations, requiring them to evaluate

41
<PAGE> 44

their respective station's preparedness for Year 2000 Issues and (ii) an inquiry
as to the Year 2000 status of third parties material to the Company's
operations, including the transmission of letters to all key service providers
requesting written confirmation of their Year 2000 readiness.

Although the Company is still in the process of assessment, the Company has
determined that the bulk of the technology systems it uses internally, are Year
2000 compliant. The Company has received confirmation from each supplier that
provided or manufactured a material information or non-information technology
system used by the Company that such system is either Year 2000 compliant or
that such supplier will, within a short period of time, provide software aides,
supplements or replacements that will make such system Year 2000 compliant.

Due to (i) the preventive measures being taken in response to the Company's
assessment, (ii) the relatively small degree to which the radio broadcasting
industry, as compared to other industries, depends on older large computer
systems or interfaces with third party computer systems, (iii) the fact that
most of the Company's automated administrative services can, if needed, be
performed manually, and (iv) the fact that the Company's radio stations are
mostly equipped with emergency power systems, management believes that, while
difficult to fully assess, Year 2000 Issues should not have a material adverse
effect on the Company's broadcast operations.

The Company believes that it is difficult to fully assess the risks of the
Year 2000 problem due to the numerous uncertainties surrounding the issue.
Management believes that the primary risks are external to the Company and
relate to the Year 2000 readiness of its third party suppliers. The inability of
such third party suppliers to adequately address the Year 2000 issues on a
timely basis could result in a material financial risk, including loss of
revenue, substantial unanticipated costs and service interruptions. The Company
plans to continue its efforts to survey all work with such third party suppliers
to address all significant Year 2000 issues in a timely manner.

The Company expects to have completed its Year 2000 remediation efforts by
the end of the third quarter of fiscal 1999. Additionally, the Company will
develop a contingency plan for dealing with Year 2000 Issues caused by systems
external to the Company by the end of the third quarter of fiscal 1999. Since
most of the Year 2000 compliance achieved by the Company to date has been done
through the normal upgrading process, separate costs have not been allocated to
the Year 2000 Issue. Based on its experience to date, the Company estimates that
the remaining costs to respond to the Year 2000 Issues will be approximately
$250,000. All such costs will be expensed as incurred.

42
<PAGE> 45

BUSINESS

OVERVIEW

Entercom, founded in 1968, is the sixth largest radio broadcasting company
in the United States, based on pro forma 1997 gross revenues. The Company owns
and operates 42 stations, 25 FM and 17 AM, in eight markets, including five of
the country's top 30 radio advertising markets. The Company has built the
largest radio station clusters, based on gross revenues, in Seattle and Kansas
City, and one of the three largest clusters in Boston, Portland, Sacramento and
Rochester. On a pro forma basis, the Company would have had net revenues of
$171.4 million, operating income of $29.2 million and net income of $9.0 million
for the year ended September 30, 1998. In addition, pro forma broadcast cash
flow during the same period would have been $53.0 million.

The Company's net revenues and broadcast cash flow have grown significantly
on both a total and same-station basis. Over the past three fiscal years, net
revenues grew at a compound annual rate of 68.4% from an actual $35.9 million in
fiscal 1995 to a pro forma $171.4 million in fiscal 1998. Broadcast cash flow
grew at a compound annual rate of 64.8% from an actual $11.8 million in fiscal
1995 to a pro forma $53.0 million in fiscal 1998. During this same period, the
Company's same station net revenues and broadcast cash flow grew at average
annual rates of 15.0% and 36.4%, respectively. In addition, the Company's
after-tax cash flow grew at a compound annual rate of 71.5% during these three
fiscal years.

CORPORATE HISTORY

Throughout its 30 year history of operations, Entercom has experienced
sustained growth by adapting its acquisition and operating strategies to
capitalize on changes occurring in the radio broadcasting industry. Entercom's
Chairman of the Board and Chief Executive Officer, Joseph M. Field, founded the
Company in 1968 on the conviction that FM broadcasting, then in its infancy,
would surpass AM broadcasting as the leading aural medium. The Company's
strategy from inception through the 1970's was to acquire FM stations in the top
20 radio advertising markets at a fraction of prevailing prices for AM stations
and to operate those stations economically and profitably by utilizing niche
formats not being offered by major AM stations. The Company continued this
strategy until FM's technical superiority and the availability of inexpensive
AM/FM receivers drove FM's penetration of the radio advertising market to
critical mass and FM stations began to compete successfully with the dominant AM
stations of the time for control of mass market audiences. In addition, Entercom
pursued a strategy of purchasing technically underdeveloped FM stations and
upgrading them so that they could become competitive stations in their markets.

The Company adjusted its strategic plan in the mid-1980's. With FM at
critical mass, the Company began a deliberate multi-year effort to enhance its
operations at both the corporate and station levels to compete for greater
shares of audience and advertising dollars in its markets. With the advent of
the duopoly rules in 1992 (permitting expansion of ownership in a market from
one to two stations in each radio medium), Entercom began to "double up" in its
markets. Since the passage of the Telecom Act, which permitted ownership of up
to eight radio stations in most major markets, the Company has pursued a
creative acquisition and development strategy pursuant to which it has swapped
stand-alone FM stations in various markets to build market leading clusters in
large growth markets where the Company could develop a significant presence.

ACQUISITION STRATEGY

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<PAGE> 46

Company exchanged one station in Houston plus $5.0 million for three stations in
Seattle and four stations in Kansas City. The Seattle acquisitions solidified
the Company's position as the leading radio operator in that market while the
four stations acquired in Kansas City enabled the Company to enter a new large
market with a significant presence.

The Company has a track record of structuring acquisitions in creative
ways, including being a pioneer of multi-party station swaps. Since October 1,
1996, the Company, in 19 transactions, has acquired or agreed to acquire 37
radio stations and has divested or agreed to divest, for strategic reasons, nine
radio stations. The Company has been involved in transactions with many of the
leading radio broadcast companies or their predecessors, including CBS Radio,
Viacom Inc., American Radio Systems Corporation, Citicasters Inc., Jacor
Communications, Inc., Sinclair Broadcast Group, Inc., Bonneville International
Corp. and Susquehanna Radio Corp. As a result of these transactions, the Company
has divested its stand-alone stations while establishing the largest clusters in
Seattle and Kansas City and building superduopolies in Boston, Portland,
Sacramento and Rochester. The Company believes that its proven record of
consummating creative transactions with many of the leading radio broadcast
companies positions it well to continue to participate in the consolidation
occurring in its industry.

OPERATING STRATEGY

The principal components of the Company's operating strategy are set forth
below.

- DEVELOP MARKET LEADING STATION CLUSTERS. The Company has built one of
the three leading clusters in each of its eight markets. To enhance its
competitive position, the Company strategically aligns its stations
within each market to optimize their performance, both individually and
collectively. The Company seeks to maximize the ratings, revenue and
broadcast cash flow of its radio stations by tailoring their programming
to optimize aggregate audience delivery. For example, in Kansas City,
Entercom acquired two stations that had been engaged in a lengthy battle
in the Adult Contemporary format. Largely as a result of that
competition, these stations were the 10(th) and 12(th) ranked stations
among Adults 25-54 in the market. Shortly after acquiring the stations,
the Company reformatted one of the stations to an Album Oriented Rock
format. As a result of this strategy, the stations now rank 3(rd) in
Women 25-54 and 2(nd) in Men 25-54, respectively.

- ENHANCE OPERATIONS OF NEWLY ACQUIRED UNDERPERFORMING STATIONS. The
Company has built a long-term track record of acquiring and developing
underperforming stations. This has enabled the Company to achieve
superior same-station revenue and broadcast cash flow growth over the
past several years. The Company utilizes a variety of techniques to
develop underachieving properties, including: strategic market research
and analysis; management enhancements; expenditure reductions; facility
consolidations; technical upgrades; programming and marketing
enhancements; and improved sales training and techniques. The Company's
current portfolio includes a significant number of recently acquired
stations which management believes are underdeveloped. Among the 33
stations which the Company acquired, agreed to acquire or commenced
operations under TBAs since January 1, 1997, 16 operated with broadcast
cash flow margins below 20%, 11 with margins between 20% and 40% and six
with margins over 40% during calendar 1997. By comparison, among the nine
stations which the Company owned or operated prior to 1997, two operated
with margins under 20%, one between 20% and 40% and six over 40% during
calendar 1997.

- BUILD STRONGLY-BRANDED FRANCHISES. The Company analyzes market research
and competitive factors to identify the format opportunity, music
selection and rotation, presentation and other key programming attributes
that it believes will best position each station to maximize its audience
share and, consequently, its revenues and broadcast cash flow. The
Company's stations pursue a variety of programming and marketing
initiatives designed to develop a distinctive identity and to strengthen
the stations' local "brand" or "franchise" value. For example, the
Company's "endfest(TM)" festival in Seattle attracts 18,000 listeners to
a day-long festival with live music and other attractions, solidifying
KNDD's ("The End(TM)") brand image in Seattle. The Company has also been
on the leading edge of

44
<PAGE> 47

several national programming trends during the past decade including
Modern Rock, Young Adult Country and Adult Album Alternative.

- MAXIMIZE TECHNICAL CAPABILITIES. The Company seeks to operate stations
with the strongest signals in their respective markets. In addition, the
Company, on various occasions, has identified opportunities to acquire
and upgrade low-powered or out-of-market stations and transform them into
competitive signals, thus increasing their value significantly. For
example, the Company recently agreed to sell its two Tampa FM stations,
which it had purchased for an aggregate of $4.9 million, for $75.0
million after upgrading their respective license classes. In addition,
the Company upgraded the FCC license class of KMTT-FM in Seattle, KNRK-FM
in Portland and, KRXQ-FM in Sacramento. Today each of these stations has
a competitive signal in its respective market.

- RECRUIT, DEVELOP, MOTIVATE AND RETAIN SUPERIOR EMPLOYEES. The Company
believes that station operators differentiate themselves from their peers
primarily through their ability to recruit, develop, motivate and retain
superior management, programming, and sales talent. Accordingly, the
Company strives to establish a creative and collegial working environment
in which talented employees are able to thrive. The Company encourages
its stations to build strong community bonds through local and
company-wide community service programs, which facilitate strong local
business relationships and provide employees with opportunities for
enhanced job fulfillment. The Company offers competitive pay packages
with performance-based incentives for its key employees. In addition, the
Company provides employees with opportunities for personal growth and
advancement through extensive training, seminars and other educational
programs.

STATION PORTFOLIO

The Company has built a highly consolidated portfolio of radio stations
concentrated primarily in top 30 markets with above average growth
characteristics. The Company generated 94.0% of its pro forma fiscal 1998 net
revenues from the five top 30 markets in which it operates. Radio advertising
revenues in these five markets have grown at an average annual rate of 10.8%
from 1993 to 1997, which exceeded the average annual growth rate of both the
aggregate radio industry and top 30 markets. Furthermore, the Company generated
98.7% of its pro forma fiscal 1998 net revenues from superduopolies, which the
Company defines as clusters of four or more stations in one market. Management
believes that Entercom's superduopolies enable the Company to (i) amass greater
resources to penetrate and capture additional local radio advertising revenues,
(ii) consolidate administrative, engineering and management functions to reduce
costs and (iii) be more flexible in adjusting formats to serve changing listener
needs. In addition, the Company believes that superduopolies enhance its
stations' ability to compete for advertising and promotional dollars with other
media, including television and newspaper.

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<PAGE> 48

The following table sets forth certain information about the markets in
which the Company operates:

<TABLE>
<CAPTION>
1993-1997 1997
1997 RADIO MARKET COMPANY'S STATIONS COMPANY
RADIO MARKET AVERAGE ------------------- MARKET
MARKET(1) REVENUE RANK(2) REVENUE GROWTH(2) FM AM TOTAL REVENUE SHARE(2)
- --------- ---------------- ------------------ --- --- ----- ----------------
<S> <C> <C> <C> <C> <C> <C>
Boston................. 10 13.7% 2 3 5 19.4%(3)
Seattle(4)............. 13 10.5 5(4) 3 8(4) 40.4(4)
Portland............... 21 11.8 4 3 7 25.8
Sacramento............. 28 6.7 4 1 5 20.9
Kansas City............ 29 11.3 3 4 7 33.8
-- -- --
Top 30 Markets....... 18 14 32

Rochester.............. 55 8.1 3 1 4 21.7
Gainesville/Ocala...... 124 6.5 2 0 2 23.8
Longview/Kelso......... n/a n/a 2 2 4 n/a
-- -- --
All Markets.......... 25 17 42
</TABLE>

- ---------------
(1) The Company's stations are in some instances licensed to communities other
than the named principal community for the market.
(2) Source: Duncan's.
(3) Does not include the revenues of WWTM-AM, which competes in the adjacent
Worcester market.
(4) The Company also sells substantially all the advertising time of a sixth FM
station under a joint sales agreement and the revenue from such sales are
included in the Company's Market Revenue Share.

The following is a general description of each of the Company's stations
and the markets served by those stations. The Audience Share and Audience Rank
in Target Demographic figures are shown as reported by Arbitron, and the 1997
Radio Market Revenue Rank for each market figure is shown as reported by
Duncan's.

BOSTON
1997 Radio Market Revenue Rank: 10

<TABLE>
<CAPTION>
AUDIENCE SHARE AUDIENCE RANK
TARGET IN TARGET IN TARGET
STATION CALL LETTERS FORMAT DATE ACQUIRED DEMOGRAPHIC DEMOGRAPHIC DEMOGRAPHIC
- -------------------- ------------ -------------- ------------ -------------- -------------
<S> <C> <C> <C> <C> <C>
WEEI-AM Sports Talk pending Men 25-54 6.5 2(tie)
WRKO-AM Talk pending Men 25-54 5.1 4
WAAF-FM Active Rock pending Men 18-34 8.6 3
WEGQ-FM Classic Hits pending Adults 25-54 3.7 11(tie)
WWTM-AM(1) Sports Talk pending Men 25-54 n/a n/a
</TABLE>

- ---------------
(1) Station competes in the adjacent community of Worcester, Massachusetts and
simulcasts virtually all of the programming of WEEI-AM.

Market Overview

Boston is the tenth largest radio market in the United States based on 1997
radio advertising revenue. Radio advertising revenues in the Boston market have
grown from approximately $115.6 million in 1992 to approximately $219.0 million
in 1997 at a compound annual rate of 13.7%. Market radio advertising revenue in
1997 grew 12.9% over 1996 revenue. There are currently 20 viable stations in the
Boston market, according to Duncan's.

Boston Stations

The Company will own and operate five stations, 2 FM and 3 AM, in Boston,
including one AM station in the adjacent Worcester market, upon consummation of
the CBS Transactions. The Company's cluster is the second largest in Boston with
a 19.4% market revenue share. Of the Company's five Boston stations, two rank in
the top three for their respective target demographic audiences.

The Entercom cluster in Boston features two of the market's three major AM
stations. WEEI-AM, Boston's all-sports station, is the flagship for the radio
networks of the Boston Red Sox, Boston Celtics and
46
<PAGE> 49

Boston College's football and basketball teams. The station also features a
highly rated line-up of talk show hosts which has enabled WEEI-AM to rank
consistently as one of the leaders among Men 25-54. WRKO-AM is Boston's
principal talk station, featuring major nationally syndicated and local
personalities such as Dr. Laura and Howie Carr, whose afternoon show is
syndicated by WRKO-AM to several other stations throughout New England.

The Company will also own and operate two FM rock stations in the Boston
market, WAAF-FM and WEGQ-FM. WAAF-FM, a heritage rock station, features an
Active Rock format that appeals to the Men 18-34 demographic. WEGQ-FM is a
Classic Hits station featuring music from the 70's and 80's that is targeted to
Adults 25-54.

SEATTLE
1997 Radio Market Revenue Rank: 13

<TABLE>
<CAPTION>
AUDIENCE SHARE AUDIENCE RANK
TARGET IN TARGET IN TARGET
STATION CALL LETTERS FORMAT DATE ACQUIRED DEMOGRAPHIC DEMOGRAPHIC DEMOGRAPHIC
- -------------------- ---------------- -------------- ------------ -------------- -------------
<S> <C> <C> <C> <C> <C>
KBSG-AM/FM Oldies August 1996 Adults 25-54 5.8 2
KIRO-AM News/Talk/Sports March 1997 Men 25-54 7.1 1
KIRO-FM Talk March 1997 Adults 25-54 3.7 12(tie)
KISW-FM Active Rock May 1997(1) Men 18-34 11.4 2
KMTT-FM Adult Rock 1973 Adults 25-54 3.6 14
KNWX-AM News/Business March 1997 Adults 25-54 1 22(tie)
KNDD-FM Modern Rock August 1996 Men 18-34 12.7 1
</TABLE>

- ---------------
(1) TBA commenced June 1996

Market Overview

Seattle is the thirteenth largest radio market in the United States based
on 1997 radio advertising revenue. Radio advertising revenues in the Seattle
market have grown from approximately $91.9 million in 1992 to approximately
$150.5 million in 1997 at a compound annual rate of 10.5%. Market radio
advertising revenue in 1997 grew 13.8% over 1996 revenue. There are currently 22
viable stations in the Seattle market, according to Duncan's.

Seattle Stations

The Company owns and operates eight stations, 5 FM and 3 AM, in Seattle,
and sells advertising on a sixth FM station pursuant to a joint sales agreement.
The nine station group is the market's largest radio cluster with a 40.4% market
revenue share according to Duncan's. Of the Company's eight Seattle stations,
two rank first and an additional two rank in the top five for their respective
target demographic audiences.

A cornerstone of Entercom's Seattle cluster is KIRO-AM, the market's
leading radio news and information source. KIRO Newsradio 710 AM broadcasts
up-to-the-minute news and popular local talk-shows and serves as the flagship
station for the Seattle Mariners and the Seattle Seahawks radio networks. In the
last eight Arbitron quarterly reports, the station has ranked first among Adults
25-54 four times and first among Men 25-54 five times. The Company recently
negotiated a five-year extension through the 2002 season of its exclusive radio
broadcasting rights agreement with the Seattle Mariners. The Company's agreement
with the Seattle Seahawks runs through the 1999 season. Complementing KIRO-AM,
the Company owns and operates KNWX-AM, a business-oriented news radio station,
and KIRO-FM, Seattle's only FM talk station.

In addition, the Company owns and operates three rock stations in the
Seattle market including KNDD-FM ("The End(TM)"), KMTT-FM ("The Mountain(R)")
and KISW-FM. The Company has refined the programming of each of these rock
stations so that each station targets a distinct segment of the Adults 18-54
market. As a result, the Company's rock stations rank first and second with Men
18-34. The Company's Seattle cluster also includes KBSG-AM/FM, Seattle's only
Oldies station, which has ranked first or second among Adults 25-54 in eleven of
the last twelve Arbitron quarterly reports.

47
<PAGE> 50

In connection with the Bonneville Transaction in March 1997, the Company
assumed the obligations of Bonneville under a JSA pursuant to which it sells all
the commercial air time for KING-FM, Seattle's only classical radio station. On
July 1, 1997 the Company and Classic Radio, Inc. extended the JSA through June
2002.

PORTLAND
1997 Radio Market Revenue Rank: 21

<TABLE>
<CAPTION>
AUDIENCE SHARE AUDIENCE RANK
STATION TARGET IN TARGET IN TARGET
CALL LETTERS FORMAT DATE ACQUIRED DEMOGRAPHIC DEMOGRAPHIC DEMOGRAPHIC
- ------------ ---------------------- ----------------- ----------- -------------- -------------
<S> <C> <C> <C> <C> <C>
KFXX-AM Sports Talk August 1995(1) Men 25-54 3.3 12
KGON-FM Classic Rock August 1995(1) Men 25-54 10.7 1
KKSN-AM Nostalgia June 1998(2) Adults 1.5 16(tie)
35-64
KKSN-FM Oldies June 1998(2) Adults 8.0 2
25-54
KNRK-FM Modern Rock August 1995(1) Men 18-34 11.2 2
KRSK-FM Hot Adult Contemporary June 1998(2) Women 18-34 10.6 2
KSLM-AM Sports Talk December 1998 Men 25-54 n/a(3) n/a(3)
</TABLE>

- ---------------
(1) TBA commenced April 1995.

(2) TBA commenced March 1998.

(3) KSLM-AM is licensed to Salem, Oregon within the Portland market and will
simulcast KFXX-AM programming.

Market Overview

Portland is the twenty-first largest radio market in the United States
based on 1997 radio advertising revenue. Radio advertising revenues in the
Portland market have grown from approximately $52.5 million in 1992 to
approximately $91.8 million in 1997 at a compound annual rate of 11.8%. Market
radio advertising revenue in 1997 grew 6.3% over 1996 revenue. There are
currently 18.5 viable stations in the Portland market, according to Duncan's.

Portland Stations

The Company owns and operates seven stations, 4 FM and 3 AM, in the
Portland market. The Company's seven-station cluster is one of the three largest
clusters in the market with a 25.8% market revenue share. Of the Company's seven
stations, one ranks first and an additional three rank in the top five stations
for their respective demographic audiences.

The Company entered the Portland market in 1995, as a result of an internal
study that identified Portland as the Company's primary target market for
expansion. In 1995, the Company acquired three stations in Portland, including
KGON-FM, the market's Classic Rock station. The Company recently increased the
size of its Portland cluster by acquiring three additional stations, including
KKSN-FM, the market's only Oldies station and KKSN-AM, the market's only
Nostalgia station. The Company also acquired KKRH-FM, a Classic Hits station,
which competed directly with KGON-FM. In June 1998, the Company changed
KKRH-FM's format to Hot Adult Contemporary to pursue a different demographic
target, Women 18-34 and changed its call letters to KRSK-FM ("Rosie 105(TM)").

The Company also owns and operates KFXX-AM, an all-sports station. KFXX-AM
is an affiliate of the Seattle Mariners radio network and carries popular local
and nationally-syndicated programming. To increase the nighttime strength and
coverage of KFXX-AM's signal, the Company recently exchanged the broadcast
frequency and technical facilities of KFXX-AM with those of KKSN-AM and agreed
to acquire KSLM-AM in Salem, Oregon to expand the coverage of KFXX-AM to the
south through a simulcast of its programming.

48
<PAGE> 51

SACRAMENTO
1997 Radio Market Revenue Rank: 28

<TABLE>
<CAPTION>
AUDIENCE SHARE AUDIENCE RANK
TARGET IN TARGET IN TARGET
STATION CALL LETTERS FORMAT DATE ACQUIRED DEMOGRAPHIC DEMOGRAPHIC DEMOGRAPHIC
- -------------------- -------------- ---------------- ------------ -------------- -------------
<S> <C> <C> <C> <C> <C>
KCTC-AM Nostalgia January 1998 Adults 35-64 2.3 14
KRXQ-FM Active Rock June 1997(1) Men 18-34 14.2 1
KSEG-FM Classic Rock June 1997(1) Men 25-54 6.1 4
Adults 25-54 5.2 5
KSSJ-FM Smooth Jazz November 1997 Adults 25-54 3.7 11
KDND-FM Contemporary June 1997(1) Women 18-34 6.6 7
Hit Radio
</TABLE>

- ---------------

(1) TBA commenced January 1997.

Market Overview

Sacramento is the twenty-eighth largest radio market in the United States
based on 1997 radio advertising revenue. Radio advertising revenues in the
Sacramento market have grown from approximately $54.4 million in 1992 to
approximately $75.0 million in 1997 at a compound annual rate of 6.7%. Market
radio advertising revenue in 1997 grew 5.0% over 1996 revenue. There are
currently 17 viable stations in the Sacramento radio market, according to
Duncan's.

Sacramento Stations

The Company owns and operates five stations, 4 FM and 1 AM, in Sacramento.
The five-station group is one of the three largest clusters in the market with a
20.9% market revenue share. Of the Company's five stations, one ranks first and
an additional station ranks in the top five in their respective target
demographic audiences.

Two of the Company's FM stations, KSEG-FM and KDND-FM (formerly KXOA-FM),
have been direct competitors. In July 1998, the Company changed KDND-FM's format
from Classic Hits to Contemporary Hit Radio to pursue a different demographic
target, Women 18-34. Management believes that KSEG-FM, Sacramento's exclusive
Classic Rock station, should benefit from this format change.

KRXQ-FM, an Active Rock station, has been the market's consistent leader
among Men 18-34 and a leading competitor among Adults 18-34 as well. The Company
recently completed a frequency exchange with ARS, through which KRXQ-FM has
upgraded its current class B1 facility at 93.7 FM to a full class B signal at
98.5 FM, which has expanded KRXQ-FM's signal coverage, and therefore, its
competitive position. KSSJ-FM (formerly KBYA-FM) commenced operations from a new
tower site in December 1997 with a Smooth Jazz format.

KANSAS CITY
1997 Radio Market Revenue Rank: 29

<TABLE>
<CAPTION>
AUDIENCE SHARE AUDIENCE RANK
TARGET IN TARGET IN TARGET
STATION CALL LETTERS FORMAT DATE ACQUIRED DEMOGRAPHIC DEMOGRAPHIC DEMOGRAPHIC
- -------------------- ------------------- ------------- ----------- -------------- -------------
<S> <C> <C> <C> <C> <C>
KCMO-AM Talk March 1997 Adults 2.4 14
25-54
KCMO-FM Oldies March 1997 Adults 5.9 8(tie)
25-54
KMBZ-AM News/Talk/Sports March 1997 Men 25-54 6.2 5
KUDL-FM Adult Contemporary January 1998 Women 25-54 9.4 3
KYYS-FM Album Oriented Rock March 1997 Men 25-54 8.2 2
WDAF-AM Country January 1998 Adults 7.8 1
35-64
WREN-AM (To be Determined) Anticipated n/a n/a n/a
first quarter
1999
</TABLE>

49
<PAGE> 52

Market Overview

Kansas City is the twenty-ninth largest radio market in the United States
based on 1997 radio advertising revenue. Radio advertising revenues in the
Kansas City market have grown from approximately $42.0 million in 1992 to
approximately $71.4 million in 1997 at a compound annual rate of 11.3%. Market
radio advertising revenue in 1997 grew 7.5% over 1996 revenue. There are
currently 16 viable stations in the Kansas City market, according to Duncan's.

Kansas City Stations

The Company owns and operates six stations, 3 FM and 4 AM, in the Kansas
City market. The six-station group is the market's largest radio cluster with a
33.8% market revenue share. The Company's cluster includes three well-branded FM
stations and the market's three strongest AM signals. Of the Company's seven
stations, one ranks first and an additional three rank in the top five in their
respective target demographic audiences.

The Company's Kansas City FM stations illustrate the Company's ability to
react to local market conditions and tailor its stations' programming to broaden
their collective audience reach and, consequently, their revenue and broadcast
cash flow potential. Prior to their recent acquisition by the Company, KYYS-FM
(formerly KLTH-FM) and KUDL-FM had been engaged in a lengthy battle in the Adult
Contemporary format. Largely as result of that competition, these stations were
the 10th and 12th ranked adult stations in the market. Shortly after acquiring
the stations, the Company took advantage of the opportunity created when a new
operator dropped the format and call-letters of KYYS-FM, the Kansas City
heritage rock station. To capitalize on this opportunity, the Company replaced
the Adult Contemporary format on KLTH-FM with an Album Oriented Rock format,
changed KLTH-FM's call letters to KYYS-FM and emerged as the heritage rock
station in the market. As a result of this strategy, KUDL-FM and KYYS-FM rank
3rd in Women 25-54 and 2nd Men 25-54, respectively. The Company's third FM
station in Kansas City, KCMO-FM, is the market's exclusive Oldies station and
targets the Adults 25-54 demographic.

The cornerstone of the Company's Kansas City AM presence is KMBZ-AM, the
market's news/talk/sports leader. In addition to featuring successful talk-shows
such as the Rush Limbaugh Show, KMBZ-AM is the new flagship of the Kansas City
Royals Radio Network and carries sports coverage of the University of Kansas and
the University of Missouri. The Company's exclusive radio broadcasting rights
agreement with the Kansas City Royals runs through the 2000 season. In addition,
the Company owns and operates KCMO-AM, the market's leading Talk Radio station,
and WDAF-AM, one of the most listened to AM Country stations in the United
States. Traditionally known as the "voice of the heartland," WDAF-AM possesses
the Kansas City radio market's best AM signal and a multi-decade heritage of
Country music programming.

ROCHESTER
1997 Radio Market Revenue Rank: 55

<TABLE>
<CAPTION>
AUDIENCE SHARE AUDIENCE RANK
TARGET IN TARGET IN TARGET
STATION CALL LETTERS FORMAT DATE ACQUIRED DEMOGRAPHIC DEMOGRAPHIC DEMOGRAPHIC
- -------------------- ------------ ------------- ------------ -------------- -------------
<S> <C> <C> <C> <C> <C>
WBBF-FM Oldies June 1998 (1) Adults 25-54 7.3 5
WBEE-FM Country June 1998 (1) Adults 25-54 11.0 1
WEZO-AM Nostalgia June 1998 (1) Adults 35-64 1.1 15
WQRV-FM Classic Hits June 1998 (1) Adults 25-54 3.2 11
</TABLE>

- ---------------
(1) TBA commenced March 1998.

50
<PAGE> 53

Market Overview

Rochester, New York is the fifty-fifth largest radio market in the United
States based on 1997 radio advertising revenue. Radio advertising revenues in
the Rochester market have grown from approximately $23.5 million in 1992 to
approximately $34.5 million in 1997 at a compound annual rate of 8.1%. Market
radio advertising revenue in 1997 grew 6.8% over 1996 revenue. There are
currently 13.5 viable stations in the Rochester market, according to Duncan's.

Rochester Stations

In June 1998, the Company acquired the four stations, 3 FM and 1 AM,
comprising its Rochester cluster. The four-station group is one of the three
largest clusters in the market with a 21.7% market revenue share. Of the
Company's four stations, one ranks first and one ranks fifth in their respective
target demographic audiences.

The Rochester market has only seven full-powered FM stations, of which the
Company owns two. One is WBEE-FM which features Country music and is Rochester's
leading station among Adults 25-54. The second is WBBF-FM (formerly WKLX-FM),
Rochester's exclusive Oldies station. Prior to its acquisition by Entercom,
WBBF-FM relied on nationally syndicated programing, without the benefit of
locally-targeted music or personalities. Management believes that this approach
limited the station's financial potential. The Company has recently modified the
station's programming focusing on locally programmed music and live
personalities, and utilizing significantly enhanced audience marketing and
research. The Company's third FM station in Rochester is WQRV-FM, a Class A
station that commenced operations in 1997 as a Classic Hits station.

GAINESVILLE / OCALA
1997 Radio Market Revenue Rank: 124

- ---------------
(1) WSKY-FM (formerly WRRX-FM) recently changed its format. Accordingly, prior
Arbitron ratings are not meaningful.

Market Overview

Gainesville/Ocala is the 124th largest radio market in the United States
based on 1997 radio advertising revenue. Radio advertising revenues in the
Gainesville/Ocala market have grown from approximately $8.9 million in 1992 to
approximately $12.2 million in 1997 at a compound annual rate of 6.5%. Market
radio advertising revenue in 1997 grew 8.0% over 1996 revenue. There are
currently 13 viable stations in the Gainesville/Ocala market, according to
Duncan's.

Gainesville/Ocala Stations

The Company owns and operates two FM stations in Gainesville/Ocala. With
WKTK-FM and WSKY-FM (formerly WRRX-FM), the Company has a 23.8% market revenue
share. Although the Gainesville/Ocala market's size is outside of the Company's
target parameters, the acquisition presented the opportunity to acquire the
dominant station in a fast growing area of the country. WKTK-FM broadcasts an
Adult Contemporary format and has been a ratings leader in this northern Florida
market for many years. In May 1998, the Company acquired WSKY-FM and management
believes that Entercom can now begin capitalizing on the benefits of multiple
station ownership in this market.

51
<PAGE> 54

LONGVIEW/KELSO
1997 Radio Market Revenue Rank: N/A

<TABLE>
<CAPTION>
AUDIENCE SHARE AUDIENCE RANK
TARGET IN TARGET IN TARGET
STATION CALL LETTERS FORMAT DATE ACQUIRED DEMOGRAPHIC DEMOGRAPHIC DEMOGRAPHIC
- -------------------- ------------------ ------------- ------------ -------------- -------------
<S> <C> <C> <C> <C> <C>
KBAM-AM Country May 1998 Adults 25-54 n/a n/a
KEDO-AM Oldies April 1997 Adults 25-54 n/a n/a
KLYK-FM Adult Contemporary April 1997 Adults 25-54 n/a n/a
KRQT-FM Classic Rock May 1998 Men 25-54 n/a n/a
</TABLE>

Market Overview

The Longview/Kelso market is located between the Seattle and Portland
markets. The market is not surveyed by Arbitron or Duncan's.

Longview/Kelso Stations

The Company owns and operates four stations, 2 FM and 2 AM, in the
Longview/Kelso market. These stations serve two important functions for the
Company. First these stations, which the Company acquired at relatively low
capital costs, are strategically significant because of their impact on the
potential upgrade of certain Portland radio stations. Second, these stations
also permit the Company to capitalize on some regional revenue and cost saving
opportunities.

COMPETITION; CHANGES IN BROADCASTING INDUSTRY

The radio broadcasting industry is highly competitive. The success of each
of the Company's stations depends largely upon its audience ratings and its
share of the overall advertising revenue within its market. The Company's
stations compete for listeners and advertising revenue directly with other radio
stations within their respective markets. Radio stations compete for listeners
primarily on the basis of program content that appeals to a particular
demographic group. By building a strong listener base consisting of a specific
demographic group in each of its markets, the Company is able to attract
advertisers seeking to reach those listeners.

Factors that are material to a radio station's competitive position include
management experience, the station's local audience rank in its market,
transmitter power, assigned frequency, audience characteristics, local program
acceptance and the number and characteristics of other radio stations and other
advertising media in the market area. The Company attempts to improve its
competitive position with promotional campaigns aimed at the demographic groups
targeted by its stations and by sales efforts designed to attract advertisers.
Recent changes in the FCC's policies and rules permit increased ownership and
operation of multiple local radio stations. Management believes that radio
stations that elect to take advantage of joint arrangements such as local
marketing agreements or joint sales agreements may in certain circumstances have
lower operating costs and may be able to offer advertisers more attractive rates
and services. Although the Company currently operates several multiple station
groups and intends to pursue the creation of additional multiple station groups,
the Company's competitors in certain markets include operators of multiple
stations or operators who already have entered into local marketing agreements
or joint sales agreements.

Despite the competitiveness within the radio broadcasting industry, some
barriers to entry exist. The operation of a radio broadcast station requires a
license from the FCC. The number of radio stations that can operate in a given
market is limited by strict AM interference criteria and the availability of FM
radio frequencies allotted by the FCC to communities in that market, as well as
by the FCC's multiple ownership rules that regulate the number of stations
serving the same area that may be owned and controlled by a single entity. See
"-- Federal Regulation of Radio Broadcasting."

The Company's stations also compete for audiences and advertising revenues
within their respective markets directly with other radio stations, as well as
with other media such as newspapers, magazines, cable

52
<PAGE> 55

television, outdoor advertising and direct mail. In addition, the radio
broadcasting industry is subject to competition from new media technologies that
are being developed or introduced, such as the delivery of audio programming by
cable television systems, DARS, the Internet, satellite, television and PCS.
DARS plans to deliver by satellite to nationwide audiences, multi-channel,
multi-format, digital radio services with sound quality equivalent to compact
discs. The FCC is also considering proposals for the establishment of
"microbroadcasting" stations, low-powered AM or FM stations that would be
designed to serve small localized areas. The delivery of information or
entertainment programming 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 greater
availability of radios, particularly car and portable radios, have contributed
to this growth. There can be no assurance, 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.

The FCC has adopted licensing and operating rules for DARS and in April
1997 awarded two licenses for this service. DARS may provide a medium for the
delivery by satellite or terrestrial means of multiple new audio programming
formats to local and/or national audiences. Digital technology also may be used
in the future by terrestrial radio broadcast stations either on existing or
alternate broadcasting frequencies, and the FCC has stated that it will consider
making changes to its rules to permit AM and FM radio stations to offer digital
sound following industry analysis of technical standards. In addition, the FCC
has authorized an additional 100 kHz of bandwidth for the AM band and has
allotted frequencies in this new band to certain existing AM station licensees
that applied for migration to the expanded AM band, subject to the requirement
that at the end of a transition period, those licensees return to the FCC either
the license for their existing AM band station or the license for the expanded
AM band station.

The Company cannot predict what other matters might be considered in the
future by the FCC, nor can it assess in advance what impact, if any, the
implementation of any of these proposals or changes might have on its business.

The Company employs a number of on-air personalities and generally enters
into employment agreements with certain of these personalities to protect its
interests in those relationships that it believes to be valuable. The loss of
certain of these personalities could result in a short-term loss of audience
share, but the Company does not believe that any such loss would have a material
adverse effect on the Company.

FEDERAL REGULATION OF RADIO BROADCASTING

The ownership, operation and sale of radio stations are subject to the
jurisdiction of the FCC, which acts under authority granted by the
Communications Act. Among other things, the FCC assigns frequency bands for
broadcasting; determines the particular frequencies, locations and operating
power of stations; issues, renews, revokes and modifies station licenses;
determines whether to approve changes in ownership or control of station
licenses; regulates equipment used by stations; and adopts and implements
regulations and policies that directly affect the ownership, operation and
employment practices of stations. The FCC has the power to impose penalties for
violation of its rules or the Communications Act, including the imposition of
monetary forfeitures, the issuance of short-term licenses, the imposition of a
condition on the renewal of a license, and the revocation of operating
authority.

The following is a brief summary of certain provisions of the
Communications Act and of specific FCC regulations and policies. Reference
should be made to the Communications Act, FCC rules and the public notices and
rulings of the FCC for further information concerning the nature and extent of
federal regulation of radio stations.

FCC Licenses. Radio stations operate pursuant to broadcasting licenses
that are ordinarily granted by the FCC for maximum terms of eight years and are
subject to renewal upon application to the FCC. The FCC licenses for the
Company's stations are held by certain of the Company's subsidiaries. During
certain periods when renewal applications are pending, petitions to deny license
renewals can be filed by interested parties, including members of the public.
Historically, the Company's management has not experienced any material
53
<PAGE> 56

difficulty in renewing any licenses for stations under its control. The FCC is
required to hold hearings on a station's renewal application if a substantial or
material question of fact exists as to whether (i) the station has served the
public interest, convenience and necessity, (ii) there have been serious
violations by the licensee of the Communications Act or the FCC rules thereunder
or (iii) there have been other violations by the licensee of the Communications
Act or the FCC rules thereunder that, taken together, constitute a pattern of
abuse. Historically, FCC licenses have generally been renewed. The Company has
no reason to believe that its licenses will not be renewed in the ordinary
course, although there can be no assurance to that effect. The non-renewal of
one or more of the Company's licenses could have a material adverse effect on
the Company.

The FCC classifies each AM and FM station. An AM station operates on either
a clear channel, regional channel or local channel. A clear channel is one on
which AM stations are assigned to serve wide areas. Clear channel AM stations
are classified as either: Class A stations, which operate on an unlimited time
basis and are designated to render primary and secondary service over an
extended area; Class B stations, which operate on an unlimited time basis and
are designed to render service only over a primary service area; or Class D
stations, which operate either during daytime hours only, during limited times
only or on an unlimited time basis with low nighttime power. A regional channel
is one on which Class B and Class D AM stations may operate and serve primarily
a principal center of population and the rural areas contiguous to it. A local
channel is one on which AM stations operate on an unlimited time basis and serve
primarily a community and the suburban and rural areas immediately contiguous
thereto. Class C AM stations operate on a local channel and are designed to
render service only over a primary service area that may be reduced as a
consequence of interference.

The minimum and maximum facilities requirements for an FM station are
determined by its class. FM class designations depend, in part, upon the
geographic zone in which the transmitter of the FM station is located. In
general, commercial FM stations are classified as follows, in order of
increasing power and antenna height: Class A, B1, C3, B, C2, C1 and C. The FCC
is considering dividing Class C stations into two subclasses, Class C and Class
C0. Stations would be categorized into one of the two classes depending on the
antenna height of each station.

The following table sets forth the market, call letters, FCC license
classification, antenna height above average terrain ("HAAT"), power and
frequency, of each of the stations owned or operated by the Company, and the
date on which each station's FCC license expires (a station may continue to
operate beyond the expiration date if a timely filed license application is
pending):

54
<PAGE> 57

<TABLE>
<CAPTION>
FCC HAAT POWER IN EXPIRATION DATE OF
MARKET(1) STATION CLASS (IN METERS) FREQUENCY KILOWATTS(2) FCC LICENSE
- --------- ------- ----- ----------- ------------ ------------ ------------------
<S> <C> <C> <C> <C> <C> <C>
Portland
KFXX-AM B * 910 KHZ 5 February 1, 2006
KSLM-AM B * 1390 KHZ 5-D February 1, 2006
0.69-N
KKSN-AM B * 1520 KHZ 50-D February 1, 2006
15-N
KGON-FM C 386 92.3 MHZ 100 February 1, 2006
KNRK-FM C2 259 94.7 MHZ 17 February 1, 2006
KKSN- FM C 386 97.1 MHZ 100 February 1, 2006
KRSK-FM C 561 105.1 MHZ 100 February 1, 2006
Sacramento
KCTC-AM B * 1320 KHZ 5 December 1, 2005
KSSJ-FM B1 99 94.7 MHZ 25 December 1, 2005
KSEG-FM B 152 96.9 MHZ 50 December 1, 2005
KRXQ-FM B 151 98.5 MHZ 50 December 1, 2005
KDND-FM B 123 107.9 MHZ 50 December 1, 2005
Kansas City
WDAF-AM B * 610 KHZ 5 February 1, 2005
KCMO-AM B * 710 KHZ 10-D February 1, 2005
5-N
KMBZ-AM B * 980 KHZ 5 February 1, 2005
KCMO-FM C 322 94.9 MHZ 100 February 1, 2005
KUDL-FM C 303 98.1 MHZ 100 June 1, 2005
KYYS-FM C 308 99.7 MHZ 100 February 1, 2005
WREN-AM B * 12.50 KHZ(2) 25-D June 1, 2005
3.7-N
Rochester
WEZO-AM B * 950 KHZ 1 June 1, 2006
WBEE-FM B 152 92.5 MHZ 50 June 1, 2006
WQRV-FM A 119 93.3 MHZ 4 June 1, 2006
WBBF-FM B 172 98.9 MHZ 37 June 1, 2006
Gainesville/Ocala
WSKY-FM(4) C2 289 97.3 MHZ 13.5 February 1, 2004
WKTK-FM C1 299 98.5 MHZ 100 February 1, 2004
Longview/Kelso
KBAM-AM D * 1270 KHZ 5-D February 1, 2006
0.083-N
KEDO-AM C * 1400 KHZ 1 February 1, 2006
KLYK-FM A 262 105.5 MHZ 0.7 February 1, 2006
KRQT-FM C3 528 107.7 MHZ 0.74 February 1, 2006
</TABLE>

- ---------------
* Not applicable for AM transmission facilities.
(1) Metropolitan market served; city of license may differ.
(2) Pursuant to FCC rules and regulations, many AM radio stations are licensed
to operate at a reduced power during the nighttime broadcasting hours, which
results in reducing the radio station's coverage during the nighttime hours
of operation. Both power ratings are shown, where applicable. For FM
stations, the effective radiated power is given.

