Lamar Advertising Co/New – ‘DEFM14C’ on 8/13/99

On:  Friday, 8/13/99   ·   Accession #:  906280-99-200   ·   File #:  333-50559-56

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

Definitive Proxy Information Statement — Merger or Acquisition   —   Schedule 14C
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: DEFM14C     Definitive Proxy Information Statement -- Merger     223±   940K 
                          or Acquisition                                         
 2: EX-23       Consent of Experts or Counsel                          1      7K 

DEFM14C   —   Definitive Proxy Information Statement — Merger or Acquisition
Document Table of Contents

DEFM14C
1st “Page” of 82
TOC
↑Top
Previous
Next
↓Bottom
Just 1st
 
UNITED STATES 
SECURITIES AND EXCHANGE COMMISSION    
Washington, D.C. 20549  

SCHEDULE 14C INFORMATION  
____________  
Information Statement Pursuant to Section 14(c) of the Securities Exchange Act  
of 1934                                                                         

Check the appropriate box:                                                      

<square>       Preliminary Information Statement                                

<square>       Confidential, for Use of the Commission Only (as permitted by    
Rule 14c-5(d)(i))                                   

<checked-box>  Definitive Information Statement                                 

LAMAR ADVERTISING COMPANY 
(Name of Registrant as Specified in its Charter)  

(Name of Person Filing Information Statement, if other than the Registrant) 

Payment of Filing Fee (Check the appropriate box):                              

<square>       No fee required                                                  

<square>       Fee computed on table below per Exchange Act Rules 14c-5(g) and  
0-11.                                               
     (1)   Title of each class of securities to which the transaction applies:
          Class A Common Stock, $0.001 par value per share (the "Lamar Class
      A Common Stock"), of Lamar Advertising Company ("Lamar") to be
      issued in connection with the purchase by Lamar Media Corp., a
       wholly-owned subsidiary of Lamar ("Lamar Media"), of all of the
 outstanding capital stock of (a) Chancellor Media Outdoor
           Corporation ("Chancellor Outdoor") and (b) Chancellor Media Whiteco
Outdoor Corporation ("Chancellor Whiteco").             
(2)   Aggregate number of securities to which transaction applies:  
26,227,273 shares of Lamar Class A Common Stock.        
  (3)   Per unit price or other underlying value of transaction computed
         pursuant to Exchange Act Rule 0-11: The filing fee of $329,114 is
           calculated in accordance with Rule 0-11(c)(1)(i) under the Exchange
          Act as one fiftieth of one percent of $1,645,570,000, which is the
         aggregate book value as of March 31, 1999 of the (a) 1,000 shares
         of Common Stock, $0.01 par value per share, of Chancellor Outdoor
           and (b) 1,000 shares of Common Stock, $0.01 par value per share, of
 Chancellor Whiteco, to be purchased by Lamar Media in the
transaction.                                            
(4)   Proposed maximum aggregate value of the transaction:          
$1,645,570,000.                                         
(5)   Total fee paid:  $329,114.                                    

<checked-box>  Fee paid previously with preliminary materials.                  

<square>       Check box if any part of the fee is offset as provided           
   by Exchange Act Rule 0-11(a)(2) and identify the filing
for which the offsetting fee was paid previously.   
  Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its 
filing.                                             

DEFM14C
2nd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 2nd
INFORMATION STATEMENT 

LAMAR ADVERTISING COMPANY 
5551 CORPORATE BOULEVARD  
BATON ROUGE, LOUISIANA 70808  

Lamar Advertising Company, a Delaware corporation ("Lamar"), is     
furnishing this Information Statement (the "Information Statement") to its      
stockholders in connection with the proposed purchase (the "Stock Purchase")    
by Lamar Media Corp., a Delaware corporation and wholly-owned subsidiary of     
Lamar ("Lamar Media") of all of the outstanding common stock of Chancellor      
Media Outdoor Corporation ("Chancellor Outdoor") from its parent corporation,   
Chancellor Media Corporation of Los Angeles ("Chancellor LA") and all of the    
outstanding common stock of Chancellor Media Whiteco Outdoor Corporation        
("Chancellor Whiteco") from Chancellor LA's parent corporation, Chancellor      
Mezzanine Holdings Corporation ("Chancellor Mezzanine"), for a combination of   
$700 million in cash and 26,227,273 shares (the "Lamar Shares") of the Class A  
common stock, $0.001 par value per share, of Lamar (the "Class A Common Stock") 
to be issued by Lamar upon consummation of the Stock Purchase (the "Share       
Issuance").                                                                     

     The Board of Directors of Lamar has fixed the close of business on August
4, 1999 as the record date (the "Record Date") for the determination of         
stockholders entitled to receive notice of and to vote on the Share Issuance.   
As of the Record Date, Lamar had outstanding 43,568,340 shares of Class A       
Common Stock, each of which is entitled to one vote per share, and 17,699,997   
shares of Class B common stock, $0.001 par value per share (the "Class B Common 
Stock"), each of which is entitled to ten votes per share.  The Share Issuance  
requires the affirmative vote of Lamar stockholders holding at least a majority 
of the voting power of the outstanding Lamar Class A and Class B Common Stock.  

   The Reilly Family Limited Partnership ("RFLP"), holder of 100% of the
Class B Common Stock as of the Record Date, representing approximately 80% of   
the total voting power of Lamar, has advised the Lamar Board that it intends to 
execute a written consent (the "Written Consent") approving the Share Issuance. 
Thus, no further stockholder vote will be necessary and the Written Consent     
will be executed in lieu of a special meeting of the stockholders of Lamar.     

This Information Statement is first being mailed to stockholders of 
record as of the Record Date on or about August 13, 1999.   In accordance with  
the regulations of the Securities and Exchange Commission, the Stock Purchase   
and the Share Issuance may not be completed prior to 20 business days following 
the date that this Information Statement is mailed to the Lamar stockholders.   

    WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A
PROXY.                                                                          
                                      By Order of the Board of Directors

                                     /S/ JAMES R. MCILWAIN
                                       James R. McIlwain
                                       Secretary
Baton Rouge, Louisiana                                                          
August 13, 1999                                                                 

DEFM14C
3rd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 3rd
WHERE YOU CAN FIND MORE INFORMATION                                             

Lamar files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission").  You may inspect and     
copy this information at the Commission's public reference facilities in Room   
1024, 450 Fifth Street, N.W., Washington, D.C. 20549, as well as the            
Commission's Regional Offices.  You may also call the Commission at 1-800-SEC-  
0330 for more information about the public reference room, how to obtain copies 
of documents by mail or how to access documents electronically on the           
Commission's Web site at (http://www.sec.gov).                                  

Commission rules permit Lamar to "incorporate by reference" the     
information that it files with the Commission, which means that Lamar may       
disclose important information to you in this Information Statement by          
referring to documents that it files with the Commission.  Certain information  
that Lamar currently has on file is incorporated by reference and is an         
important part of this Information Statement.  Other information that Lamar     
will file later with the Commission will automatically update and supersede     
this information.                                                               

     Lamar incorporates by reference the following documents that it has filed
with the Commission pursuant to the Securities Exchange Act of 1934, as amended 
(the "Exchange Act"):                                                           

<circle>    Current Report on Form 8-K filed on October 15, 1998, as amended    
          by Form 8-K/A filed on October 19, 1998 and by Form 8-K/A filed on
June 8, 1999                                            

<circle>    Annual Report on Form 10-K for the fiscal year ended December 31,   
1998 , as amended by Form 10-K/A filed on August 5, 1999

<circle>    Quarterly Report on Form 10-Q for the fiscal quarter ended March    
31, 1999                                                

<circle>    Current Report on Form 8-K filed on May 7, 1999                     

<circle>    Current Report on Form 8-K filed on June 10, 1999                   

<circle>    Current Report on Form 8-K filed on July 7, 1999                    

<circle>    Current Report on Form 8-K filed on July 22, 1999, as amended by    
Form 8-K/A filed on July 26, 1999                       

<circle>    Current Report on Form 8-K filed on July 28, 1999                   

<circle>    Current Report on Form 8-K filed on August 3, 1999                  

<circle>    Current Report on Form 8-K filed on August 5, 1999                  

<circle>    Current Report on Form 8-K filed on August 6, 1999 (referencing     
File No.  333-50559)                                    

<circle>    Current Report on Form 8-K filed on August 6, 1999 (referencing     
File No.  333-71929)                                    

<circle>    Current Report on Form 8-K filed on August 10, 1999                 

<circle>    All other documents filed by Lamar with the Commission pursuant     
         to Sections 13(a), 14 or 15(d) of the Exchange Act after the date
      of this Information Statement and prior to consummation of the
Stock Purchase.                                         