(3) WREN also has a construction permit to broadcast at 1660 KHZ in the expanded
AM band with 10KW-D and 1KW-N.

(4) Station is currently operating pursuant to Program Test Authority.

Ownership Matters. The Communications Act prohibits the assignment of a
broadcast license or the transfer of control of a broadcast licensee without the
prior approval of the FCC. In determining whether to grant such approval, the
FCC considers a number of factors pertaining to the licensee, including
compliance with the various rules limiting common ownership of media properties
in a given market, the "character" of the licensee and those persons holding
"attributable" interests therein, and compliance with the Communica-

55
<PAGE> 58

tions Act's limitations on alien ownership as well as compliance with other FCC
policies, including FCC equal employment opportunity requirements. The equal
opportunity requirements have been declared unconstitutional by the U.S. Court
of Appeals for the District of Columbia. See "-- Programming and Operation."

A transfer of control of a corporation holding a broadcast license may
occur in various ways. For example, a transfer of control occurs if an
individual stockholder gains or loses "affirmative" or "negative" control of
such corporation through issuance, redemption or conversion of stock.
"Affirmative" control would consist of control of more than 50% of such
corporation's outstanding voting power and "negative" control would consist of
control of exactly 50% of such voting power. To obtain the FCC's prior consent
to assign or transfer control of a broadcast license, appropriate applications
must be filed with the FCC. If the application involves a "substantial change"
in ownership or control, in that new individuals approved by the FCC propose to
acquire "affirmative" or "negative" control, the application must be placed on
public notice for a period of not less than 30 days during which petitions to
deny or other objections against the application may be filed by interested
parties, including members of the public. If the application does not involve a
"substantial change" in ownership or control, it is a "pro forma" application.
The "pro forma" application is nevertheless subject to having informal
objections filed against it. If the FCC grants an assignment or transfer
application, interested parties have not less than 30 days from public notice of
the grant to seek reconsideration or review of that grant. Generally, parties
that do not file initial petitions to deny or informal objections against the
application face a high hurdle in seeking reconsideration or review of the
grant. The FCC normally has approximately an additional ten days to set aside on
its own motion any grant made by the FCC staff acting pursuant to delegated
authority. When passing on an assignment or transfer application, the FCC is
prohibited from considering whether the public interest might be served by an
assignment or transfer of the broadcast license to any party other than the
assignee or transferee specified in the application.

In response to the Telecom Act, the FCC amended its multiple ownership
rules to eliminate the national limits on the ownership of AM and FM stations.
Additionally, it established new local ownership rules that use a sliding scale
of permissible ownership, depending on market size. In radio markets with 45 or
more commercial radio stations, a licensee may own up to eight stations, no more
than five of which can be in a single radio service (i.e., no more than five AM
or five FM). In radio markets with 30 to 44 commercial radio stations, a
licensee may own up to seven stations, no more than four of which can be in a
single radio service. In radio markets having 15 to 29 commercial radio
stations, a licensee may own up to six radio stations, no more than four of
which can be in a single radio service. Finally, in radio markets having 14 or
fewer commercial radio stations, a licensee may own up to five radio stations,
no more than three of which can be in the same service; provided that the
licensee may not own more than one half of the total number of radio stations in
the market. FCC ownership rules continue to permit an entity to own one FM and
one AM station in a local market regardless of market size. In addition to the
numerical limitations on ownership depending on market size, the FCC is
considering adopting a policy that would review a proposed transaction if it
would enable a single owner to attain a high degree of revenue concentration in
a market.

The FCC's "one-to-a-market" rule prohibits the common ownership, operation
or control of a radio broadcast station and a television broadcast station
serving the same geographic market (subject to a waiver of such prohibition if
certain conditions are satisfied) and the common ownership, operation or control
of a radio broadcast station and a daily newspaper serving the same geographic
market. Under these rules, absent waivers, the Company would not be permitted to
acquire any daily newspaper or television broadcast station (other than
low-power television) in any geographic market in which it now owns radio
broadcast properties. On October 1, 1996, the FCC commenced a proceeding to
explore possible revisions of its policies concerning waiver of the
newspaper/radio cross-ownership restrictions.

The FCC generally applies its ownership limits to "attributable" interests
held by an individual, corporation, partnership or other association. In the
case of corporations holding, or through subsidiaries controlling, broadcast
licenses, the interests of officers, directors and those who, directly or
indirectly, have the right to vote 5% or more of the corporation's voting stock
(or 10% or more of such stock in the case of insurance companies, investment
companies and bank trust departments that are passive investors) are generally
attributable. If a single individual or entity controls more than 50% of a
corporation's voting stock, that individual or entity is viewed as a single
majority shareholder; in this case, the interests of other
56
<PAGE> 59

shareholders are not attributable unless the shareholders are also officers or
directors of the corporation. The FCC is currently reviewing its attribution
rules to determine whether changes in those rules are appropriate.

In determining whether the Company is in compliance with the local
ownership limits on AM and FM stations, the FCC will consider the Company's AM
and FM holdings, as well as the attributable broadcast interests of the
Company's officers, directors and attributable shareholders. Accordingly, the
attributable broadcast interests of the Company's officers and directors
described in the preceding paragraph will limit the number of radio stations the
Company may acquire or own in any market in which such officers or directors
hold or acquire attributable broadcast interests. In addition, the Company's
officers and directors may from time to time hold various nonattributable
interests in media properties, which, under certain circumstances, may also
limit the number of radio stations the Company may acquire or own in a given
market.

Under its "cross-interest" policy, the FCC considers certain "meaningful"
relationships among competing media outlets in the same market, even if the
ownership rules do not specifically prohibit the relationship. Under the
cross-interest policy, the FCC in certain instances may prohibit one party from
holding an attributable interest in one media outlet and a substantial
non-attributable economic interest in another media outlet in the same market.
Under this policy, the FCC may consider significant equity interests combined
with an attributable interest in a media outlet in the same market, joint
ventures, and common key employees among 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. Heretofore, the FCC has not applied its cross-interest
policy to TBAs and JSAs between broadcast stations. In its ongoing rulemaking
proceeding concerning the attribution rules described below, the FCC has sought
comment on, among other things, (i) whether the cross-interest policy should be
applied only in smaller markets and (ii) whether non-equity financial
relationships such as debt, when combined with multiple business
interrelationships such as TBAs and JSAs, raise concerns under the
cross-interest policy.

The Communications Act prohibits the issuance of broadcast licenses to, or
the holding of broadcast licenses by, any corporation of which more than 20% of
the capital stock is owned of record or voted by non-U.S. citizens or their
representatives or by a foreign government or a representative thereof, or by
any corporation organized under the laws of a foreign country (collectively,
"Aliens"). The Communications Act also authorizes the FCC, if the FCC determines
that it would be in the public interest, to prohibit the issuance of a broadcast
license to, or the holding of a broadcast license by, any corporation directly
or indirectly controlled by any other corporation of which more than 25% of the
capital stock is owned of record or voted by Aliens. The FCC staff has
interpreted this provision to require a public interest finding in favor of such
a grant or holding before a broadcast license may be granted to or held by any
such corporation and has made such a finding only in limited circumstances
generally involving licenses other than broadcast licenses. The FCC has issued
interpretations of existing law (i) under which these restrictions in modified
form apply to other forms of business organizations, including partnerships and
(ii) indicating how alien interests in a company that are held directly through
intermediate entities should be considered in determining whether that company
is in compliance with these alien ownership restrictions. As a result of these
provisions, the licenses granted to the radio station subsidiaries of the
Company by the FCC could be revoked if, among other restrictions imposed by the
FCC, more than 25% of the Company's stock were directly or indirectly owned or
voted by Aliens. The Company's Amended and Restated Articles of Incorporation
restrict the ownership, voting and transfer of the Company's capital stock in
accordance with the Communications Act and the rules of the FCC, and prohibit
the issuance of more than 25% of the Company's outstanding capital stock (or
more than 25% of the voting rights it represents) to or for the account of
Aliens or corporations otherwise subject to domination or control by Aliens. The
Amended and Restated Articles of Incorporation authorize the Company's Board of
Directors to enforce these prohibitions. In addition, the Amended and Restated
Articles of Incorporation provide that shares of capital stock of the Company
determined by the Company's Board of Directors to be owned beneficially by an
Alien or an entity directly or indirectly owned by Aliens in whole or in part
shall be subject to redemption by the Company by action of the Board of
Directors to the extent necessary, in the judgment of the Board of Directors, to
comply with these alien ownership restrictions. See "Description of Capital
Stock."

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<PAGE> 60

Time Brokerage Agreements. Over the past few years, a number of radio
stations have entered into what have commonly been referred to TBAs. While these
agreements may take varying forms, under a typical TBA, separately owned and
licensed radio stations agree to enter into cooperative arrangements of varying
sorts, subject to compliance with the requirements of antitrust laws and with
the FCC's rules and policies. Under these arrangements, separately-owned
stations could agree to function cooperatively in programming, advertising sales
and similar matters, subject to the requirement that the licensee of each
station maintain independent control over the programming and operations of its
own station. One typical type of TBA is a programming agreement between two
separately-owned radio stations serving a common service area, whereby the
licensee of one station provides substantial portions of the broadcast
programming for airing on the other licensee's station, subject to ultimate
editorial and other controls being exercised by the latter licensee, and sells
advertising time during those program segments.

The FCC has specifically revised its "cross-interest" policy to make that
policy inapplicable to TBAs. Furthermore, the staff of the FCC's Mass Media
Bureau has held that TBAs are not contrary to the Communications Act provided
that the licensee of the station that is being substantially programmed by
another entity maintains complete responsibility for, and control over,
programming and operations of its broadcast station and assures compliance with
applicable FCC rules and policies.

The FCC's multiple ownership rules specifically permit radio station TBAs
to continue to be entered into and implemented, but provide that a licensee or a
radio station that brokers more than 15% of the weekly broadcast time on another
station serving the same market will be considered to have an attributable
ownership interest in the brokered station for purposes of the FCC's multiple
ownership rules. As a result, in a market where it owns a radio station, the
Company would not be permitted to enter into a TBA with another local radio
station in the same market that it could not own under the local ownership
rules, unless the Company's programming on the brokered station constituted 15%
or less of the other local station's programming time on a weekly basis. The FCC
rules also prohibit a broadcast licensee from simulcasting more than 25% of its
programming on another station in the same broadcast service (i.e., AM-AM or FM-
FM) through a TBA where the brokered and brokering stations which it owns or
programs serve substantially the same area. Such 25% simulcasting limitation
also applies to commonly owned stations in the same broadcast service that serve
substantially the same area.

Joint Sales Agreements. Over the past few years, a number of radio
stations have entered into cooperative arrangements commonly known as JSAs.
While these agreements may take varying forms, under the typical JSA, a station
licensee obtains, for a fee, the right to sell substantially all of the
commercial advertising on a separately-owned and licensed station in the same
market. The typical JSA also customarily involves the provision by the selling
party of certain sales, accounting and "back office" services to the station
whose advertising is being sold. The typical JSA is distinct from a TBA in that
a JSA normally does not involve programming.

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
attributable interests of that licensee. However, in connection with its ongoing
rulemaking proceeding 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 TBAs. If JSAs become attributable interests as a result of changes in the
FCC rules, the Company may be required to terminate any JSA it might have with a
radio station which the Company could not own under the FCC's multiple ownership
rules.

Programming and Operation. The Communications Act requires broadcasters to
serve the "public interest." The FCC gradually has relaxed or eliminated many of
the more formalized procedures it had developed in the past to promote the
broadcast of certain types of programming responsive to the needs of a station's
community of license. A licensee continues to be required, however, to present
programming that is responsive to issues of the station's community of license
and to maintain certain records demonstrating such responsiveness. Complaints
from listeners concerning a station's programming often will be considered by
the FCC when it evaluates renewal applications of a licensee, although listener
complaints may be filed at any
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<PAGE> 61

time, are required to be maintained in the station's public file and generally
may be considered by the FCC at any time. Stations also must pay regulatory and
application fees and follow various rules promulgated under the Communications
Act that regulate, among other things, political advertising, sponsorship
identifications, the advertisement of contests and lotteries, obscene and
indecent broadcasts, and technical operations, including limits on human
exposure to radio frequency radiation. In addition, the FCC rules formerly
required that licensees develop and implement affirmative action programs
designed to promote equal employment opportunities and submit reports to the FCC
with respect to these matters on an annual basis and in connection with a
renewal application. The U.S. Court of Appeals for the District of Columbia has
declared these rules unconstitutional. The FCC has announced that it intends to
reestablish employment regulations through rulemaking proceedings to be
initiated in the future.

Failure to observe these or other rules and policies can result in the
imposition of various sanctions, including monetary forfeitures, the grant of
"short term" (less than the full term) license renewal, the imposition of a
condition on the renewal of a license or, for particularly egregious violations,
the denial of a license renewal application or the revocation of a license.

Proposed and Recent Changes. The FCC has pending a rulemaking proceeding
that seeks, among other things, comment on whether the FCC should modify its
radio and television broadcast ownership "attribution" rules by (i) raising the
basic benchmark for attributing ownership in a corporate licensee from 5% to 10%
of the licensee's outstanding voting power, (ii) increasing from 10% to 20% of
the licensee's outstanding voting power the attribution benchmark for
institutional investors in corporate licensees holding interests deemed
"passive" in nature, (iii) attributing certain minority stockholdings in
corporations with a single majority shareholder and (iv) attributing certain
local marketing agreements ("LMA"), TBAs, JSAs, debt or non-voting stock
interests that have heretofore been non-attributable.

Moreover, Congress and the FCC have under consideration, and in the future
may consider and adopt, new laws, regulations and policies regarding a wide
variety of matters that could affect, directly or indirectly, the operation,
ownership and profitability of the Company's radio stations, result in the loss
of audience share and advertising revenues for the Company's radio stations, and
affect the ability of the Company to acquire additional radio stations or to
finance those acquisitions. Such matters may include spectrum use or other fees
on FCC licenses; foreign ownership of broadcast licenses; restatement in revised
form of the FCC's equal employment opportunity rules and revisions to the FCC's
rules relating to political broadcasting; technical and frequency allocation
matters; proposals to restrict or prohibit the advertising of beer, wine and
other alcoholic beverages on radio; changes in the FCC's cross-interest,
multiple ownership and attribution policies; and new technologies such as DARS
and microbroadcasting. As required by the Telecom Act, the FCC has instituted a
proceeding to investigate, among other things, the effect of the revised
ownership rules for radio stations adopted through the Telecom Act, and the
resulting consolidation in the radio industry, on the diversity of programming
and ownership, and on programming and advertising competition. The FCC may
conclude, as a consequence of this review, to modify the radio ownership rules.
Finally, the FCC has adopted procedures for the auction of broadcast spectrum in
circumstances where two or more parties have filed for major change applications
which are mutually exclusive; such procedure may limit the Company's efforts to
modify or expand the broadcast signals of its stations.

The Company cannot predict what other matters might be considered in the
future by the FCC or Congress, nor can it judge in advance what impact, if any,
the implementation of any of these proposals or changes might have on its
business.

Federal Antitrust Laws. In addition to the risks associated with the
acquisition of radio stations, the Company is also aware of the possibility that
certain acquisitions it proposes to make may be investigated by the FTC or the
DOJ, which are the agencies responsible for enforcing the federal antitrust
laws. The Company cannot predict the outcome of any specific DOJ or FTC
investigation, which is necessarily fact specific. Any decision by the FTC or
the DOJ to challenge a proposed acquisition could affect the ability of the
Company to consummate the acquisition or to consummate it on the proposed terms.

For an acquisition meeting certain size thresholds, the HSR Act and the
rules promulgated thereunder require the parties to file Notification and Report
Forms with the FTC and the DOJ and to observe specified
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<PAGE> 62

waiting period requirements before consummating the acquisition. During the
initial 30-day period after the filing, the agencies decide which of them will
investigate the transaction. If the investigating agency determines that the
transaction does not raise significant antitrust issues, then it will either
terminate the waiting period or allow it to expire after the initial 30 days. On
the other hand, if the agency determines that the transaction requires a more
detailed investigation, then prior to the conclusion of the initial 30-day
period, it will issue a formal request for additional information ("Second
Request"). The issuance of a Second Request extends the waiting period until the
twentieth calendar day after the date of substantial compliance with the Second
Request by all parties to the acquisition. Thereafter, such waiting period may
only be extended by court order or with the consent of the parties. In practice,
complying with a Second Request can take a significant amount of time. In
addition, if the investigating agency raises substantive issues in connection
with a proposed transaction, then the parties frequently engage in lengthy
discussions or negotiations with the investigating agency concerning possible
means of addressing those issues, including but not limited to persuading the
agency that the proposed acquisition would not violate the antitrust laws,
restructuring the proposed acquisition, divestiture of other assets of one or
more parties, or abandonment of the transaction. Such discussions and
negotiations can be time-consuming and expensive, and the parties may agree to
delay consummation of the acquisition during their pendency.

At any time before or after the consummation of a proposed acquisition, the
FTC or the DOJ could take such action under the antitrust laws as it deems
necessary or desirable in the public interest, including seeking to enjoin the
acquisition or seeking divestiture of the business acquired or other assets of
the Company. Acquisitions that are not required to be reported under the HSR Act
may be investigated by the FTC or the DOJ under the antitrust laws before or
after consummation. In addition, private parties may under certain circumstances
bring legal action to challenge an acquisition under the antitrust laws.

As part of its increased scrutiny of radio station acquisitions, the DOJ
has stated publicly that it believes that LMAs, JSAs, TBAs and other similar
agreements customarily entered into in connection with radio station transfers
could violate the HSR Act if such agreements take effect prior to the expiration
of the waiting period under the HSR Act. Furthermore, the DOJ has noted that
JSAs may raise antitrust concerns under Section 1 of the Sherman Act and has
challenged JSAs in certain locations.

EMPLOYEES

On November 15, 1998, the Company had a staff of 819 full-time employees
and 366 part-time employees. The Company is a party to collective bargaining
agreements with the American Federation of Television and Radio Artists
("AFTRA") which apply to certain of the Company's programming personnel in
Seattle, Kansas City and Boston and with the International Brotherhood of
Electrical Workers which applies to certain of the Company's engineering
personnel in Boston. The Company believes that its relations with its employees
are good.

ENVIRONMENTAL

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

SEASONALITY

Seasonal revenue fluctuations are common in the radio broadcasting industry
and are due primarily to fluctuations in advertising expenditures by retailers.
The Company's revenues and broadcast cash flows are typically lowest in the
first calendar quarter.

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<PAGE> 63

PROPERTIES AND FACILITIES

The types of properties required to support each of the Company's radio
stations include offices, studios and transmitter/antenna sites. The Company
typically leases its studio and office space with lease terms that expire in
five to ten years, although the Company does own certain of its facilities. A
station's studios are generally housed with its offices in downtown or business
districts. The Company generally considers its facilities to be suitable and of
adequate size for its current and intended purposes. The Company owns a majority
of its main transmitter and antenna sites and leases the remainder of its
transmitter/antenna sites with lease terms that expire, including renewal
options, in periods ranging up to twenty years. The transmitter/antenna site for
each station is generally located so as to provide maximum market coverage,
consistent with the station's FCC license. In general, the Company does not
anticipate difficulties in renewing facility or transmitter/antenna site leases
or in leasing additional space or sites if required.

The Company owns substantially all of its other equipment, consisting
principally of transmitting antennae, transmitters, studio equipment and general
office equipment. The towers, antennae and other transmission equipment used by
the Company's stations are generally in good condition, although opportunities
to upgrade facilities are continuously reviewed. Substantially all of the
property owned by the Company secures the Company's borrowings under the Credit
Facility.

The principal executive offices of the Company are located at 401 City
Avenue, Suite 409, Bala Cynwyd, Pennsylvania 19004. The telephone number of the
Company is (610) 660-5610.

LEGAL PROCEEDINGS

The Company currently and from time to time is involved in litigation
incidental to the conduct of its business, but the Company is not a party to any
lawsuit or proceeding which, in the opinion of management, is likely to have a
material adverse effect on the Company.

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<PAGE> 64

MANAGEMENT

EXECUTIVE OFFICERS AND DIRECTORS

The following table provides information concerning the directors and
executive officers of the Company.

<TABLE>
<CAPTION>
NAME AGE POSITION WITH THE COMPANY
- ---- --- -------------------------
<S> <C> <C>
Joseph M. Field........................... 66 Chairman of the Board and Chief Executive
Officer
David J. Field............................ 36 President, Chief Operating Officer and
Director
John C. Donlevie.......................... 51 Executive Vice President, General Counsel
and Director
Stephen F. Fisher......................... 46 Senior Vice President and Chief Financial
Officer
Herbert Kean, M.D......................... 66 Director
S. Gordon Elkins.......................... 67 Director
Thomas H. Ginley, M.D..................... 74 Director
Lee Hague................................. 52 Director
Marie H. Field............................ 61 Director
Michael R. Hannon......................... 38 Director
</TABLE>

Joseph M. Field founded Entercom in 1968 and has served since the Company's
inception as Chairman of the Board and Chief Executive Officer and was the
Company's President until September 1998. Mr. Field served on the Board of
Directors of the National Association of Broadcasters for four years as a
representative of the major radio group broadcasters. Mr. Field is a graduate of
the University of Pennsylvania and of Yale Law School and practiced law in New
York and Philadelphia before entering the broadcasting business. Mr. Field
currently serves on the Boards of Directors of The Curtis Institute of Music,
the Settlement Music School, the American Interfaith Institute, the Liberty
Museum, the Jewish Educational and Vocational Service (JEVS) and the
Philadelphia Chamber Music Society. Joseph M. Field is the spouse of Marie H.
Field and the father of David J. Field.

David J. Field has served as President of the Company since September 1998,
as Chief Operating Officer since April 1996 and as director since November 1995.
He also served as Chief Financial Officer from 1992 to November 1998. Mr. Field
joined the Company in 1987 and served as Director of Finance and Corporate
Development from 1987 to 1988, Vice President - Finance and Corporate
Development from 1988 to 1992, Vice President - Operations and Chief Financial
Officer from 1992 to 1995 and Senior Vice President - Operations and Chief
Financial Officer from 1995 to 1996. Prior to joining the Company, Mr. Field was
an investment banker with Goldman, Sachs & Co. Mr. Field has a B.A. from Amherst
College and an M.B.A. from the Wharton School of the University of Pennsylvania.
Mr. Field currently serves on the Boards of Directors of The Radio Advertising
Bureau and The Wilderness Society. David J. Field is the son of Joseph M. Field
and Marie H. Field.

John C. Donlevie has served as Executive Vice President and director since
1989 and as General Counsel of the Company since 1984 when he joined the
Company. In addition, Mr. Donlevie served as Vice President - Legal and
Administrative from 1984 through 1989. Prior to joining the Company, Mr.
Donlevie practiced law for eleven years, most recently as Corporate Counsel of
Ecolaire Incorporated in Malvern, Pennsylvania. Mr. Donlevie has a B.S. in
engineering from Drexel University and a J.D. from Temple University School of
Law.

Stephen F. Fisher has served as Senior Vice President and Chief Financial
Officer since November 1998. From 1994 to 1998, Mr. Fisher was a Managing
Director with Bachow & Associates, a private equity firm located in Bala Cynwyd,
Pennsylvania. Prior to joining Bachow & Associates, Mr. Fisher held numerous
operational and financial management positions over a period of fifteen years,
most recently as Executive Vice President/Vice President Development, with
Westinghouse Broadcasting Company, Inc. (now CBS). Mr. Fisher has an M.A. from
Bob Jones University and an M.B.A. from the University of South Carolina.

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<PAGE> 65

Herbert Kean, M.D. has served as a director of the Company since its
inception and as secretary from its inception until February 1984. Dr. Kean is
currently a medical physician in private practice in the Philadelphia area. Dr.
Kean has a B.S. from the University of Pennsylvania and a M.D. from Hahnemann
University.

S. Gordon Elkins has served as a director of the Company since February
1978. Mr. Elkins is a partner in the law firm of Stradley, Ronon, Stevens &
Young. Mr. Elkins has a B.S. from Temple University and an L.L.B. from Yale Law
School.

Thomas H. Ginley, M.D. has served as a director of the Company since
January 1971 and as Secretary of the Company since February 1984. Dr. Ginley is
currently a medical physician in private practice in the Philadelphia area. Mr.
Ginley serves on the Board of Directors of A & T Development Corporation,
Vanessa Noel Couture, Inc. and GEM Treasury International Corporation. Dr.
Ginley has a M.D. from Georgetown University.

Lee Hague has served as a director of the Company since March 1980. Mr.
Hague has served as an independent consultant to various broadcasting groups and
provides financial advisory and media brokering services to the industry. Mr.
Hague has over 20 years' experience in the radio industry. Mr. Hague has a B.S.
in Economics from Northwestern University and a M.M. from the J.L. Kellogg
Graduate School of Management, Northwestern University.

Marie H. Field has served as a director of the Company since 1989. Mrs.
Field served for over 25 years as a teacher in public and private schools in New
York and Philadelphia. Mrs. Field serves on the Board of Directors of the
Ovarian Cancer Research Fund in New York and the Board of Overseers of the
University of Pennsylvania School of Social Work. Mrs. Field has a B.A. from
Barnard College. Mrs. Field is the spouse of Joseph M. Field and the mother of
David J. Field.

Michael R. Hannon was elected to serve as a director of the Company in
December 1998. Mr. Hannon is a general partner of Chase Capital, a general
partnership which invests in international private equity opportunities with a
significant concentration on the media and telecommunications industries. Prior
to joining Chase Capital in 1988, Mr. Hannon held various positions at Morgan
Stanley & Co. Incorporated. Mr. Hannon currently serves as Chairman of Telecorp
PCS, Inc. and as a director of Formus Communications and Financial Equity
Partners. Mr. Hannon has a B.A. from Yale University and an M.B.A. from Columbia
Business School.

COMMITTEES OF THE BOARD OF DIRECTORS

The Company's Board of Directors has established an Audit Committee and a
Compensation Committee.

The responsibilities of the Audit Committee include recommending to the
Board of Directors independent public accountants to conduct the annual audit of
the financial statements of the Company, reviewing the proposed scope of such
audit and approving the audit fees to be paid, reviewing accounting and
financial controls of the Company with the independent public accountants and
the Company's financial and accounting staff and reviewing and approving
transactions, other than compensation matters, between the Company and its
directors, officers and affiliates. Prior to the consummation of the Offering,
the Board will appoint two or more non-employee directors to be the initial
members of the Audit Committee.

The Compensation Committee provides a general review of the Company's
compensation plans to ensure that they meet corporate objectives. The
responsibilities of the Compensation Committee also include administering and
interpreting the Company's 1998 Equity Compensation Plan, including selecting
the officers and salaried employees to whom awards will be granted. Messrs.
Ginley, Hague and Kean serve as the initial members of the Compensation
Committee.

DIRECTOR COMPENSATION

During the last fiscal year, all directors of the Company were compensated
$200 for each meeting of the Board that they attended in person. Upon
consummation of the Offering, all directors who are not currently

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<PAGE> 66

receiving compensation as officers, employees or consultants of the Company will
be entitled to receive an annual retainer fee of $ , plus $ and
reimbursement of expenses for each meeting of the Board and each committee
meeting that they attend in person. Directors who serve as employees of the
Company will not receive additional compensation for their services as
directors.

EXECUTIVE OFFICER COMPENSATION

The following table sets forth certain information concerning compensation
paid to or earned by the Chief Executive Officer of the Company and the
Company's other most highly compensated executive officers for services rendered
during the year ended September 30, 1998 (the "Named Executive Officers").

Summary Compensation Table

<TABLE>
<CAPTION>
ANNUAL COMPENSATION
-------------------- OTHER ANNUAL
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS(1) COMPENSATION
--------------------------- ---- -------- -------- ------------
<S> <C> <C> <C> <C>
Joseph M. Field, Chairman of the Board and Chief
Executive Officer.............................. 1998 $554,992 0 *
David J. Field, President and Chief Operating
Officer........................................ 1998 $262,973 $116,000 *
John C. Donlevie, Executive Vice President and
General Counsel................................ 1998 $181,947 $116,000 *
</TABLE>

- ---------------
* Value of perquisites and other personal benefits paid does not exceed the
lesser of $50,000 or 10% of the total annual salary and bonus reported for
the executive officer and, therefore, is not required to be disclosed
pursuant to rules of the Securities and Exchange Commission (the
"Commission").

(1) Includes amounts accrued during year presented but paid in the subsequent
year.

1998 EQUITY COMPENSATION PLAN

The Company has adopted the 1998 Equity Compensation Plan, effective as of
June 24, 1998. The 1998 Equity Compensation Plan provides for grants of (i)
options intended to qualify as incentive stock options ("ISOs") within the
meaning of Section 422 of the Code, (ii) "nonqualified stock options" that are
not intended to so qualify ("NQSOs"), (iii) restricted stock and (iv) stock
appreciation rights ("SARs"). Such grants may be made to employees of the
Company and its subsidiaries (including employees who are officers or
directors), non-employee directors of the Company and certain advisors and
consultants who perform services for the Company and its subsidiaries (the
"Participants"). Only shares of Class A Common Stock may be issued under the
1998 Equity Compensation Plan. By encouraging stock ownership, the Company seeks
to motivate such individuals and to encourage such individuals to devote their
best efforts to the business and financial success of the Company.

General. Subject to adjustment in certain circumstances as discussed
below, up to 10% of the outstanding Class A Common Stock of the Company may be
issued under the 1998 Equity Compensation Plan. The number of shares for which
ISOs may be issued under the 1998 Equity Compensation Plan may not exceed
shares (subject to adjustment as described below), and the number of
shares of restricted stock that may be issued under the 1998 Equity Compensation
Plan may not exceed shares (subject to adjustment as described
below). If and to the extent grants awarded under the 1998 Equity Compensation
Plan expire or are terminated for any reason without being exercised, the shares
of Class A Common Stock subject to such grant again will be available for
purposes of the 1998 Equity Compensation Plan.

Administration of the 1998 Equity Compensation Plan. The 1998 Equity
Compensation Plan is administered and interpreted by the Compensation Committee
(the "Committee") of the Board of Directors consisting of not less than two
persons appointed by the Board of Directors from among its members, each of whom
may be a "disinterested person" as defined by Rule 16b-3 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and an "outside director"
as defined by Section 162(m) of the Code. Subject to the ratification or
approval by the Board of Directors, if the Board retains such right, the
Committee has the sole authority to (i) determine the individuals to whom awards
shall be made under the

64
<PAGE> 67

1998 Equity Compensation Plan, (ii) determine the type, size and terms of the
awards to be made to each such individual, (iii) determine the time when the
grants will be made and the duration of any applicable exercise or restriction
period, including the criteria for vesting and the acceleration of vesting, (iv)
delegate to the Chief Executive Officer of the Company the authority to make
grants under the 1998 Equity Compensation Plan to employees of the Company who
are not subject to the limitations of Section 16(b) of the Exchange Act and who
are not expected to be subject to the limitations of Section 162(m) of the Code
and (v) deal with any other matters arising under the Plan. See "-- Committees
of the Board of Directors."

Eligibility for Participation. Awards may only be made to Participants.
During any calendar year, no Participant may receive awards for more than
1,000,000 shares of Class A Common Stock issued or available for issuance under
the 1998 Equity Compensation Plan. As of November 30, 1998, no options were
outstanding under the 1998 Equity Compensation Plan.

Options. The exercise price of any ISO granted under the 1998 Equity
Compensation Plan will not be less than the fair market value of the underlying
shares of Common Stock on the date of grant. The exercise price of an ISO
granted to an employee who owns more than 10% of the Common Stock may not be
less than 110% of the fair market value of the underlying shares of Common Stock
on the date of grant. The exercise price of an NQSO may be greater than, equal
to or less than the fair market value of the underlying shares of Common Stock
on the date of grant. The Committee will determine the term of each option;
provided, however, that the exercise period may not exceed ten years from the
date of grant, and the exercise period of an ISO granted to an employee who owns
more than 10% of the Common Stock may not exceed five years from the date of
grant. The Participant may pay the exercise price (i) in cash, (ii) with the
approval of the Committee, by delivering shares of Common Stock owned by the
Participant and having a fair market value on the date of exercise equal to the
exercise price or (iii) by such other method as the Committee approves. The
participant may instruct the Company to deliver the shares of Common Stock due
upon the exercise to a designated broker instead of to the Participant.

Restricted Stock. The Committee may issue shares of restricted Common
Stock to a Participant pursuant to the 1998 Equity Compensation Plan. Shares may
be issued for consideration or for no consideration, as the Committee
determines. The number of shares of Common Stock granted to each Participant
shall be determined by the Committee, subject to the maximum limit described
above. Grants of restricted stock will be made subject to such performance
requirements, vesting provisions, transfer restrictions or other restrictions
and conditions as the Committee may determine in its sole discretion.

Stock Appreciation Rights. The Committee may grant SARs alone or in tandem
with any stock option pursuant to the 1998 Equity Compensation Plan. Unless the
Committee determines otherwise, the exercise price of an SAR will be either (i)
the exercise price of the related stock option or (ii) the fair market value of
a share of Common Stock on the date of grant of the SAR. When the Participant
exercises a SAR, the Participant will receive the amount by which the fair
market value of the Common Stock on the date of exercise exceeds the exercise
price of the SAR. The appreciation shall be paid in cash or in shares of Common
Stock, as the Committee determines. To the extent a Participant exercises a
tandem SAR, the related option shall terminate. Similarly, upon exercise of a
stock option, the related SAR, if any, shall terminate.

Amendment and Termination of the 1998 Equity Compensation Plan. The Board
of Directors may amend or terminate the 1998 Equity Compensation Plan at any
time; provided, however, that, the Board of Directors may not amend, without
stockholder approval, the 1998 Equity Compensation Plan to make any amendment
that requires stockholder approval pursuant to Rule 16b-3 of the Exchange Act,
Section 162(m) of the Code or Section 422 of the Code. The 1998 Equity
Compensation Plan will terminate on the day immediately preceding the tenth
anniversary of its effective date, unless terminated earlier by the Board of
Directors or extended by the Board of Directors with approval of the
stockholders.

Adjustment Provisions. Subject to the change of control provisions below,
in the event of certain transactions identified in the 1998 Equity Compensation
Plan, the Committee may appropriately adjust (i) the number and kind of shares
of Class A Common Stock (and the option price per share) subject to awards, (ii)
the number and kind of shares for which awards may be made under the 1998 Equity

65
<PAGE> 68

Compensation Plan and (iii) the maximum number of shares that may be awarded to
an individual, and such adjustments shall be effective and binding for all
purposes of the 1998 Equity Compensation Plan.

Change of Control of the Company. In the event of a change of control,
unless the Committee determines otherwise, all grants shall become fully vested
and all restrictions and conditions on restricted stock shall lapse. If the
Company is not the surviving corporation, unless the Committee determines
otherwise, outstanding options and SARs will be replaced by options and SARs or
equivalent rights of the surviving corporation. The Committee may also provide
for a cashout or termination of outstanding options and SARs.

A change of control is defined as (i) any person or group becomes the owner
of more than 50% of the votes required to elect a majority of the Board of
Directors, except if such change in control results from the death of a
shareholder, (ii) a liquidation or a sale of substantially all the Company's
assets or (iii) a merger in which the shareholders of the Company immediately
before the merger do not own, after the merger, more than 50% of all votes
required to elect a majority of the Board of Directors of the surviving
corporation.

Section 162(m). Under Section 162(m) of the Code, the Company may be
precluded from claiming a federal income tax deduction for total remuneration in
excess of $1,000,000 paid to the chief executive officer or to any of the other
four most highly compensated officers in any one year. Total remuneration would
include amounts received upon the exercise of stock options or SARs granted
under the 1998 Equity Compensation Plan and the value of shares received when
the shares of restricted stock became transferable (or such other time when
income is recognized). An exception exists, however, for "performance-based
compensation," including amounts received upon the exercise of stock options or
SARs pursuant to a plan approved by shareholders that meets certain
requirements. The 1998 Equity Compensation Plan has been approved by
shareholders and is intended to make grants of options thereunder that meet the
requirements of "performance- based compensation." Awards of restricted stock
will not qualify as "performance-based compensation."

New Plan Benefits. Prior to the effective date of the Offering, the
Company will grant certain options under the 1998 Equity Compensation Plan. The
Company anticipates that these options will vest one-fourth each year over the
next four years. All options expire on the tenth anniversary of the date of
grant. The following table sets forth certain information with respect to such
contemplated Option grants.

<TABLE>
<CAPTION>
NAME AND POSITION DOLLAR VALUE NUMBER OF UNITS (1)
- ----------------- ------------ -------------------
<S> <C> <C>
Joseph M. Field, Chairman of the Board and Chief Executive
Officer...................................................
David J. Field, President, Chief Operating Officer and
Director..................................................
John C. Donlevie, Executive Vice President and General
Counsel...................................................
Stephen F. Fisher, Senior Vice President and Chief Financial
Officer...................................................
All current executive officers as a group...................
All current directors who are not executive officers as a
group.....................................................
All employees, including all current officers who are not
executive officers, as a group............................
</TABLE>

- ---------------

(1) The number of units represents the number of shares of Class A Common Stock
underlying the options granted.

EMPLOYEE STOCK PURCHASE PLAN

The Company's Employee Stock Purchase Plan (the "ESP Plan") was adopted in
June 1998 and will become effective after the Offering on such date as the Board
of Directors or the committee established to administer the ESP Plan (the "ESP
Committee") designates. The purpose of the ESP Plan is to provide eligible
employees of the Company an opportunity to purchase Common Stock of the Company.
The Company believes that employee participation in stock ownership will be to
the mutual benefit of both the employees and the Company. The ESP Plan is
intended to constitute an employee stock purchase plan within the meaning of
Section 423 of the Code. The ESP Plan is not intended to constitute an employee
benefit plan within the meaning of Section 3(3) of the Employee Retirement
Security Act of 1974, as amended. A total of

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<PAGE> 69

up to 1,000,000 shares of Class A Common Stock of the Company may be issued
under the ESP Plan (subject to adjustment in the event of certain changes in the
Common Stock). The ESP Plan will terminate after a term of 10 years, unless it
is terminated earlier pursuant to its terms or by action of the Board of
Directors. All funds received or held by the Company under the ESP Plan are
general assets of the Company, shall be held free of any trust or other
restriction and may be used for any corporate purpose.

In order to be eligible to participate in the ESP Plan, an employee must
(i) be classified by the Company as a full or part-time employee, (ii) be
employed by the Company for more than 20 hours per week and for more than five
months per year, (iii) have completed at least one year of service with the
Company or a predecessor and (iv) not be deemed for purposes of Section
423(b)(3) of the Code to own stock representing five percent or more of the
total combined voting power of all classes of stock of the Company or any
subsidiary of the Company. Employees who are covered by a collective bargaining
agreement will not participate during any period in which the union has
determined that such employees will not participate in the ESP Plan. Under the
ESP Plan, the Company will withhold a specified percentage (not to exceed 10%)
of the compensation paid to each participant, and the amount withheld (and any
additional amount contributed by the participant) will be used to purchase Class
A Common Stock from the Company on the last day of each purchase period. The
price at which the Class A Common Stock will be purchased under the ESP Plan
will be determined by the Committee and shall not be less than 85% of the value
of the stock on the last day of the purchase period. The length of each purchase
period shall be specified by the ESP Committee, with the first purchase period
to begin on a date subsequent to the effective date of this Prospectus.

Employees may end their participation in a purchase period at any time, and
participation ends automatically upon termination of employment with the
Company. The maximum value of shares that a participant in the ESP Plan may
purchase during any calendar year is $25,000. In the event of a dissolution or
liquidation of the Company or of a merger or consolidation in which the Company
is not the surviving corporation, the ESP Plan and any purchase periods then in
progress will terminate upon the effective date of such event.

The Board of Directors has the right to amend or terminate the ESP Plan.
However, any amendment that requires shareholder approval under Section 423 of
the Code shall be approved by the Company's shareholders.

EMPLOYMENT AGREEMENTS

Joseph M. Field Employment Agreement. The Company has entered into an
employment agreement with Joseph M. Field pursuant to which Mr. Field serves as
Chief Executive Officer. The employment agreement with Mr. Field may be
terminated upon written notice no less than 30 days prior to the end of any
calendar year. Absent such written notice, the employment agreement is
automatically renewed for a period of one year. In the event of Mr. Field's
death during the term of the employment agreement, the Company will pay his
survivors Mr. Field's compensation for one year at the then current rate. In the
event of the total disability of Mr. Field, the Company will pay Mr. Field
compensation for the lesser of the period of his disability or one year at the
then applicable rate. Mr. Field's current base salary is $558,000 and is
increased or decreased annually by a percentage equal to the percentage of
inflation or deflation over the immediately preceding twelve month period,
provided that the base salary shall never be less than $500,000. The Board of
Directors may approve additional salary, bonuses, fees, or other compensation
for Mr. Field. Mr. Field is entitled to participate in any bonus, profit
sharing, retirement, insurance or other plan or program adopted by the Company.
Absent the express prior written consent of the Company, Mr. Field is
prohibited, in the event of his termination by resignation or for cause, for a
period of two years following the termination of the employment agreement, from
engaging in any broadcast business in competition with the Company in any
standard metropolitan statistical area in which the Company is then operating a
broadcast property.