You may obtain any of the above-listed documents from us or from the
Commission.  Documents listed above are available from us without charge,       
excluding all appendices unless the appendices have been specifically           
incorporated by reference into this Information Statement.  Stockholders may    
request copies by writing or telephoning us at:                                 

Lamar Advertising Company 
5551 Corporate Boulevard  
Baton Rouge, Louisiana 70808  
Attn: James R. McIlwain 
Telephone: (225) 926-1000 

TABLE OF CONTENTS   

SUMMARY                                                                1  
Explanatory Note Regarding Corporate Restructuring                   1
Purpose of this Information Statement                                1
Structure and Terms of the Stock Purchase                            1
The Companies                                                        2
The Closing Date                                                     2
Reasons for the Stock Purchase                                       2
Board Recommendation                                                 2
Other Terms and Conditions to the Stock Purchase                     3
Rights of Lamar Stockholders; Dilution                               5
Accounting Treatment                                                 5
Federal Income Tax Consequences                                      5
COMPARATIVE PER SHARE DATA                                             6  
MARKET PRICES AND DIVIDENDS                                            7  
Lamar                                                                7
Chancellor Outdoor                                                   7
GENERAL                                                                8  
Purpose of this Information Statement                                8
Explanatory Note Regarding Corporate Restructuring                   8
Vote Required; Record Date                                           8
The Written Consent                                                  8
THE STOCK PURCHASE                                                     9  
The Stock Purchase Agreement                                         9
Structure and Terms of the Stock Purchase                            9
The Voting Agreement                                                 9
 Background of and Reasons for the Stock Purchase                     10
 Recommendation of the Lamar Board of Directors                       11
 The Closing Date                                                     11
 Certain Terms of the Stock Purchase Agreement                        11
 Hart-Scott-Rodino Clearance                                          12
 Other Conditions to the Stock Purchase                               13
 Sellers' Indemnification Obligations                                 14
Conduct of Business by Chancellor Outdoor and Lamar                   
  Pending the Closing                                                 14
 No Solicitation                                                      15
 No Use of Chancellor Name                                            15
 Certain Employee Benefit Matters                                     16
 Amendment and Termination                                            16
 Fees and Expenses                                                    16
 Rights of Lamar Stockholders; Dilution                               16
 Appraisal Rights                                                     17
 Accounting Treatment                                                 17
 Certain Federal Income Tax Consequences                              17
 Federal Securities Law Consequences                                  17
BUSINESS OF THE COMPANIES                                              18 
 Description of the Business of Lamar                                 18
 Description of the Business of Chancellor Outdoor                    18
PRINCIPAL STOCKHOLDERS OF LAMAR                                        21 
SELECTED FINANCIAL DATA OF LAMAR ADVERTISING COMPANY                   23 
SELECTED FINANCIAL DATA OF CHANCELLOR MEDIA OUTDOOR CORPORATION AND       
PREDECESSORS                                                          24
 Chancellor Media Outdoor Corporation                                 24
 The Outdoor Advertising Division of Whiteco Industries,  Inc.        25
 Martin Media L.P.                                                    26
 Martin & MacFarlane, Inc.                                            27
CHANCELLOR MEDIA OUTDOOR CORPORATION MANAGEMENT'S DISCUSSION              
AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS         28
LAMAR ADVERTISING COMPANY UNAUDITED PRO FORMA CONDENSED                   
CONSOLIDATED FINANCIAL STATEMENTS                                     32
ADDITIONAL INFORMATION; INCORPORATION BY REFERENCE                     39 
FURTHER STOCKHOLDER ACTION NOT REQUIRED                                39 

INDEX TO FINANCIAL STATEMENTS                                          F-1
SECOND AMENDED AND RESTATED STOCK PURCHASE AGREEMENT AND RELATED          
 AGREEMENTS                                                            A-1

DEFM14C
4th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 4th
SUMMARY 

 The following Summary is not a complete statement of all of the features or
effects of Lamar's proposed acquisition of Chancellor Outdoor and Chancellor    
Whiteco.  The more detailed business and financial information contained in, or 
incorporated by reference into, this Information Statement qualify this Summary 
in its entirety.                                                                

EXPLANATORY NOTE REGARDING CORPORATE RESTRUCTURING                              

On July 20, 1999, Lamar Advertising Company completed a corporate         
restructuring (the "Restructuring") to create a new holding company structure.  
The Restructuring was accomplished through a merger under Section 251(g) of the 
Delaware General Corporation Law ("DGCL").  At the effective time of the        
merger, all stockholders of Lamar Advertising Company became stockholders of a  
new holding company and Lamar Advertising Company became a wholly-owned         
subsidiary of the new holding company.  The new holding company took the Lamar  
Advertising Company name  and the old Lamar Advertising Company was renamed     
Lamar Media Corp.                                                               