Executive Officer Employment Agreements. The Company has entered into
employment agreements with David J. Field and John C. Donlevie. Each of these
employment agreements provides that the employee may be terminated at will by
either party (i) immediately if good cause for termination exists, or (ii) upon
thirty days notice in the absence of good cause. Pursuant to these employment
agreements, the current annual

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<PAGE> 70

salaries of Mr. Field and Mr. Donlevie are $267,000 and $183,000, respectively.
Each of the employment agreements provides for yearly salary adjustments for
inflation and an annual incentive bonus based on the increased real cash flow
(as defined in the agreement) of the Company. In addition, Mr. Donlevie may
collect a percentage of any special or liquidating distributions made by the
Company.

In addition, the Company has entered into an employment agreement with
Stephen F. Fisher for a term ending December 31, 2000 and year to year
thereafter unless terminated by either party at least 120 days prior to the end
of the then current term. In the event of a change of control of the Company,
such notice is increased by 60 days or in lieu of such additional notice the
Company may pay 60 days salary. The agreement may be terminated by the Company
at any time for cause. Mr. Fisher's salary is $250,000 annually and is increased
each year for inflation. In addition, Mr. Fisher is eligible for discretionary
bonuses.

Mr. Fisher is prohibited, so long as he is employed by the Company and for
a period of one year thereafter, from serving, directly or indirectly in any
enterprise which competes with the Company; provided, however, if Mr. Fisher is
terminated without cause or if his employment agreement is terminated due to the
parties inability to renegotiate certain compensation terms, then Mr. Fisher
will be restricted from serving in a competitive business for a period equal to
three months plus any time for which he receives a cash settlement.

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

S. Gordon Elkins, a director of the Company, is a partner at the law firm
of Stradley, Ronon, Stevens & Young, that has served as the Company's outside
counsel on various matters.

Michael R. Hannon, a director of the Company, is a general partner of Chase
Capital Partners. In May 1996, Chase Capital, acquired the 7% Subordinated
Convertible Note for $25 million. The 7% Subordinated Convertible Note will be
converted in the Chase Conversion into shares of Class A Common Stock.
Chase Capital is the Selling Shareholder in the Offering and will receive net
proceeds of $ from the sale of shares of Class A Common Stock
in the Offering. Upon completion of the Offering, Chase Capital will
beneficially own approximately % of the Company's Class A Common Stock.

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<PAGE> 71

PRINCIPAL AND SELLING SHAREHOLDERS

The following table sets forth certain information regarding the beneficial
ownership of the Common Stock as of November 30, 1998, by: (i) each person (or
group of affiliated persons) known by the Company to be the beneficial owner of
more than five percent of the outstanding Common Stock; (ii) each Named
Executive Officer of the Company; (iii) each director of the Company; (iv) the
Selling Shareholder and (v) all of the Company's directors and executive
officers as a group. Each shareholder possesses sole voting and investment power
with respect to the shares listed, unless otherwise noted.

<TABLE>
<CAPTION>
CLASS B
CLASS A COMMON STOCK(1) COMMON STOCK(2)
--------------------------------------------------------- -------------------------------------
PERCENT OF CLASS NUMBER OF PERCENT OF
SHARES ---------------------- SHARES CLASS
NAME OF BEFORE BEING AFTER BEFORE AFTER AFTER AFTER
BENEFICIAL OWNER OFFERING OFFERED OFFERING(3) OFFERING OFFERING(3) OFFERING(3) OFFERING(3)
- ----------------------- -------- ------- ----------- -------- ----------- ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Joseph M. Field (4)....
David J. Field (4).....
John C. Donlevie.......
Stephen F. Fisher......
Herbert Kean, M.D. ....
S. Gordon Elkins.......
Thomas H. Ginley,
M.D. ................
Lee Hague..............
Marie H. Field(4)......
Michael R. Hannon(5)...
Nancy E. Field(4)......
Chase Equity
Associates, L.P.(5)
380 Madison Avenue
New York, NY 10017....
All directors, and
executive officers,
as a group (
persons).............

PERCENT OF PERCENT OF
NAME OF TOTAL ECONOMIC TOTAL VOTING
BENEFICIAL OWNER INTEREST POWER
- ----------------------- -------------- ------------
<S> <C> <C>
Joseph M. Field (4)....
David J. Field (4).....
John C. Donlevie.......
Stephen F. Fisher......
Herbert Kean, M.D. ....
S. Gordon Elkins.......
Thomas H. Ginley,
M.D. ................
Lee Hague..............
Marie H. Field(4)......
Michael R. Hannon(5)...
Nancy E. Field(4)......
Chase Equity
Associates, L.P.(5)
380 Madison Avenue
New York, NY 10017....
All directors, and
executive officers,
as a group (
persons).............
</TABLE>

- ---------------
* Less than one percent.

(1) The number of shares of Class A Common Stock does not include the shares of
Class A Common Stock issuable upon conversion of the outstanding shares of
Class B Common Stock.

(2) The holders of the Class B Common Stock are entitled to vote with the
holders of the Class A Common Stock on all matters submitted to a vote of
shareholders of the Company, except with respect to the election of Class A
Directors and as otherwise required by law. Each share of Class B Common
Stock that is voted by Joseph M. Field and David J. Field is entitled to ten
votes per share on all matters submitted to a vote of shareholders, except
certain "going private" transactions or as otherwise required by law. The
shares of Class B Common Stock are convertible in whole or in part, at the
option of the holder or holders thereof, subject to certain conditions, into
the same number of shares of Class A Common Stock. See "Description of
Capital Stock."

(3) Shares beneficially owned and percentage ownership are based on
shares of Class A Common Stock and shares of Class B Common Stock
outstanding after the Offering.

(4) The address of these shareholders is 401 City Avenue, Suite 409, Bala
Cynwyd, Pennsylvania 19004.

(5) The amounts shown consist of shares held of record by Chase Equity
Associates, L.P. to be received upon the Chase Conversion. Michael Hannon is
a general partner of Chase Capital, which is an affiliate of Chase Equity
Associates, L.P. Mr. Hannon exercises shared investment and voting power
with respect to such shares, but disclaims beneficial ownership of such
shares.

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<PAGE> 72

DESCRIPTION OF CAPITAL STOCK

The following description of the capital stock of the Company gives effect
to the Recapitalization and the Chase Conversion, which will occur immediately
prior to the Offering, and to the proposed sale of shares of Class A
Common Stock in the Offering. The Company's authorized capital stock consists of
(i) 200,000,000 shares of Class A Common Stock, of which shares are
issued and outstanding; (ii) 75,000,000 shares of Class B Common Stock, of which
shares are issued and outstanding; (iii) 50,000,000 shares of Class C
Common Stock, none of which are issued or outstanding; and (iv) 25,000,000
shares of preferred stock, none of which are issued or outstanding. In addition,
the Company has reserved for issuance shares of Class A Common Stock
under the 1998 Equity Compensation Plan. See "Management -- 1998 Equity
Compensation Plan."

The following summary description of the capital stock of the Company does
not purport to be complete and is subject to the detailed provisions of, and
qualified in its entirety by reference to, the Company's Amended and Restated
Articles of Incorporation and Amended and Restated Bylaws, copies of which have
been filed as exhibits to the registration statement of which this Prospectus
forms a part, and to the applicable provisions of the Pennsylvania Business
Corporation Law of 1988 (the "PBCL").

Common Stock

The rights of holders of the Common Stock are identical in all respects,
except as discussed below. All the outstanding shares of Class A Common Stock
and Class B Common Stock and the shares of Class A Common Stock sold in the
Offering will be, upon issuance and payment of the purchase price therefor,
validly issued, fully paid and nonassessable.

Dividends. Subject to the right of the holders of any class of preferred
stock, holders of shares of Common Stock are entitled to receive such dividends
as may be declared by the Company's Board of Directors out of funds legally
available for such purpose. No dividend may be declared or paid in cash or
property on any share of any class of Common Stock unless simultaneously the
same dividend is declared or paid on each share of that and every other class of
Common Stock; provided that, in the event of stock dividends, holders of a
specific class of Common Stock shall be entitled to receive only additional
shares of such class.

Voting Rights. The Class A Common Stock and the Class B Common Stock vote
together as a single class on all matters submitted to a vote of shareholders,
with each share of Class A Common Stock entitling the holder thereof to one vote
and each share of Class B Common Stock entitling the holder thereof to ten
votes, except that (i) beginning with the Company's first annual meeting
following the Offering, the holders of Class A Common Stock, voting as a
separate class, shall be entitled to elect two Class A Directors, (ii) with
respect to a Going Private Transaction (defined as a "Rule 13e-3 transaction"
under the Exchange Act), each share of Class A Common Stock and Class B Common
Stock shall be entitled to one vote, (iii) any share of Class B Common Stock
shall only be entitled to ten votes if it is voted by either Joseph M. Field, or
David J. Field, in their own right or pursuant to a proxy and (iv) as otherwise
required by law. The Class C Common Stock has no voting rights except as
otherwise required by law.

The first two Class A Directors will be appointed by the Company's Board of
Directors as soon as practicable after the consummation of the Offering and will
serve until the Company's next annual meeting of shareholders, when the holders
of the Class A Common Stock will elect the Class A Directors. The Class A
Directors serve one-year terms and must be "independent directors." For this
purpose, an "independent director" means a person who is not an officer or
employee of the Company or its subsidiaries, and who does not have a
relationship which, in the opinion of the Board of Directors, would interfere
with the exercise of independent judgment in carrying out the responsibilities
of a director. Holders of Common Stock are not entitled to cumulate votes in the
election of directors.

Liquidation Rights. Upon liquidation, dissolution or winding-up of the
Company, the holders of the Common Stock are entitled to share ratably in all
assets available for distribution after payment in full of creditors and holders
of the preferred stock of the Company, if any.

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<PAGE> 73

Conversion of Class A Common Stock. Shares of Class A Common Stock owned
by a Regulated Entity (defined as either an entity that is a "bank holding
company" under the Bank Holding Company Act of 1956 (the "BHC Act") or a
non-bank subsidiary of such an entity, or an entity that, pursuant to Section
8(a) of the International Banking Act of 1978, as amended, is subject to the
provisions of the BHC Act, or any non-bank subsidiary of such an entity), are
convertible at any time, at the option of the holder thereof, into an equal
number of fully paid and non-assessable shares of Class C Common Stock. All
conversion rights of Class A Common Stock are subject to any necessary FCC
approval.

Conversion, Transferability of Class B Common Stock. Shares of Class B
Common Stock are convertible at any time, at the option of the holder thereof,
into an equal number of fully paid and non-assessable shares of Class A Common
Stock. All conversion rights of Class B Common Stock are subject to any
necessary FCC approval. Shares of Class B Common Stock transferred to a party
other than a Field Shareholder are automatically converted into an equal number
of fully paid and non-assessable shares of Class A Common Stock.

Conversion, Transferability of Class C Common Stock. Shares of Class C
Common Stock are convertible at any time, at the option of the holder thereof,
into an equal number of fully paid and non-assessable shares of Class A Common
Stock. All conversion rights of Class C Common Stock are subject to any
necessary FCC approval. Shares of Class C Common Stock transferred to a party
other than a Regulated Entity are automatically converted into an equal number
of fully paid and non-assessable shares of Class A Common Stock. Shares of Class
C Common Stock may be transferred by a Regulated Entity under a limited set of
circumstances.

Other Provisions. The holders of Common Stock are not entitled to
preemptive or similar rights.

Preferred Stock

The Company is authorized to issue 25,000,000 shares of preferred stock,
par value $.01 per share. The Board of Directors of the Company, in its sole
discretion, may designate and issue one or more series of preferred stock from
the authorized and unissued shares of preferred stock. Subject to limitations
imposed by law or the Amended and Restated Articles of Incorporation of the
Company, the Board of Directors is empowered to determine the designation of and
the number of shares constituting a series of preferred stock, the dividend
rate, if any, for the series, the terms and conditions of any voting and
conversion rights for the series, if any, the number of directors, if any, which
the series shall be entitled to elect, the amounts payable on the series upon
the liquidation, dissolution or winding-up of the Company, the redemption prices
and terms applicable to the series, if any, and the preferences and relative
rights among the series of preferred stock. Such rights, preferences, privileges
and limitations of preferred stock could adversely affect the rights of holders
of Common Stock. There are currently no shares of preferred stock outstanding.

FOREIGN OWNERSHIP

The Amended and Restated Articles of Incorporation of the Company restrict
the ownership, voting and transfer of the Company's capital stock, including the
Common Stock, in accordance with the Communications Act and the rules of the
FCC, which prohibit the issuance of more than 25% of the Company's outstanding
capital stock (or more than 25% of the voting rights it represents) to or for
the account of Aliens or corporations otherwise subject to domination or control
by Aliens. The Company's Amended and Restated Articles of Incorporation prohibit
any transfer of the Company's capital stock that would cause a violation of this
prohibition. In addition, the Amended and Restated Articles authorize the Board
of Directors of the Company to take action to enforce these prohibitions,
including requiring redemptions of Common Stock and placing a legend regarding
restrictions on foreign ownership on the certificates representing the Common
Stock. See "Business -- Federal Regulation of Radio Broadcasting -- Ownership
Matters."

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CERTAIN PROVISIONS OF THE AMENDED AND RESTATED ARTICLES OF INCORPORATION AND
AMENDED AND RESTATED BYLAWS OF THE COMPANY

The Company's Amended and Restated Articles of Incorporation and Amended
and Restated Bylaws include certain provisions that could have an anti-takeover
effect. These provisions are intended to preserve the continuity and stability
of the Board of Directors and the policies formulated by the Board of Directors.
These provisions are also intended to help ensure that the Board of Directors,
if confronted by a surprise proposal from a third party which has acquired a
block of stock of the Company, will have sufficient time to review the proposal,
to consider appropriate alternatives to the proposal and to act in what it
believes to be the best interests of the shareholders.

The following is a summary of the provisions included in the Amended and
Restated Articles of Incorporation and is qualified in its entirety by reference
to such documents, copies of which will be filed as exhibits to the Registration
Statement, of which this Prospectus forms a part. The Board of Directors has no
current plans to formulate or effect additional measures that could have an
anti-takeover effect.

Exculpation. The Amended and Restated Articles of Incorporation of the
Company provide that a director or officer of the Corporation shall not be
personally liable for monetary damages as such (including, without limitation,
any judgment, amount paid in settlement, penalty, punitive damages or expense of
any nature (including, without limitation, attorneys' fees and disbursements))
for any action taken, or any failure to take any action, unless (i) the director
has breached or failed to perform the duties of his or her office under the
Amended and Restated Articles of Incorporation of the Company, the Amended and
Restated Bylaws of the Company or applicable provisions of law and (ii) the
breach or failure to perform constitutes self-dealing, willful misconduct or
recklessness.

Indemnification. The Amended and Restated Articles of Incorporation of the
Company provide that, to the fullest extent permitted by the PBCL, the Company
will indemnify any person who was, is, or is threatened to be made, a party to a
proceeding by reason of the fact that he or she (i) is or was a director or
officer of the Company or (ii) while a director or officer of the Company, is or
was serving at the request of the Company as a director, officer, partner,
venturer, proprietor, trustee, employee, agent, or similar functionary of
another foreign or domestic corporation, partnership, joint venture, sole
proprietorship, trust, employee benefit plan or other enterprise.

Blank Check Preferred Stock. The Company's Amended and Restated Articles
of Incorporation will provide that the Board of Directors of the Company may
authorize the issuance of up to 25,000,000 shares of preferred stock in one or
more classes or series and may designate the dividend rate, voting rights and
other rights, preferences and restrictions of each such class or series. The
Board of Directors of the Company has no present intention to issue any
preferred stock; however, the Board of Directors of the Company has the
authority, without further shareholder approval, to issue one or more series of
preferred stock that could, depending on the terms of such series, either impede
or facilitate the completion of a merger, tender offer or other takeover
attempt. Although the Board of Directors of the Company is required to make any
determination to issue such stock based on its judgment as to the best interests
of the shareholders of the Company, the Board of Directors of the Company could
act in a manner that would discourage an acquisition attempt or other
transaction that some, or a majority, of the shareholders might believe to be in
their best interests or in which shareholders might receive a premium for their
stock over the then market price of such stock. The Board of Directors of the
Company does not intend to seek shareholder approval prior to any issuance of
such stock, unless otherwise required by law.

PENNSYLVANIA CONTROL-SHARE ACQUISITIONS LAW

Generally, subchapters 25E, F, G, H, I and J of the PBCL place certain
procedural requirements and establish certain restrictions upon the acquisition
of voting shares of a corporation which would entitle the acquiring person to
cast or direct the casting of a certain percentage of votes in an election of
directors. Subchapter 25E of the PBCL provides generally that, if the Company
were involved in a "control transaction," shareholders of the Company would have
the right to demand from a "controlling person or group" payment of the fair
value of their shares. For purposes of subchapter 25E, a "controlling person or
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<PAGE> 75

group" is a person or group of persons acting in concert that, through voting
shares, has voting power over at least 20% of the votes which shareholders of
the Company would be entitled to cast in the election of directors. A control
transaction arises, in general, when a person or group acquires the status of a
controlling person or group.

In general, Subchapter 25F of the PBCL delays for five years and imposes
conditions upon "business combinations" between an "interested shareholder" and
the Company. The term "business combination" is defined broadly to include
various merger, consolidation, division, exchange or sale transactions,
including transactions utilizing the Company's assets for purchase price
amortization or refinancing purposes. An "interested shareholder," in general,
would be a beneficial owner of at least 20% of the Company's voting shares.

In general, Subchapter 25G of the PBCL suspends the voting rights of the
"control shares" of a shareholder that acquires for the first time 20% or more,
33 1/3% or more or 50% or more of the Company's shares entitled to be voted in
an election of directors. The voting rights of the control shares generally
remain suspended until such time as the "disinterested" shareholders of the
Company vote to restore the voting power of the acquiring shareholder.

Subchapter 25H of the PBCL provides in certain circumstances for the
recovery by the Company of profits made upon the sale of its common stock by a
"controlling person or group" if the sale occurs within 18 months after the
controlling person or group became such and the common stock was acquired during
such 18 month period or within 24 months prior thereto. In general, for purposes
of Subchapter 25H, a "controlling person or group" is a person or group that (i)
has acquired, (ii) offered to acquire or (iii) publicly disclosed or caused to
be disclosed an intention to acquire voting power over shares that would entitle
such person or group to cast at least 20% of the votes that shareholders of the
Company would be entitled to cast in the election of directors.

If the disinterested shareholders of the Company vote to restore the voting
power of a shareholder who acquires control shares subject to Subchapter 25G,
the Company would then be subject to subchapters 25I and J of the PBCL.
Subchapter 25I generally provides for a minimum severance payment to certain
employees terminated within two years of such approval. Subchapter 25J, in
general, prohibits the abrogation of certain labor contracts prior to their
stated date of expiration.

The foregoing descriptions of certain subchapters of the PBCL do not
purport to be complete.

TRANSFER AGENT AND REGISTRAR

The Transfer Agent and Registrar for the Common Stock is First Union
National Bank.

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<PAGE> 76

SHARES ELIGIBLE FOR FUTURE SALE

Prior to the Offering, there has been no public market for the Class A
Common Stock of the Company. The sale, or availability for sale, of substantial
amounts of Class A Common Stock in the public market subsequent to the Offering,
could adversely affect the prevailing market price of the shares of Class A
Common Stock and could impair the Company's ability to raise additional capital
through the sale of equity securities.

Upon completion of the Offering, the Company will have outstanding
shares of Class A Common Stock and shares of Class B Common
Stock. Of these outstanding shares, the shares of Class A Common Stock
sold in the Offering will be freely transferable without restriction under the
Securities Act, except for any such shares purchased by an "affiliate" (as
defined in Rule 144 under the Securities Act) of the Company, which shares may
generally only be sold in compliance with the limitations of Rule 144 described
below. The remaining shares of Class A Common Stock and all of Class B
Common Stock will be "restricted securities" for purposes of Rule 144 and may
not be resold unless registered under the Securities Act or sold pursuant to an
applicable exemption thereunder, including the exemption contained in Rule 144.

The number of shares of Common Stock available for sale in the public
market is limited by restrictions under the Securities Act and lock-up
agreements under which all of the holders of such shares have agreed not to sell
or otherwise dispose of their shares during the Lock-Up Period without the prior
written consent of Credit Suisse First Boston Corporation. Because of these
restrictions, on the date of this Prospectus, no shares other than those offered
hereby will be eligible for sale. Upon expiration of the Lock-Up Period, all of
the restricted securities will be eligible for sale in the public market,
subject to compliance with the manner-of-sale, volume and other limitations of
Rule 144.

In general, under Rule 144, as currently in effect, a shareholder (or
shareholders whose shares are aggregated) who has beneficially owned restricted
securities for at least one year (including persons who may be deemed
"affiliates" of the Company under Rule 144) is entitled to sell a number of
shares within any three-month period that does not exceed the greater of 1% of
the then outstanding shares of the class of Common Stock or the average weekly
trading volume of such stock during the four calendar weeks preceding such sale,
subject to certain manner of sale limitations. A shareholder who is deemed not
to have been an affiliate of the Company for at least three months prior to the
date of sale and who has beneficially owned restricted securities for at least
two years would be entitled to sell such shares under Rule 144 without regard to
the volume or manner of sale limitations described above.

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<PAGE> 77

UNDERWRITING

Under the terms and subject to the conditions contained in an Underwriting
Agreement dated , 1999 (the "Underwriting Agreement"), the
underwriters named below (the "Underwriters"), for whom Credit Suisse First
Boston Corporation, BT Alex. Brown Incorporated, Goldman, Sachs & Co. and Morgan
Stanley & Co. Incorporated, acting as representatives (the "Representatives"),
have severally but not jointly agreed to purchase from the Company and the
Selling Shareholder the following respective numbers of shares of Class A Common
Stock:

<TABLE>
<CAPTION>
NUMBER
UNDERWRITER OF SHARES
----------- ---------
<S> <C>
Credit Suisse First Boston Corporation......................
BT Alex. Brown Incorporated.................................
Goldman, Sachs & Co. .......................................
Morgan Stanley & Co. Incorporated...........................

-------
Total.............................................
=======
</TABLE>

The Underwriting Agreement provides that the obligations of the
Underwriters are subject to certain conditions precedent and that the
Underwriters will be obligated to purchase all of the shares of Class A Common
Stock offered hereby (other than those shares covered by the over-allotment
option described below) if any are purchased. The Underwriting Agreement
provides that, in the event of a default by an Underwriter, in certain
circumstances the purchase commitments of non-defaulting Underwriters may be
increased or the Underwriting Agreement may be terminated.

The Company and the Selling Shareholder have granted to the Underwriters an
option, expiring at the close of business on the 30th day after the date of this
Prospectus, to purchase up to additional shares from the Company
and additional outstanding shares from the Selling Shareholder at the
initial public offering price less the underwriting discounts and commissions,
all as set forth on the cover page of this Prospectus. Such option may be
exercised only to cover over-allotments in the sale of the shares of Class A
Common Stock. To the extent such option is exercised, each Underwriter will
become obligated, subject to certain conditions, to purchase approximately the
same percentage of such additional shares of Class A Common Stock as it was
obligated to purchase pursuant to the Underwriting Agreement.

The Company and the Selling Shareholder have been advised by the
Representatives that the Underwriters propose to offer the shares of Class A
Common Stock to the public initially at the public offering price set forth on
the cover page of this Prospectus and, through the Representatives, to certain
dealers at such price less a concession of $ per share of Class A Common
Stock, and the Underwriters and such dealers may allow a discount of $
per share of Class A Common Stock on sales to certain other dealers. After the
initial public offering, the public offering price and concession and discount
to dealers may be changed by the Representatives.

The Representatives have informed the Company that they do not expect
discretionary sales by the Underwriters to exceed 5% of the shares of Class A
Common Stock being offered hereby.

The Company has agreed that it will not offer, sell, contract to sell,
announce its intention to sell, pledge or otherwise dispose of, directly or
indirectly, or file with the Commission a registration statement under the
Securities Act relating to, any additional shares of its Class A Common Stock or
securities convertible into or exchangeable or exercisable for any shares of
capital stock of the Company without the prior written consent of Credit Suisse
First Boston Corporation for a period of 180 days after the date of this
Prospectus (the "Lock-Up Period"), except (i) pursuant to or in connection with
employee stock option plans or other

75
<PAGE> 78

employee or non-employee director or key advisor compensation arrangements or
agreements, in each case in effect on the date of this Prospectus, and (ii) in
connection with the conversion of shares of Class A Common Stock, Class B Common
Stock or Class C Common Stock solely into another class of Common Stock. Each of
the Company's officers, directors, the Selling Shareholder and other
shareholders have agreed not to sell, offer, or otherwise dispose of any shares
of Common Stock or securities convertible into or exchangeable or exercisable
for Common Stock, except for the conversion of the Class A Common Stock, Class B
Common Stock and Class C Common Stock solely into shares of another class of
Common Stock, without the prior written consent of Credit Suisse First Boston
Corporation during the Lock-Up Period, except for certain limited exceptions.

The Underwriters have reserved for sale, at the initial public offering
price up to shares of the Class A Common Stock for employees,
directors and certain other persons associated with the Company or with its
officers or directors, who have expressed an interest in purchasing such shares
of Class A Common Stock in the Offering. The number of shares available for sale
to the general public in the Offering will be reduced to the extent such persons
purchase such reserved shares. Any reserved shares not so purchased will be
offered by the Underwriters to the general public on the same terms as the other
shares offered hereby.

The Company and the Selling Shareholder have agreed to indemnify the
Underwriters against certain liabilities, including civil liabilities under the
Securities Act, or contribute to payments which the Underwriters may be required
to make in respect thereof.

The shares of Class A Common Stock have been approved for listing on the
New York Stock Exchange, subject to official notice of issuance. In connection
with the listing of the Class A Common Stock on The New York Stock Exchange, the
Underwriters will undertake to sell round lots of 100 shares or more to a
minimum of 2,000 beneficial owners.

Prior to this Offering, there has been no public market for the Class A
Common Stock. Accordingly, the initial public offering price for the Class A
Common Stock will be determined by negotiations between the Company and the
Representatives. Among the factors considered in determining the initial public
offering price will be the history of, and the prospects for, the Company's
business and the industry in which it competes, an assessment of the Company's
management, its past and present operations, its past and present earnings and
the trend of such earnings, the prospects for earnings of the Company, the
present state of the Company's development, the general condition of the
securities markets at the time of the Offering and the market prices and the
earnings of similar securities of comparable companies at the time of the
Offering.

The Representatives, on behalf of the Underwriters, may engage in
over-allotment, stabilizing transactions, syndicate covering transactions and
penalty bids in accordance with Regulation M under the Exchange Act.
Over-allotment involves syndicate sales in excess of the offering size, which
creates a syndicate short position. Stabilizing transactions permit bids to
purchase the underlying security so long as the stabilizing bids do not exceed a
specified maximum. Syndicate covering transactions involve purchases of the
Class A Common Stock in the open market after the distribution has been
completed in order to cover syndicate short positions. Penalty bids permit the
Representatives to reclaim a selling concession from a syndicate member when the
shares of Class A Common Stock originally sold by such syndicate member are
purchased in a syndicate covering transaction to cover syndicate short
positions. Such stabilizing transactions, syndicate covering transactions and
penalty bids may cause the price of the Class A Common Stock to be higher than
it would otherwise be in the absence of such transactions. These transactions
may be effected on the New York Stock Exchange or otherwise and, if commenced,
may be discontinued at any time.

NOTICE TO CANADIAN RESIDENTS

RESALE RESTRICTIONS

The distribution of the shares of Class A Common Stock in Canada is being
made only on a private placement basis exempt from the requirement that the
Company and the Selling Shareholder prepare and file a prospectus with the
securities regulatory authorities in each province where trades of shares of
Class A

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<PAGE> 79

Common Stock are effected. Accordingly, any resale of the shares of Class A
Common Stock in Canada must be made in accordance with applicable securities
laws which will vary depending on the relevant jurisdiction, and which may
require resales to be made in accordance with available statutory exemptions or
pursuant to a discretionary exemption granted by the applicable Canadian
securities regulatory authority. Purchasers are advised to seek legal advice
prior to any resale of the shares of Class A Common Stock.

REPRESENTATIONS OF PURCHASERS

Each purchaser of shares of Class A Common Stock in Canada who receives a
purchase confirmation will be deemed to represent to the Company, the Selling
Shareholder and the dealer from whom such purchase confirmation is received that
(i) such purchaser is entitled under applicable provincial securities laws to
purchase such shares of Class A Common Stock without the benefit of a prospectus
qualified under such securities laws, (ii) where required by law, that such
purchaser is purchasing as principal and not as agent and (iii) such purchaser
has reviewed the text above under "Resale Restrictions."

RIGHTS OF ACTION (ONTARIO PURCHASERS)

The securities being offered are those of a foreign issuer and Ontario
purchasers will not receive the contractual right of action prescribed by
section 32 of the Regulations under the Securities Act (Ontario). As a result,
Ontario purchasers must rely on other remedies that may be available, including
common law rights of action for damages or rescission or rights of action under
the civil liability provisions of the U.S. federal securities laws.

ENFORCEMENT OF LEGAL RIGHTS

All of the issuer's directors and officers as well as the experts named
herein and the Selling Shareholder may be located outside of Canada and, as a
result, it may not be possible for Canadian purchasers to effect service of
process within Canada upon the issuer or such persons. All or a substantial
portion of the assets of the issuer and such persons may be located outside of
Canada and, as a result, it may not be possible to satisfy a judgment against
the issuer or such persons in Canada or to enforce a judgment obtained in
Canadian courts against such issuer or persons outside of Canada.

NOTICE TO BRITISH COLUMBIA RESIDENTS

A purchaser of shares of Class A Common Stock to whom the Securities Act
(British Columbia) applies is advised that such purchaser is required to file
with the British Columbia Securities Commission a report within ten days of the
sale of any shares of Class A Common Stock acquired by such purchaser pursuant
to this offering. Such report must be in the form attached to British Columbia
Securities Commission Blanket Order (BOR) #95/17, a copy of which may be
obtained from the Company. Only one such report must be filed in respect of
Class A Common Stock acquired on the same date and under the same prospectus
exemption.

TAXATION AND ELIGIBILITY FOR INVESTMENT

Canadian purchasers of shares of Class A Common Stock should consult their
own legal and tax advisers with respect to the tax consequences of an investment
in the shares of Class A Common Stock in their particular circumstances and with
respect to the eligibility of the shares of Class A Common Stock for investment
by the purchaser under relevant Canadian Legislation.

LEGAL MATTERS

The validity of the shares of Common Stock offered hereby will be passed
upon for the Company by Morgan, Lewis & Bockius LLP, Philadelphia, Pennsylvania.
Certain legal matters will be passed upon for the Underwriters by Weil, Gotshal
& Manges LLP, Dallas, Texas and New York, New York.

EXPERTS

The financial statements of Entercom Communications Corp. as of September
30, 1997 and 1998 and for each of the three years in the period ended September
30, 1998 included in this Prospectus and the related

77
<PAGE> 80

financial statement schedule included elsewhere in the registration statement
have been audited by Deloitte & Touche LLP, independent auditors, as stated in
their reports appearing herein and elsewhere in the registration statement, and
have been so included in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.

The combined financial statements of KMBZ-AM, KLTH-FM, KCMO-AM/FM,
KIRO-AM/FM, KNWX-AM and KING-FM for each of the three years in the period ended
December 31, 1996 included in this Prospectus have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their report appearing herein,
and have been so included in reliance upon the report of such firm given upon
their authority as experts in accounting and auditing.

The combined financial statements of the Sacramento Station Group for the
period January 1, 1996 to September 18, 1996 and for the period September 19,
1996 to December 31, 1996 included in this Prospectus have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report appearing
herein, and have been so included in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.

The combined financial statements of KBSG, Inc. and KNDD, Inc. for the year
ended December 31, 1995 included in this Prospectus have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report appearing
herein, and have been so included in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.

The combined financial statements of the Portland, Oregon and Rochester,
New York Radio Groups of Heritage Media Services, Inc. - Broadcasting Segment as
of December 31, 1997 and for the eight month period ended August 31, 1997 and
the four month period ended December 31, 1997 included in this Prospectus have
been audited by Arthur Andersen LLP, independent public accountants, as stated
in their report appearing herein, and have been so included in reliance upon the
report of such firm given upon their authority as experts in accounting and
auditing.

The combined financial statements of the Boston Radio Market of CBS Radio,
Inc. for the year ended December 31, 1997 included in this Prospectus have been
audited by Deloitte & Touche LLP, independent auditors, as stated in their
report appearing herein, and have been so included in reliance upon the report
of such firm given upon their authority as experts in accounting and auditing.

ADDITIONAL INFORMATION

The Company has filed with the Commission a Registration Statement on Form
S-1 (the "Registration Statement") under the Securities Act and the rules and
regulations promulgated thereunder, covering the Common Stock offered hereby.
This Prospectus omits certain information contained in the Registration
Statement, and reference is made to the Registration Statement, and the exhibits
and schedules thereto for further information with respect to the Company and
the Common Stock offered hereby. Statements contained in this Prospectus as to
the contents of any contract, agreement or other document filed as an exhibit to
the Registration Statement are not necessarily complete, and in each instance,
reference is made to the exhibit for a more complete description of the matter
involved, each such statement being qualified in its entirety by such reference.
The Registration Statement may be inspected and copied at the public reference
facilities maintained by the Commission at Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the regional offices of the Commission
maintained at 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and
Seven World Trade Center, Suite 1300, New York, New York 10048. Copies of such
materials may be obtained from the Public Reference Section of the Commission,
Room 10124, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. In addition, registration statements and certain other filings
made with the Commission through its Electronic Data Gathering, Analysis and
Retrieval ("EDGAR") system are publicly available through the Commission's site
on the Internet's World Wide Web, located at http://www.sec.gov. The
Registration Statement, including all exhibits thereto and amendments thereof,
has been filed with the Commission through EDGAR.

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December 7, 1998

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Attention: Edward M. Kelly
Senior Counsel

Re: ENTERCOM COMMUNICATIONS CORP.
AMENDMENT NO. 2 TO THE REGISTRATION STATEMENT ON FORM S-1
FILED NOVEMBER 4, 1998
FILE NO. 333-61381

Dear Mr. Kelly:

On behalf of Entercom Communications Corp., a Pennsylvania corporation (the
"Company"), we are responding to the comments of the Staff (the "Staff") of the
Securities and Exchange Commission (the "Commission") as set forth in the
letter, dated November 20, 1998, to Mr. Joseph M. Field with respect to the
Company's Amendment No. 1 to the Registration Statement on Form S-1 (File No.
333-61381)(the "Registration Statement") dated November 4, 1998, of which the
Prospectus (the "Prospectus") is a part.

Where indicated below, requested changes will be included in Amendment No. 2 to
the Registration Statement ("Amendment No. 2"), which is being filed
contemporaneously with this response. Under separate cover, the Company will
provide the Staff with black-lined courtesy copies of Amendment No. 2, in which
revisions will be marked to reference the Staff's corresponding comment.

The responses and supplementary information set forth below have been numbered
to correspond to the comments as numbered on the attached copy of your letter.

<PAGE> 82

Securities and Exchange Commission
December 7, 1998
Page 2

CERTAIN DEFINITIONS, PAGE 2

1 Once the Company has determined the amount of the stock split, the Company
will revise the Registration Statement to include all information which is
available to the Company, except information that may be omitted pursuant
to Rule 430A. With respect to the Staff's comment concerning the
retroactive effect to the stock split in the Recapitalization, once the
stock split has been adopted by the Board of Directors, the Company will
provide such disclosure by way of subsequent amendment to the Registration
Statement.

UNAUDITED PRO FORMA FINANCIAL INFORMATION, PAGES 26 THROUGH 38

2 Once the stock split has been adopted by the Board of Directors, the
Company will provide such disclosure by way of subsequent amendment to the
Registration Statement.

3 Note(B) of the Pro Forma Financial Statements has been expanded to
disclose the amortization period. In addition, the requested disclosure
regarding the CBS payment has been added to Note B. Note(M) reflects the
allocation of the purchase price to the liability assumed for those loss
contracts.

4 The pro forma balance sheet presentation [on page F-5] has been revised to
reflect the total distribution to be made to the S-Corporation
shareholders. [TO BE EXPANDED BY D&T]

5 Note(B) has been revised and expanded to include the requested
information. Supplementally, the Company wishes to advise the Commission
that FCC licenses represent over 99% of the balance of intangibles in the
Company's consolidated balance sheet as of September 30, 1998. FCC
licenses are generally granted for a period of eight years and although
the approval of future renewal applications cannot be guaranteed, it is
rare for the FCC to deny future license renewal application. Further the
Company has not experienced any such denials. Accordingly, the Company
amortizes these assets over 40 years, a period prevalent in the radio
broadcasting industry to coincide with the effective long-term nature of
these assets.

Under the Company's accounting policies, all intangibles are amortized
over a 40-year period. However, intangibles other than FCC licenses are
not material.

<PAGE> 83

Securities and Exchange Commission
December 7, 1998
Page 3

Please refer to the Company's Consolidated Financial Statements, Note (2)
Summary of Significant Accounting Policies - Long Lived Assets, for a
discussion of the Company's methodology for evaluating the recoverability
its long-lived assets.

6 The gain referred to in this comment related to the pro forma statement of
income for fiscal 1997. This statement is no longer presented. The gain on
the Vancouver license rights has been eliminated from the pro forma
statement of income for fiscal 1998. No other gains or losses are affected
by any of the transactions included in this filing.

7 Note (AD) was unintentionally omitted from Amendment No. 1. It has been
included in Amendment No. 2 as Note (W).

8 The independent appraisal of the radio stations acquired in the Bonneville
and KIRO acquisitions will be delivered to the Staff under separate cover.
Supplementally, the Company informs the Commission that KLDE-FM was
acquired in 1969.

Management's Discussion and Analysis, pages 41 through 48

General, page 41

9 The revision in the "General" section has been made as requested.

Results of Operations, page 42

10 The disclosure included under the title "Results of Operations" has been
modified to discuss the Company's pro forma income (loss) after
extraordinary items, including a discussion of the historical extraordinary
items. In addition the Company has deleted the discussion presented under
"pro forma income before extraordinary items" and replaced it with a
discussion of historical income before taxes for each of the required
periods. [this has not yet been done]

Liquidity and Capital Resources, page 45

11 The last paragraph under "Liquidity and Capital Resources" that contains
the discussion of Rate Hedging Transactions has been modified to disclose
the date the swaps expire or terminate. In addition the disclosure has been
modified to include a discussion of the

<PAGE> 84

Securities and Exchange Commission
December 7, 1998
Page 4

difference between a "convertible rate cap" and "interest rate swap. [THIS
LAST PART HAS NOT YET BEEN DONE]

Impact of Year 2000 Issues, page 47

12 The Company's Year 2000 disclosure has been revised to disclose: (i) the
date by which the Company expects to be Year 2000 compliant, (ii) the costs
incurred by the Company due to Year 2000 Issues as of September 30, 1998,
(iii) the Company's estimated future costs of becoming Year 2000 compliant,
and (iv) the fact that the Company will expense all Year 2000 related costs
as incurred.

Financial Statements -- Entercom Communications Corp., pages F-3 through F-23

Note 6 Debt, page F-16

13 On May 21, 1996, the Company issued the Convertible Subordinated Note (the
"Note") described in Note 6(A)(1) to the Company's consolidated financial
statements. At the time of issuance, the Company had no plans for: (i) a
public offering of its common stock (ii) a sale of substantially all of its
assets, (iii) merger or consolidation with another company or (iv)
termination of its S-Corporation status; as such, the holder was precluded
from exercising the conversion feature. Further, if a change in control had
occurred, it was highly unlikely that the holder of the note would convert
the note to common stock because a 15% investment in the Company was not
worth $25 million at that time. In its negotiations with the lender at the
time of the debt issuance, the Company did not intend to give, and believes
that it did not give, the lender the opportunity to obtain shares of its
common stock at a discount. Since at the date of issuance of the
convertible debt the conversion feature was not "in the money" ("beneficial
conversion feature" per EFTF 0-60), the accounting outlined in EFTF 0-60
was not required.

Note 3, Acquisitions and Other Significant Transactions, page F-12

14 All of the "Completed Transactions" discussed on pages 24 and 25 are
disclosed in Note 3 to the consolidated financial statements.

In each of the Kanza and Sacramento transactions the Company exchanged its
broadcast frequencies and transmission facilities for similar assets. In
both cases, it retained its call

<PAGE> 85

Securities and Exchange Commission
December 7, 1998
Page 5

letter, formats, studio facilities and work force which represent the core
businesses. The transfers involved operating assets, as that term is used
in EITP 98-3, which are similar productive assets, not businesses, and the
transactions do not result in the culmination of an earnings process.
Accordingly, the Company believes that the assets exchanged meet the
criteria of APB No. 29, paragraph 21.b., and as such, should be accounted
for at the recorded amount of the assets relinquished (plus the amount of
monetary consideration paid in the Sacramento transaction).

The discussion on page 25 related to the Sacramento Frequency Exchange has
been modified to disclose the amounts involved.

Financial Statements - Boston Radio Market, pages F-56 through F-64

General

15 The Company has not yet received the September 30, 1998 financials for the
Boston Radio Market. As soon as the Company receives this information, it
will be filed with the Commission by way of a subsequent amendment. The
requested modifications, including information on the changes in equity
will be included in the financial statements for September 30, 1998.

Note 1. Summary of Significant Accounting Policies. Page F-60

Intangible Assets

16 The disclosure included under the title "Intangible Assets" has been
modified as requested to disclose which intangible assets are amortized
over 1 year, 40 years and other. [THIS HAS NOT YET BEEN DONE]

Exhibit 27.01 Financial Data Schedule

17 Amendment 2 includes the Financial Data Schedule for the Company's most
recent fiscal year end, September 30, 1998.

<PAGE> 86

Securities and Exchange Commission
December 7, 1998
Page 6

Age of Financial Statements

18 The amended filing includes all of the Company's September 30, 1998
financial information as required by Regulation S-X. The Company has not
yet received the September 30, 1998 financials for the Boston Radio Market.
As soon as the Company receives this information, it will be filed with the
Commission by way of a subsequent amendment. See Response to Comment 15.

Accountants' Consents

19 The amended filing includes updated accountants' consents for all of the
financial statement information contained in the Registration Statement.

General

20 As requested, the Company has provided, under separate cover, copies of the
Duncan's Radio Market Guide, 1998 Edition and selected excerpts of the 1998
Summer Arbitron, Radio Market Reports. The graphic art to be included in
the Registration Statement is currently being prepared. The Company will
provide the Staff with copies of the graphic art supplementally when it
becomes available. In addition, the Company will provide the Staff with the
narrative descriptions required by Rule 304 of Regulation S-T by way of
subsequent amendment to the Registration Statement.

If you have any questions with regard to these responses, need further
supplemental information, or would like to discuss any of the matters covered
by this letter, please contact me.

Very truly yours,

James W. McKenzie, Jr.

JWM/avm
enclosures

cc: John C. Donlevie
David J. Field

<PAGE> 87

Securities and Exchange Commission
December 7, 1998
Page 7

Joseph H. Field
Jeremy W. Dickens
Kara L. MacCullough

<PAGE> 88

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ENTERCOM COMMUNICATIONS CORP.
CONSOLIDATED FINANCIAL STATEMENTS
Independent Auditors' Report.............................. F-3
Balance Sheets as of September 30, 1997 and 1998.......... F-4
Statements of Income for the Years Ended September 30,
1996, 1997 and 1998.................................... F-6
Statements of Retained Earnings for the Years Ended
September 30, 1996, 1997 and 1998...................... F-7
Statements of Cash Flows for the Years Ended September 30,
1996, 1997 and 1998.................................... F-8
Notes to the Consolidated Financial Statements for years
ended September 30, 1996, 1997 and 1998................ F-9

THE BONNEVILLE TRANSACTION

KMBZ-AM, KLTH-FM, KCMO-AM/FM, KIRO-AM/FM, KNWX-AM, AND
KING-FM
Independent Auditors' Report........................... F-23
Combined Statements of Operations for the Years Ended
December 31, 1994, 1995 and 1996 and for the Three
Months Ended March 27, 1996 and 1997 (Unaudited)...... F-24
Combined Statements of Cash Flows for the Years Ended
December 31, 1994, 1995 and 1996 and for the Three
Months Ended March 27, 1996 and 1997 (Unaudited)...... F-25
Notes to Combined Statements of Operations and of Cash
Flows................................................. F-26

THE CITICASTERS TRANSACTION

SACRAMENTO STATION GROUP (KSEG-FM AND KRXQ-FM)
Independent Auditors' Report........................... F-30
Combined Statements of Operations for the Periods
January 1, 1996 to September 18, 1996 (Predecessor)
and September 19, 1996 to December 31, 1996 and for
the Five Months Ended May 31, 1996 (Predecessor) and
1997 (Unaudited)...................................... F-31
Combined Statements of Cash flows for the Periods
January 1, 1996 to September 18, 1996 (Predecessor)
and September 19, 1996 to December 31, 1996 and for
the Five Months Ended May 31, 1996 (Predecessor) and
1997 (Unaudited)...................................... F-32
Notes to Combined Financial Statements................. F-33

KBSG, INC. AND KNDD, INC. (KBSG-FM AND KNDD-FM)
Independent Auditors' Report.............................. F-35
Combined Statements of Income for the Year Ended December
31, 1995 and for the Seven-Month Periods Ended July 31,
1995 and 1996 (Unaudited).............................. F-36
Combined Statements of Cash Flows for the Year Ended
December 31, 1995 and for the Seven-Month Periods Ended
July 31, 1995 and 1996 (Unaudited)..................... F-37
Notes to Combined Financial Statements.................... F-38
</TABLE>

F-1
<PAGE> 89

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
THE SINCLAIR TRANSACTION

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING
SEGMENT
Report of Independent Public Accountants............... F-41
Combined Balance Sheet as of December 31, 1997......... F-42
Combined Statements of Operations for the Eight-Month
Period Ended August 31, 1997 (Predecessor) and for the
Four-Month Period Ended December 31, 1997............. F-43
Combined Statements of Stockholders' Equity for the
Eight-Month Period Ended August 31, 1997 (Predecessor)
and for the Four-Month Period Ended December 31,
1997.................................................. F-44
Combined Statements of Cash Flows for the Eight-Month
Period Ended August 31, 1997 (Predecessor) and for the
Four-Month Period Ended December 31, 1997............. F-45
Notes to Combined Financial Statements................. F-46
Unaudited Financial Statements
Combined Balance Sheets as of December 31, 1997 and
March 31, 1998........................................ F-51
Combined Statements of Operations for the Three Months
Ended March 31, 1997, the Two-Month Period Ended
February 28, 1998 and the One-Month Period Ended March
31, 1998.............................................. F-52
Combined Statements of Cash Flows for the Three Months
Ended March 31, 1997, the Two-Month Period Ended
February 28, 1998 and the One-Month Period Ended March
31, 1998.............................................. F-53
Notes to Combined Financial Statements................. F-54

THE BOSTON TRANSACTION
THE BOSTON RADIO MARKET OF CBS RADIO, INC.
Independent Auditors' Report........................... F-55
Combined Balance Sheet as of December 31, 1997 and June
30, 1998.............................................. F-56
Combined Statements of Operations for the Year Ended
December 31, 1997 and for the Six-Month Periods Ended
June 30, 1997 and 1998 (Unaudited).................... F-57
Combined Statements of Cash Flows for the Year Ended
December 31, 1997 and for the Six-Month Periods Ended
June 30, 1997 and 1998 (Unaudited).................... F-58
Notes to Combined Financial Statements................. F-59
</TABLE>

F-2
<PAGE> 90

INDEPENDENT AUDITORS' REPORT

To the Board of Directors of
Entercom Communications Corp.:

We have audited the accompanying consolidated balance sheets of Entercom
Communications Corp. (formerly Entertainment Communications, Inc.) and
subsidiaries (the "Company") as of September 30, 1997 and 1998, and the related
consolidated statements of income, retained earnings, and cash flows for each of
the three years in the period ended September 30, 1998. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. 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, such consolidated financial statements present fairly, in all
material respects, the financial position of Entercom Communications Corp. and
subsidiaries at September 30, 1997 and 1998, and the results of their operations
and their cash flows for each of the three years in the period ended September
30, 1998 in conformity with generally accepted accounting principles.

DELOITTE & TOUCHE LLP
Philadelphia, Pennsylvania

November 12, 1998

F-3
<PAGE> 91

ENTERCOM COMMUNICATIONS CORP.

CONSOLIDATED BALANCE SHEETS

SEPTEMBER 30, 1997 AND 1998

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
SEPTEMBER 30,
--------------------
1997 1998
-------- --------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents (Note 2)........................ $ 3,626 $ 6,666
Accounts receivable (net of allowance for doubtful
accounts of $292 in 1997 and $367 in 1998)............. 24,796 32,524
Prepaid expenses and deposits............................. 1,691 5,303
Station acquisition deposits.............................. 4,957 344
Income tax deposit........................................ 490 978
Assets held for sale (Note 9)............................. -- 5,310
Total current assets.............................. 35,560 51,125
-------- --------
PROPERTY AND EQUIPMENT -- At cost (Note 2):
Land, land easements and land improvements................ 4,584 5,954
Building.................................................. 2,454 3,939
Equipment................................................. 22,784 31,979
Furniture and fixtures.................................... 5,064 7,115
Leasehold improvements.................................... 1,047 3,362
-------- --------
35,933 52,349
Accumulated depreciation.................................. (8,158) (9,679)
-------- --------
27,775 42,670
Capital improvements in progress.......................... 1,379 387
-------- --------
Net property and equipment........................ 29,154 43,057
-------- --------
RADIO BROADCASTING LICENSES AND OTHER INTANGIBLES
Net of accumulated amortization of $6,307 in 1997 and
$14,564 in 1998 (Notes 2, 3, and 4).................... 295,419 424,716
DEFERRED CHARGES AND OTHER ASSETS -- Net (Notes 2, 3 and
5)........................................................ 4,610 4,047
-------- --------
TOTAL....................................................... $364,743 $522,945
======== ========
</TABLE>

See notes to consolidated financial statements.
F-4
<PAGE> 92

ENTERCOM COMMUNICATIONS CORP.

CONSOLIDATED BALANCE SHEETS

SEPTEMBER 30, 1997 AND 1998

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
SEPTEMBER 30, SEPTEMBER 30,
------------------- 1998
1997 1998 PRO FORMA
-------- -------- -------------
(NOTE 1)
<S> <C> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable......................................... $ 7,128 $ 10,919 $ 10,919
Accrued liabilities:
Salaries.............................................. 2,422 4,052 4,052
Interest.............................................. 109 1,114 1,114
Taxes other than income............................... 69 189 189
Barter (Note 2)....................................... 5 18 18
Corporate state income taxes (Note 2).................... 323 459 459
Long-term debt -- current................................ 10 10
-------- -------- --------
Total current liabilities........................ 10,056 16,761 16,761
LONG-TERM DEBT (Note 6).................................... 142,000 278,774 295,918
ACCRUED INTEREST (Note 6).................................. 2,427 4,352 4,352
DEFERRED TAX LIABILITY..................................... 82,138
MINORITY INTEREST IN EQUITY OF PARTNERSHIP (Notes 2 and
8)....................................................... 2,171 2,177 2,177
-------- -------- --------
Total liabilities................................ 156,654 302,064 401,346
-------- -------- --------
COMMITMENTS AND CONTINGENCIES (Note 9)

SHAREHOLDERS' EQUITY (Note 10):
Common stock $.05 par value; nonvoting; authorized
180,000 shares; issued 43,650 and 43,650 shares in
1997 and 1998, respectively........................... 2 2 2
Common stock $.05 par value; voting; authorized 180,000
shares; issued 72,750 and 72,750 shares in 1997 and
1998, respectively.................................... 4 4 4
Capital in excess of par value........................... 710 710 124,775
Retained earnings........................................ 207,373 220,165
-------- -------- --------
Total shareholders' equity....................... 208,089 220,881 124,781
-------- -------- --------
TOTAL...................................................... $364,743 $522,945 $526,127
======== ======== ========
</TABLE>

See notes to consolidated financial statements.
F-5
<PAGE> 93

ENTERCOM COMMUNICATIONS CORP.

CONSOLIDATED STATEMENTS OF INCOME

YEARS ENDED SEPTEMBER 30, 1996, 1997 AND 1998

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30,
-------------------------------
1996 1997 1998
-------- --------- --------
<S> <C> <C> <C>
NET REVENUES................................................ $ 48,675 $ 93,862 $132,998
OPERATING EXPENSES:
Station operating expenses................................ 31,659 61,280 88,599
Depreciation and amortization............................. 2,960 7,685 13,066
Corporate general and administrative expenses............. 2,872 3,249 4,527
Net expense (income) from time brokerage agreement fees... (879) (476) 2,399
-------- --------- --------
36,612 71,738 108,591
-------- --------- --------
OPERATING INCOME............................................ 12,063 22,124 24,407
OTHER EXPENSE (INCOME) ITEMS:
Interest expense.......................................... 5,196 11,388 14,663
Interest income........................................... (95) (482) (410)
Other nonoperating expenses............................... 28 1,986 82
Gains on sale of assets and other......................... (119) (197,097) (8,661)
-------- --------- --------
Total other expenses (income)...................... 5,010 (184,205) 5,674
-------- --------- --------
INCOME BEFORE INCOME TAXES AND EXTRAORDINARY ITEMS.......... 7,053 206,329 18,733
INCOME TAXES................................................ 274 489 453
-------- --------- --------
INCOME BEFORE EXTRAORDINARY ITEMS........................... 6,779 205,840 18,280
EXTRAORDINARY ITEMS:
Debt extinguishment (net of taxes of $23, $0 and $24 in
1996, 1997 and 1998, respectively) (Note 6)............... 539 2,376
-------- --------- --------
NET INCOME.................................................. $ 6,240 $ 205,840 $ 15,904
======== ========= ========
PRO FORMA DATA (UNAUDITED)
PRO FORMA NET INCOME DATA:
Income before income taxes and extraordinary items........ 7,053 206,329 18,733
Pro forma income taxes (Note 1)........................... 2,680 78,405 7,119
-------- --------- --------
Pro forma income before extraordinary items............... 4,373 127,924 11,614
Extraordinary items, net of pro forma taxes............... 348 1,488
-------- --------- --------
PRO FORMA NET INCOME........................................ $ 4,025 $ 127,924 $ 10,126
======== ========= ========
PRO FORMA EARNINGS PER SHARE (Note 1):
Basic:
Pro forma earnings before extraordinary items........... $ 37.57 $1,099.00 $ 99.78
Extraordinary items, net of pro forma taxes............. 2.99 12.78
-------- --------- --------
Pro forma earnings per share............................ $ 34.58 $1,099.00 $ 87.00
======== ========= ========
Diluted:
Pro forma earnings before extraordinary items........... $ 31.93 $ 934.08 $ 84.80
Extraordinary items, net of pro forma taxes............. 2.54 10.87
-------- --------- --------
Pro forma earnings per share............................ $ 29.39 $ 934.08 $ 73.93
======== ========= ========
WEIGHTED AVERAGE SHARES:
Basic..................................................... 116,400 116,400 116,400
Diluted................................................... 136,952 136,952 136,952
</TABLE>

See notes to consolidated financial statements.
F-6
<PAGE> 94

ENTERCOM COMMUNICATIONS CORP.

CONSOLIDATED STATEMENTS OF RETAINED EARNINGS

YEARS ENDED SEPTEMBER 30, 1996, 1997 AND 1998

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30,
-----------------------------
1996 1997 1998
------- -------- --------
<S> <C> <C> <C>
RETAINED EARNINGS, BEGINNING OF YEAR........................ $ 1,155 $ 5,407 $207,373
NET INCOME.................................................. 6,240 205,840 15,904
RETIREMENT OF TREASURY STOCK................................ (1,044)
DIVIDENDS (Note 10)......................................... (1,988) (2,830) (3,112)
------- -------- --------
RETAINED EARNINGS, END OF YEAR.............................. $ 5,407 $207,373 $220,165
======= ======== ========
</TABLE>

See notes to consolidated financial statements
F-7
<PAGE> 95

ENTERCOM COMMUNICATIONS CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED SEPTEMBER 30, 1996, 1997 AND 1998

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30,
----------------------------------
1996 1997 1998
-------- --------- ---------
<S> <C> <C> <C>
OPERATING ACTIVITIES:
Net income................................................ $ 6,240 $ 205,840 $ 15,904
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation............................................ 1,554 2,141 3,829
Amortization of:
Covenant not to compete............................... 50 25
Radio broadcasting licenses, other intangible and
deferred charges.................................... 1,357 5,519 9,237
Extraordinary items..................................... 562 2,401
Gains on dispositions and exchanges of assets........... (119) (197,097) (8,661)
Interest accrued........................................ 642 1,785 1,925
Changes in assets and liabilities which provided (used)
cash:
Accounts receivable................................... (3,336) (11,798) (7,728)
Prepaid expenses...................................... (150) (956) (101)
Accounts payable, accrued liabilities and corporate
state income taxes.................................. 4,048 1,463 6,695
Minority interest..................................... (21) 1,910 6
Income Tax deposit.................................... 1,946 27 (488)
-------- --------- ---------
Net cash provided by operating activities........... 12,773 8,859 23,019
-------- --------- ---------
INVESTING ACTIVITIES:
Additions to property and equipment....................... (1,493) (4,373) (11,183)
Proceeds from sale of property and equipment, intangibles
and other assets........................................ 560 3,750 9,724
Proceeds from exchanges of radio stations................. 72,200 3,132
Payments for exchanges of radio stations.................. (5,304) (306)
Purchases of radio station assets (Note 3)................ (91,519) (74,498) (152,791)
Deferred charges and other assets......................... (4,050) (644) (3,329)
Station acquisition deposits.............................. (4,826) 1,102
-------- --------- ---------
Net cash used in investing activities............... (96,502) (13,695) (153,651)
-------- --------- ---------
FINANCING ACTIVITIES:
Proceeds from issuance of long-term debt.................. 137,500 20,000 277,286
Payments of long-term debt................................ (48,055) (14,000) (140,502)
Dividends paid............................................ (1,988) (2,830) (3,112)
-------- --------- ---------
Net cash provided by financing activities........... 87,457 3,170 133,672
-------- --------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS........ 3,728 (1,666) 3,040
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD.............. 1,564 5,292 3,626
-------- --------- ---------
CASH AND CASH EQUIVALENTS, END OF
PERIOD.................................................... $ 5,292 $ 3,626 $ 6,666
======== ========= =========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION --
Cash paid during the period for:
Interest................................................ $ 3,688 $ 10,203 $ 11,541
======== ========= =========
Income taxes............................................ $ 148 $ 211 $ 293
======== ========= =========
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES --
In connection with the radio station exchange transactions completed by the Company, the
noncash portion of assets recorded was $127,000 for the year ended September 30, 1997 and
$22,500 for the year ended September 30, 1998.
</TABLE>

See notes to consolidated financial statements.
F-8
<PAGE> 96

ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED SEPTEMBER 30, 1996, 1997 AND 1998

1. BASIS OF PRESENTATION AND ORGANIZATION

Operations -- Entercom Communications Corp. (formerly Entertainment
Communications, Inc.) (the "Company") is principally engaged in the management
and operation of radio broadcast stations throughout the United States. The
Company owns or operates three or more radio stations in the following markets:
Boston, Seattle, Portland, Sacramento, Kansas City and Rochester.

Pro Forma Adjustments -- The Company intends to offer shares of its Class A
Common Stock to the public during 1998 (the "Offering"). Upon completion of the
Offering of Class A Common Stock, the Company will be subject to federal and
state income taxes from the date of termination of the Company's S corporation
status (the "Termination Date"). The unaudited pro forma net income data for the
years ended September 30, 1996, 1997 and 1998 reflects adjustments for income
taxes based upon income before income taxes as if the Company had been subject
to additional federal and state income taxes based upon a pro forma effective
tax rate of 38%.

In addition, the Company will be required to provide a deferred tax
liability for cumulative temporary differences between financial statement and
income tax bases of the Company's assets and liabilities by recording an expense
for such deferred tax liabilities in its consolidated statement of income for
the period following the effective date of the Offering. Such deferred tax
liabilities will be based on the cumulative temporary differences upon the
conversion from an S Corporation to a C Corporation on the Termination Date. The
net difference between the financial statement and income tax bases of the
Company's assets and liabilities resulted in a deferred tax liability of
approximately $82.1 million at September 30, 1998. In addition, prior to the
conversion from an S Corporation to a C Corporation, distributions of
approximately $88.0 million will be made to the Company's existing S Corporation
shareholders.

Pro Forma Earnings Per Share -- Pro forma earnings per share is calculated
in accordance with Statement of Financial Accounting Standards No. 128 and, as
such, is based on the weighted average number of shares of Common Stock
outstanding and dilutive common equivalent shares from convertible debt (using
the if-converted method).

<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30,
-----------------------------
1996 1997 1998
------- ------- -------
<S> <C> <C> <C>
Weighted average shares -- basic............ 116,400 116,400 116,400
Common Stock equivalent -- convertible
debt...................................... 20,552 20,552 20,552
Weighted average shares -- diluted.......... 136,952 136,952 136,952
</TABLE>

2. SIGNIFICANT ACCOUNTING POLICIES

Income Tax Status -- The shareholders of the Company elected to change the
tax status of the Company from a C Corporation to an S Corporation beginning
October 1, 1987 for federal and certain state income tax purposes. For certain
other states for which an S Corporation election has not been made, the Company
incurs state income taxes.

The shareholders' election to be taxed as an S Corporation relieves the
Company of the obligation to pay federal and certain state corporate income
taxes but results in shareholders being directly liable for payment of such
income taxes on their pro rata share of the Company's taxable income, including
taxable income which has been deferred as a result of the Company's use of
different accounting methods for financial reporting and income tax reporting.

Principles of Consolidation -- The accompanying consolidated financial
statements include the accounts of the Company, its limited partnership interest
and its subsidiaries, all of which are wholly-owned. All intercompany
transactions and balances have been eliminated in consolidation.

F-9
<PAGE> 97
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Management's Use of Estimates -- The preparation of consolidated financial
statements, in accordance with generally accepted accounting principles,
requires the Company to make estimates and assumptions that affect the reported
amounts of assets and liabilities, and the disclosure of contingent assets and
liabilities, as of the date of the consolidated financial statements, and the
reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.

Depreciation -- Depreciation is determined on a straight-line basis. The
estimated useful lives for depreciation are as follows:

<TABLE>
<S> <C>
Land improvements.................................... 10 years
Building............................................. 20 years
Equipment............................................ 5-20 years
Furniture and fixtures............................... 5-10 years
Leasehold improvements............................... Various
</TABLE>

Revenue Recognition -- Revenue from the sale of commercial broadcast time
to advertisers is recognized when the commercials are broadcast. Promotional
fees are recognized as services are rendered.

Concentration of Credit Risk -- The Company's revenues and accounts
receivable relate primarily to the sale of advertising within the radio
stations' broadcast areas. Credit is extended based on an evaluation of the
customers' financial condition, and generally, collateral is not required.
Credit losses are provided for in the financial statements and consistently have
been within management's expectations.

Advertising Costs -- Advertising costs are expensed as incurred and
approximated $4.3 million, $6.0 million and $6.6 million for the fiscal years
ended September 30, 1996, 1997 and 1998, respectively.

Radio Broadcasting Licenses and Other Intangibles -- Broadcasting licenses
and other intangibles are being amortized on a straight-line basis over 40
years.

Long-Lived Assets -- In accordance with SFAS No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of",
the Company evaluates the recoverability of its long-lived assets which include
broadcasting licenses, other intangibles, deferred charges, and other assets
whenever events or changes in circumstances indicate that the carrying amount
may not be recoverable. If indications are that the carrying amount of the asset
is not recoverable, the Company will estimate the future cash flows expected to
result from use of the asset and its eventual disposition. If the sum of the
expected future cash flows (undiscounted and without interest charges) is less
than the carrying amount of the asset, the Company recognizes an impairment
loss. The impairment loss recognized is measured as the amount by which the
carrying amount of the asset exceeds its fair value.

Deferred Charges -- The Company defers and amortizes debt issuance costs
and leasehold premiums over the term of the debt and life of the lease,
respectively. Costs of program format changes are expensed when incurred.

Net Expense (Income) from Time Brokerage Agreement ("TBA") Fees -- Net
expense (income) from TBA fees consist of fees paid by or earned by the Company
under agreements which permit an acquirer to program and market stations prior
to acquisition. The Company sometimes enters into such agreements prior to the
consummation of station acquisitions or dispositions. Under the TBAs relating to
the Company's acquisitions, the expense from TBA fees was approximately $0.4
million, $2.2 million and $2.5 million for the years ended September 30, 1996,
1997 and 1998, respectively. Under the TBAs relating to the Company's
dispositions, the income from TBA fees was approximately $1.2 million, $2.7
million and $0.1 million for the years ended September 30, 1996, 1997 and 1998,
respectively. Amounts reflected in net revenues and station operating expenses
from operations under TBAs, excluding expense (income) from TBA fees, were

F-10
<PAGE> 98
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

approximately $2.4 million and $1.3 million, $12.3 million and $9.0 million, and
$7.8 million and $5.0 million for the years ended September 30, 1996, 1997 and
1998, respectively.

Barter Transactions -- The Company provides advertising broadcast time in
exchange for certain products, supplies and services. The terms of the exchanges
generally permit the Company to preempt such broadcast time in favor of
advertisers who purchase time on regular terms. The Company includes the value
of such exchanges in both broadcasting revenues and operating costs and
expenses. Barter valuation is based upon management's estimate of the fair value
of the products, supplies and services received. For the years ended September
30, 1996, 1997 and 1998, barter transactions amounted to approximately $632,000,
$822,000 and $1,043,000, respectively. The Company accrues as a liability the
amount by which the value of broadcasting time to be provided exceeds the value
of products, supplies and services to be received. At September 30, 1996, 1997
and 1998, such amounts were approximately $120,000, $5,000 and $19,000,
respectively.

Cash and Cash Equivalents -- Cash and cash equivalents consist primarily of
amounts held on deposit with financial institutions in immediately available
money market accounts.

Derivative Financial Instruments -- The Company uses derivative financial
instruments, including interest rate exchange agreements ("Swaps") and interest
rate cap agreements ("Caps"), to manage its exposure to fluctuations in interest
rates. Swaps and Caps are matched with debt and periodic cash payments and are
accrued on a net basis as an adjustment to interest expense. Any fees associated
with these instruments are amortized over their term.

Recent Accounting Pronouncements -- In February 1997, the Financial
Accounting Standards Board ("FASB") issued Statement of Financial Accounting
Standard ("SFAS") No. 128, "Earnings per Share", which was effective for the
Company beginning October 1, 1997. SFAS No. 128 establishes standards for
computing and presenting earnings per share ("EPS") and applies to entities with
publicly held common stock or potential common stock. It replaces the
presentation of primary EPS with a presentation of basic EPS and requires the
dual presentation of basic and diluted EPS on the face of the income statement.
This statement requires restatement of all prior period EPS data presented. The
Company's diluted EPS for 1996, 1997 and 1998 includes the effect of convertible
debt.

In June 1998, the FASB issued SFAS No. 133 entitled "Accounting for
Derivative Instruments and Hedging Activities," which establishes accounting and
reporting standards for derivative instruments, including certain derivative
instruments embedded in other contracts, (collectively referred to as
"derivatives") and for hedging activities. It requires that an entity recognize
all derivatives as either assets or liabilities in the statement of financial
position and measure those instruments at fair value. This statement is
effective for all fiscal quarters of fiscal years beginning after June 15, 1999.
Management has not yet determined what effect, if any, this statement will have
on the Company.

Reclassifications -- Certain reclassifications have been made to the
consolidated financial statements for the years ended September 30, 1996 and
1997 in order to conform to the current year presentation.

3. ACQUISITIONS AND OTHER SIGNIFICANT TRANSACTIONS

During each of the periods presented the Company consummated acquisitions
of radio stations. All of these acquisitions were accounted for under the
purchase method of accounting (unless otherwise noted below), and the purchase
prices, including transaction costs, were allocated to the assets based upon
their respective fair values as determined by independent appraisal as of the
purchase dates. Gains on exchange transactions are determined based on the
excess of the fair value of the station assets acquired, as determined by an
independent appraisal, plus any cash received, over the Company's carrying basis
in the station assets exchanged, plus cash paid by the Company, all less
transaction costs.

F-11
<PAGE> 99
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

1996 Acquisitions

The Company completed a three party Asset Purchase Agreement on August 1,
1996, whereby the Company acquired WAXQ-FM, New York City, from GAF Corporation
for a cash purchase price of $90 million and simultaneously exchanged WAXQ-FM
and $1.2 million in cash to Viacom, Inc. for all of Viacom's broadcast assets of
three radio stations, KBSG-FM, KBSG-AM and KNDD-FM, and two tower facilities,
all serving the Seattle, Washington radio market. The Company incurred
approximately $319,000 in transaction costs related to the acquisition.
Broadcasting licenses and other intangibles totaling approximately $87.5 million
were recorded in connection with this transaction.

1997 Acquisitions

On March 27, 1997, the Company acquired the assets of KMBZ-AM, KYYS-FM
(formerly KLTH-FM), KCMO-AM and KCMO-FM, serving the Kansas City,
Kansas/Missouri radio market, from Bonneville International Corporation and
Bonneville Holding Corporation (collectively referred to hereafter as
"Bonneville") for a purchase price of $35.0 million. The Company also acquired
the assets of KIRO-AM, KIRO-FM and KNWX-AM, serving the Seattle, Washington
radio market, from KIRO, Inc., a wholly owned subsidiary of Bonneville
International Corporation ("KIRO") for a purchase price of $60.0 million. As
consideration for the assets received, the Company transferred the assets of
KLDE-FM serving the Houston, Texas radio market, plus $5.0 million, to
Bonneville and KIRO resulting in a gain of $88.7 million. The Company incurred
transaction costs of $246,000 related to these acquisitions. Broadcasting
licenses and other intangibles in the amount of $85.8 million were recorded in
connection with these transactions.

On April 28, 1997, the Company acquired the assets of KEDO-AM and KLYK-FM,
serving the Longview/Kelso, Washington radio market, for $1.8 million from
Longview Broadcasting Company and Premier Development Company. The Company
incurred transaction costs of $38,000 related to these acquisitions.
Broadcasting licenses and other intangibles in the amount of $733,000 were
recorded in connection with this transaction.

On May 30, 1997, the Company completed an Asset Exchange Agreement with
Nationwide Communications, Inc. ("Nationwide") and Secret Communications, LP
("Secret"). In this three party agreement, in exchange for the transfer to
Secret of the Company's two FM radio stations in Pittsburgh, WDSY and WNRQ, the
Company received Nationwide's FM radio station in Seattle, KISW, plus $32.5
million, resulting in a gain of $43.9 million. Broadcasting licenses and other
intangibles in the amount of $12.1 million were recorded in connection with this
transaction. The total purchase price of this transaction was $47.0 million.

On May 30, 1997, the Company acquired the assets of KLOU-FM, serving the
St. Louis, Missouri radio market, from Group W Broadcasting, Inc., plus $39.7
million, in exchange for the assets of KITS-FM, resulting in a gain of $61.2
million. The Company incurred transaction costs of $58,000 related to this
acquisition. Broadcasting licenses and other intangibles in the amount of $21.6
million were recorded in connection with this transaction. The total purchase
price of this transaction was $62.2 million.

On June 3, 1997, the Company acquired the assets of KDND-FM (formerly
KXOA-FM), serving the Sacramento, California radio market, from American Radio
Systems Corporation for $27.2 million. The Company incurred transaction costs of
$192,000 related to this acquisition. Broadcasting licenses and other
intangibles in the amount of $26.9 million were recorded in connection with this
transaction.

On June 4, 1997, the Company acquired the assets of KRXQ-FM and KSEG-FM,
serving the Sacramento, California radio market, from Citicasters Co. for $45.0
million. The Company incurred transaction costs of $268,000 related to these
acquisitions. Broadcasting licenses and other intangibles in the amount of $40.7
million were recorded in connection with this transaction.

F-12
<PAGE> 100
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

1998 Acquisitions

On November 26, 1997, the Company acquired the assets of KSSJ-FM (formerly
KBYA-FM), serving the Sacramento, California radio market, from Susquehanna
Radio Corp., KTHX License Investment Co. and KTHX Radio Inc. for $15.9 million.
The Company incurred transaction costs of $87,000 related to this acquisition.
Broadcasting licenses and other intangibles in the amount of $15.8 million were
recorded in connection with this transaction.

On January 1, 1998, the Company acquired the assets of KCTC-AM, serving the
Sacramento, California radio market, from ARS for $4.0 million. The Company
incurred transaction costs of $13,000 related to this acquisition. Broadcasting
licenses and other intangibles in the amount of $2.7 million were recorded in
connection with this transaction.

On January 1, 1998, the Company acquired the assets of KUDL-FM and WDAF-AM,
serving the Kansas City, Kansas/Missouri radio market from ARS. As consideration
for the assets received, which included the receipt of $7.1 million in cash from
ARS, the Company transferred the assets of KLOU-FM, serving the St. Louis radio
market, to ARS resulting in a gain of $300,000. The Company incurred transaction
costs of $294,000 related to this acquisition. Broadcasting licenses and other
intangibles in the amount of $12.8 million were recorded in connection with this
transaction. The total purchase price of this transaction was $15.4 million.

On May 7, 1998, the Company acquired the assets of WSKY-FM (formerly
WRRX-FM), serving the Gainesville/Ocala, Florida radio market, from Gator
Broadcasting Co. for $2.0 million. The Company incurred transaction costs of
$66,000 related to this acquisition. Broadcasting licenses and other intangibles
in the amount of $1.7 million were recorded in connection with this transaction.

On May 15, 1998, the Company acquired the assets of KBAM-AM and KRQT-FM,
serving the Longview, Washington radio market, from Armak Broadcasters Inc. for
$1.0 million. The Company incurred transaction costs of $43,000 related to this
acquisition. Broadcasting licenses and other intangibles in the amount of
$350,000 were recorded in connection with this transaction.

On June 19, 1998, the Company acquired from Sinclair Broadcast Group the
assets of KKSN-AM, KKSN-FM, and KKRH-FM, all serving the Portland, Oregon radio
market, and WBEE-FM, WBBF-FM (formerly WKLX-FM), WQRV-FM and WEZO-AM (formerly
WBBF-AM) all serving the Rochester, New York radio market. The purchase price
for the stations was $126.5 million. The Company began operations at these
stations on March 1, 1998 under a time brokerage agreement ("TBA"). The Company
incurred transaction costs of $494,000 related to this acquisition. Broadcasting
licenses and other intangibles in the amount of $121.3 million were recorded in
connection with this transaction.

On August 13, 1998 the Company acquired from Capital Broadcasting, Inc. the
assets and rental leases used in connection with the operation of a tower
facility serving the Kansas City, Kansas/Missouri radio market for a purchase
price of $2.0 million.

On September 16, 1998, the Company completed an agreement with American
Radio Systems, Inc. and American Radio Systems License Corp. (collectively
referred to as "ARS") to exchange certain assets used in the operation of radio
stations serving the Sacramento radio market. ARS provided KRAK-FM's license and
transmission facility to the Company in exchange for KRXQ's license and
transmission facility and $4.5 million. Each of the stations retained its own
call letters, programming format and studio and office property and equipment,
and the parties provided each other with reciprocal covenants against
programming competition on the respective frequencies for a period of two years.
ARS also transferred the intellectual property comprising program format for use
by the Company on its recently acquired KBYA-FM in that market. The transaction
was accounted for as a nonmonetary exchange of similar productive assets and no
gain or loss was recognized. The assets received were recorded at the historical
cost of the assets surrendered

F-13
<PAGE> 101
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

plus the $3.8 million paid to ARS. In a related transaction the Company sold the
KRXQ-FM transmitter site, including broadcast tower facilities, to ARS for
$750,000, resulting in a loss of $34,000.

Other Transactions

On March 6, 1996, the Company sold all of the assets of KMTT-AM, Tacoma,
Washington, including assignment of the FCC license, to Southwave Wireless
Communications, Inc. LLC for a cash purchase price of $500,000, resulting in a
gain of approximately $140,000.

On December 6, 1996, the Company sold certain assets of KEGE-AM,
Minneapolis, Minnesota, including assignment of the FCC license, to Salem Media
of Minnesota, Inc. for $3.0 million, resulting in a gain of approximately $2.6
million.

On February 6, 1997, the Company sold all of the assets of WDSY-AM,
Pittsburgh, Pennsylvania, including assignment of the FCC license, to Mortenson
Broadcasting Company for a cash purchase price of $750,000, resulting in a gain
of approximately $700,000.

On May 7, 1998, the Company sold certain rights in a license for the
Vancouver, Washington radio market to Jacor Communications and Smith
Broadcasting, Inc. for $10.0 million. The Company acquired an interest in these
rights at a cost of $1.3 million through an agreement with Q Prime Inc.,
Clifford Burnstein and Peter D. Mensch. The sale resulted in a gain of $8.5
million.

On June 25, 1998, the Company completed its transaction with McKenzie River
Broadcasting Company ("McKenzie") whereby McKenzie received FCC approval to
reclassify the broadcast license of its KMGE-FM station, serving the Eugene,
Oregon radio market, from a Class C to a Class C-1. Such a reclassification of
that station allowed the Company to seek approval from the FCC for construction
and operation of an enhanced transmission facility for its KNRK-FM station
serving the Portland, Oregon radio market. In consideration for its agreement,
McKenzie was paid approximately $1.2 million and the Company recorded this
amount as broadcast licenses.

Effective July 1, 1997, the Company entered into a Joint Sales Agreement
("JSA") with Classic Radio, Inc. ("Classic"), whereby the Company serves as the
exclusive sales agent for the Classic-owned KING-FM radio station, located in
Seattle, Washington. This agreement is a continuation of a relationship under a
prior JSA which expired on June 30, 1997. Under the new JSA, which continues
through June 30, 2002, the Company will be entitled to all revenues from the
sale of advertising time broadcast on KING-FM, but will be required to pay a
monthly fee to Classic based upon calculations as defined in the agreement.
Under the terms of the JSA, the Company will be responsible for all costs
incurred in selling the advertising time. Classic will be responsible for all
costs incurred in operating the station. Gross revenues and expenses incurred by
the Company under this contract during the years ended September 30, 1997 and
1998 were $2.6 and $1.3 million and $3.6 and $2.3 million, respectively.

On October 7, 1997, the Company, in a transaction with Kanza Inc.,
exchanged the broadcasting frequency and the transmitter related assets of
KCMO-AM, Kansas City, Missouri for the broadcasting frequency and transmitter
related assets of WHB-AM, Kansas City, Missouri. The Company incurred
transaction costs of $233,000. The transaction was accounted for as a
nonmonetary exchange of similar productive assets and no gain or loss was
recognized. The assets received were recorded at the historical cost of the
assets surrendered.

The following unaudited pro forma summary presents the consolidated results
of operations as if the transactions which occurred within either the 1997 or
1998 fiscal years had all occurred at the beginning of the 1997 fiscal year,
after giving effect to certain adjustments, including depreciation and
amortization of assets and interest expense on any debt incurred to fund the
acquisitions which would have been incurred had such acquisitions and other
transactions occurred at the beginning of the 1997 fiscal year. These unaudited
pro forma results have been prepared for comparative purposes only and do not
purport to be indicative of what

F-14
<PAGE> 102
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

would have occurred had the acquisitions and other transactions been made as of
that date or results which may occur in the future.

<TABLE>
<CAPTION>
YEARS ENDED SEPTEMBER 30,
--------------------------
1997 1998
---------- ----------
(AMOUNTS IN THOUSANDS)
<S> <C> <C>
Net revenues................................................ $122,711 $140,544
======== ========
Income before extraordinary items........................... $ 7,275 $ 11,967
======== ========
Net income.................................................. $212,383 $ 9,275
======== ========
</TABLE>

4. RADIO BROADCASTING LICENSES AND OTHER INTANGIBLES

Radio Broadcasting Licenses and other intangibles consist of the following:

<TABLE>
<CAPTION>
SEPTEMBER 30,
--------------------
1997 1998
-------- --------
<S> <C> <C>
FCC Licenses................................................ $300,022 $436,407
Other Intangibles........................................... 1,704 2,574
-------- --------
Subtotal.......................................... 301,726 438,981
Less accumulated amortization............................... (6,307) (14,265)
-------- --------
Total radio broadcasting licenses and other intangibles..... $295,419 $424,716
======== ========
</TABLE>

5. DEFERRED CHARGES AND OTHER ASSETS

Deferred charges and other assets (which are amortized principally on the
straight-line method) consist of the following:

<TABLE>
<CAPTION>
SEPTEMBER 30,
----------------
1997 1998
------ ------
(AMOUNTS IN
THOUSANDS)
<S> <C> <C>
Debt issuance costs, less accumulated amortization of
$123,000, $715,000 and $566,000 in 1996, 1997 and 1998,
respectively.............................................. $3,629 $2,163
Leasehold premium, less accumulated amortization of $90,000,
$125,000 and $228,000 in 1996, 1997 and 1998,
respectively.............................................. 862 1,644
Other deferred charges, less accumulated amortization of
$120,000, $77,000 and $276,000 in 1996, 1997 and 1998,
respectively.............................................. 119 240
------ ------
$4,610 $4,047
====== ======
</TABLE>

F-15
<PAGE> 103
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

6. DEBT

(A) Long-term debt consists of the following:

<TABLE>
<CAPTION>
SEPTEMBER 30,
----------------------
1997 1998
--------- ---------
(AMOUNTS IN THOUSANDS)
<S> <C> <C>
Notes payable due February 13, 2006 (A)(3).................. $253,500
Notes payable, due June 30, 2003 (A)(2)(a).................. $ 92,000 --
Notes payable, due June 30, 2003 (A)(2)(b).................. 25,000 --
Note payable, subordinated, due May 21, 2003(A)(1).......... 25,000 25,000
Other....................................................... 284
-------- --------
Total............................................. 142,000 278,784
Amounts due within one year................................. 10
-------- --------
$142,000 $278,774
======== ========
</TABLE>

(1) On May 21, 1996, the Company entered into a convertible subordinated note
purchase agreement with an investment partnership in the principal amount of
$25.0 million. Interest on the note accrues at the rate of 7% per annum.
Such interest compounds annually and is deferred and payable with principal
in one installment on May 21, 2003. The payment due date can be deferred by
one year under certain circumstances. The obligations of the Company under
the note are subordinate to the obligations of the notes payable to the
banks as noted in (A)(3) below.

The convertible subordinated note is convertible by the holder under certain
events and circumstances such as a public offering of the Company's capital
stock, a change of control of the Company, a sale of substantially all of
the Company's assets, a merger or consolidation into a publicly traded
company or the Company's ceasing to be an S Corporation. In the event of
conversion, the holders would receive shares of the common stock of the
Company representing an ownership interest of approximately 15% of the
Company prior to such event in lieu of all outstanding principal and
interest. If the note is not converted by May 21, 2003, then the holder of
the note has the option to put the convertible subordinated note to the
Company and receive, at the option of the Company, either cash or a new note
(Put Note). The amount of cash or principal of the Put Note will equal the
fair market value of the shares of common stock into which the convertible
subordinated notes were convertible. The Put Note would accrue interest at
prime plus 2% and would be due May 21, 2004.

In the event that the note is not converted or put to the Company by May 21,
2003, then the Company can redeem the convertible subordinated note by
either paying cash or issuing a new note (Redemption Note). The amount of
cash or principal of the Redemption Note will equal the original principal
amount of the convertible subordinated note ($25 million) plus interest
accrued through the Date of Redemption at an interest rate of 7% per annum .
The Redemption Note would also accrue interest at 7% per annum and would be
due on May 21, 2004.

(2) On March 25, 1997, the Company expanded its existing credit facility with a
group of banks to $165.0 million. The credit facility consisted of a $140.0
million reducing revolving credit and a $25.0 million amortizing term loan.
At September 30, 1997, outstanding balances against these credit facilities
were $92.0 million and $25.0 million, respectively. Under the loan
agreement, the Company provided the banks with a pledge of its 99% interest
in ECI License Company LP, a pledge of all of the outstanding stock of the
Company, and a pledge of all the Company's other assets. The agreement
included certain restrictive covenants, including a limitation on dividends.
These debt facilities were replaced with the debt facility described in
paragraph (A)(3) below.

F-16
<PAGE> 104
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(a) The availability under the reducing revolving credit agreement,
which was to mature on June 30, 2003, reduced on a quarterly basis
beginning September 30, 1997 in amounts which vary from $3.5 million
to $12.4 million. The Company had the option under this agreement to
elect to pay interest at a rate equal to LIBOR (in increments with
durations of 1, 2, 3 or 6 months) plus 1.25% or the prime rate.
Under certain events, the Company's borrowing costs could have
increased to a maximum of LIBOR plus 3.25% or prime plus 2%. The
interest payable on LIBOR rates was payable at the end of the
selected duration but not less frequently than every three months
and on prime rates was payable at the end of each calendar quarter.
The weighted average interest rate under this agreement at September
30, 1997 was 7.46%. The Company was required to maintain a minimum
of $1 million in cash, cash equivalents, or cash available under
this facility.

(b) The $25.0 million amortizing term loan, which was to mature on June
30, 2003, reduced in ten equal quarterly payments of $625,000,
beginning December 31, 2000 with a final payment of $18.75 million
due June 30, 2003. The Company had the option to pay interest at a
rate of LIBOR plus 3.25% or prime plus 2%. The interest payment was
due in the same manner as described in (A)(2)(a) above. The interest
rate under this agreement at September 30, 1997 was 8.91%.

(3) The Company's term and revolving credit facilities were refinanced on
February 13, 1998, under a new bank credit agreement (the "New Credit
Agreement") with Key Corporate Capital Inc., as administrative agent. The
New Credit Agreement provides for a $300.0 million Senior Secured Revolving
Credit Facility (the "New Bank Facility"). See Note 12, Subsequent Events,
for further discussion.

The New Bank Facility is secured by (i) a pledge of 99% of the Company's
interest in ECI License Company LP ("ECI"), (ii) a security interest in
substantially all of the assets of ECI, (iii) a pledge of 100% of the
outstanding stock of the Company; provided, however, that this pledge will
be released if the Company restructures by forming subsidiaries to hold the
station assets and licenses (in such a restructuring, the Company will
pledge the stock of all such subsidiaries which will become Guarantors, and
ECI will be dissolved, further, upon such restructuring and pledge of stock,
the pledges under (i) and (ii) above will be terminated and released), (iv)
a security interest in all major tangible and intangible personal property
assets of the Company and any future subsidiaries as well as a negative
pledge on all real property, and (v) an assignment of all major leases,
rights, etc. as appropriate.

The availability under the reducing revolving credit agreement, which
matures on February 13, 2006, reduces on a quarterly basis beginning June
30, 2000 in amounts which vary from $3.75 million to $15.0 million. The
Company has the option under this agreement to elect to pay interest at a
rate equal to LIBOR (in increments with durations of 1, 2, 3 or 6 months)
plus .50% or the prime rate. Under certain events, the Company's borrowing
costs can increase to a maximum of LIBOR plus 2.125% or prime plus .875%.
The interest payable on LIBOR rates is payable at the end of the selected
duration but not less frequently than every three months and on prime rates
is payable at the end of each calendar quarter. The weighted average
interest rates under this agreement at September 30, 1998 was 7.53%. The
Company also pays a commitment fee of 0.375% per annum on the average unused
balance of the New Bank Facility.

(B) The Company has entered into several interest rate transactions as hedges
against the variable rate debt discussed in 6(A) above:

(1) In June 1987, the Company entered into an interest rate agreement or
"swap" for a notional amount of $6.0 million which concluded in June
1996. The Company paid a fixed rate of 9.55% on the notional amount to
a bank and the bank paid to the Company a variable rate equal to
three-month LIBOR as determined from time to time on a quarterly basis
through June 30, 1996. The net

F-17
<PAGE> 105
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

amount the Company paid under this agreement was $175,000 for the year
ended September 30, 1996 and has been accounted for as interest expense.

(2) In May 1995, the Company entered into an interest rate swap agreement
for a notional amount of $20.0 million through May 16, 2000. Under this
agreement, the Company pays a fixed rate of 6.77% on the notional
amount to a bank and the bank pays to the Company a variable rate equal
to three-month LIBOR as determined from time to time on a quarterly
basis through May 16, 2000. The variable rate was 5.5%, 5.7% and 5.7%
at September 30, 1996, 1997 and 1998, respectively. The net amount the
Company paid under this agreement was $240,000, $235,000 and $211,000
for the years ended September 30, 1996, 1997 and 1998, respectively.
These amounts have been accounted for as interest expense.

(3) In July 1996, the Company entered into a convertible rate cap
transaction in the amount of $25.0 million to hedge a portion of its
variable rate debt. Pursuant to this transaction, the bank elected,
effective October 29, 1998, to convert the transaction to a swap for a
notional amount of $25.0 million in which the Company pays a fixed rate
of 5.89% on the notional amount to the bank and the bank pays to the
Company a variable rate equal to three-month LIBOR through July 29,
2003. No amounts were paid relating to this transaction during the
years ended September 30, 1996, 1997 and 1998.

(4) In August 1996, the Company simultaneously entered into a rate cap
transaction and a swap option transaction in the amount of $25.0
million to hedge a portion of its variable rate debt. Under the rate
cap transaction, which expires August 8, 2000, the Company's base LIBOR
rate cannot exceed 7.5% at the time of any quarterly reset date. Under
the swap option transaction, the bank may make an election prior to
August 8, 2000 to enter into a swap in which the Company pays a fixed
rate of 6.05% on the notional amount to a bank and the bank pays to the
Company a variable rate equal to three-month LIBOR. If the bank
exercises its election, then the swap will terminate on August 8, 2002.
Any election by the bank will not terminate the rate cap transaction
described above. No amounts were paid related to these transactions
during the years ended September 30, 1996, 1997 and 1998.

(5) On January 6, 1998, the Company entered into an interest rate swap
agreement with a bank in the amount of $15.0 million to hedge a portion
of its variable rate debt. Under the swap transaction, which expires
January 10, 2005, unless terminated by the bank by January 6, 2003, the
Company pays a fixed rate of 5.61% on the notional amount to the bank
and the bank pays to the Company a variable rate equal to three month
LIBOR as determined from time to time on a quarterly basis through the
end of the transaction period. The variable rate was 5.7% as of
September 30, 1998. The net amount paid to the Company under this
agreement was $9,000 for the year ended September 30, 1998.

(6) On January 6, 1998, the Company entered into an interest rate swap
agreement with a bank in the amount of $14.0 million to hedge a portion
of its variable rate debt. Under the swap transaction, which expires
January 10, 2005, the Company pays a fixed rate of 5.86% on the
notional amount to the bank and the bank pays to the Company a variable
rate equal to three months LIBOR as determined from time to time on a
quarterly basis through the end of the transaction period. The variable
rate was 5.7% as of September 30, 1998. The net amount paid by the
Company under this agreement was $17,000 for the year ended September
30, 1998.

(7) On February 26, 1998, the Company entered into an interest rate swap
agreement with a bank in the amount of $30.0 million to hedge a portion
of its variable rate debt. Under the swap transaction, which expires
February 27, 2008, unless terminated by the bank on February 28, 2005,
the Company pays a fixed rate of 5.77% on the notional amount to the
bank and the bank pays to the Company a

F-18
<PAGE> 106
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

variable rate equal to three month LIBOR as determined from time to
time on a quarterly basis through the end of the transaction period.
The variable rate was 5.7% as of September 30, 1998. The net amount
paid by the Company under this agreement was $16,000 for the year ended
September 30, 1998.

<TABLE>
<S> <C>
Fiscal years ending September 30:
1999.......................................... $ 10
2000.......................................... 10
2001.......................................... 10
2002.......................................... 43,510
2003.......................................... 60,010
Thereafter.................................... 175,224
--------
Total...................................... $278,774
========
</TABLE>

The extraordinary charges for 1996, 1997 and 1998 are the result of the
write-offs ($539,000, $0 and $2,376,000 respectively, net of tax benefits) of
unamortized finance charges resulting from the early extinguishment of long-term
debt.

7. FAIR VALUE OF FINANCIAL INSTRUMENTS

The estimated fair value of the Company's financial instruments, which
consist of cash and cash equivalents, accounts receivable, station acquisition
deposits, income tax deposit, accounts payable, accrued liabilities, debt and
interest rate instruments, have been determined by the Company using available
market information and appropriate valuation methodologies. At September 30,
1997 and 1998, the fair value of cash and cash equivalents, accounts receivable,
station acquisition deposits, income tax deposit, accounts payable, accrued
liabilities and debt approximate their carrying value. At September 30, 1997 and
1998, respectively, unrealized losses on interest rate hedges described under
Note 6(B) (2), (3), (4), (5), (6) and (7) are as follows (amounts in thousands):

<TABLE>
<CAPTION>
SEPTEMBER 30,
----------------
1997 1998
----- -------
<S> <C> <C>
6(B)(2)................................. $(351) $ (652)
(3)................................ (212) (1,057)
(4)................................ (103) (1,069)
(5)................................ -- (525)
(6)................................ -- (705)
(7)................................ -- (1,793)
</TABLE>

8. MINORITY INTEREST

On December 2, 1992, in connection with a financing transaction, the
Company created a wholly owned subsidiary, ECI Investors Corporation
("Investors"), with a capital of $50,000. Upon creation, the Company immediately
distributed the stock of Investors to the Company's shareholders. On December
23, 1992, the Company formed a limited partnership, ECI License Company, LP
("Partnership") with Investors. The Company is the sole general partner of the
Partnership. The Company contributed its Federal Communications Commission (FCC)
licenses and authorizations to the Partnership in exchange for a 99% interest in
the Partnership, and Investors acquired its 1% interest in the Partnership for
cash.

F-19
<PAGE> 107
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

On all subsequent occasions when the Company acquired FCC licenses and
authorizations it has contributed them to the Partnership for its 99% interest
and Investors has contributed its matching 1% interest. On each such occasion,
as well as on the dispositions of FCC licenses and authorizations, excluding
those FCC licenses and authorizations used to acquire new FCC licenses and
authorizations which qualify under IRC Section 1031, commonly known as "SWAPS,"
the book value of the Partnership has been adjusted to reflect such transaction.
The book value of the Partnership was approximately $114.2 million (net of
accumulated amortization of approximately $4.5 million) and $132.2 million (net
of accumulated amortization of approximately $7.3 million) at September 30, 1997
and 1998. The Company's 99% interest in the Partnership is pledged as collateral
for the debt described in Note 6A(3). The Company pays a licensing fee to the
Partnership in exchange for the right to utilize the Partnership's licenses and
authorizations in connection with the operation of the stations. As discussed in
Note 2, the financial impact of such transactions is substantially eliminated in
consolidation. The minority interest at September 30, 1997 and 1998 included in
the accompanying consolidated balance sheets represents the 1% interest of
Investors in the Partnership, net of two notes receivable by the Partnership
from Investors. These notes were in the amounts of approximately $875,000 and
$7,000 at September 30, 1997 and $839,000 plus various other notes which total
approximately $200,000 at September 30, 1998. These notes bear interest at rates
ranging from 6% to 8% per annum, and were issued to the Partnership by Investors
for Investors' share of the FCC licenses and authorizations acquired by the
Company during 1997 and 1998. These notes are due in ten equal annual
installments, plus accrued interest.

9. COMMITMENTS AND CONTINGENCIES

Acquisitions

The Company entered into a preliminary agreement on February 6, 1996 for
the Company to acquire the assets of radio station KWOD-FM, Sacramento,
California, from Royce International Broadcasting Corporation subject to
approval by the FCC for a purchase price of $25.0 million. Notwithstanding
efforts by the Company to pursue this transaction, the seller has been
nonresponsive. Accordingly, the Company cannot determine if and when the
transaction might occur.

On July 13, 1998, the Company entered into a preliminary agreement with
Willamette Broadcasting Co. to acquire KSLM-AM, serving the Salem, Oregon radio
markets. The purchase price for the station is $605,000. The Company anticipates
that this transaction will close in calendar year 1998.

On August 13, 1998, the Company entered into three agreements with CBS
Radio, Inc. pursuant to which it will (i) purchase WRKO-AM and WEEI-AM in Boston
for $82.0 million in cash (the "First Boston Transaction"), (ii) sell WLLD-FM
and WYUU-FM in Tampa for $75.0 million in cash (the "Tampa Transaction") and
(iii) purchase WAAF-AM and WEGQ-FM in Boston and WWTM-AM in Worchester for $58.0
million (the "Second Boston Transaction"). The Company anticipates that the
First Boston Transaction and the Tampa Transaction will close in the calendar
year 1998 and that the Second Boston Transaction will close sometime during the
1999 calendar year. The assets that will be sold in the Tampa Transaction have
been segregated on the Consolidated Balance Sheet as assets held for sale. These
assets consist of $2.8 million in property and equipment, net of accumulated
depreciation, and $2.5 million in radio broadcasting licenses and other
intangibles, net of accumulated amortization.

Other

The Company's employment agreement with its Chairman and Chief Executive
Officer renews automatically each calendar year unless terminated by either
party in accordance with the contract. Under the terms of the agreement,
compensation is calculated annually by utilizing the gross national product
implicit price deflator issued by the Bureau of Economic Analysis to determine
the equivalent of 1993 base compensation of $500,000. Total compensation for the
years ended September 30, 1996, 1997 and 1998 was approximately $540,000,
$554,000, and $567,000, respectively.

F-20
<PAGE> 108
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Rental expense is incurred principally for office and broadcasting
facilities. Rental expense during the years ended September 30, 1996, 1997 and
1998 was approximately $1.2 million, $2.2 million and 2.8 million, respectively.

The Company also has various contracts for sports programming and on-air
personalities with terms ranging from one to five years.

The aggregate minimum annual commitments as of September 30, 1998 for
operating leases, sports programming and on-air personalities are as follows:

<TABLE>
<CAPTION>
OPERATING SPORTS ON-AIR
LEASES PROGRAMMING PERSONALITIES
--------- ----------- -------------
(AMOUNTS IN THOUSANDS)
<S> <C> <C> <C>
Fiscal years ending September 30:
1999..................................... $ 3,160 $16,625 $ 5,880
2000..................................... 3,066 18,110 3,690
2001..................................... 2,893 8,802 1,420
2002..................................... 2,964 6,718 713
2003..................................... 2,458 181
Thereafter............................... 11,138 --
------- ------- -------
$25,679 $50,255 $11,884
======= ======= =======
</TABLE>

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

10. SHAREHOLDERS' EQUITY

During 1997, the Company retired treasury stock consisting of 2,610 shares
of nonvoting common stock and 7,830 shares of voting common stock.

For the fiscal years ended September 30, 1996, 1997 and 1998, the Company
paid total dividends of $2.0, $2.8, and $3.1 million, respectively. These
amounts include special dividends paid to the Company's shareholders to
compensate them for federal and state tax obligations attributable to
pass-through taxable income generated by the Company.

On June 24, 1998, the Board of Directors and the shareholders of the
Company approved the Company's amended and restated Articles of Incorporation to
provide for, among other things, an increase in the aggregate number of shares
which the Company has authority to issue to 350,000,000 shares, par value $.01
per share, consisting of the following: (i) 200,000,000 shares of Class A Common
Stock; (ii) 75,000,000 shares of Class B Common Stock; (iii) 50,000,000 shares
of Class C Common Stock; and (iv) 25,000,000 shares of Preferred Stock. Such
change will occur just prior to the effective date of the Company's initial
public offering.

11. EMPLOYEE SAVINGS AND BENEFIT PLANS

The Company sponsors a 401(k) savings plan which includes a provision under
which the Company contributes 50% of the amount of any eligible employee's
contribution to the plan up to a maximum employer contribution of 3% of an
employee's compensation. The maximum eligible employee contribution under the
plan was $9,500, $9,500 and $10,000 for the plan years ended December 31, 1996,
1997 and 1998. The Company may at its discretion suspend future matching
contributions. The Company contributed approxi-

F-21
<PAGE> 109
ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

mately $232,000, $485,000, and $588,000, under the 401(k) plan for the years
ended September 30, 1996, 1997, and 1998, respectively.

On June 24, 1998, the Company adopted an Equity Compensation Plan (the
"Compensation Plan"). The Compensation Plan will allow officers (including those
also serving as directors) and other employees, non-employee directors and key
advisors or consultants, selected by a Committee of the Board of Directors, to
receive incentive stock options, nonqualified stock options, restricted stock
and stock appreciation rights in the Common Stock of the Company. Assuming the
new Articles of Incorporation are effected, there will be 5,000,000 shares of
Common Stock reserved for issuance under the Compensation Plan. No awards have
been issued under this plan.

On June 24, 1998, the Company adopted an Employee Stock Purchase Plan (the
"Purchase Plan"). The Purchase Plan will allow the participants to purchase
shares of the Company's Common Stock at a purchase price equal to 85% of the
Market Value of such shares on the Purchase Date. Assuming the new Articles of
Incorporation are effected, there will be 1,000,000 shares of Common Stock
reserved for issuance under the Purchase Plan. No awards have been issued under
this plan.

12. SUBSEQUENT EVENTS

(A) On October 8, 1998, the Company amended their New Credit Agreement with Key
Corporation Capital Inc. to increase their Senior Secured Revolving Credit
Facility to $350.0 million. Availability under this credit agreement reduces
on a quarterly basis beginning June 30, 2000 in amounts which vary from $4.4
million to $17.5 million.

(B) In July 1996, the Company entered into a convertible rate cap transaction in
the amount of $25.0 million to hedge a portion of its variable rate debt.
Pursuant to this transaction, the bank elected, effective October 29, 1998,
to convert the transaction to a swap for a notional amount of $25.0 million
in which the Company pays a fixed rate of 5.89% on the notional amount to
the bank and the bank pays to the Company a variable rate equal to the
three-month LIBOR through July 29, 2003.

F-22
<PAGE> 110

INDEPENDENT AUDITORS' REPORT

Entercom Communications Corp.:

We have audited the accompanying combined statements of operations and of cash
flows of KMBZ-AM, KLTH-FM, KCMO-AM/FM, KIRO-AM/FM, KNWX-AM, and KING-FM ("the
Stations") for the years ended December 31, 1994, 1995, and 1996. These combined
financial statements are the responsibility of the Stations' management. Our
responsibility is to express an opinion on these combined financial statements
based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the combined 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, such combined financial statements present fairly, in all
material respects, the results of operations and cash flows of the Stations for
the years ended December 31, 1994, 1995, and 1996 in conformity with generally
accepted accounting principles.

The accompanying combined financial statements have been prepared from the
separate records maintained by the Stations and may not be indicative of the
conditions that would have existed or the results of operations had the Stations
been operated as an unaffiliated company. As discussed in Note 1, certain
corporate overhead expenses represent allocations made by the Stations' parent.

DELOITTE & TOUCHE LLP

Salt Lake City, Utah
June 10, 1998

F-23
<PAGE> 111

KMBZ-AM, KLTH-FM, KCMO-AM/FM, KIRO-AM/FM, KNWX-AM, AND KING-FM

COMBINED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1994, 1995, AND 1996 AND
FOR THE THREE MONTHS ENDED MARCH 27, 1996 AND 1997 (UNAUDITED)

<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 27,
--------------------------------------- -----------------------
1994 1995 1996 1996 1997
----------- ----------- ----------- ---------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
GROSS REVENUE..................... $33,030,947 $35,313,323 $39,508,602 $6,882,991 $4,804,521
AGENCY AND REPRESENTATIVE
COMMISSIONS AND REVENUE SHARING
FEES............................ 5,854,857 6,863,145 7,847,095 1,519,908 1,090,028
----------- ----------- ----------- ---------- ----------
NET REVENUES...................... 27,176,090 28,450,178 31,661,507 5,363,083 3,714,493
OPERATING EXPENSES................ 11,827,214 15,046,401 16,666,152 2,120,720 1,246,577
SELLING AND PROMOTIONAL
EXPENSES........................ 7,381,684 9,121,858 9,395,272 2,139,418 1,469,538
GENERAL AND ADMINISTRATIVE
EXPENSES........................ 5,011,439 4,603,611 4,986,714 1,349,394 872,442
ALLOCATED CORPORATE EXPENSES...... 355,553 458,364 452,288 86,414 58,657
DEPRECIATION AND AMORTIZATION..... 1,291,220 1,517,720 1,421,065 405,676 338,826
----------- ----------- ----------- ---------- ----------
OPERATING INCOME (LOSS)........... 1,308,980 (2,297,776) (1,259,984) (738,539) (271,547)
OTHER EXPENSE:
Interest expense................ (72,566) (28,223)
Other -- net.................... (19,781) (41,309) (139,216)
----------- ----------- ----------- ---------- ----------
INCOME (LOSS) BEFORE INCOME
TAXES........................... 1,216,633 (2,367,308) (1,399,200) (738,539) (271,547)
INCOME TAX (EXPENSE) BENEFIT...... (456,000) 888,000 525,000 277,000 102,000
----------- ----------- ----------- ---------- ----------
NET INCOME (LOSS)................. $ 760,633 $(1,479,308) $ (874,200) $ (461,539) $ (169,547)
=========== =========== =========== ========== ==========
</TABLE>

See notes to combined statements of operations and of cash flows.
F-24
<PAGE> 112

KMBZ-AM, KLTH-FM, KCMO-AM/FM, KIRO-AM/FM, KNWX-AM, AND KING-FM

COMBINED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1994, 1995, AND 1996 AND
FOR THE THREE MONTHS ENDED MARCH 27, 1996 AND 1997 (UNAUDITED)

<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 27,
--------------------------------------- -------------------------
1994 1995 1996 1996 1997
----------- ----------- ----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)...................... $ 760,633 $(1,479,308) $ (874,200) $ (461,539) $ (169,547)
Adjustments to reconcile net income
(loss) to cash provided by (used in)
operating activities:
Depreciation and amortization....... 1,291,220 1,517,720 1,421,065 405,676 338,826
Loss (gain) on disposal of property
and equipment..................... 2,750 (32,549) 114,134 675 (3,545)
Changes in operating assets and
liabilities:
Receivables....................... (1,172,491) (1,741,557) (1,440) 2,258,629 1,977,565
Prepaid expenses and other current
assets......................... 196,719 (498,815) 213,850 (249,871) 366,198
Other assets...................... (67,730) 62,741 (12,619) (4,185) 5,490
Accounts payable.................. (331,108) 227,182 (416,504) 331,145 (304,234)
Accrued expenses.................. (19,759) (357,472) (405,954) 58,362 399,655
Due to parent -- current.......... 394,680 (3,974,049) 202,305 (1,908,945) (1,317,870)
----------- ----------- ----------- ----------- -----------
Net cash provided by (used in)
operating activities......... 1,054,914 (6,276,107) 240,637 429,947 1,292,538
----------- ----------- ----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment..... (951,151) (3,227,605) (3,637,864) (1,145,450) (546,944)
Proceeds from sale of property and
equipment........................... 8,024 390,439 25,294 17,647
----------- ----------- ----------- ----------- -----------
Net cash (used in) investing
activities................... (943,127) (2,837,166) (3,612,570) (1,127,803) (546,944)
----------- ----------- ----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES --
Net interdivisional transfers from (to)
parent.............................. 71,514 9,408,614 3,030,472 (86,398) (1,123,328)
----------- ----------- ----------- ----------- -----------
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS............................ 183,301 295,341 (341,461) (784,254) (377,734)
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD................................. 504,233 687,534 982,875 982,875 641,414
----------- ----------- ----------- ----------- -----------
CASH AND CASH EQUIVALENTS, END OF
PERIOD................................. $ 687,534 $ 982,875 $ 641,414 $ 198,621 $ 263,680
=========== =========== =========== =========== ===========
</TABLE>

See notes to combined statements of operations and of cash flows.
F-25
<PAGE> 113

KMBZ-AM, KLTH-FM, KCMO-AM/FM, KIRO-AM/FM, KNWX-AM, AND KING-FM

NOTES TO COMBINED STATEMENTS OF OPERATIONS AND OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1994, 1995, AND 1996
(INFORMATION PERTAINING TO THE THREE MONTHS ENDED
MARCH 27, 1996 AND 1997 IS UNAUDITED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business -- The radio stations, KMBZ-AM, KLTH-FM, and KCMO-AM/FM are
broadcast in the Kansas City, Missouri area. The radio stations KIRO-AM/FM,
KNWX-AM, and KING-FM are broadcast in the Seattle, Washington area. Through
March 27, 1997, KMBZ-AM, KLTH-FM, KCMO-AM/FM, KIRO-AM/FM, KNWX-AM, and KING-FM
(the Stations) were operated by Bonneville International Corporation (BIC) with
the FCC broadcasting licenses for all Stations except KING-FM being owned by
Bonneville Holding Company (BHC), an affiliate of BIC, and the operating assets
for all Stations except KING-FM being owned by BIC.

BIC marketed and sold advertising for KING-FM under a Joint Sales Agreement
(the "KING Agreement") whereby BIC, through its wholly-owned subsidiary, KIRO,
Inc., acted as the exclusive sales agent for KING-FM. Under the KING Agreement,
BIC was required to pay to the Licensee an advertising revenue sharing fee equal
to the greater of 70% of net sales or an annual fixed dollar amount that varied
for each ratings share level. In addition, the KING Agreement required BIC to
pay costs of selling advertising time other than agency fees while the Licensee
paid for costs of operating the station. The accompanying statements of
operations include both the gross advertising revenues of KIRO-FM and the
advertising revenue sharing fees paid by BIC under the KING Agreement.

On March 27, 1997, BIC and BHC entered into an agreement (the "Exchange
Agreement") with Entercom Communications Corp., formerly Entertainment
Communications, Inc. ("Entercom"), whereby BIC and BHC agreed to transfer title
to the net assets and related FCC licenses of the Stations and BIC's sales agent
claim under the KING Agreement to Entercom in exchange for Entercom transferring
title to the assets and related FCC license of a radio station located in
Houston, Texas to BIC and BHC, respectively. In addition to the assets
exchanged, BIC received an additional $5.0 million in cash from Entercom under
the Exchange Agreement. For income tax purposes, the exchange was structured as
a "like-kind exchange" through a Qualified Intermediary under the provisions of
Section 1031 of the Internal Revenue Code. The parties to the Exchange Agreement
operated each other's stations under a time brokerage agreement ("TBA") for the
period March 1, 1997 through March 27, 1997, the closing date.

The accompanying statement of operations for the period January 1, 1997
through March 27, 1997 does not include the revenues or expenses of the Stations
during the TBA period, March 1, 1997 through March 27, 1997. However, the
accompanying statement of operations for the period January 1, 1997 through
March 27, 1997 does include as revenue, TBA fees received from Entercom in the
amount of $104,000, and as expense, TBA fees paid to Entercom in the amount of
$71,000.

Basis of Accounting -- The combined statements of operations and net assets
and of cash flows include the historical accounts and transactions of the
Stations, as operated by BIC, including the FCC licenses owned by BHC.
Historically, BIC did not charge the Stations for certain corporate overhead
expenses; however, for purposes of the accompanying statements of operations,
such expenses have been charged as described below. All inter-station
transactions have been eliminated in combination.

Use of Estimates in Preparing Financial Statements -- 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.

F-26
<PAGE> 114
KMBZ-AM, KLTH-FM, KCMO-AM/FM, KIRO-AM/FM, KNWX-AM, AND KING-FM

NOTES TO COMBINED STATEMENTS OF OPERATIONS AND OF CASH FLOWS -- (CONTINUED)

Transactions with BIC -- The Stations are charged for certain corporate
services received from BIC based upon the percentage of revenue of each station
to total revenue of all stations operated by BIC. Although management is of the
opinion that the allocations used are reasonable and appropriate, other
allocations might be used that could produce results substantially different
from those reflected herein and these cost allocations might not be indicative
of amounts which might be paid to unrelated parties for similar services. The
following BIC corporate departmental expenses have been charged to the Stations'
accompanying statements of operations:

<TABLE>
<CAPTION>
THREE MONTHS
YEARS ENDED ENDED MARCH 27
-------------------------------- ------------------
1994 1995 1996 1996 1997
-------- -------- -------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Management............................ $110,588 $137,140 $115,079 $29,805 $19,072
Finance............................... 72,503 97,982 99,146 18,425 12,993
Information systems................... 57,327 85,556 66,436 11,453 8,551
Human resources....................... 71,928 84,571 113,088 16,532 11,488
Engineering........................... 19,034 24,871 27,160 4,532 3,822
Legal................................. 24,173 28,244 31,379 5,667 2,731
-------- -------- -------- ------- -------
Total....................... $355,553 $458,364 $452,288 $86,414 $58,657
======== ======== ======== ======= =======
</TABLE>

Revenue Recognition -- Revenues (including agency and representative
commissions and revenue sharing fees) are recognized when advertisements are
broadcast. Included in revenue are nonmonetary transactions arising from the
trading of advertising time for merchandise and services. These transactions are
recorded as the advertising is broadcast at the fair market value of the
merchandise and services received. Advertising time exchanged for merchandise
and services amounted to approximately $1,253,000, $1,975,000, and $1,619,000 in
1994, 1995, and 1996 and $134,000 and $20,000 for the three months ended March
27, 1996 and 1997, respectively.

Depreciation and Amortization -- Depreciation and amortization are computed
using the straight-line method, based on historical costs, over estimated useful
lives, as follows:

<TABLE>
<CAPTION>
ESTIMATED
LIVES (YEARS)
-------------
<S> <C>
Buildings.............................................. 8 - 40
Furniture and fixtures................................. 5 - 8
Equipment.............................................. 3 - 15
Leasehold improvements................................. Life of lease
</TABLE>

Intangible Assets -- Intangible assets (primarily the FCC licenses owned by
BHC) acquired prior to November 1, 1970 are not being amortized because
management believes there has been no decline in their values nor evidence of
limited lives. Amortization expense related to intangible assets acquired
subsequent to October 31, 1970 (effective date of the adoption by the Accounting
Principles Board of principles relating to the accounting for intangible assets)
has been included in the accompanying statements of operations. The intangible
assets are being amortized over various periods not exceeding forty years.

Income Taxes -- Through March 27, 1997, the results of the Stations'
operations are included in consolidated Federal, Utah, and Kansas income tax
returns filed by the parent corporation of BIC, Deseret Management Corporation
("DMC"). The Stations' portion of the income tax provision (benefit) is
allocated at a Federal and state computed statutory rate of 37.5%. The Stations'
Federal and Kansas income taxes are generally paid to, or refunded from, DMC.

F-27
<PAGE> 115
KMBZ-AM, KLTH-FM, KCMO-AM/FM, KIRO-AM/FM, KNWX-AM, AND KING-FM

NOTES TO COMBINED STATEMENTS OF OPERATIONS AND OF CASH FLOWS -- (CONTINUED)

Concentration of Credit Risk -- The Stations extend credit to customers on
an unsecured basis in the normal course of business. The customers are generally
located in the greater Seattle, Washington and Kansas City, Missouri areas, and
no individual industry or industry segment is significant to the Stations'
customer base. The Stations have policies governing the extension of credit and
collection of amounts due from customers.

Statements of Cash Flows -- For purposes of the statements of cash flows,
the Stations consider all highly liquid, short-term investments purchased with
remaining maturities of three months or less to be cash equivalents.

Interim Results (Unaudited) -- In the opinion of management, the
accompanying unaudited interim financial statements for the periods January 1 to
March 27, 1996 and 1997 (referred to as the three months ended March 27, 1996
and 1997) have been prepared on the same basis as the audited financial
statements and include all adjustments, consisting of only normal recurring
adjustments, necessary for a fair presentation of operating results and cash
flows for such periods.

2. EMPLOYEE BENEFIT PLANS

Defined Benefit Plan -- Through March 27, 1997, the Stations participated
in a defined benefit plan of BIC which covered all employees who worked at least
1,000 hours in a year, had one year or more of service, and were at least 21
years of age. The plan was sponsored by BIC. Retirement benefits were based on
years of service and an average of the employee's highest five years of
compensation during the last ten years of employment. BIC's policy is to fund
the maximum amounts required by the Employee Retirement Income Security Act of
1974. Contributions were intended to provide not only for benefits attributed
for service to date but also for those expected to be earned in the future. The
Stations have included in the accompanying statements of operations, pension
expense (benefit) under this plan of approximately $113,000, $(42,000), and
$21,000 for the years ended December 31, 1994, 1995, and 1996, respectively, and
$5,000 and $(21,000) for the three months ended March 27, 1996 and 1997,
respectively.

Thrift Plan -- The Stations also participated in a Section 401(k) defined
contribution plan (the Thrift Plan) of BIC in which employees age 21 or older
could participate. Under provisions of the Thrift Plan, participants could
contribute up to 17% of their pre-tax compensation to either a savings option
(based on after tax earnings) or a deferred option (based on pre-tax earnings),
subject to the "excess contribution" limitations defined in the Internal Revenue
Code. For each participating employee, the Stations provided a matching
contribution of up to 3% of a participant's annual salary. The Stations'
contributions to the Thrift Plan were approximately $372,000, $295,000, and
$263,000 in 1994, 1995, and 1996, respectively, and $66,000 and $55,000 for the
three months ended March 27, 1996 and 1997, respectively. The plan was sponsored
by BIC.

Postretirement Benefits Other Than Pensions -- BIC provided a
postretirement monetary benefit other than pensions. It consisted of a fixed
monthly dollar contribution toward the purchase of medical, dental, and life
insurance for substantially all of its retired employees. In 1993, BIC began
advance funding for postretirement life benefits for employees retiring on or
after January 1, 1994. Advance funding for medical benefits commenced in 1994.
Medical benefits for employees who retired before January 1, 1994 continue to be
funded on a pay-as-you-go basis. The Stations have included in the accompanying
statements of operations, expense under this plan of approximately $32,000,
$48,000, and $34,000 for the years ended December 31, 1994, 1995, and 1996,
respectively, and $9,000 and $19,000 for the three months ended March 27, 1996
and 1997, respectively.

F-28
<PAGE> 116
KMBZ-AM, KLTH-FM, KCMO-AM/FM, KIRO-AM/FM, KNWX-AM, AND KING-FM

NOTES TO COMBINED STATEMENTS OF OPERATIONS AND OF CASH FLOWS -- (CONTINUED)

3. COMMITMENTS AND CONTINGENCIES

Leases -- The Stations lease office and studio space under operating leases
expiring in 2010 and lease antennas under operating leases expiring in 2002.
Rental expense pursuant to the terms of these operating leases was approximately
$354,000, $232,000, and $492,000 for the years ended December 31, 1994, 1995,
and 1996 and $208,000 and $89,000 for the three months ended March 27, 1996 and
1997.

At December 31, 1996, future minimum rental payments required under these
leases are as follows:

<TABLE>
<S> <C>
1997..................................................... $ 509,012
1998..................................................... 498,956
1999..................................................... 502,508
2000..................................................... 433,030
2001..................................................... 459,019
Thereafter............................................... 4,190,178
----------
Total.......................................... $6,592,703
==========
</TABLE>

Contingencies -- The Stations are involved in litigation regarding
transactions conducted in the ordinary course of business and are defending
their positions. The final outcome of litigation is not presently determinable;
however, in the opinion of management, the effects, if any, will not be material
to the net assets or the results of operations and cash flows derived from such
net assets.

F-29
<PAGE> 117

INDEPENDENT AUDITORS' REPORT

Entercom Communications Corp.:

We have audited the accompanying combined statements of operations and cash
flows of the Sacramento Station Group consisting of stations KSEG-FM and KRXQ-FM
(the "Stations") for the period January 1, 1996 to September 18, 1996 (the
"Predecessor") and for the period September 19, 1996 to December 31, 1996 (the
"Company"). These financial statements are the responsibility of the Station's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the combined 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, such combined financial statements present fairly, in all
material respects, the results of operations and cash flows of the Predecessor
for the period January 1, 1996 to September 18, 1996 and of the Company for the
period September 19, 1996 to December 31, 1996 in conformity with generally
accepted accounting principles.

The accompanying combined financial statements have been prepared from the
separate records maintained by the Predecessor and the Company and may not be
indicative of the results of operations and cash flows had the Stations been
operated as an unaffiliated company and, as discussed in Note 3, certain
expenses represent allocations made from the Stations' parent.

DELOITTE & TOUCHE LLP
Cincinnati, Ohio
May 21, 1998

F-30
<PAGE> 118

SACRAMENTO STATION GROUP

COMBINED STATEMENTS OF OPERATIONS
FOR THE PERIODS JANUARY 1, 1996 TO SEPTEMBER 18, 1996 AND SEPTEMBER 19, 1996 TO
DECEMBER 31, 1996 AND THE FIVE MONTHS ENDED MAY 31, 1996 AND 1997

<TABLE>
<CAPTION>
PERIOD JANUARY 1, PERIOD FIVE MONTHS
1996 TO SEPTEMBER 19, ENDED MAY 31,
SEPTEMBER 18, 1996 TO --------------------------
1996 DECEMBER 31, 1996
(PREDECESSOR) 1996 (PREDECESSOR) 1997
----------------- ------------- ------------- ---------
(UNAUDITED)
<S> <C> <C> <C> <C>
NET REVENUES.......................... $5,189,461 $1,944,529 $2,638,700
---------- ----------
OPERATING EXPENSES:
Operating expenses, excluding
depreciation and amortization.... 3,765,749 1,572,153 2,052,346
Depreciation and amortization....... 1,136,300 361,936 629,481 $ 580,527
Corporate and general expenses...... 202,000 78,000 112,000 112,000
---------- ---------- ---------- ---------
Total operating expenses.... 5,104,049 2,012,089 2,793,827 692,527
---------- ---------- ---------- ---------
OPERATING INCOME (LOSS)............... 85,412 (67,560) (155,127) (692,527)
OTHER INCOME (EXPENSE) -- Net......... (27,341) 35,361 (27,341) 586,000
---------- ---------- ---------- ---------
INCOME (LOSS) BEFORE INCOME TAXES..... 58,071 (32,199) (182,468) (106,527)
---------- ---------- ---------- ---------
PROVISION FOR INCOME TAXES............ 287,000 75,000 74,000 104,000
---------- ---------- ---------- ---------
NET LOSS.............................. $ (228,929) $ (107,199) $ (256,468) $(210,527)
========== ========== ========== =========
</TABLE>

See notes to financial statements.
F-31
<PAGE> 119

SACRAMENTO STATION GROUP

COMBINED STATEMENTS OF CASH FLOWS
FOR THE PERIODS JANUARY 1, 1996 TO SEPTEMBER 18, 1996 AND SEPTEMBER 19, 1996 TO
DECEMBER 31, 1996 AND THE FIVE MONTHS ENDED MAY 31, 1996 AND 1997

<TABLE>
<CAPTION>
PERIOD JANUARY 1, PERIOD FIVE MONTHS
1996 TO SEPTEMBER 19, ENDED MAY 31,
SEPTEMBER 18, 1996 TO ---------------------------
1996 DECEMBER 31, 1996
(PREDECESSOR) 1996 (PREDECESSOR) 1997
----------------- ------------- ------------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss................................. $ (228,929) $(107,199) $(256,468) $ (210,527)
Adjustments to reconcile net loss to cash
provided by operating activities:
Depreciation and amortization......... 1,136,300 361,936 629,481 580,527
Loss on disposal of property and
equipment........................... 32,341 32,341
Change in assets and liabilities:
Accounts receivable................. (245,215) (56,840) 68,087 1,755,043
Prepaid expenses and other assets... 11,698 138,711 (22,673) 31,768
Accounts payable and accrued
expenses......................... (13,569) (264,917) (224,392) (119,146)
---------- --------- --------- -----------
Cash provided by operating
activities..................... 692,626 71,691 226,376 2,037,665
---------- --------- --------- -----------
CASH FLOWS FROM INVESTING
ACTIVITIES -- Purchase of property and
equipment................................ (298,383) (17,348) (239,717) --
---------- --------- --------- -----------
CASH FLOWS FROM FINANCING
ACTIVITIES -- Change in due to Parent.... (336,450) (186,679) (57,374) (2,122,203)
---------- --------- --------- -----------
INCREASE (DECREASE) IN CASH................ 57,793 (132,336) (70,715) (84,538)
CASH, BEGINNING OF PERIOD.................. 159,081 216,874 159,081 84,538
---------- --------- --------- -----------
CASH, END OF PERIOD........................ $ 216,874 $ 84,538 $ 88,366 $ --
========== ========= ========= ===========
</TABLE>

See notes to financial statements.
F-32
<PAGE> 120

SACRAMENTO STATION GROUP

NOTES TO COMBINED FINANCIAL STATEMENTS
(INFORMATION PERTAINING TO THE FIVE-MONTH PERIODS ENDED
MAY 31, 1996 AND 1997 IS UNAUDITED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business -- The Sacramento Station Group consists of radio stations KSEG-FM
and KRXQ-FM (the "Stations") which broadcast in the Sacramento, California area.
The stations were an operating unit of Jacor Communication, Inc. (the "Parent")
during the period September 19, 1996 through June 4, 1997. During the period
January 1, 1996 to September 18, 1996 ("Predecessor Period"), the Stations were
owned and operated by Citicasters, Inc. ("Predecessor Parent").

Basis of Presentation -- The accompanying combined statements of operations
and cash flows have been prepared from the separate records of the Stations and
may not be indicative of the results of operations and cash flows had the
Stations been operated as an unaffiliated entity. The accompanying combined
statements of operations and cash flows for the period from January 1, 1996 to
September 18, 1996 represent the results of direct revenues and expenses and
cash flows generated from the historical basis of assets and liabilities of the
Predecessor Parent. On September 18, 1996, Citicasters, Inc. was acquired by
Jacor Communications, Inc. and in accordance with the purchase method of
accounting the assets and liabilities of the Stations were adjusted to fair
value on the date of the acquisition. Accordingly, the combined statements of
operations and cash flows for the period from September 19, 1996 to December 31,
1996 represent the results of revenues and expenses and cash flows generated
from the revalued assets and liabilities. A vertical black line is shown in the
accompanying combined financial statements to separate the post acquisition
operations from those prior September 19, 1996 since they have not been prepared
on a comparable basis.

Effective January 1997, the Parent entered into a time brokerage agreement
with Entercom Communications Corp. ("Entercom"), formerly Entertainment
Communications, Inc. whereby Entercom operated the Stations and remitted to the
Parent a monthly rental fee totaling approximately $586,000 through June 4,
1997. The time brokerage agreement expired on June 4, 1997 at which time the
Parent sold substantially all of the tangible and intangible assets of the
Stations to Entercom for approximately $45,000,000. The Parent retained the
ownership of the FCC broadcast license for Stations throughout the contract
period of the time brokerage agreement.

Revenue Recognition -- Revenues are recognized when advertisements are
broadcast.

Property and Equipment -- Building, property and equipment are recorded at
cost and depreciation is provided using the straight-line method over estimated
useful lives ranging from 3 to 25 years. Leasehold improvements are depreciated
over the term of the lease.

Intangible Assets -- Intangible assets consisting primarily of goodwill,
FCC licenses and call letters acquired in connection with the acquisition of the
Stations are being amortized over their respective estimated useful lives
(ranging from 19 to 40 years during the period January 1, 1996 to September 18,
1996 and 40 years effective September 19, 1996 and thereafter) using the
straight-line method.

Income Taxes -- The results of operations of the Stations are included in
the consolidated tax returns of the Predecessor Parent and the Parent during
their respective periods of ownership. The Predecessor Parent and the Parent did
not historically allocate taxes to the Stations. However, for purposes of the
accompanying financial statements, a provision for income taxes has been made in
accordance with Statement of Financial Accounting Standards (SFAS) No. 109,
Accounting for Income Taxes, as if the stations filed separate returns. The
effective income tax rate for the periods September 19, 1996 to December 31,
1996 and January 1, 1996 to September 18, 1996 varies from the statutory rate of
35% due to non-deductible amortization.

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 revenue and
expenses during the reporting period. Actual results could differ from those
estimates.

F-33
<PAGE> 121
SACRAMENTO STATION GROUP

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

Interim Financial Statements (Unaudited) -- In the opinion of management,
the accompanying unaudited interim combined financial statements for the five
months ended May 31, have been prepared on the same basis as the audited
combined financial statements and include all adjustments, consisting of only
normal recurring adjustments, necessary for a fair presentation of the operating
results and cash flows for such periods. Results of operations for an interim
period are not necessarily indicative of results to be expected for a full year.

2. EMPLOYEE BENEFIT PLAN

The Stations participate in a retirement savings plan (the "Plan") that is
sponsored by the Parent. The Stations' expense for the Plan was approximately
$15,000 for the period September 19, 1996 to December 31, 1996.

A similar plan was sponsored by the Predecessor Parent for which the
Stations expensed approximately $45,000 for the period January 1, 1996 to
September 18, 1996.

3. RELATED-PARTY TRANSACTIONS

Corporate and general expenses consists of corporate overhead costs
including treasury, tax, legal, data processing, risk management and other
administrative services not specifically related to any specific stations.
Management is of the opinion that the allocations used are reasonable and
appropriate.

4. LEASES

The Stations lease office and studio space under operating leases. Total
rent expense was approximately $59,000 for the period September 19, 1996 to
December 31, 1996 and approximately $177,000 for the period January 1, 1996 to
September 18, 1996. Future minimum rental commitments for noncancellable leases
are as follows: 1997, $242,000; 1998, $245,000; 1999, $245,000; 2000, $143,000;
2001, $109,000; thereafter, $290,000.

F-34
<PAGE> 122

INDEPENDENT AUDITORS' REPORT

Entercom Communications Corp.:

We have audited the accompanying combined statements of income and cash flows of
KBSG, Inc. and KNDD, Inc., (wholly owned subsidiaries of Viacom Inc. (the
"Parent"), which businesses were acquired on August 1, 1996 by Entercom
Communications Corp., formerly Entertainment Communications, Inc.) (the
"Companies") for the year ended December 31, 1995. These combined financial
statements are the responsibility of the Companies' management. Our
responsibility is to express an opinion on these combined financial statements
based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the combined 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 audit provides a reasonable basis for our opinion.

In our opinion, such financial statements present fairly, in all material
respects, the combined results of operations and combined cash flows of the
Companies for the year ended December 31, 1995 in conformity with generally
accepted accounting principles.

The accompanying combined financial statements have been prepared from the
separate records maintained by the Companies and may not necessarily be
indicative of the conditions that would have existed or the results of
operations if the Companies had been operated as unaffiliated companies. As
described in Note 3, portions of certain expenses represent allocations made
from the Companies' Parent.

DELOITTE & TOUCHE LLP
Seattle, Washington
May 29, 1998

F-35
<PAGE> 123

KBSG, INC. AND KNDD, INC.

COMBINED STATEMENTS OF INCOME
YEAR ENDED DECEMBER 31, 1995, AND SEVEN-MONTH
PERIODS ENDED JULY 31, 1995 AND 1996 (UNAUDITED)

<TABLE>
<CAPTION>
YEAR ENDED SEVEN MONTHS ENDED JULY 31,
DECEMBER 31, ---------------------------
1995 1995 1996
------------ ----------- ------------
(UNAUDITED)
<S> <C> <C> <C>
NET REVENUES:
Unaffiliated customers............................. $18,744,926 $8,682,084 $ 9,093,436
Related party...................................... 743,602 431,844 1,028,412
----------- ---------- -----------
19,488,528 9,113,928 10,121,848
OPERATING EXPENSES:
Operating expenses, excluding depreciation and
amortization and corporate, general, and
administrative expenses......................... 10,938,095 4,595,159 4,821,993
Depreciation and amortization...................... 1,532,665 889,813 902,825
Provision for doubtful accounts.................... 163,379 107,827 27,735
General and administrative......................... 1,505,255 976,678 578,459
----------- ---------- -----------
Total operating expenses................... 14,139,394 6,569,477 6,331,012
----------- ---------- -----------
Operating income........................... 5,349,134 2,544,451 3,790,836
OTHER INCOME......................................... 343,164 173,129 181,781
INTEREST EXPENSE, related party...................... (1,365,000) (796,250) (630,287)
----------- ---------- -----------
Income before income taxes................. 4,327,298 1,921,330 3,342,330
INCOME TAXES......................................... 1,745,960 813,482 1,296,621
----------- ---------- -----------
NET INCOME........................................... $ 2,581,338 $1,107,848 $ 2,045,709
=========== ========== ===========
</TABLE>

See notes to combined financial statements.
F-36
<PAGE> 124

KBSG, INC. AND KNDD, INC.

STATEMENTS OF CASH FLOWS
YEAR ENDED DECEMBER 31, 1995, AND SEVEN-MONTH

PERIODS ENDED JULY 31, 1995 AND 1996 (UNAUDITED)

<TABLE>
<CAPTION>
YEAR ENDED SEVEN MONTHS ENDED JULY 31,
DECEMBER 31, ---------------------------
1995 1995 1996
------------ ------------ ------------
(UNAUDITED)
<S> <C> <C> <C>
OPERATING ACTIVITIES:
Net income............................................ $ 2,581,338 $ 1,107,848 $ 2,045,709
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization...................... 1,532,665 889,813 902,825
Loss (gain) on sale of property and equipment...... 7,655 (3,219)
Cash provided (used) by changes in operating assets
and liabilities:
Accounts receivable.............................. (117,162) 303,582 (14,244)
Prepaid expenses and other assets................ 11,651 10,436 34,222
Accounts payable and accrued expenses............ 284,600 (258,713) 185,407
----------- ----------- -----------
Net cash provided by operating activities..... 4,300,747 2,052,966 3,150,700
=========== =========== ===========
INVESTING ACTIVITIES:
Purchase of property and equipment.................... (225,615) (158,778) (92,076)
Proceeds from sale of property and equipment.......... 14,711 12,366 8,255
Net cash used by investing activities................. (210,904) (146,412) (83,821)
----------- ----------- -----------
FINANCING ACTIVITIES:
Net Change in due from Parent......................... (4,116,170) (1,932,962) (3,073,980)
NET DECREASE IN CASH AND CASH EQUIVALENTS............... (26,327) (26,408) (7,101)
CASH AND CASH EQUIVALENTS:
Beginning of period................................... 51,760 51,760 25,433
----------- ----------- -----------
End of period......................................... $ 25,433 $ 25,352 $ 18,332
=========== =========== ===========
</TABLE>

See notes to combined financial statements.
F-37
<PAGE> 125

KBSG, INC. AND KNDD, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1995, AND SEVEN-MONTH
PERIODS ENDED JULY 31, 1995 AND 1996 (UNAUDITED)

NOTE 1: DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION: KBSG, Inc. and KNDD,
Inc. (the "Companies") own and operate radio stations KBSG-AM and -FM, and
KNDD-FM, respectively (the "Stations"), which broadcast in the greater Seattle,
Washington area. The Companies are wholly owned subsidiaries of Viacom Inc. (the
"Parent"). Effective August 1, 1996, the Stations were acquired by Entercom
Communications Corp., formerly Entertainment Communications, Inc. Accordingly,
the accompanying statements of income and cash flows include the accounts of the
Companies on a combined basis for 1995, and the unaudited interim seven-month
periods ended July 31, 1995 and 1996. Intercompany transactions are eliminated
in combination.

UNAUDITED INTERIM FINANCIAL INFORMATION: The accompanying unaudited
interim statements of income and cash flows for the seven-month periods ended
July 31, 1995 and 1996 are unaudited. In the opinion of management, such
unaudited interim financial statements have been prepared on a basis
substantially consistent with the audited financial statements and include all
adjustments, consisting only of normal recurring adjustments, necessary for a
fair presentation of the statements of income and cash flows for those periods.

REVENUE RECOGNITION: Revenues consist primarily of sales of advertising
time and are recognized when advertisements are broadcast. Revenues from the
Stations' exchange of advertising time for goods or services (barter revenue)
are recognized based on the estimated value of advertising time provided, which
approximates the estimated fair value of the items received or to be received.
The value assigned to the goods and services received is charged to expense when
used. Barter revenue was approximately $1,035,800 for 1995.

DEPRECIATION AND AMORTIZATION: Depreciation of property and equipment is
provided using the straight-line method over their estimated useful lives
ranging from three to 20 years. Amortization of intangible assets, consisting
primarily of FCC licenses and goodwill is provided using the straight-line
method over 30 years.

ADVERTISING EXPENSES: Advertising costs are expensed as incurred and
totalled approximately $1,426,187 for 1995.

INCOME TAXES: The Companies are included in the consolidated federal
income tax return of the Parent. Income taxes have not historically been
allocated to the Companies. However, for purposes of the accompanying financial
statements, a provision for income taxes has been made in accordance with
Statement of Financial Accounting Standards ("SFAS") No. 109, Accounting for
Income Taxes, as if the Companies filed separate tax returns. Information
regarding deferred income taxes is not available. The effective income tax rate
for the year ended December 31, 1995, varies from the statutory income tax rate
of 34% due to nondeductible amortization.

STATEMENTS OF CASH FLOWS: For purposes of the statements of cash flow, the
Companies consider highly liquid, short-term investments purchased with
remaining maturities of 90 days or less to be cash equivalents. Interest on
Parent debt and income taxes are deemed paid when accrued and credited to
amounts due from Parent. Actual payments to creditors and tax authorities are
made by the Parent. Also see Note 3.

PROVISION FOR DOUBTFUL ACCOUNTS: The Companies extend credit to customers
on an unsecured basis in the normal course of business. The customers are
generally located in the greater Seattle, Washington area, and no individual
industry or industry segment is significant to the Company's customer base. The
Companies record a provision for doubtful accounts based on their estimate of
uncollectible accounts receivable. Bad debt write-offs, net of recoveries, were
$193,000 for the year ended December 31, 1995.

F-38
<PAGE> 126
KBSG, INC. AND KNDD, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

USE OF ESTIMATES: 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 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.

NOTE 2: COMMITMENTS

The Companies lease office space under operating leases expiring from 1998
to 2004. Rental expenses pursuant to the terms of these operating leases were
$295,670 for the year ended December 31, 1995.

At December 31, 1995, future minimum rental payments required under these
leases are as follows:

<TABLE>
<S> <C>
1996..................................................... $ 790,548
1997..................................................... 790,548
1998..................................................... 372,548
1999..................................................... 268,482
2000..................................................... 148,848
Thereafter............................................... 58,404
----------
$2,429,378
==========
</TABLE>

NOTE 3: RELATED PARTY TRANSACTIONS

In the ordinary course of business, the Companies enter into transactions
with the Parent which are recorded through a due-from-Parent account. Such
transactions for the year ended December 31, 1995, consist primarily of:

<TABLE>
<S> <C>
Barter revenue.............................................. $ 744,000
Income tax expense payable to Parent........................ 1,746,000
Interest expense on Parent company debt at 9.75%............ 1,365,000
Corporate overhead charges.................................. 806,000
</TABLE>

The corporate overhead charge allocated to the seven month period ended
July 31, 1995 was approximately $470,000. There was no corporate overhead charge
for the seven month period ended July 31, 1996 (unaudited).

Other transactions include immaterial amounts related to employee benefits,
insurance, and other items. Although management is of the opinion that the
allocations used are reasonable, other allocations might be used that could
produce results substantially different from those reflected herein, and these
allocations might not be indicative of amounts which might be incurred with
unrelated parties.

The Companies' cash and financing requirements are managed on a centralized
basis by the Parent. Accordingly, the Companies' available cash is deposited in,
and cash requirements are transferred from, corporate accounts on a regular
basis. Such transactions are recorded through the due-from-Parent account.

The due-from-Parent account is noninterest bearing and has no specified
repayment date, which may not be indicative of arrangements that could be made
with unrelated parties. Arrangements with unrelated parties could produce
results substantially different from these reflected herein.

In June 1996, Parent Company debt of $14,000,000 was retired through
adjustment to the Parent company account.

F-39
<PAGE> 127
KBSG, INC. AND KNDD, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 4: EMPLOYEE BENEFIT PLANS

The Companies participate in a pension and other employee benefit plans
offered by the Parent covering substantially all employees. The Companies'
expenses related to the plans were not significant for the year ended December
31, 1995.

NOTE 5: RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

Subsequent to December 31, 1995, SFAS No. 121, Accounting for the
Impairment of Long-lived Assets and for Long-lived Assets to be Disposed Of,
became effective. SFAS No. 121 requires the Companies to analyze their
long-lived assets, such as fixed assets, identifiable intangibles, and goodwill,
for impairment when events or changes in circumstances indicate that the
carrying amount of such assets may not be recoverable. Adoption of this standard
is not expected to have a material effect on the financial statements.

Other subsequently issued pronouncements, such as SFAS No. 123, Stock-based
Compensation, SFAS No. 128, Earnings per Share, SFAS No. 130, Segment
Information, SFAS No. 131, Reporting Comprehensive Income, Statement of Position
(SOP) 98-1, Reporting the Costs of Computer Software Developed or Obtained for
Internal Use, SOP 98-5, Reporting the Costs of Start-up Activities, either do
not apply to the Companies or their adoption is not expected to have a material
effect on the financial statements.

F-40
<PAGE> 128

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders of
Entertainment Communications, Inc. and Subsidiaries:

We have audited the accompanying combined balance sheet of the Portland, Oregon
and Rochester, New York Radio Groups of Heritage Media Services,
Inc. -- Broadcasting Segment (the Company) as of December 31, 1997, and the
related combined statements of operations, stockholders' equity and cash flows
of the Portland, Oregon and Rochester, New York Radio Groups of Heritage Media
Services, Inc. -- Broadcasting Segment (the Predecessor) for the eight months
ended August 31, 1997 and of the Company for the four months ended December 31,
1997. These financial statements are the responsibility of the Company's and the
Predecessor's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the financial position of the Company as of
December 31, 1997, and the results of operations and cash flows of the
Predecessor for the eight months ended August 31, 1997, and of the Company for
the four months ended December 31, 1997, in conformity with generally accepted
accounting principles.

ARTHUR ANDERSEN LLP
Baltimore, Maryland,
May 29, 1998

F-41
<PAGE> 129

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

COMBINED BALANCE SHEET
AS OF DECEMBER 31, 1997
(IN THOUSANDS)

<TABLE>
<CAPTION>
1997
--------
<S> <C>
ASSETS
CURRENT ASSETS:
Cash...................................................... $ 594
Accounts receivable, net of allowance for doubtful
accounts of $166....................................... 3,474
Prepaid expenses and other current assets................. 41
Deferred barter costs..................................... 113
Deferred tax asset........................................ 64
--------
Total current assets.............................. 4,286
PROPERTY, PLANT AND EQUIPMENT, net.......................... 4,497
DUE FROM AFFILIATE.......................................... 1,719
ACQUIRED INTANGIBLE BROADCASTING ASSETS, net................ 116,171
--------
Total Assets...................................... $126,673
========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses..................... $ 520
Deferred revenue.......................................... 11
Deferred barter revenue................................... 108
--------
Total current liabilities......................... 639
DEFERRED TAX LIABILITY...................................... 98
OTHER LONG-TERM LIABILITIES................................. 292
--------
Total Liabilities................................. 1,029
--------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, $1.00 par value, 10,000 shares authorized
and 10,000 shares issued and outstanding............... 10
Additional paid-in capital................................ 127,035
Accumulated deficit....................................... (1,401)
--------
Total Stockholders' Equity........................ 125,644
--------
Total Liabilities and Stockholders' Equity........ $126,673
========
</TABLE>

The accompanying notes are an integral part of this combined balance sheet.
F-42
<PAGE> 130

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

COMBINED STATEMENTS OF OPERATIONS
(IN THOUSANDS)

<TABLE>
<CAPTION>
PREDECESSOR COMPANY
------------ ------------
EIGHT MONTHS FOUR MONTHS
ENDED ENDED
AUGUST 31, DECEMBER 31,
1997 1997
------------ ------------
<S> <C> <C>
NET REVENUES:
Station broadcasting revenues, net of agency commissions
of $1,060 and $1,845, respectively..................... $10,449 $ 5,635
Revenues realized from station barter arrangements........ 847 464
------- -------
Total net revenues................................ 11,296 6,099
------- -------
OPERATING EXPENSES:
Programming and production................................ 4,024 2,059
Selling, general and administrative....................... 1,618 830
Corporate overhead allocation............................. 814 478
Expenses realized from station barter arrangements........ 922 411
Depreciation of property and equipment.................... 395 251
Amortization of acquired intangible broadcasting assets
and other assets....................................... 775 2,623
------- -------
Total operating expenses.......................... 8,548 6,652
------- -------
Broadcast operating income (loss)................. 2,748 (553)
------- -------
OTHER INCOME (EXPENSE):
Interest expense.......................................... 651 265
Other expense, net........................................ -- 21
------- -------
Income (loss) before provision for income taxes... 2,097 (839)
PROVISION FOR INCOME TAXES.................................. 1,339 562
------- -------
Net income (loss)................................. $ 758 $(1,401)
======= =======
</TABLE>

The accompanying notes are an integral part of these combined statements.
F-43
<PAGE> 131

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS)

<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL RETAINED EARNINGS/
--------------- PAID-IN (ACCUMULATED STOCKHOLDER'S
SHARES AMOUNT CAPITAL DEFICIT) EQUITY
------ ------ ---------- ------------------ -------------
<S> <C> <C> <C> <C> <C>
PREDECESSOR:
BALANCE, January 1, 1997......... 10 $ 10 $ -- $ 7,041 $ 7,051
HMC noncash capital
contributions............... -- -- 1,209 -- 1,209
Net income.................... -- -- -- 758 758
Acquisition by News
Corporation................. -- -- 125,291 (7,799) 117,492
----- ------ -------- ------- --------
BALANCE, August 31, 1997......... 10 $ 10 $126,500 $ -- $126,510
===== ====== ======== ======= ========
COMPANY:
BALANCE, September 1, 1997....... 10 $ 10 $126,500 $ -- $126,510
News Corporation noncash
capital contributions....... -- -- 535 -- 535
Net loss...................... -- -- -- (1,401) (1,401)
----- ------ -------- ------- --------
BALANCE, December 31, 1997....... 10 $ 10 $127,035 $(1,401) $125,644
===== ====== ======== ======= ========
</TABLE>

The accompanying notes are an integral part of these combined statements.
F-44
<PAGE> 132

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

COMBINED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
PREDECESSOR COMPANY
------------ ------------
EIGHT MONTHS FOUR MONTHS
ENDED ENDED
AUGUST 31, DECEMBER 31,
1997 1997
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)......................................... $ 758 $(1,401)
Adjustments to reconcile net income (loss) to net cash
flows from operating activities-
Depreciation of property and equipment................. 395 251
Amortization of acquired intangible broadcasting assets
and other assets...................................... 775 2,623
Changes in assets and liabilities, net of effects of
acquisitions-
(Increase) decrease in accounts receivable, net........ 121 (225)
Net effect of change in deferred barter revenue and
deferred barter
costs................................................ 76 (49)
Increase in prepaid expenses and other current
assets................................................ (15) (15)
Increase in deferred tax asset......................... (50) (15)
Increase (decrease) in accounts payable and accrued
expenses.............................................. (826) 150
Increase (decrease) in deferred revenue................ (75) 11
(Decrease) increase in deferred tax liability.......... 99 (1)
Decrease in other long-term liabilities................ (12) (25)
------- -------
Net cash flows from operating activities.......... 1,246 1,304
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment..................... (157) (11)
Acquisitions, net of cash acquired........................ (1,859) --
------- -------
Net cash flows from investing activities.......... (2,016) (11)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Decrease in due to affiliates............................. (512) --
Increase in due from affiliates........................... -- (1,719)
Capital contributions made by Parent...................... 1,209 535
------- -------
Net cash flows from financing activities.......... 697 (1,184)
------- -------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS........ (73) 109
CASH, beginning of period................................... 558 485
------- -------
CASH, end of period......................................... $ 485 $ 594
======= =======
SUPPLEMENTAL DISCLOSURES:
Cash paid for interest.................................... $ -- $ 21
======= =======
Cash paid for income taxes................................ $ 152 $ 29
======= =======
</TABLE>

The accompanying notes are an integral part of these combined statements.
F-45
<PAGE> 133

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

NOTES TO COMBINED FINANCIAL STATEMENTS
DECEMBER 31, 1997

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Basis of Presentation

Heritage Media Services, Inc. ("HMSI") operates in two
segments -- Marketing Services and Broadcasting. Heritage Media Corporation is
the parent company of HMSI, (collectively referred to hereafter as either "HMC"
or the "Parent"). The Broadcasting Segment was wholly-owned and operated by
HMSI, which was owned by HMC through August 31, 1997 (the "Predecessor"). In
July 1997, HMC entered into an asset sale agreement with Sinclair Broadcast
Group, Inc. ("SBG") whereby SBG would acquire 100% of the Broadcasting Segment
(which consisted of six television stations in three markets and 24 radio
stations in seven markets) for $630 million in cash. Effective September 1,
1997, The News Corporation Limited ("News Corporation") acquired all of the
license and nonlicense assets of HMC. Due to certain regulatory requirements,
News Corporation has established a trust to hold all of the license and
nonlicense assets of the Broadcasting Segment until the sale to SBG has closed.
The acquisition was accounted for under the purchase method of accounting
whereby the purchase price was allocated to property and programming assets and
acquired intangible broadcasting assets of $51.4 million and $578.6 million,
respectively.

During January 1998, Entertainment Communications, Inc. ("Entercom")
entered into an Asset Purchase Agreement with Tuscaloosa Broadcasting Inc.,
Sinclair Radio of Portland Licensee, Inc. and Sinclair Radio of Rochester
Licensee, Inc. (collectively referred to hereafter as "Sinclair") to acquire
KKSN-AM, KKSN-FM and KKRH-FM, all serving the Portland, Oregon radio market and
WBBF-AM, WBBF-FM, WKLX-FM and WQRV-FM, all serving the Rochester, New York radio
market for a purchase price of $126.5 million. Simultaneously with the above
agreement, Entercom entered into a Time Brokerage Agreement ("TBA") with
Sinclair whereby, effective March 1, 1998, Entercom programs these stations for
the period prior to consummation of the purchase agreement and Sinclair receives
a monthly TBA fee of $631,500. Closing on this transaction is expected in June
1998. The accompanying combined financial statements include the accounts of the
Portland, Oregon and Rochester, New York Radio Group, which are collectively
referred to hereafter as "the Company."

The accompanying December 31, 1997, balance sheet and related statements of
operations and cash flows for the four-month period ended December 31, 1997, are
presented on a new basis of accounting, reflecting the impact of the News
Corporation acquisition. The accompanying financial statements for the
eight-month period ended August 31, 1997, are presented as "Predecessor"
financial statements.

Disclosure of Certain Significant Risks and Uncertainties

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.

Concentration of Credit Risk

The Company's revenues and accounts receivable relate primarily to the sale
of advertising within the radio stations' broadcast areas. Credit is extended
based on an evaluation of the customers' financial condition. Credit losses are
provided for in the financial statements.

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

F-46
<PAGE> 134
THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

uncollectable trade receivables are maintained. At December 31, 1997, no
receivable from any customer exceeded 5% of stockholders' equity, and no
customer accounted for more than 10% of net revenues for the eight months ended
August 31, 1997 or for the four months ended December 31, 1997.

Acquired Intangible Broadcasting Assets

Acquired intangible broadcasting assets are being amortized over periods of
4 to 40 years. These amounts result from the acquisition of certain radio
station license and nonlicense assets by The News Corporation (see Note 1). The
Company monitors the individual financial performance of each of the stations
and continually evaluates the realizability of intangible and tangible assets
and the existence of any impairment to its recoverability based on the projected
undiscounted cash flows of the respective stations.

Intangible assets consist of the following as of December 31, 1997 (in
thousands):

<TABLE>
<CAPTION>
AMORTIZATION
PERIOD 1997
------------ --------
<S> <C> <C>
Goodwill.......................................... 40 years $1,897
FCC licenses...................................... 15-25 years 52,092
Other............................................. 4-25 years 65,172
--------
119,161
Less: Accumulated amortization.................... 2,626
--------
$116,535
========
</TABLE>

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation.
Depreciation is recorded on the straight-line basis over the estimated useful
lives of the assets. Property and equipment at December 31, 1997, are summarized
as follows (in thousands):

<TABLE>
<CAPTION>
USEFUL LIFE 1997
----------- ------
<S> <C> <C>
Land........................................................ -- $ 442
Broadcasting equipment...................................... 5-25 years 366
Buildings and improvements.................................. 12-30 years 3,684
Other equipment............................................. 4-8 years 256
------
4,748
Less: Accumulated depreciation.............................. 251
------
$4,497
======
</TABLE>

Barter Transactions

Certain program contracts provide for the exchange of advertising air time
in lieu of cash payments for the rights to such programming. These contracts are
recorded as the programs are aired at the estimated fair value of the
advertising air time given in exchange for the program rights. Network
programming is excluded from these calculations.

The Company broadcasts certain customers' advertising in exchange for
equipment, merchandise and services. The estimated fair value of the equipment,
merchandise or services received is recorded as deferred barter costs and the
corresponding obligation to broadcast advertising is recorded as deferred barter
revenues.

F-47
<PAGE> 135
THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

The deferred barter costs are expensed or capitalized as they are used, consumed
or received. Deferred barter revenues are recognized as the related advertising
is aired.

Revenues

Revenue from the sale of commercial broadcast time to advertisers is
recognized when the commercials are broadcast. Promotional fees are recognized
as services are rendered.

2. ACCRUED EXPENSES:

Accrued expenses consist of the following at December 31, 1997, (in
thousands):

<TABLE>
<CAPTION>
1997
----
<S> <C>
Commissions................................................. $193
Payroll and employee benefits............................... 137
Other....................................................... 187
----
$517
====
</TABLE>

3. DUE TO AFFILIATE:

The Predecessor had an arrangement with HMSI whereby HMSI would provide
certain management and other services to the Predecessor. The services provided
included consultation and direct management assistance with respect to
operations and strategic planning. The Predecessor was allocated approximately
$814,000 of corporate overhead expenses for these services for the eight months
ended August 31, 1997.

In order to fund acquisitions and provide operating funds, HMSI entered
into a Bank Credit Agreement. The debt used to finance acquisitions and fund
daily operations of the Predecessor was recorded by the Predecessor as due to
affiliate in the year ending December 31, 1996. HMSI allocated interest at a
rate of approximately 10.0%, which approximated the average rate paid on the
borrowings. Associated with the HMSI debt, the Predecessor was allocated
approximately $0.6 million of deferred financing costs in 1996. The deferred
financing costs were fully amortized in accordance with the acquisition by News
Corporation on September 1, 1997.

4. INCOME TAXES:

The Parent files a consolidated federal tax return and separate state tax
returns for each of its subsidiaries in certain filing jurisdictions. It is the
Parent's policy to pay the federal income tax provision of the Company. The
accompanying financial statements have been prepared in accordance with the
separate return method of FASB 109, whereby the allocation of the federal tax
provision due to the Parent is based on what the Company's current and deferred
federal tax provision would have been had the Company filed a federal income tax
return outside of its consolidated group. The Company is not required to
reimburse the Parent for its federal tax provision. Accordingly, this amount is
recorded as a capital contribution in the accompanying consolidated financial
statements. No federal deferred tax assets or liabilities are recorded because
those amounts are considered currently paid to or received by the Parent. The
federal and state tax provision was calculated based on pretax income, plus or
minus permanent book-to-tax differences, times the statutory tax rate of 40%.
The Company had no alternative minimum tax credit carryforwards as of December
31, 1997. The effective tax rate in the current year exceeds the statutory tax
rate of 40% due to the effects of nondeductible goodwill.

F-48
<PAGE> 136
THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

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

<TABLE>
<CAPTION>
PREDECESSOR COMPANY
------------ ------------
EIGHT MONTHS FOUR MONTHS
ENDED ENDED
AUGUST 31, DECEMBER 31,
1997 1997
------------ ------------
<S> <C> <C>
Current:
Federal.................................................. $1,267 $523
State.................................................... 81 33
------ ----
1,348 556
------ ----
Deferred:
Federal.................................................. -- --
State.................................................... (9) 6
------ ----
(9) 6
------ ----
Provision for income taxes................................. $1,339 $562
====== ====
</TABLE>

The following is a reconciliation of federal income taxes at the applicable
statutory rate to the recorded provision (in thousands):

<TABLE>
<CAPTION>
PREDECESSOR COMPANY
------------ ------------
EIGHT MONTHS FOUR MONTHS
ENDED ENDED
AUGUST 31, DECEMBER 31,
1997 1997
------------ ------------
<S> <C> <C>
Statutory federal income taxes............................. $ 703 $ (504)
Adjustments:
State income taxes, net of federal effect................ 82 (59)
Non-deductible goodwill amortization..................... 276 1,125
Other.................................................... 278 --
------ ------
Provision for income taxes................................. $1,339 $ 562
====== ======
</TABLE>

The following table summarizes the state tax effects of the significant
types of temporary differences between financial reporting basis and tax basis
which were generated during the years ended December 31, 1997 (in thousands):

<TABLE>
<CAPTION>
1997
----
<S> <C>
Deferred Tax Assets:
Bad debt reserve.......................................... $14
Accruals.................................................. 27
Other intangibles......................................... 23
---
$64
===
Deferred Tax Liability:
Depreciation.............................................. $98
===
</TABLE>

5. EMPLOYEE BENEFIT PLAN:

Company employees were covered by HMC's Retirement Savings Plan (the Plan)
through December 31, 1997, whereby participants contributed portions of their
annual compensation to the Plan and

F-49
<PAGE> 137
THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

certain contributions were made at the discretion of the Company based on
criteria set forth in the Plan Agreement. Participants are generally 100% vested
in Company contributions after five years of employment with the Company.
Company expenses under the Plan were not material for the year ended December
31, 1997.

6. RELATED PARTY TRANSACTIONS:

The Company received certain advances from HMC during the eight months
ended August 31, 1997, which were evidenced by a subordination agreement. All
advances from HMC were repaid on August 31, 1997.

7. CONTINGENCIES AND OTHER COMMITMENTS:

Leases and Contracts

The Company and its subsidiaries lease certain real property and
transportation and other equipment under noncancellable operating leases
expiring at various dates through 2015. The Company also has long-term
contractual obligations with two major broadcast ratings firms that provide
monthly ratings services and guaranteed store contracts. Rent expense under
these leases for the eight months ended August 31, 1997, and for the four months
ended December 31, 1997, was approximately $210,000 and $105,000, respectively.

Future minimum payments under the leases are as follows (in thousands):

<TABLE>
<S> <C>
1998........................................................ $ 392
1999........................................................ 386
2000........................................................ 386
2001........................................................ 371
2002........................................................ 357
2003 and thereafter......................................... 814
------
$2,706
======
</TABLE>

Litigation

Lawsuits and claims are filed against the Company from time to time in the
ordinary course of business which are generally incidental to its business.
Management of the Company does not believe the resolution of such matters will
have a significant effect on its liquidity, financial position or results of
operations.

F-50
<PAGE> 138

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

COMBINED BALANCE SHEETS
AS OF DECEMBER 31, 1997 AND MARCH 31, 1998
(IN THOUSANDS)

PREDECESSOR COMPANY
DECEMBER 31, MARCH 31,
1997 1998
------------ --------
(UNAUDITED)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash...................................................... $ 594 $ --
Accounts receivable, net of allowance for doubtful
accounts of $166....................................... 3,474 --
Prepaid expenses and other current assets................. 41 --
Deferred barter costs..................................... 113 --
Deferred tax asset........................................ 64 --
-------- --------
Total current assets.............................. 4,286 --
PROPERTY, PLANT AND EQUIPMENT, net.......................... 4,497 5,152
DUE FROM AFFILIATE.......................................... 1,719 --
ACQUIRED INTANGIBLE BROADCASTING ASSETS, net................ 116,171 116,934
-------- --------
Total Assets...................................... $126,673 $122,086
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses..................... $ 520 $ --
Deferred revenue.......................................... 11 --
Deferred barter revenue................................... 108 --
Due to parent............................................. -- 70
-------- --------
Total current liabilities......................... 639 70
DEFERRED TAX LIABILITY...................................... 98 --
OTHER LONG-TERM LIABILITIES................................. 292 --
-------- --------
Total Liabilities................................. 1,029 70
-------- --------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, $1.00 par value, 10,000 shares authorized
and 10,000 and 0 shares issued and outstanding......... 10 --
Additional paid-in capital................................ 127,035 122,827
Accumulated deficit....................................... (1,401) (811)
-------- --------
Total Stockholders' Equity........................ 125,644 122,016
-------- --------
Total Liabilities and Stockholders' Equity........ $126,673 $122,086
======== ========
</TABLE>

The accompanying notes are an integral part of these combined balance sheets.
F-51
<PAGE> 139

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

COMBINED STATEMENTS OF OPERATIONS
(IN THOUSANDS)

<TABLE>
<CAPTION>
PREDECESSOR PREDECESSOR COMPANY
THREE MONTHS TWO MONTHS ONE MONTH
ENDED ENDED ENDED
MARCH 31, 1997 FEBRUARY 28, 1998 MARCH 31, 1998
-------------- ----------------- --------------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
NET REVENUES:
Station broadcasting revenue, net of agency
commissions of $611 and $387, respectively.... $3,349 $ 2,169 $ --
Revenues realized from station barter
arrangements.................................. 249 187 --
Time brokerage agreement revenues............... -- -- 635
------ ------- -----
Total net revenues.................... 3,598 2,356 635
OPERATING EXPENSES:
Programming and production...................... 1,303 824 3
Selling, general and administrative............. 885 603 --
Expenses realized from station barter
arrangements.................................. 245 280 --
Depreciation of property and equipment.......... 147 126 78
Amortization of acquired intangible broadcasting
assets and other assets....................... 287 1,503 663
------ ------- -----
Total operating expenses.............. 2,867 3,336 744
------ ------- -----
Broadcast operating income (loss)..... 731 (980) (109)
------ ------- -----
OTHER EXPENSE:
Interest expense................................ 261 -- 702
------ ------- -----
Income (loss) before provision for
income taxes........................ 470 (980) (811)
PROVISION FOR INCOME TAXES...................... 52 40 --
------ ------- -----
Net income (loss)..................... $ 418 $(1,020) $(811)
====== ======= =====
</TABLE>

The accompanying notes are an integral part of these combined statements.
F-52
<PAGE> 140

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

COMBINED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
PREDECESSOR PREDECESSOR COMPANY
THREE MONTHS TWO MONTHS ONE MONTH
ENDED ENDED ENDED
MARCH 31, 1997 FEBRUARY 28, 1998 MARCH 31, 1998
-------------- ----------------- --------------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)............................. $ 418 $(1,020) $(811)
Adjustments to reconcile net income (loss) to
net cash flows from operating activities-
Depreciation of property and equipment...... 147 126 78
Amortization of acquired intangible
broadcasting assets and other assets..... 287 1,503 663
Changes in certain assets and liabilities, net
of effects of acquisitions:
Decrease in accounts receivable, net........ 644 415 --
Net effect of change in deferred barter
revenue and deferred barter costs........ (6) 96 --
Increase in prepaid expenses and other
assets................................... (9) (3) --
(Decrease) increase in accounts payable and
accrued expenses......................... (535) 76 --
Decrease in deferred revenue................ (3) -- --
Decrease in other long-term liabilities..... (1) (70) --
------- ------- -----
Net cash flows from operating
activities........................ 942 1,123 (70)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment......... (82) (7) --
Acquisitions, net of cash acquired............ (1,894) -- --
------- ------- -----
Net cash flows from investing
activities........................ (1,976) (7) --
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase (decrease) in due to affiliates...... 995 (1,111) 70
------- ------- -----
Net cash flows from financing
activities........................ 995 (1,111) 70
------- ------- -----
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS................................. (39) 5 --
CASH, beginning of period..................... 558 594 --
------- ------- -----
CASH, end of period........................... $ 519 $ 599 $ --
======= ======= =====
</TABLE>

The accompanying notes are an integral part of these combined statements.
F-53
<PAGE> 141

THE PORTLAND, OREGON AND ROCHESTER, NEW YORK RADIO GROUPS
OF HERITAGE MEDIA SERVICES, INC. -- BROADCASTING SEGMENT

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Basis of Presentation

Heritage Media Services, Inc. ("HMSI") operates in two
segments -- Marketing Services and Broadcasting. Heritage Media Corporation is
the parent company of HMSI, (collectively referred to hereafter as either "HMC"
or the "Parent"). The Broadcasting Segment was wholly-owned and operated by
HMSI, which was owned by HMC through August 31, 1997 (the "Predecessor"). In
July 1997, HMC entered into an asset sale agreement with Sinclair Broadcast
Group, Inc. ("SBG") whereby SBG would acquire 100% of the Broadcasting Segment
(which consisted of six television stations in three markets and 24 radio
stations in seven markets) for $630 million in cash. Effective September 1,
1997, The News Corporation Limited ("News Corporation") acquired all of the
license and nonlicense assets of HMC. Due to certain regulatory requirements,
News Corporation established a trust to hold all of the license and nonlicense
assets of the Broadcasting Segment until the sale to SBG had closed. The
acquisition was accounted for under the purchase method of accounting whereby
the purchase price was allocated to property and programming assets and acquired
intangible broadcasting assets of $51.4 million and $578.6 million,
respectively.

During January 1998, Entertainment Communications, Inc. ("Entercom")
entered into an Asset Purchase Agreement with Tuscaloosa Broadcasting Inc.,
Sinclair Radio of Portland Licensee, Inc. and Sinclair Radio of Rochester
Licensee, Inc. (collectively referred to hereafter as "Sinclair") to acquire
KKSN-AM, KKSN-FM and KKRH-FM, all serving the Portland, Oregon radio market and
WBBF-AM, WBBF-FM, WKLX-FM and WQRV-FM, all serving the Rochester, New York radio
market for a purchase price of $126.5 million. Simultaneously with the above
agreement, Entercom entered into a Time Brokerage Agreement ("TBA") with
Sinclair whereby, effective March 1, 1998, Entercom programs these stations for
the period prior to consummation of the purchase agreement and Sinclair receives
a monthly TBA fee of $631,500. Effective March 1, 1998, SBG completed its
acquisition of the Portland, Oregon and Rochester, New York Radio Groups from
News Corporation. The acquisition was accounted for under the purchase method of
accounting whereby the purchase price was allocated to the assets to be sold. In
June 1998, Entercom closed its transaction with Sinclair. The accompanying
combined financial statements include the accounts of the Portland, Oregon and
Rochester, New York Radio Group, which are collectively referred to hereafter as
"the Company."

The accompanying March 31, 1998, balance sheet and the related statements
of operations and cash flows for the one-month period ended March 31, 1998, are
presented on a new basis of accounting, reflecting the impact of the acquisition
by SBG. The accompanying financial statements for the three months ended March
31, 1997, and the two months ended February 28, 1998, are presented as
"Predecessor" financial statements.

Interim Financial Statements

The combined financial statements for the period ended March 31, 1997, the
two months ended February 28, 1998, and the one month ended March 31, 1998, are
unaudited, but in the opinion of management, such financial statements have been
presented on the same basis as the audited combined financial statements and
include all adjustments, consisting only of normal recurring adjustments
necessary for a fair presentation of the financial position and results of
operations, and cash flows for these periods. The results of operations
presented in the accompanying financial statements are not necessarily
representative of operations for an entire year.

F-54
<PAGE> 142

INDEPENDENT AUDITORS' REPORT

Entercom Communications Corp.:

We have audited the accompanying combined balance sheet of the Boston Radio
Market of CBS Radio, Inc. (the "Boston Radio Market") (formerly American Radio
Systems Corporation ("ARS") prior to the sale of ARS to CBS on June 4, 1998),
which is comprised of radio properties owned by CBS Radio, Inc., a wholly owned
subsidiary of CBS Corporation ("CBS") as of December 31, 1997, and the related
combined statements of operations, and cash flows for the year ended December
31, 1997. These financial statements are the responsibility of the management of
the Boston Radio Market. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. 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 audit provides a reasonable basis for our opinion.

In our opinion, such financial statements present fairly, in all material
respects, the combined financial position of the Boston Radio Market as of
December 31, 1997, and the results of their combined operations and their
combined cash flows for the year then ended in conformity with generally
accepted accounting principles.

The accompanying combined financial statements have been prepared from the
separate accounting records maintained by the Boston Radio Market while owned by
ARS and may not be indicative of the conditions that would have existed or the
results of operations had the assets to be sold been operated as an unaffiliated
company. As discussed in Note 1, certain of the operating expenses represent
allocations made by ARS in the accompanying financial statements.

In August 1998, CBS Radio, Inc. entered into an agreement to sell the net
assets of the Boston Radio Market to Entercom Communications Corp.

DELOITTE & TOUCHE LLP
Boston, Massachusetts
September 18, 1998

F-55
<PAGE> 143

THE BOSTON RADIO MARKET OF CBS RADIO, INC.

COMBINED BALANCE SHEETS
DECEMBER 31, 1997 AND JUNE 30, 1998

<TABLE>
<CAPTION>
PREDECESSOR CURRENT
OWNER OWNER
------------- -------------
DECEMBER 31, JUNE 30,
1997 1998
------------- -------------
(UNAUDITED)
(NOTE 1)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Accounts and notes receivable (less allowances for doubtful accounts of
$2,140,000 in 1997 and $2,690,000 (unaudited) in 1998)....................... $ 8,246,194 $ 9,275,415
Prepaid expenses and other assets............................................... 486,976 893,408
Deposits and other current assets -- related parties............................ 6,695 --
------------- -------------
Total................................................................... 8,739,865 10,168,823
------------- -------------
PROPERTY AND EQUIPMENT -- Net..................................................... 11,799,363 10,380,837
------------- -------------
OTHER ASSETS:
Intangible assets -- net........................................................ 33,006,828 32,292,335
Other assets.................................................................... 94,758 94,758
------------- -------------
Total................................................................... 33,101,586 32,387,093
------------- -------------
TOTAL............................................................................. $ 53,640,814 $ 52,936,753
============= =============
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Accounts payable................................................................ $ 994,252 $ 661,201
Accrued compensation............................................................ 303,104 607,799
Accrued expenses................................................................ 794,867 1,714,657
Capitalized lease obligation.................................................... 137,762 35,324
------------- -------------
Total................................................................... 2,229,985 3,018,981
COMMITMENTS AND CONTINGENCIES (Note 6)
EQUITY............................................................................ 51,410,829 49,917,772
------------- -------------
TOTAL............................................................................. $ 53,640,814 $ 52,936,753
============= =============
</TABLE>

See notes to combined financial statements.
F-56
<PAGE> 144

THE BOSTON RADIO MARKET OF CBS RADIO, INC.

COMBINED STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1997, SIX MONTHS ENDED JUNE 30, 1997,
FIVE MONTHS ENDED MAY 31, 1998, AND ONE MONTH ENDED JUNE 30, 1998

<TABLE>
<CAPTION>
PREDECESSOR OWNER CURRENT OWNER
--------------------------------------------- --------------
YEAR ENDED SIX MONTHS FIVE MONTHS ONE MONTH
DECEMBER 31, ENDED JUNE 30, ENDED MAY 31, ENDED JUNE 30,
1997 1997 1998 1998
------------- -------------- -------------- --------------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
(NOTE 1)
<S> <C> <C> <C> <C>
NET REVENUES................................. $ 37,331,314 $ 19,468,896 $ 14,994,176 $ 3,475,627
------------- ------------ ------------ ------------
OPERATING EXPENSES:
Operating expenses, excluding depreciation,
amortization, general and administrative
expenses................................ 27,747,140 14,143,092 12,205,334 2,533,595
Depreciation and amortization.............. 2,852,025 1,287,158 1,245,587 249,117
General and administrative................. 5,092,850 2,652,002 2,630,801 340,448
------------- ------------ ------------ ------------
Total operating expenses........... 35,692,015 18,082,252 16,081,722 3,123,160
------------- ------------ ------------ ------------
OPERATING INCOME (LOSS) BEFORE INCOME
TAXES...................................... 1,639,299 1,386,644 (1,087,546) 352,467
INCOME TAX EXPENSE (BENEFIT)................. 660,600 558,800 (438,300) 142,000
------------- ------------ ------------ ------------
NET INCOME (LOSS)............................ $ 978,699 $ 827,844 $ (649,246) $ 210,467
============= ============
</TABLE>

See notes to combined financial statements.
F-57
<PAGE> 145

THE BOSTON RADIO MARKET OF CBS RADIO, INC.

COMBINED STATEMENTS OF CASH FLOWS
YEAR ENDED DECEMBER 31, 1997, SIX MONTHS ENDED JUNE 30, 1997,
FIVE MONTHS ENDED MAY 31, 1998, AND ONE MONTH ENDED JUNE 30, 1998

<TABLE>
<CAPTION>
PREDECESSOR OWNER CURRENT
OWNER
----------------------------------------- -----------
SIX MONTHS FIVE MONTHS ONE MONTH
YEAR ENDED
DECEMBER 31, ENDED JUNE ENDED MAY ENDED JUNE
30, 31, 30,
1997 1997 1998 1998
------------- ------------- ----------- -----------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
(NOTE 1)
<S> <C> <C> <C> <C>
NET CASH PROVIDED BY (USED FOR) OPERATING
ACTIVITIES (Note 1).............................. $ 3,674,288 $ 2,037,283 $ (4,440) $ (888)
------------- ------------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment............... (1,396,694) (322,184) (373,488) --
Proceeds from sale of property................... 60,654 10,500 -- --
------------- ------------- --------- ---------
Net cash used for investing
activities............................. (1,336,040) (311,684) (373,488) --
------------- ------------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of long-term debt..................... (189,840) (92,480) (85,000) (17,438)
------------- ------------- --------- ---------
Net transfer (to) from Owner..................... (2,148,408) (1,633,119) 462,928 18,326
------------- ------------- --------- ---------
Net cash (used for) provided by financing
activities............................. (2,338,248) (1,725,599) 377,928 888
------------- ------------- --------- ---------
CASH, BEGINNING AND END OF PERIOD.................. $ -- $ -- $ -- $ --
============= =============
</TABLE>

- ---------------
NONCASH ACTIVITIES:

In 1997, the Predecessor Owner acquired $24.8 million in assets,
principally intangible assets, which were financed by the Owners.

In 1997, the Predecessor Owner transferred assets to an affiliate of the
Stations totaling approximately $1 million.

See notes to combined financial statements.
F-58
<PAGE> 146

THE BOSTON RADIO MARKET OF CBS RADIO, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1997, SIX MONTHS ENDED JUNE 30, 1997,
FIVE MONTHS ENDED MAY 31, 1998, AND ONE MONTH ENDED JUNE 30, 1998

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business and Basis of Presentation -- The accompanying financial statements
present the combined assets, liabilities and operations of the Boston Radio
Market of CBS Radio, Inc. (the "Boston Radio Market"), which is comprised of
radio stations WRKO-AM, WEEI-AM, WEGQ-FM, WAAF-FM, serving the Boston,
Massachusetts, radio market, and WWTM-AM, serving the Worcester, Massachusetts,
radio market (the "Stations"). Through June 4, 1998, the Stations were owned by
American Radio Systems Corporation (the "Predecessor Owner" or "ARS"), an
operator of radio stations throughout the United States. On June 4, 1998, ARS
was acquired by CBS Radio, Inc., a wholly owned subsidiary of CBS Corporation
(collectively with CBS Radio, Inc., "CBS" or the "Current Owner"). In connection
with the acquisition of ARS by CBS (the "ARS/CBS merger"), CBS was required to
sell the Boston Radio Market to comply with certain regulations of the Federal
Communications Commission. During August 1998, CBS entered into purchase and
sale agreements with Entercom Communications Corp. ("Entercom") to sell the net
assets of the Boston Radio Market for approximately $140.0 million, subject to
receipt of regulatory approval which is expected to be received during 1998. CBS
and ARS are referred to as the Stations' "Owners" for purposes of these notes to
combined financial statements. All significant intercompany transactions have
been eliminated in combination.

Interim Financial Information and Related Valuation of Assets Acquired and
Liabilities Assumed -- The unaudited financial statements for the six months
ended June 30, 1997, the five months ended May 31, 1998, and the one month ended
June 30, 1998 have been prepared on a basis substantially consistent with that
of the audited Predecessor Owner's financial statements included herein. The
valuations of the assets acquired and the liabilities assumed have not been
prepared and, accordingly, the accompanying June 30, 1998 unaudited financial
statements have been prepared on the Predecessor Owner's historical cost basis
and do not reflect any purchase price adjustments. For purposes of preparing the
Predecessor Owner's unaudited financial statements, the ARS/CBS merger is
assumed to have occurred on May 31, 1998. In the opinion of management, such
unaudited financial statements include all adjustments, which are only of a
normal and recurring nature, considered necessary for a fair presentation.
Operating results for the unaudited periods presented are not necessarily
indicative of the results that may be expected for a full year.

Revenue Recognition -- Revenues are recognized when advertisements are
broadcast.

Property and Equipment -- Property and equipment are recorded at cost, and
depreciation is computed using straight-line and accelerated methods over
estimated useful lives ranging from three to twenty years.

Intangible Assets -- Intangible assets consist primarily of goodwill, FCC
licenses, and call letters acquired in connection with the acquisition of the
Stations and are being amortized over their respective estimated useful lives
(ranging from one to forty years) using the straight-line method.

On an ongoing basis, management evaluates the recoverability of the net
carrying value of property and equipment and intangible assets by reference to
the Stations' anticipated future cash flows generated by said assets and
comparison of carrying value to management's estimates of undiscounted fair
value, generally determined by using certain accepted industry measures of value
(principally, cash flow multiple methods).

Income Taxes -- The results of the Stations' operations are included in the
federal and state income tax returns filed by the Stations' Owners. The
Stations' portion of the income tax provision (benefit) is allocated at a
federal and state computed statutory rate of 40.3%. The Stations' federal and
state income taxes are generally paid to, or refunded from, the Owners. Deferred
tax assets and liabilities are maintained at the Owners' ownership levels.

F-59
<PAGE> 147
THE BOSTON RADIO MARKET OF CBS RADIO, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

Barter Transactions -- Revenues from the Stations' exchanges of advertising
time for goods or services are recognized at the fair market value of the items
received or to be received. The value of the goods and services received is
charged to expense when used. Net unearned barter balances are included in
accounts receivable.

Barter transactions are reported on a net basis within operating expenses
and balances as of and for the year ended December 31, 1997 were approximately
as follows:

<TABLE>
<S> <C>
Barter revenues.......................................... $2,273,689
Barter expenses.......................................... 1,978,702
Net barter receivable.................................... 120,852
</TABLE>

Use of Estimates -- The preparation of combined financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes to the financial statements. Management bases
its estimates on certain assumptions which they believe are reasonable in the
circumstances, and while actual results could differ from those estimates.
management does not believe that any change in those assumptions in the near
term would have a material effect on its financial position, results of
operations or liquidity.

Allocation of Certain Operating Expenses -- The operations, as presented
herein, include allocations and estimates of certain expenses, principally
corporate accounting and tax, rent, administrative salaries, and legal,
historically provided to the Stations by the Owners. The amounts of such
allocated expenses in these combined financial statements have been allocated by
management based on a variety of factors, including, for example, personnel,
labor costs and square footage. Management believes these allocations have been
made on a reasonable basis. However, the financial position and results of
operations, as presented herein, may not be the same as would have occurred had
the Stations been operated as a stand-alone entity.

Interest expense incurred by the Owners under various long-term debt
arrangements has not historically been allocated to the Stations and,
accordingly, the accompanying combined financial statements do not include
interest expense. See Note 4 for interest expense associated with a capitalized
lease obligation.

Concentration of Credit Risk -- The Stations extend credit to customers on
an unsecured basis in the normal course of business. No individual industry or
industry segment is significant to the Stations' customer base. The Stations
have policies governing the extension of credit and collection of amounts due
from customers.

Impairment of Long-Lived Assets -- Recoverability of long-lived assets is
determined by periodically comparing the forecasted undiscounted net cash flows
of the operations to which the assets relate to the carrying amount, including
associated intangible assets of such operations. Through December 31, 1997, no
impairments requiring adjustments have occurred.

Supplemental Cash Flow Information -- The Stations participate in a
centralized cash management system maintained by the Owners. Accordingly, cash
balances are not maintained at the Stations. The Stations' assets are pledged as
collateral for the Owners' long-term debt agreements.

F-60
<PAGE> 148
THE BOSTON RADIO MARKET OF CBS RADIO, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

The components of cash provided by operating activities for the year ended
December 31, 1997 are as follows:

<TABLE>
<S> <C>
Net income.................................................. $ 978,699
Reconciliation of net income to net cash provided by
operating activities:
Depreciation and amortization............................. 2,852,025
Loss on disposal of property and equipment................ 28,021
Change in assets and liabilities:
Accounts receivable.................................... 405,299
Prepaid expenses....................................... (324,285)
Other assets........................................... 709,979
Accounts payable and accrued expenses.................. (975,450)
----------
Net cash provided by operating activities................... $3,674,288
==========
</TABLE>

Cash paid for interest aggregated $44,900 during 1997.

New Accounting Pronouncements -- During 1998, the Stations adopted
Statement of Financial Accounting Standards ("SFAS") No. 130, "Reporting
Comprehensive Income," and SFAS No. 131, "Disclosures about Segments of an
Enterprise and Related Information." The adoption of SFAS No. 130 and No. 131
did not affect the Stations' combined financial statements. In June 1998, the
Financial Accounting Standards Board issued SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities," which the Stations will adopt
during fiscal year 2000. The adoption of SFAS No. 133 is not expected to have a
material impact on the Stations' combined financial statements.

2. ACQUISITIONS

In January 1997, ARS completed the acquisition of WAAF-FM and WWTM-AM for
an aggregate purchase price of approximately $24.8 million (the "1997
Acquisition"). The purchase price related to the 1997 Acquisition was allocated
to the assets acquired, principally intangible assets, based on their estimated
fair value at the date of acquisition. Since the acquisition, the 1997
Acquisition has been included as a component of the Boston Radio Market. The
Predecessor Owner began programming and marketing the Stations pursuant to a
Local Marketing Agreement ("LMA") in August 1996 and, as a result, proforma
financial information has not been presented as such information would not be
materially different from the amounts presented in the historical 1997 combined
statements of operations.

3. PROPERTY AND EQUIPMENT AND INTANGIBLE ASSETS

Property and equipment consisted of the following at December 31, 1997:

<TABLE>
<S> <C>
Land and improvements....................................... $ 1,426,552
Buildings and improvements.................................. 3,133,400
Broadcast equipment(1)...................................... 8,847,524
Office and other equipment, furniture and fixtures.......... 2,382,158
Other....................................................... 7,430
-----------
Total....................................................... 15,797,064
Less accumulated depreciation............................... (3,997,701)
-----------
Property and equipment -- net............................... $11,799,363
===========
</TABLE>

- ---------------
(1) Includes approximately $570,000 of assets recorded under a capital lease
(see Note 4).

F-61
<PAGE> 149
THE BOSTON RADIO MARKET OF CBS RADIO, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

Intangible assets consisted of the following at December 31, 1997:

<TABLE>
<S> <C>
FCC licenses................................................ $30,786,241
Goodwill.................................................... 4,246,985
Other intangibles........................................... 2,044,207
-----------
Total....................................................... 37,077,433
Less accumulated amortization............................... (4,070,605)
-----------
Intangible assets -- net.................................... $33,006,828
===========
</TABLE>

4. CAPITALIZED LEASE OBLIGATION

In September of 1996, an equipment lease agreement with Fleet Capital
Corporation dated May 17, 1990 was extended for an additional twenty-four
months. Upon the lease's final payment in August 1998, ownership of the property
was transferred to the Stations. Interest expense, reported within general and
administrative expense in the accompanying combined statement of operations,
aggregated $32,400 during 1997.

5. EMPLOYEE BENEFIT PLAN

Through December 31, 1997, employees of the Stations participated in a
retirement savings plan (the "Plan") sponsored by the Predecessor Owner. The
Plan is a defined contribution plan that covers eligible salaried employees who
have at least one year of service. Participants may make pre-tax contributions
to the Plan up to 10% of their compensation, not to exceed the annual limit
prescribed by the Internal Revenue Service. The Owners matched contributions to
the Plan in an amount equal to 100% of the first 5% of base compensation that a
participant contributes to the Plan, unless otherwise determined by annual
resolution. The Stations were charged $90,000 by the Predecessor Owner for the
year ended December 31, 1997.

6. COMMITMENTS AND CONTINGENCIES

Broadcast Rights -- At December 31, 1997, the Stations were committed to
the purchase of broadcast rights for various sports events and other
programming, including on-air talent, aggregating approximately $21,134,000.
This programming is not yet available for broadcast. As of December 31, 1997,
aggregate payments related to these commitments during the next five years are
as follows (in thousands):

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31
<S> <C>
1998....................................................... $ 8,042
1999....................................................... 7,266
2000....................................................... 5,408
2001....................................................... 358
2002....................................................... 60
-------
$21,134
=======
</TABLE>

F-62
<PAGE> 150
THE BOSTON RADIO MARKET OF CBS RADIO, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

Leases -- The Stations lease various offices, studios, and broadcast and
other equipment under operating leases that expire over various terms. Most
leases contain renewal options with specified increases in lease payments in the
event of renewal by the Stations.

Future minimum rental payments required under noncancelable operating
leases in effect at December 31, 1997 are approximately as follows (in
thousands):

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31
<S> <C>
1998........................................................ $ 620
1999........................................................ 473
2000........................................................ 295
2001........................................................ 286
2002........................................................ 187
Thereafter.................................................. 1,378
------
Total....................................................... $3,239
======
</TABLE>

Aggregate rent expense under operating leases for the year ended December
31, 1997 approximated $438,000.

Audience Rating and Other Service Employment Contracts -- The Stations have
entered into various noncancelable audience rating and other service and
employment contracts that expire over the next five years. Most of these
audience rating and other service agreements are subject to escalation clauses
and may be renewed for successive periods ranging from one to five years on
terms similar to current agreements, except for specified increases in payments.
Certain of these contracts will not be assumed by Entercom.

Future minimum payments required under these contracts at December 31, 1997
are as follows (in thousands):

<TABLE>
<S> <C>
1998........................................................ $2,481
1999........................................................ 2,573
2000........................................................ 1,725
2001........................................................ 699
2002........................................................ 648
------
Total....................................................... $8,126
======
</TABLE>

Total expense under these contracts for the year ended December 31, 1997
approximated $2,574,000.

Litigation -- CBS has agreed to indemnify Entercom for any litigation
expenses associated with the Stations prior to the acquisition by Entercom.

* * * * * *

F-63
<PAGE> 151

- ------------------------------------------------------

NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE COMPANY, THE SELLING SHAREHOLDER OR ANY
UNDERWRITER. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY
JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH
JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE
INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE SUCH DATE.
------------------
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary.................... 4
Risk Factors.......................... 13
Use of Proceeds....................... 20
Recapitalization, Chase Conversion and
Former S Corporation Status......... 20
Dividend Policy....................... 21
Dilution.............................. 22
Capitalization........................ 23
CBS Transactions...................... 24
Completed Transactions................ 24
Unaudited Pro Forma Financial
Information......................... 27
Selected Historical Financial Data.... 34
Management's Discussion and Analysis
of Financial Condition and Results
of Operations....................... 36
Business.............................. 44
Management............................ 63
Certain Relationships and Related
Party Transactions.................. 69
Principal and Selling Shareholders.... 70
Description of Capital Stock.......... 71
Shares Eligible for Future Sale....... 75
Underwriting.......................... 76
Notice to Canadian Residents.......... 77
Legal Matters......................... 78
Experts............................... 78
Additional Information................ 79
Index to Financial Statements......... F-1
</TABLE>

------------------

UNTIL , 1999 (25 DAYS AFTER THE COMMENCEMENT OF THE OFFERING),
ALL DEALERS EFFECTING TRANSACTIONS IN THE REGISTERED SECURITIES, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
THIS IS IN ADDITION TO THE OBLIGATIONS OF DEALERS TO DELIVER A PROSPECTUS WHEN
ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR
SUBSCRIPTIONS.

- ------------------------------------------------------

[ENTERCOM LOGO]

Entercom Communications Corp.

Shares
Class A Common Stock
($.01 par value)

PROSPECTUS
Credit Suisse First Boston

BT Alex. Brown
Goldman, Sachs & Co.
Morgan Stanley Dean Witter
------------------------------------------------------
<PAGE> 152

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth fees payable to the Securities and Exchange
Commission and the National Association of Securities Dealers, Inc., and other
estimated expenses expected to be incurred in connection with the issuance and
distribution of securities being registered. All such fees and expenses shall be
paid by the Company.

<TABLE>
<CAPTION>
<S> <C>
Securities and Exchange Commission Registration Fee......... $71,242.50
NASD Fee.................................................... *
New York Stock Exchange Listing Fee......................... *
Printing and Engraving Expenses............................. *
Accounting Fees and Expenses................................ *
Legal Fees and Expenses..................................... *
Directors and Officers Insurance............................ *
Transfer Agent Fees and Expenses............................ *
Miscellaneous............................................... *
----------
Total............................................. $
==========
</TABLE>

- ---------------

* To be filed by amendment

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

The Company's Amended and Restated Articles of Incorporation provide that
the Company's directors shall not be personally liable to the Company and its
shareholders for monetary damages for any action taken, or any failure to take
any action, unless: (i) the director has breached or failed to perform the
duties of his or her office under applicable provisions of Pennsylvania law, and
(ii) the breach or failure to perform constitutes self-dealing, willful
misconduct or recklessness. This provision does not eliminate the duty of care,
and, in appropriate circumstances, equitable remedies such as an injunction or
other forms of non-monetary relief would remain available under Pennsylvania
law. The provision does not affect a director's responsibilities under any other
law, such as federal securities laws, criminal laws or state or federal
environmental laws. The Company's Amended and Restated Bylaws provide that the
Company shall indemnify its officers and directors to the fullest extent
permitted by Pennsylvania law, including some instances in which indemnification
is otherwise discretionary under Pennsylvania law.

In general, any officer or director of the Company shall be indemnified by
the Company against expenses including attorneys' fees, judgments, fines and
settlements actually and reasonably incurred by that person in connection with a
legal proceeding as a result of such relationship, whether or not the
indemnified liability arises from an action by or in the right of the Company,
if the officer or director acted in good faith and in the manner believed to be
in, or not opposed to, the Company's best interest, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe the conduct
was unlawful. Such indemnity is limited to the extent that (i) such person is
not otherwise indemnified and (ii) such indemnifications are not prohibited by
Pennsylvania law or any other applicable law.

Any indemnification under the previous paragraph (unless ordered by a
court) shall be made by the Company only as authorized in the specific case upon
the determination that indemnification of the director or officer is proper in
the circumstances because that person has met the applicable standard of conduct
set forth above. Such determination shall be made (i) by the Board of Directors
by a majority vote of a quorum of disinterested directors who are not parties to
such action or (ii) if such quorum is not obtainable or, even if obtainable, a
quorum of disinterested directors so directs, by independent legal counsel in a
written opinion. To the extent that a director or officer of the Company shall
be successful in prosecuting an indemnity claim, the reasonable expenses of any
such person and the fees and expenses of any special legal counsel engaged to
determine the possibility of indemnification shall be borne by the Company.

II-1
<PAGE> 153

Expenses incurred by a director or officer of the Company in defending a
civil or criminal action, suit or proceeding shall be paid by the Company in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that person is not entitled to be
indemnified by the Company under the Bylaws or applicable provisions of
Pennsylvania law.

The indemnification and advancement of expenses provided by, or granted
pursuant to Article VIII of the Bylaws is not deemed exclusive of any other
rights to which those seeking indemnification or advancement of expenses may be
entitled, both as to action in that person's official capacity and as to action
in another capacity while holding such office.

To satisfy its indemnification obligations, the Company may maintain
insurance, obtain a letter of credit, act as self-insurer, create a reserve,
trust, escrow, cash collateral or other fund or account, enter into
indemnification agreements, pledge or grant a security interest in any assets or
properties of the Company, or use any other mechanism or arrangement whatsoever
in such amounts, costs, terms and conditions as the Board of Directors shall
deem appropriate. The obligations of the Company to indemnify a director or
officer under Article VIII of the Bylaws is a contract between the Company and
such director or officer and no modification or repeal of the Bylaws shall
detrimentally affect such officer or director with regard to that person's acts
or omissions prior to such amendment or repeal.

Upon consummation of the Offering, the Company will purchase insurance for
its directors and officers for certain losses arising from claims or charges
made against them in their capacities as directors and officers of the Company.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

On May 21, 1996, the registrant sold a 7% Subordinated Convertible Note due
2003 in the principal amount of $25 million to Chase Equity Associates, L.P., an
affiliate of Chase Capital Partners, for the aggregate purchase price of $25
million, which is convertible into the registrant's common stock. The
transaction was intended to be exempt from the registration requirements of the
Securities Act by virtue of Section 4(2) thereof.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) The following exhibits are filed as part of this registration
statement:

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
1.01 Form of Underwriting Agreement(3)
3.01 Form of Amended and Restated Articles of Incorporation of
the Registrant(3)
3.02 Form of Amended and Restated Bylaws of the Registrant(3)
5.01 Opinion of Morgan, Lewis & Bockius LLP as to the Legality of
the Securities Being Registered(1)
10.01 Registration Rights Agreement, dated as of May 21, 1996,
between the Registrant and Chase Equity Associates, L.P.(3)
10.02 Employment Agreement, dated June 25, 1993, between the
Registrant and Joseph M. Field, as amended(3)
10.03 Employment Agreement, dated December 28, 1992, between the
Registrant and David J. Field, as amended(3)
10.04 Employment Agreement, dated December 28, 1992, between the
Registrant and John C. Donlevie, as amended(3)
10.05 Employment Agreement, dated November 13, 1998, between the
Registrant and Stephen F. Fisher
10.06 Entercom 1998 Equity Compensation Plan
</TABLE>

II-2
<PAGE> 154

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
10.07 Asset Purchase Agreement, dated as of January 26, 1998,
among the Registrant, Tuscaloosa Broadcasting, Inc.,
Sinclair Radio of Portland Licensee, Inc. and Sinclair Radio
of Rochester Licensee, Inc.(3)
10.08 Time Brokerage Agreement, dated as of January 26, 1998,
among the Registrant, Tuscaloosa Broadcasting, Inc.,
Sinclair Radio of Portland Licensee, Inc. and Sinclair Radio
of Rochester Licensee, Inc.(3)
10.09 Loan Agreement, dated as of February 13, 1998, among the
Registrant, Key Corporate Capital Inc., as administrative
agent, Bank of America, National Trust and Savings
Association, as syndication agent, and certain banks listed
therein, as amended by the First Amendment to Loan Agreement
dated October 8, 1998(3)
10.10 Asset Purchase Agreement, dated as of August 13, 1998, among
CBS Radio, Inc., CBS Radio License, Inc. and the
Registrant(3)
10.11 Time Brokerage Agreement, dated as of August 13, 1998, among
CBS Radio, Inc., CBS Radio License, Inc. and the
Registrant(3)
10.12 Asset Purchase Agreement, dated as of August 13, 1998, among
the Registrant, CBS Radio, Inc. and CBS Radio License,
Inc.(3)
10.13 Time Brokerage Agreement, dated as of August 13, 1998, among
the Registrant, CBS Radio, Inc. and CBS Radio License,
Inc.(3)
10.14 Asset Purchase Agreement, dated as of August 13, 1998, among
CBS Radio, Inc., CBS Radio License, Inc., ARS Acquisition
II, Inc. and the Registrant(3)
10.15 Time Brokerage Agreement, dated as of August 13, 1998, among
CBS Radio, Inc., CBS Radio License, Inc., ARS Acquisition
II, Inc. and the Registrant(3)
21.01 Information Regarding Subsidiaries of the Registrant
23.01 Consent of Deloitte & Touche LLP, Philadelphia, PA
23.02 Consent of Deloitte & Touche LLP, Salt Lake City, UT
23.03 Consent of Deloitte & Touche LLP, Cincinnati, OH
23.04 Consent of Deloitte & Touche LLP, Seattle, WA
23.05 Consent of Deloitte & Touche LLP, Boston, MA
23.06 Consent of Arthur Andersen LLP, Baltimore, MD
23.07 Consent of Morgan, Lewis & Bockius LLP (included in opinion
filed as Exhibit 5.01)(1)
24.01 Power of Attorney (included on signature page of
Registration Statement filed August 13, 1998)(2)
24.02 Power of Attorney for signature of Stephen F. Fisher
27.01 Financial Data Schedule
99.01 Consent of Person About to Become a Director from Michael R.
Hannon(2)
</TABLE>

- ---------------
(1) To be filed by amendment.
(2) Previously filed with Registration Statement dated August 13, 1998.

(3) Previously filed with Registration Statement dated November 4, 1998.

(b) FINANCIAL STATEMENT SCHEDULE

SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS

ITEM 17. UNDERTAKINGS.

The undersigned registrant hereby undertakes to provide to the underwriter
at the closing specified in the underwriting agreements, certificates in such
denominations and registered in such names as required by the underwriter to
permit prompt delivery to each purchaser.

II-3
<PAGE> 155

Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

II-4
<PAGE> 156

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Bala Cynwyd, Pennsylvania, on
December 8, 1998.

ENTERCOM COMMUNICATIONS CORP.

By: /s/ JOSEPH M. FIELD
------------------------------------
Joseph M. Field
Chairman and Chief Executive Officer

Pursuant to the requirements of the Securities Act, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated.

<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
--------- -------- ----
<C> <S> <C>

* Chairman of the Board and December 8, 1998
- ----------------------------------------------------- Chief Executive Officer
Joseph M. Field (Principal Executive Officer)

* President, Chief Operating December 8, 1998
- ----------------------------------------------------- Officer and a Director
David J. Field (Principal Financial Officer)

* Executive Vice President, December 8, 1998
- ----------------------------------------------------- General Counsel and a
John C. Donlevie Director

/s/ STEPHEN F. FISHER Senior Vice President and December 8, 1998
- ----------------------------------------------------- Chief Financial Officer
Stephen F. Fisher

* Director December 8, 1998
- -----------------------------------------------------
Marie H. Field

* Director December 8, 1998
- -----------------------------------------------------
Herbert Kean, M.D.

* Director December 8, 1998
- -----------------------------------------------------
Lee Hague

* Director December 8, 1998
- -----------------------------------------------------
Thomas H. Ginley, M.D.

* Director December 8, 1998
- -----------------------------------------------------
S. Gordon Elkins

*By:
/s/ DAVID J. FIELD
------------------------------------------------
David J. Field
Attorney-in-Fact
</TABLE>

II-5
<PAGE> 157

INDEPENDENT AUDITORS' REPORT

To the Board of Directors of
Entercom Communications Corp.:

We have audited the accompanying consolidated financial statements of
Entercom Communications Corp. and subsidiaries (the "Company") as of September
30, 1997 and 1998 and for each of the three years in the period ended September
30, 1998 and have issued our report thereon dated November 12, 1998 (included
elsewhere in this Registration Statement). Our audits also included the
financial statement schedule listed in Item 16 of this Registration Statement.
This financial statement schedule is the responsibility of the Company's
management. Our responsibility is to express an opinion based on our audits. In
our opinion, such financial statement schedule, when considered in relation to
the basic financial statements taken as a whole, presents fairly in all material
respects the information set forth therein.

DELOITTE & TOUCHE LLP
Philadelphia, PA

November 12, 1998

<PAGE> 158

SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS

ENTERCOM COMMUNICATIONS CORP.

YEARS ENDED SEPTEMBER 30, 1996, 1997, AND 1998

<TABLE>
<CAPTION>
ADDITIONS
BALANCE AT CHARGED TO DEDUCTIONS
BEGINNING COSTS AND FROM BALANCE AT
ALLOWANCE FOR DOUBTFUL ACCOUNTS OF PERIOD EXPENSES RESERVES(A) END OF PERIOD
------------------------------- ---------- ---------- ----------- -------------
<S> <C> <C> <C> <C>
1996.................................. $ 63,524 $318,599 $265,283 $116,840
1997.................................. 116,840 548,726 373,566 292,000
1998.................................. 292,000 920,381 845,381 367,000
</TABLE>

- ---------------

(A) Uncollectible accounts written off.
<PAGE> 159

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S>
1.01 Form of Underwriting Agreement
3.01 Form of Amended and Restated Articles of Incorporation of
the Registrant
3.02 Form of Amended and Restated Bylaws of the Registrant
10.01 Registration Rights Agreement, dated as of May 21, 1996,
between the Registrant and Chase Equity Associates, L.P.
10.02 Employment Agreement, dated June 25, 1993, between the
Registrant and Joseph M. Field, as amended
10.03 Employment Agreement, dated December 28, 1992, between the
Registrant and David J. Field, as amended
10.04 Employment Agreement, dated December 28, 1992, between the
Registrant and
John C. Donlevie, as amended
10.05 Employment Agreement, dated November 13, 1998, between the
Registrant and Stephen F. Fisher
10.06 Entercom 1998 Equity Compensation Plan
10.07 Asset Purchase Agreement, dated as of January 26, 1998,
among the Registrant, Tuscaloosa Broadcasting, Inc.,
Sinclair Radio of Portland Licensee, Inc. and Sinclair Radio
of Rochester Licensee, Inc.
10.08 Time Brokerage Agreement, dated as of January 26, 1998,
among the Registrant, Tuscaloosa Broadcasting, Inc.,
Sinclair Radio of Portland Licensee, Inc. and Sinclair Radio
of Rochester Licensee, Inc.
10.09 Loan Agreement, dated as of February 13, 1998, among the
Registrant, Key Corporate Capital Inc., as administrative
agent, Bank of America, National Trust and Savings
Association, as syndication agent, and certain banks listed
therein, as amended by the First Amendment to Loan Agreement
dated October 8, 1998
10.10 Asset Purchase Agreement, dated as of August 13, 1998, among
CBS Radio, Inc., CBS Radio License, Inc. and the Registrant
10.11 Time Brokerage Agreement, dated as of August 13, 1998, among
CBS Radio, Inc., CBS Radio License, Inc. and the Registrant
10.12 Asset Purchase Agreement, dated as of August 13, 1998, among
the Registrant, CBS Radio, Inc. and CBS Radio License, Inc.
10.13 Time Brokerage Agreement, dated as of August 13, 1998, among
the Registrant, CBS Radio, Inc. and CBS Radio License, Inc.
10.14 Asset Purchase Agreement, dated as of August 13, 1998, among
CBS Radio, Inc., CBS Radio License, Inc., ARS Acquisition
II, Inc. and the Registrant
10.15 Time Brokerage Agreement, dated as of August 13, 1998, among
CBS Radio, Inc., CBS Radio License, Inc., ARS Acquisition
II, Inc. and the Registrant
21.01 Information Regarding Subsidiaries of the Registrant
23.01 Consent of Deloitte & Touche LLP, Philadelphia, PA
23.02 Consent of Deloitte & Touche LLP, Salt Lake City, UT
23.03 Consent of Deloitte & Touche LLP, Cincinnati, OH
23.04 Consent of Deloitte & Touche LLP, Seattle, WA
23.05 Consent of Deloitte & Touche LLP, Boston, MA
23.06 Consent of Arthur Andersen LLP, Baltimore, MD
24.01 Power of Attorney (included on signature page of
Registration Statement filed August 13, 1998)
24.02 Power of Attorney for signature of Stephen F. Fisher
27.01 Financial Data Schedule
</TABLE>

<PAGE> 1
Exhibit 10.5

November 13, 1998

Mr. Steve Fisher
425 King of Prussia Road
St. Davids, PA 19087

Dear Steve:

We are happy to welcome you as Entercom's Senior Vice President and
Chief Financial Officer and are looking forward to a long and mutually
beneficial association with you.

This letter will serve as a memorandum of our agreement concerning the
terms of you employment which is to be effective November 16, 1998 and
continuing through December 31, 2000 except that the Company may terminate this
agreement at any time for cause. This agreement shall automatically renew from
year to year thereafter, unless either party gives at least 120 days prior
written notice of its election to either terminate or to renegotiate the terms
of this agreement at the end of the original or any then current renewal term;
except that, if there is a "Change of Control" of the Company (as defined in the
Company's S-1 Registration Statement filed with the SEC) and your employment
hereunder is terminated within one year after such Change of Control, then in
connection with such termination you will be entitled to either an additional
sixty (60) days prior written notice of termination or in lieu thereof the
Company may pay you severance in an amount (at your then current salary rate)
which will compensate you for any portion of such additional sixty (60) days
notice which is not provided.

Commencing effective November 1, 1998 and so long as you are performing
the duties set forth herein, you will be paid a base semi-monthly salary of
$10,416.67 (annual rate of $250,000), as may be adjusted as provided below, plus
incentive compensation as hereinafter provided. Effective each January 1st,
starting in 2000 such salary shall be increased by the percentage increase in
the Consumer Price Index for all Urban Consumers ("CPI-U") as published by the
U.S. Department of Labor for the immediately preceding November compared to the
CPI-U for the month of November one year earlier.

In addition, you will be eligible for the following:

(a) ANNUAL INCENTIVE BONUS. You will be eligible for an annual cash
bonus of up to $100,000 as of end of each fiscal year of the Company. The amount
of such bonus will be determined in the sole discretion of the CEO of the
Company or the Compensation Committee of the Board of Directors based on a
review of the Company's performance and your performance during the fiscal year
then ended. You must work through the end of the fiscal year to be eligible for
the bonus for that year and the bonus will be determined and then paid after the
completion of the financial statements for the fiscal year in question.
<PAGE> 2
(b) STOCK OPTIONS. In the event the Company consummates the planned
Initial Public Offering ("IPO") of its Class A Common Stock and subject to the
approval of the Compensation Committee of the Board of Directors, you will be
awarded options under the Entercom 1998 Equity Compensation Plan to purchase
Class A Common Stock totaling $600,000 in value at the IPO price. Such options
will have a ten-year term, will vest 25% per year at the end of each of the
first four years following the award and will contain such other terms as
determined by the Compensation Committee of the Board of Directors. You will
also be eligible for future discretionary awards of options by the Compensation
Committee.

You will be provided with the use of a Company automobile to be
selected by the Company. You will be responsible for gas for this automobile and
the Company will be responsible for all repairs, maintenance and insurance for
this automobile. In lieu thereof, you may elect a car allowance of $750 per
month.

You will be eligible to participate in the Company's 401(k) Plan and
you will be provided with coverage under the Company's life insurance and LTD
insurance plans and any other benefits generally available to officers of the
Company, and you and your dependents will be provided with coverage under the
Company's major medical and dental insurance plans.

As Senior Vice President and Chief Financial Officer you will be
responsible for the general management and supervision of the fiscal affairs of
the Company and discharge such other duties as may from time to time be assigned
by the Board of Directors, the CEO or the President of the Company. As part of
such duties and responsibilities, you shall see that a full and accurate
accounting of all financial transactions of the Company is made, oversee the
investment and reinvestment of the capital funds of the Company, cooperate in
the conduct of the annual audit of the Corporation's financial records and
manage the relationships with the Company's lenders and investors.

If is of course essential that you maintain strict adherence to all of
the rules and regulations of the Federal Communications Commission ("FCC") in
all facets of your duties to protect the Company's FCC licenses. Please see that
you familiarize yourself thoroughly with these rules and regulations and if you
have any questions at any time feel free to consult with the appropriate
corporate officer or advisor.

Your position involves a close and confidential relationship in which
you will be privy to proprietary information of the Company, including without
limitation business plans, acquisition strategy, research, consulting reports,
computer programs and sales, technical, financial and programming practices and
data which you agree will be held in the strictest confidence at all times. All
trade secret, copyright, trademark and/or other intellectual property rights of
any kind developed while this agreement is in effect which relate to the
Company's business or to your duties hereunder shall be considered a "work for
hire" and shall be and remain the sole and exclusive property of the Company and
you shall, to the extent deemed necessary or desirable by the Company, cooperate
and
<PAGE> 3
assist the Company in assigning to the Company and perfecting, filing and
recording any such rights in the name of the Company.

You agree that you will devote your full time and best efforts to the
Company's business and will not accept any outside employment without the prior
written consent of the Company.

It is further understood and agreed that so long as you are employed by
the Company and for a period of one year thereafter you will not directly or
indirectly, provide any service either as an employee, employer, consultant,
contractor, agent, principal, partner, substantial stockholder, corporate
officer or director of or for a company or enterprise which competes in any
material manner with the then present or planned business activities of the
Company, including without limitation, any audio programming, production,
engineering, promotion or broadcasting regardless of the method of its delivery,
which methods include, without limitation, AM, FM, satellite, PCS, cable,
Internet, or any other means. The foregoing notwithstanding, if the Company
either (i) elects to terminate your employment for reasons other than cause or
(ii) offers you a salary and bonus package which is lower than your then current
package in connection with an election by the Company to renegotiate the terms
of this agreement and your employment terminates due to a failure to reach
agreement on a lower salary and bonus package, then in either such event the
length of the foregoing covenant against competition shall be reduced to the
period following the termination of your employment which is the sum of: (a) any
period of notice provided for in this agreement for which you are given payment
in lieu thereof; (b) the time equivalent, at your ten current base salary rate,
of any additional payments made to you in connection with such termination; and
(c) three (3) months.

In addition it is understood and agreed that for the one year period
following any termination of your employment with the Company you will not,
without the express prior written permission of the Company, employ, counsel a
third party to employ, or participate in any manner in the recommendation,
recruitment or solicitation of the employment of any person who was an employee
of the Company on the date of their termination of your employment or at any
time within the 90 days prior thereto. In the event that any such person shall
be employed in a position under your direct or indirect supervision within such
one year period without the Company's express prior written permission, it shall
be conclusively presumed that this restriction has been violated.

You agree that a material portion of the compensation to be paid to you
hereunder is consideration for the restrictions contained in the two preceding
paragraphs and that for purposes of this letter the "Company" includes Entercom
Communications Corp., any subsidiaries and affiliates under common control with
Entercom Communications Corp. and any successors thereto.

In making this agreement you represent and warrant that you are free to
enter into and perform this agreement and are not and will not be under any
disability, restriction or prohibition, contractual or otherwise, with respect
to (a) your right to execute this agreement; (b) your right to make the
covenants contained herein; and (c) your right to fully perform each and every
team and obligation hereunder. You further agree not to do or attempt to do, or
suffer to be done, during or
<PAGE> 4
after the term hereof, any act in derogation of or inconsistent with the
obligations under this agreement.

If the foregoing accurately reflects the agreement between us please
sign a copy as indicated at the foot hereof and return to me.

With all best wishes.

Sincerely,

/s/ Joseph M. Field
Joseph M. Field, Chairman & CEO

/s/ David J. Field
David J. Field, President & COO

Agreed this 13th day of November, 1998

By: /s/ Steve Fisher
--------------------------
Steve Fisher

<PAGE> 1
Exhibit 10.6

ENTERCOM

1998 EQUITY COMPENSATION PLAN

The purpose of the Entercom 1998 Equity Compensation Plan (the "Plan")
is to provide (i) designated employees of Entercom Communications Corp. (the
"Company") and its subsidiaries, (ii) certain consultants and advisors who
perform services for the Company or its subsidiaries and (iii) non-employee
members of the Board of Directors of the Company (the "Board") with the
opportunity to receive grants of incentive stock options, nonqualified stock
options, stock appreciation rights or restricted stock. The Company believes
that the Plan will enhance the incentive for participants to contribute
materially to the growth of the Company, thereby benefitting the Company and the
Company's shareholders, and will align the economic interests of the
participants with those of the shareholders.

1. Administration

(a) Committee. The Plan shall be administered and interpreted by a
committee appointed by the Board (the "Committee"). The Committee shall consist
of two or more persons who may be "outside directors" as defined under section
162(m) of the Internal Revenue Code of 1986, as amended (the "Code") and related
Treasury regulations and "non-employee directors" as defined under Rule 16b-3
under the Securities Exchange Act of 1934, as amended (the "Exchange Act").
However, the Board may retain the right to ratify or approve any grants as it
deems appropriate. If the Board requires ratification or approval of a grant and
the grant is not ratified or approved by the Board, such grant shall not be
effective. Before an initial public offering of the Company's stock as described
in Section 19(b) (a "Public Offering"), the Plan may be administered by the
Board. If the Board administers the Plan during a period prior to a Public
Offering, references in the Plan to the "Committee" shall be deemed to refer to
the Board during but only for such period.

(b) Committee Authority. Subject to ratification or approval by the
Board if the Board retains such right pursuant to subsection (a) above, the
Committee shall have the sole authority to (i) determine the individuals to whom
grants shall be made under the Plan, (ii) determine the type, size and terms of
the grants to be made to each such individual, (iii) determine the time when
grants will be made and the commencement and duration of any applicable exercise
or restriction period, including the criteria for exercisability and the
acceleration of exercisability and (iv) deal with any other matters arising
under the Plan.

(c) Committee Determinations. Subject to ratification or approval by
the Board if the Board retains such right pursuant to subsection (a) above, the
Committee shall have full
<PAGE> 2
power and authority to administer and interpret the Plan, to make factual
determinations and to adopt or amend such rules, regulations, agreements and
instruments for implementing the Plan and for the conduct of its business as it
deems necessary or advisable, in its sole discretion. Subject to ratification or
approval by the Board if the Board retains such right pursuant to subsection (a)
above, the Committee's interpretations of the Plan and all determinations made
by the Committee pursuant to the powers vested in it hereunder shall be
conclusive and binding on all persons having any interest in the Plan or in any
awards granted hereunder. All powers of the Committee shall be executed in its
sole discretion, in the best interest of the Company, not as a fiduciary, and in
keeping with the objectives of the Plan and need not be uniform as to similarly
situated individuals.

(d) Delegation of Authority. Notwithstanding the foregoing, the
Committee may delegate to the Chief Executive Officer of the Company the
authority to make grants under the Plan to employees of the Company and its
subsidiaries who are not subject to the restrictions of section 16(b) of the
Exchange Act and who are not expected to be subject to the limitations of
section 162(m) of the Code. The grant of authority under this subsection 1(d)
shall be subject to such conditions and limitations as may be determined by the
Committee, subject to ratification and approval by the Board if the Board
retains such right pursuant to subsection (a) above. If the Chief Executive
Officer makes grants pursuant to the delegated authority under this subsection
(d), references in the Plan to the "Committee," as they relate to making such
grants (but not to the subsequent administration of such grants), shall be
deemed to refer to the Chief Executive Officer.

2. Shares Subject to the Plan and Types of Grants

Before a Public Offering, awards may be made under the Plan with
respect to shares of non-voting common stock of the Company, and after a Public
Offering, awards may be made with respect to shares of Class A common stock of
the Company. The term "Company Stock" means, before a Public Offering,
non-voting common stock of the Company and, after a Public Offering, Class A
common stock of the Company. Awards under the Plan may consist of grants of (a)
incentive stock options as described in Section 5 ("Incentive Stock Options"),
(b) nonqualified stock options as described in Section 5 ("Nonqualified Stock
Options") (Incentive Stock Options and Nonqualified Stock Options are
collectively referred to as "Options"), (c) restricted stock as described in
Section 6 ("Restricted Stock") and (d) stock appreciation rights as described in
Section 7 ("SARs") (all such awards being hereinafter collectively referred to
as "Grants"). All Grants shall be subject to the terms and conditions set forth
herein and to such other terms and conditions consistent with this Plan as the
Committee deems appropriate and as are specified in writing by the Committee to
the individual in a grant instrument or an amendment to the grant instrument
made in conformance with the Plan (the "Grant Instrument"). The Committee shall
approve the form and provisions of each Grant Instrument. Grants under a
particular Section of the Plan need not be uniform as among the Grantees (as
defined below) or among any class or grouping of Grantees.

-2-
<PAGE> 3
3. Limitations on the Number of Shares Subject to the Plan

(a) Limitations. At no time shall the number of shares of Company Stock
subject to Grants under the Plan exceed 10% of the number of outstanding shares
of all classes of common stock of the Company, determined at the time of each
Grant. In no event shall the foregoing limit be considered to be exceeded as a
result of a reduction in the number of outstanding shares of Company Stock after
a Grant is made. Restricted Stock granted under the Plan shall not be taken into
account for purposes of determining the number of outstanding shares of Company
Stock during any restriction period until such restrictions have lapsed. As a
further limitation, subject to adjustment as described in subsection (b) below,
the aggregate number of shares of Company Stock that may be subject to Grants of
Incentive Stock Options shall not exceed 10,000 shares, and the aggregate number
of shares of Company Stock that may be subject to Restricted Stock Grants shall
not exceed 5,000 shares. After a Public Offering, subject to adjustment as
described in subsection (b) below, the aggregate number of shares of Company
Stock that may be subject to Grants made under the Plan to any individual during
any calendar year shall not exceed 5,000 shares. The shares may be authorized
but unissued shares of Company Stock or reacquired shares of Company Stock,
including shares purchased by the Company on the open market for purposes of the
Plan. If and to the extent Options or SARs granted under the Plan terminate,
expire, or are canceled, forfeited, exchanged or surrendered without having been
exercised, or if any shares of Restricted Stock are forfeited, the shares
subject to such Grants shall again be available for purposes of the Plan.

(b) Adjustments. If there is any change in the number or kind of shares
of Company Stock outstanding (i) by reason of a stock dividend, spinoff,
recapitalization, stock split, or combination or exchange of shares, (ii) by
reason of a merger, reorganization or consolidation in which the Company is the
surviving corporation, (iii) by reason of a reclassification or change in par
value, or (iv) by reason of any other extraordinary or unusual event affecting
the outstanding Company Stock without the Company's receipt of consideration, or
if the value of outstanding shares of Company Stock is substantially reduced as
a result of a spinoff or the Company's payment of an extraordinary dividend or
distribution, the maximum number of shares of Company Stock available for
Grants, the maximum number of shares of Company Stock that any individual
participating in the Plan may be granted in any year, the number of shares
covered by outstanding Grants, the kind of shares issued under the Plan, and the
price per share of such Grants may be appropriately adjusted by the Committee to
reflect any increase or decrease in the number of, or change in the kind or
value of, issued shares of Company Stock to preclude, to the extent practicable,
the enlargement or dilution of rights and benefits under such Grants; provided,
however, that any fractional shares resulting from such adjustment shall be
eliminated. Any adjustments determined by the Committee shall be final, binding
and conclusive.

4. Eligibility for Participation

(a) Eligible Persons. All employees of the Company and its subsidiaries
("Employees"), including Employees who are officers or members of the Board, and
members of

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<PAGE> 4
the Board who are not Employees ("Non-Employee Directors") shall be eligible to
participate in the Plan. Consultants and advisors who perform services for the
Company or any of its subsidiaries ("Key Advisors") shall be eligible to
participate in the Plan if the Key Advisors render bona fide services and such
services are not in connection with the offer or sale of securities in a
capital-raising transaction.

(b) Selection of Grantees. The Committee shall select the Employees,
Non-Employee Directors and Key Advisors to receive Grants and shall determine
the number of shares of Company Stock subject to a particular Grant in such
manner as the Committee determines. Employees, Key Advisors and Non-Employee
Directors who receive Grants under this Plan shall hereinafter be referred to as
"Grantees".

5. Granting of Options

(a) Number of Shares. The Committee shall determine the number of
shares of Company Stock that will be subject to each Grant of Options to
Employees, Non-Employee Directors and Key Advisors.

(b) Type of Option and Price.

(i) The Committee may grant Incentive Stock Options which are
intended to qualify as "incentive stock options" within the meaning of section
422 of the Code or Nonqualified Stock Options which are not intended so to
qualify or any combination of Incentive Stock Options and Nonqualified Stock
Options, all in accordance with the terms and conditions set forth herein.
Incentive Stock Options may be granted only to Employees. Nonqualified Stock
Options may be granted to Employees, Non-Employee Directors and Key Advisors.

(ii) The purchase price (the "Exercise Price") of Company
Stock subject to an Option shall be determined by the Committee and may be equal
to, greater than, or less than the Fair Market Value (as defined below) of a
share of Company Stock on the date the Option is granted; provided, however,
that (x) the Exercise Price of an Incentive Stock Option shall be equal to, or
greater than, the Fair Market Value of a share of Company Stock on the date the
Incentive Stock Option is granted and (y) an Incentive Stock Option may not be
granted to an Employee who, at the time of grant, owns stock possessing more
than 10% of the total combined voting power of all classes of stock of the
Company or any parent or subsidiary of the Company, unless the Exercise Price
per share is not less than 110% of the Fair Market Value of Company Stock on the
date of grant.

(iii) If the Company Stock is publicly traded, then the Fair
Market Value per share shall be determined as follows: (x) if the principal
trading market for the Company Stock is a national securities exchange or the
Nasdaq National Market, the last reported sale price thereof on the relevant
date or (if there were no trades on that date) the latest preceding date upon
which a sale was reported, or (y) if the Company Stock is not principally traded
on such exchange or

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<PAGE> 5
market, the mean between the last reported "bid" and "asked" prices of Company
Stock on the relevant date, as reported on Nasdaq or, if not so reported, as
reported by the National Daily Quotation Bureau, Inc. or as reported in a
customary financial reporting service, as applicable and as the Committee
determines. If the Company Stock is not publicly traded or, if publicly traded
but not subject to reported transactions or "bid" or "asked" quotations as set
forth above, the Fair Market Value per share shall be as determined by the
Committee.

(c) Option Term. The Committee shall determine the term of each Option.
The term of any Option shall not exceed ten years from the date of grant.
However, an Incentive Stock Option which is granted to an Employee who, at the
time of grant, owns stock possessing more than 10% of the total combined voting
power of all classes of stock of the Company, or any parent or subsidiary of the
Company, may not have a term that exceeds five years from the date of grant.

(d) Exercisability of Options. Options shall become exercisable in
accordance with such terms and conditions, consistent with the Plan, as may be
determined by the Committee and specified in the Grant Instrument. The Committee
may accelerate the exercisability of any or all outstanding Options at any time
for any reason, and such acceleration need not be uniform as among any class or
grouping of Grantees.

(e) Termination of Employment, Disability or Death.

(i) Except as provided below, an Option may only be exercised
while the Grantee is employed by, or providing service to, the Company as an
Employee, Key Advisor or member of the Board. In the event that a Grantee ceases
to be employed by, or provide service to, the Company for any reason other than
a Disability (as defined in subsection (v) below), death, or termination for
Cause (as defined in subsection (v) below), any Option which is otherwise
exercisable by the Grantee shall terminate unless exercised within 90 days after
the date on which the Grantee ceases to be employed by, or provide service to,
the Company (or within such other period of time as may be specified by the
Committee), but in any event no later than the date of expiration of the Option
term. Except as otherwise provided by the Committee, any of the Grantee's
Options which are not otherwise exercisable as of the date on which the Grantee
ceases to be employed by, or provide service to, the Company shall terminate as
of the date such employment or service ceased.

(ii) In the event the Grantee ceases to be employed by, or
provide service to, the Company on account of a termination for Cause by the
Company, any Option held by the Grantee shall terminate as of the date and time
the Grantee ceases to be employed by, or provide service to, the Company. In
addition, notwithstanding any other provisions of this Section 5, if the
Committee determines that the Grantee has engaged in conduct that constitutes
Cause at any time while the Grantee is employed by, or providing service to, the
Company or after the Grantee's termination of employment or service, any Option
held by the Grantee shall immediately terminate. In the event the Committee
determines that the Grantee has engaged in

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<PAGE> 6
conduct that constitutes Cause, in addition to the immediate termination of all
Grants, the Grantee shall automatically forfeit all shares underlying any
exercised portion of an Option for which the Company has not yet delivered the
share certificates, upon refund by the Company of the Exercise Price paid by the
Grantee for such shares (subject to any right of setoff by the Company).

(iii) In the event the Grantee ceases to be employed by, or
provide service to, the Company because the Grantee is Disabled, any Option
which is otherwise exercisable by the Grantee shall terminate unless exercised
within one year after the date on which the Grantee ceases to be employed by, or
provide service to, the Company (or within such other period of time as may be
specified by the Committee), but in any event no later than the date of
expiration of the Option term. Except as otherwise provided by the Committee,
any of the Grantee's Options which are not otherwise exercisable as of the date
on which the Grantee ceases to be employed by, or provide service to, the
Company shall terminate as of the date such employment or service ceased.

(iv) If the Grantee dies while employed by, or providing
service to, the Company or within 90 days after the date on which the Grantee
ceases to be employed or provide service on account of a termination specified
in Section 5(e)(i) above (or within such other period of time as may be
specified by the Committee), any Option which is otherwise exercisable by the
Grantee as of the date of his or her death shall terminate unless exercised
within one year after the date on which the Grantee ceases to be employed by, or
provide service to, the Company (or within such other period of time as may be
specified by the Committee), but in any event no later than the date of
expiration of the Option term. Except as otherwise provided by the Committee,
any of the Grantee's Options which are not otherwise exercisable as of the date
on which the Grantee ceases to be employed by, or provide service to, the
Company shall terminate as of the date such employment or service ceased.

(v) For purposes of this Section 5(e) and Section 6:

(A) The term "Company" shall mean the Company and its parent
and subsidiary corporations.

(B) "Employed by, or provide service to, the Company" shall
mean employment or service as an Employee, Key Advisor or member of the
Board (so that, for purposes of exercising Options and SARs and
satisfying conditions with respect to Restricted Stock, a Grantee shall
not be considered to have terminated employment or service until the
Grantee ceases to be an Employee, Key Advisor or member of the Board),
unless the Committee determines otherwise in the Grant Instrument.

(C) "Disability" or "Disabled" shall mean a Grantee's becoming
disabled within the meaning of section 22(e)(3) of the Code.

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<PAGE> 7
(D) "Cause" shall mean, except to the extent specified
otherwise by the Committee, a finding by the Committee that, before or
after termination of employment or service, the Grantee (i) has engaged
in fraud, embezzlement, theft, commission of a felony or proven
dishonesty in the course of his or her employment or service, (ii) has
breached any provision of his or her employment or service contract
with the Company, including, without limitation, any covenant against
competition and/or raiding of the Company's Employees, Non-Employee
Directors or Key Advisors, or (iii) has disclosed trade secrets or
confidential information of the Company to persons not entitled to
receive such information.

(f) Exercise of Options. A Grantee may exercise an Option which has
become exercisable, in whole or in part, by delivering a notice of exercise to
the Company with payment of the Exercise Price. The Grantee shall pay the
Exercise Price for an Option as specified by the Committee (x) in cash, (y) with
the approval of the Committee, subject to such restrictions as the Committee
deems appropriate, by delivering shares of Company Stock owned by the Grantee
(including Company Stock acquired in connection with the exercise of an Option)
and having a Fair Market Value on the date of exercise equal to the Exercise
Price or (z) by such other method as the Committee may approve, including, after
a Public Offering, payment through a broker in accordance with procedures
permitted by Regulation T of the Federal Reserve Board. Shares of Company Stock
used to exercise an Option must, unless otherwise determined by the Committee,
have been held by the Grantee for the requisite period of time to avoid adverse
accounting or tax consequences to the Company with respect to the Option. The
Grantee shall pay the Exercise Price and the amount of any withholding tax due
(pursuant to Section 8) at the time of exercise.

(g) Limits on Incentive Stock Options. Each Incentive Stock Option
shall provide that if the aggregate Fair Market Value of the stock with respect
to which Incentive Stock Options are exercisable for the first time during any
calendar year by a Grantee exceeds $100,000, then the Option, as to the excess,
shall be treated as a Nonqualified Stock Option. For this purpose, the Fair
Market Value of the stock shall be measured on the date of grant of the Option.
All Incentive Stock Options granted to the Grantee under the Plan or any other
stock option plan of the Company or a parent or subsidiary corporation shall be
taken into consideration in determining whether the foregoing limit has been
met. An Incentive Stock Option shall not be granted to any person who is not an
employee of the Company or a parent or subsidiary (within the meaning of section
424(f) of the Code) at the time of the grant.

6. Restricted Stock Grants

The Committee may issue or transfer shares of Company Stock to an
Employee, Non-Employee Director or Key Advisor under a Grant of Restricted
Stock, upon such terms as the Committee deems appropriate. The following
provisions are applicable to Restricted Stock:

(a) General Requirements. Shares of Company Stock issued or transferred
pursuant to Restricted Stock Grants may be issued or transferred for
consideration or for no consideration,

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<PAGE> 8
as determined by the Committee. The Committee may establish conditions under
which restrictions on shares of Restricted Stock shall lapse over a period of
time or according to such other criteria as the Committee deems appropriate. The
period of time during which the Restricted Stock will remain subject to
restrictions will be designated in the Grant Instrument as the "Restriction
Period."

(b) Number of Shares. The Committee shall determine the number of
shares of Company Stock to be issued or transferred pursuant to a Restricted
Stock Grant and the restrictions applicable to such shares.

(c) Requirement of Employment or Service. If the Grantee ceases to be
employed by, or provide service to, the Company (as defined in Section 5(e))
during a period designated in the Grant Instrument as the Restriction Period, or
if other specified conditions are not met, the Restricted Stock Grant shall
terminate as to all shares covered by the Grant as to which the restrictions
have not lapsed, and those shares of Company Stock must be immediately returned
to the Company. The Committee may, however, provide for complete or partial
exceptions to this requirement as it deems appropriate.

(d) Restrictions on Transfer and Legend on Stock Certificate. During
the Restriction Period, a Grantee may not sell, assign, transfer, pledge or
otherwise dispose of the shares of Restricted Stock except to a Successor
Grantee under Section 9(a). Each certificate for a share of Restricted Stock
shall contain a legend giving appropriate notice of the restrictions in the
Grant. The Grantee shall be entitled to have the legend removed from the stock
certificate covering the shares subject to restrictions when all restrictions on
such shares have lapsed. The Committee may determine that the Company will not
issue certificates for shares of Restricted Stock until all restrictions on such
shares have lapsed, or that the Company will retain possession of certificates
for shares of Restricted Stock until all restrictions on such shares have
lapsed.

(e) Right to Vote and to Receive Dividends. Unless the Committee
determines otherwise, during the Restriction Period, the Grantee shall have the
right to vote shares of Restricted Stock and to receive any dividends or other
distributions paid on such shares, subject to any restrictions deemed
appropriate by the Committee.

(f) Lapse of Restrictions. All restrictions imposed on Restricted Stock
shall lapse upon the expiration of the applicable Restriction Period and the
satisfaction of all conditions imposed by the Committee. The Committee may waive
any or all restrictions and conditions of a Restricted Stock Grant.

7. Stock Appreciation Rights

(a) General Requirements. The Committee may grant SARs to an Employee,
Non-Employee Director or Key Advisor separately or in tandem with any Option
(for all or a portion of the applicable Option). Tandem SARs may be granted
either at the time the Option is

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<PAGE> 9
granted or at any time thereafter while the Option remains outstanding;
provided, however, that, in the case of an Incentive Stock Option, SARs may be
granted only at the time of the Grant of the Incentive Stock Option. The
Committee shall establish the base amount of the SAR at the time the SAR is
granted. Unless the Committee determines otherwise, the base amount of each SAR
shall be equal to the per share Exercise Price of the related Option or, if
there is no related Option, the Fair Market Value of a share of Company Stock as
of the date of Grant of the SAR.

(b) Tandem SARs. In the case of tandem SARs, the number of SARs granted
to a Grantee that shall be exercisable during a specified period shall not
exceed the number of shares of Company Stock that the Grantee may purchase upon
the exercise of the related Option during such period. Upon the exercise of an
Option, the SARs relating to the Company Stock covered by such Option shall
terminate. Upon the exercise of SARs, the related Option shall terminate to the
extent of an equal number of shares of Company Stock.

(c) Exercisability. An SAR shall be exercisable during the period
specified by the Committee in the Grant Instrument and shall be subject to such
vesting and other restrictions as may be specified in the Grant Instrument. The
Committee may accelerate the exercisability of any or all outstanding SARs at
any time for any reason, and such acceleration need not be uniform as among any
class or grouping of Grantees. SARs may only be exercised while the Grantee is
employed by, or providing service to, the Company or during the applicable
period after termination of employment or service as described in Section 5(e)
with respect to Options, and such exercise shall be under and subject to all of
the limitations and termination and forfeiture provisions applicable to Options
under Section 5(e), including without limitation forfeiture of any SARs and the
release of any obligations of the Company to respond to the exercise of any SARs
under the circumstances set forth in Section 5(e)(ii). A tandem SAR shall be
exercisable only during the period when the Option to which it is related is
also exercisable.

(d) Value of SARs. When a Grantee exercises SARs, the Grantee shall
receive in settlement of such SARs an amount equal to the value of the stock
appreciation for the number of SARs exercised, payable in cash, Company Stock or
a combination thereof. The stock appreciation for an SAR is the amount by which
the Fair Market Value of the underlying Company Stock on the date of exercise of
the SAR exceeds the base amount of the SAR as described in Subsection (a).

(e) Form of Payment. The Committee shall determine whether the
appreciation in an SAR shall be paid in the form of cash, shares of Company
Stock, or a combination of the two, in such proportion as the Committee deems
appropriate. For purposes of calculating the number of shares of Company Stock
to be received, shares of Company Stock shall be valued at their Fair Market
Value on the date of exercise of the SAR. If shares of Company Stock are to be
received upon exercise of an SAR, cash shall be delivered in lieu of any
fractional share.

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<PAGE> 10
8. Withholding of Taxes

(a) Required Withholding. All Grants under the Plan shall be subject to
applicable federal (including FICA), state and local tax withholding
requirements. The Company may require that the Grantee or other person receiving
or exercising Grants pay to the Company the amount of any federal, state or
local taxes that the Company is required to withhold with respect to such Grants
and may require such payment as a precondition for awarding or exercising such
Grant, or the Company may deduct from other wages paid by the Company the amount
of any withholding taxes due with respect to such Grants.

(b) Election to Withhold Shares. If the Committee so permits, a Grantee
may elect to satisfy the Company's income tax withholding obligation with
respect to an Option, SAR or Restricted Stock by having shares withheld up to an
amount that does not materially exceed the Grantee's minimum applicable
withholding tax rate for federal (including FICA), state and local tax
liabilities. The election must be in a form and manner prescribed by the
Committee and shall be subject to the prior approval of the Committee.

9. Transferability of Grants

(a) Nontransferability of Grants. Except as provided below, only the
Grantee may exercise rights under a Grant during the Grantee's lifetime. A
Grantee may not transfer those rights except by will or by the laws of descent
and distribution or, with respect to Grants other than Incentive Stock Options,
if permitted in any specific case by the Committee, pursuant to a domestic
relations order (as defined under the Code or Title I of the Employee Retirement
Income Security Act of 1974, as amended, or the regulations thereunder). When a
Grantee or permitted transferee dies, the personal representative or other
person entitled to succeed to the rights of the Grantee or permitted transferee
("Successor Grantee") may exercise such rights. A Successor Grantee must furnish
proof satisfactory to the Company of his or her right to receive the Grant under
the Grantee's will or under the applicable laws of descent and distribution.

(b) Transfer of Nonqualified Stock Options. Notwithstanding the
foregoing, the Committee may provide, in a Grant Instrument, that a Grantee may
transfer as a gift Nonqualified Stock Options to family members, one or more
trusts for the benefit of family members, or one or more partnerships of which
family members are the only partners, according to such terms as the Committee
may determine; provided that the Grantee receives no consideration for the
transfer of an Option and the transferred Option shall continue to be subject to
the same terms and conditions as were applicable to the Option immediately
before the transfer.

10. Shareholder Agreement

Prior to a Public Offering, the Committee shall, as a condition to any
Grant, require that a Grantee become a party to a shareholder agreement with
respect to any Grants and any Company

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<PAGE> 11
Stock that may be obtained pursuant thereto. Such shareholder agreement shall
contain the terms of any then existing shareholder agreement and/or any terms
which the Committee deems appropriate.

11. Change of Control of the Company

As used herein, a "Change of Control" shall be deemed to have occurred
if:

(a) Any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act) (other than persons who are shareholders of the Company on the
date the Plan is adopted) becomes a "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
representing more than 50% of all votes required to elect a majority of the
Board, provided that a Change of Control shall not be deemed to occur as a
result of a change of ownership resulting from the death of a shareholder;

(b) The shareholders of the Company approve (or, if shareholder
approval is not required, the Board approves) an agreement providing for (i) the
merger or consolidation of the Company with another corporation where the
shareholders of the Company, immediately prior to the merger or consolidation,
will not beneficially own, immediately after the merger or consolidation, shares
entitling such shareholders to more than 50% of all votes required to elect a
majority of the board of directors of the surviving corporation, (ii) the sale
or other disposition of all or substantially all of the assets of the Company,
or (iii) a liquidation or dissolution of the Company; or

(c) After a Public Offering, any person has completed a tender offer or
exchange offer for shares representing more than 50% of all votes required to
elect a majority of the Board.

12. Consequences of a Change of Control

(a) Notice and Acceleration. Upon a Change of Control, unless the
Committee determines otherwise, (i) the Company shall provide each Grantee with
outstanding Grants written notice of such Change of Control, (ii) all
outstanding Options and SARs shall automatically accelerate and become fully
exercisable and (iii) the restrictions and conditions on all outstanding
Restricted Stock shall immediately lapse.

(b) Assumption of Grants. Upon a Change of Control where the Company is
not the surviving corporation (or survives only as a subsidiary of another
corporation), unless the Committee determines otherwise, all outstanding Options
and SARs that are not exercised shall be assumed by, or replaced with comparable
options and rights by, the surviving corporation.

(c) Other Alternatives. Notwithstanding the foregoing, subject to
subsection (d) below, in the event of a Change of Control, the Committee may
take one or both of the following actions: the Committee may (i) require that
Grantees surrender their outstanding Options and

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<PAGE> 12
SARs in exchange for a payment by the Company, in cash or Company Stock as
determined by the Committee, in an amount equal to the amount by which the then
Fair Market Value of the shares of Company Stock subject to the Grantee's
unexercised Options and SARs exceeds the Exercise Price of the Options or the
base amount of the SARs, as applicable, or (ii) after giving Grantees an
opportunity to exercise their outstanding Options and SARs, terminate any or all
unexercised Options and SARs at such time as the Committee deems appropriate.
Such surrender or termination shall take place as of the date of the Change of
Control or such other date as the Committee may specify.

(d) Committee. The Committee making the determinations under this
Section 12 following a Change of Control must be comprised of the same members
as those on the Committee immediately before the Change of Control. If the
Committee members do not meet this requirement, the automatic provisions of
subsections (a) and (b) shall apply, and the Committee shall not have discretion
to vary them (except to the extent Grants are rescinded pursuant to subsection
(e) below).

(e) Limitations. Notwithstanding anything in the Plan to the contrary,
in the event of a Change of Control, (i) the Committee (including the Committee
in place before a Change of Control and any Committee convened after a Change of
Control) shall not have the right to take any actions described in the Plan
(including without limitation actions described in Subsection (c) above) that
would make the Change of Control ineligible for pooling of interests accounting
treatment or that would make the Change of Control ineligible for desired tax
treatment if, in the absence of such right, the Change of Control would qualify
for such treatment and the Company (or, if applicable, the successor entity)
intends to use such treatment with respect to the Change of Control, and (ii)
without limiting the foregoing, in such event, the Committee may rescind any
Grants (whether or not vested or exercisable) that would impair the use of
pooling of interests accounting treatment, as determined by the Company's
certified public accountants.

13. Limitations on Issuance or Transfer of Shares

No Company Stock shall be issued or transferred in connection with any
Grant hereunder unless and until all legal and contractual restrictions
applicable to the issuance or transfer of such Company Stock have been complied
with to the satisfaction of the Committee. The Committee shall have the right to
condition any Grant made to any Grantee hereunder on such Grantee's undertaking
in writing to comply with such restrictions on his or her subsequent disposition
of such shares of Company Stock as the Committee shall deem necessary or
advisable as a result of (i) any applicable law, regulation or official
interpretation thereof, or (ii) the provisions of any stockholder agreement
concerning Company Stock, and certificates representing such shares shall be
legended to reflect any such restrictions. Certificates representing shares of
Company Stock issued or transferred under the Plan will be subject to such
stop-transfer orders and other restrictions as may be required by applicable
laws, regulations and interpretations, including any requirement that a legend
be placed thereon.

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<PAGE> 13
14. Amendment and Termination of the Plan

(a) Amendment. The Board may amend or terminate the Plan at any time;
provided, however, that the Board shall not amend the Plan without shareholder
approval if such approval is required in order for Incentive Stock Options
granted or to be granted under the Plan to meet the requirements of section 422
of the Code or if, after a Public Offering, such approval is required in order
to exempt compensation under the Plan from the deduction limit under section
162(m) of the Code.

(b) Termination of Plan. The Plan shall terminate on the day
immediately preceding the tenth anniversary of its effective date, unless the
Plan is terminated earlier by the Board or is extended by the Board with the
approval of the shareholders.

(c) Termination and Amendment of Outstanding Grants. A termination or
amendment of the Plan that occurs after a Grant is made shall not materially
impair the rights of a Grantee unless the Grantee consents or unless the
Committee acts under Section 20(b). The termination of the Plan shall not impair
the power and authority of the Committee with respect to an outstanding Grant.
Whether or not the Plan has terminated, an outstanding Grant may be terminated
or amended under Section 20(b) or may be amended by agreement of the Company and
the Grantee consistent with the Plan.

(d) Governing Document. The Plan shall be the controlling document. No
other statements, representations, explanatory materials or examples, oral or
written, may amend the Plan in any manner. The Plan shall be binding upon and
enforceable against the Company and its successors and assigns.

15. Funding of the Plan

This Plan shall be unfunded and is not intended to be subject to the
Employee Retirement Income Security Act of 1974, as amended. No provision
contained herein shall be construed to require that (i) the Company be required
to establish any special or separate fund or to make any other segregation of
assets to assure the payment of any Grants under this Plan, or (ii) interest be
paid or accrued on any Grant or on any subsequent distribution of Company Stock,
payment of cash, release or lapse of any restrictions on Company Stock, or any
other distribution or payment of property or cash pursuant to the exercise of
any rights provided by any Grants.

16. Rights of Participants

Nothing in this Plan shall entitle any Employee, Key Advisor,
Non-Employee Director or other person to any claim or right to be awarded a
Grant under this Plan. Neither this Plan nor any action taken hereunder shall be
construed as giving any individual any rights to be retained by or in the employ
of the Company or any other employment rights.

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<PAGE> 14
17. No Fractional Shares

No fractional shares of Company Stock shall be issued or delivered
pursuant to the Plan or any Grant. The Committee shall determine whether cash,
other awards or other property shall be issued or paid in lieu of such
fractional shares or whether such fractional shares or any rights thereto shall
be disregarded or otherwise eliminated.

18. Headings

Section headings are for reference only. In the event of a conflict
between a title and the content of a Section, the content of the Section shall
control.

19. Effective Date of the Plan.

(a) Effective Date. Subject to approval by the Company's shareholders,
the Plan shall be effective on June 24, 1998.

(b) Public Offering. The provisions of the Plan that refer to a Public
Offering, or that refer to, or are applicable to persons subject to, section 16
of the Exchange Act or section 162(m) of the Code, shall be effective, if at
all, upon the effective date of the initial registration of the Company Stock
under section 12(g) of the Exchange Act.

20. Miscellaneous

(a) Grants in Connection with Corporate Transactions and Otherwise.
Nothing contained in this Plan shall be construed to (i) limit the right of the
Committee to make Grants under this Plan in connection with the acquisition, by
purchase, lease, merger, consolidation or otherwise, of the business or assets
of any corporation, firm or association, including Grants to employees thereof
who become Employees of the Company, or for other proper corporate purposes, or
(ii) limit the right of the Company to grant stock options or make other awards
outside of this Plan. Without limiting the foregoing, the Committee may make a
Grant to an employee of another corporation who becomes an Employee by reason of
a corporate merger, consolidation, acquisition of stock or property,
reorganization or liquidation involving the Company or any of its subsidiaries
in substitution for a stock option or restricted stock grant made by such
corporation. The terms and conditions of the substitute grants may vary from the
terms and conditions required by the Plan and from those of the substituted
stock incentives. The Committee shall prescribe the provisions of the substitute
grants.

(b) Compliance with Law. The Plan, the exercise of Options and SARs and
the obligations of the Company to issue or transfer shares of Company Stock
under Grants shall be subject to all applicable laws and to approvals by any
governmental or regulatory agency as may be required. It is the intent of the
Company that the Plan and applicable Grants under the Plan comply with the
applicable provisions of section 162(m) of the Code (after a Public Offering)

-14-
<PAGE> 15
and section 422 of the Code (with respect to Incentive Stock Options). After a
Public Offering it is the intent of the Company, with respect to persons subject
to section 16 of the Exchange Act, that the Plan and all transactions under the
Plan comply with all applicable provisions of Rule 16b-3 or its successors under
the Exchange Act. To the extent that any legal requirement of section 162(m) or
422 of the Code or of section 16 of the Exchange Act ceases to be required by
law or that the restrictions thereof are liberalized, the Committee may provide,
in its sole discretion, that Plan provisions and restrictions relating to such
legal requirements shall cease to apply or be liberalized, as appropriate. The
Committee may revoke any Grant if it is contrary to law or modify a Grant to
bring it into compliance with any valid and mandatory government regulation. The
Committee may also adopt rules regarding the withholding of taxes on payments to
Grantees. The Committee may, in its sole discretion, agree to limit its
authority under this Section.

(c) Communications Laws. Notwithstanding any other provision in the
Plan to the contrary, if prior consent to the issuance or exercise of any Grant
hereunder is required for any reason under the Communications Act of 1934, as
amended, and/or the rules, regulations or policies of the Federal Communications
Commission (the "FCC") or any successor governmental agency (the "Communications
Laws") in effect at the time, whether as a consequence of the extent of the
current and proposed holdings of the Grantee, the citizenship or legal
qualifications of the Grantee or for any other reason under the Communications
Laws, then no Grant shall be issued, become effective or be exercised without
the Grantee first obtaining such prior written consent of the FCC or any
successor governmental agency.

(d) Governing Law. The validity, construction, interpretation and
effect of the Plan and Grant Instruments issued under the Plan shall be governed
and construed by and determined in accordance with the laws of the Commonwealth
of Pennsylvania, without giving effect to the conflict of laws provisions
thereof.

ENTERCOM COMMUNICATIONS CORP.

By: ________________________________

Date: ______________________________

-15-

<PAGE> 1

Exhibit 21.01

SUBSIDIARIES OF THE REGISTRANT

<TABLE>
<CAPTION>
NAME UNDER WHICH
NAME JURISDICTION OF ORGANIZATION SUBSIDIARY DOES BUSINESS
- ---- ---------------------------- ------------------------
<S> <C> <C>
ECI License Company, LP Pennsylvania ECI License Company, LP

Entercom Portland, LLC Oregon Entercom Portland, LLC

Entercom Portland License, LLC Oregon Entercom Portland License, LLC

Entercom Rochester, Inc. New York Entercom Rochester, Inc.

Entercom Boston 1 Trust Massachusetts Entercom Boston License, LLC

Entercom Boston 2 Trust Massachusetts Entercom Boston License, LLC

Entercom Boston License II, LLC Delaware Entercom Boston License, LLC

Entercom Boston LLC Delaware Entercom Boston License, LLC

Entercom Boston License, LLC Delaware Entercom Boston License, LLC

</TABLE>

<PAGE> 1

EXHIBIT 23.01

INDEPENDENT AUDITORS' CONSENT

To the Board of Directors of
Entercom Communications Corp.
Bala Cynwyd, Pennsylvania

We consent to the use in this Amendment No. 2 to Registration Statement No.
333-61381 of Entercom Communications Corp. of our report dated November 12,
1998, appearing in the Prospectus, which is a part of this Registration
Statement, and of our report dated November 12, 1998, related to the financial
statement schedule included elsewhere in this Registration Statement.

We also consent to the reference to us under the heading "Experts" in such
Prospectus.

DELOITTE & TOUCHE LLP
Philadelphia, Pennsylvania
December 4, 1998

<PAGE> 1

Exhibit 23.02

INDEPENDENT AUDITORS' CONSENT

To the Board of Directors of
Entercom Communications Corp.
Bala Cynwyd, Pennsylvania

We consent to the use in this Amendment No. 2 to Registration Statement No.
333-61381 of Entercom Communications Corp. of our report dated June 10, 1998,
appearing in the Prospectus, which is a part of this Registration Statement,
and to the reference to us under the heading "Experts" in such Prospectus.

DELOITTE & TOUCHE LLP
Salt Lake City, Utah
December 4, 1998

<PAGE> 1

Exhibit 23.03

INDEPENDENT AUDITORS' CONSENT

To the Board of Directors of
Entercom Communications Corp.
Bala Cynwyd, Pennsylvania

We consent to the use in this Amendment No. 2 to Registration Statement No.
333-61381 of Entercom Communications Corp. of our report dated May 21, 1998,
appearing in the Prospectus, which is a part of this Registration Statement,
and to the reference to us under the heading "Experts" in such Prospectus.

DELOITTE & TOUCHE LLP
Cincinnati, Ohio
December 4, 1998

<PAGE> 1

Exhibit 23.04

INDEPENDENT AUDITORS' CONSENT

To the Board of Directors of
Entercom Communications Corp.
Bala Cynwyd, Pennsylvania

We consent to the use in this Amendment No. 2 to Registration Statement No.
333-61381 of Entercom Communications Corp. of our report dated May 29, 1998,
appearing in the Prospectus, which is a part of this Registration Statement, and
to the reference to us under the heading "Experts" in such Prospectus.

DELOITTE & TOUCHE LLP
Seattle, Washington
December 4, 1998

<PAGE> 1
Exhibit 23.05

INDEPENDENT AUDITORS' CONSENT

To the Board of Directors of
Entercom Communications Corp.
Bala Cynwyd, Pennsylvania

We consent to the use in this Amendment No. 2 to Registration Statement No.
333-61381 of Entercom Communications Corp. of our report dated September 18,
1998, appearing in the Prospectus, which is a part of this Registration
Statement, and to the reference to us under the heading "Experts" in such
Prospectus.

DELOITTE & TOUCHE LLP
Boston, Massachusetts
December 4, 1998

<PAGE> 1
Exhibit 23.06

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our report
(and to all references to our Firm) included in or made a part of this
Registration Statement under the Securities Act of 1933.

/s/ ARTHUR ANDERSEN LLP
-----------------------

Baltimore, Maryland,
December 4, 1998

<PAGE> 1
EXHIBIT 24.02

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS that Steve Fisher constitutes and appoints
Joseph M. Field and David J. Field, and each of them, his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his person's name, place and stead, in any and all capacities to
sign any and all amendments (including post-effective amendments) to this
registration statement and additional registration statements pursuant to Rule
462(b) of the Securities Act, and to file the same, with all exhibits thereto,
and all other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each said attorney-in-fact and agent full
power and authority to do and perform each and every act in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or either
of them or their or his substitute or substitutes may lawfully do or cause to
be done by virtue hereof.

/s/ Stephen F. Fisher
---------------------
Stephen F. Fisher

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<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-1-1997
<PERIOD-END> SEP-30-1998
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<RECEIVABLES> 32,891
<ALLOWANCES> 367
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0
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<COMMON> 6
<OTHER-SE> 220,165
<TOTAL-LIABILITY-AND-EQUITY> 522,945
<SALES> 0
<TOTAL-REVENUES> 132,998
<CGS> 104,064
<TOTAL-COSTS> 104,064
<OTHER-EXPENSES> 4,527
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<INTEREST-EXPENSE> 14,663
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