The new holding company's Class A Common Stock trades under the symbol    
"LAMR" on the Nasdaq National Market with the same CUSIP number as the old Lamar
Advertising Company's Class A Common Stock.  In the merger, all outstanding     
shares of the old Lamar Advertising Company's capital stock were converted into 
shares of the new holding company with the same voting powers, designations,    
preferences and rights, and the same qualifications, restrictions and           
limitations, as the shares of the old Lamar Advertising Company.  Stockholders  
of Lamar do not need to take any action since their existing stock certificates 
represent the same number of shares of the same class of capital stock of the   
new holding company as were previously held of the old Lamar Advertising        
Company.                                                                        

PURPOSE OF THIS INFORMATION STATEMENT                                           

  Under the DGCL neither the Stock Purchase nor the Share Issuance is required
to be approved by Lamar's stockholders.  However, the rules of the Nasdaq       
National Market, upon which the Class A Common Stock is traded, require that    
the Share Issuance be submitted to the Lamar stockholders and approved by the   
holders of at least a majority of the votes cast on the proposal.  In           
accordance with the DGCL and Lamar's Certificate of Incorporation, Lamar's      
Board has decided to obtain the necessary stockholder vote by a written consent 
in lieu of a special meeting of stockholders, and thus under the DGCL, the      
Share Issuance must be approved by the holders of at least a majority of the    
voting power of the outstanding Lamar Class A and Class B Common Stock          
(collectively, the "Lamar Common Stock").                                       

  RFLP, holder of 100% of the Class B Common Stock, representing approximately
80% of the voting power of Lamar, has advised the Board that it intends to      
execute the Written Consent approving the Share Issuance.  Thus, no further     
stockholder vote will be necessary and the Written Consent obviates the need to 
incur the expense of conducting a formal stockholders' meeting to approve the   
Share Issuance.  In accordance with the DGCL and regulations promulgated under  
the Exchange Act,  Lamar has provided this Information Statement to its         
stockholders of record as of the Record Date, and the Share Issuance may not be 
completed until 20 business days following the date of this Information         
Statement.  See "The Stock Purchase - The Voting Agreement."                    

STRUCTURE AND TERMS OF THE STOCK PURCHASE                                       

On June 1, 1999, Lamar and Chancellor LA entered into a Stock Purchase    
Agreement; on July 12, 1999, Lamar, Chancellor LA and Chancellor Mezzanine      
entered into an Amended and Restated Stock Purchase Agreement; and on August    
11, 1999, Lamar, Lamar Media, Chancellor LA and Chancellor Mezzanine entered    
into a Second Amended and Restated Stock Purchase Agreement (as amended and     
restated, the "Stock Purchase Agreement") and related agreements.               

 Pursuant to these agreements, Lamar Media will purchase (i) 1,000 shares of
the common stock, $0.01 par value per share, of Chancellor Outdoor,             
representing all of the issued and outstanding common stock of Chancellor       
Outdoor (the "Chancellor Outdoor Common Stock") and (ii) 1,000 shares of the    
common stock, $0.01 par value per share, of Chancellor Whiteco, representing    
all of the issued and outstanding common stock of Chancellor Whiteco (the       
"Whiteco Common Stock"), for a combination of $700 million in cash and          
26,227,273 shares (the "Lamar Shares") of Class A Common Stock (collectively,   
the "Purchase Price").  Chancellor Whiteco is currently a wholly-owned          
subsidiary of Chancellor Outdoor.  Immediately prior to consummation of the     
Stock Purchase, the Whiteco Common Stock will be distributed to Chancellor LA   
and then to Chancellor Mezzanine.  Lamar Media will purchase the Whiteco Common 
Stock from Chancellor Mezzanine and will purchase the Chancellor Outdoor Common 
Stock from Chancellor LA.   (Chancellor LA and Chancellor Mezzanine are         
sometimes collectively referred to herein as the "Sellers").                    

  The Lamar Shares to be issued to Chancellor LA and Chancellor Mezzanine will
constitute in the aggregate approximately 37% of the Class A Common Stock, and  
approximately 30% of the Lamar Common Stock, outstanding after such issuance.   
However, because of the different voting rights of the Class A and Class B      
Common Stock, the Lamar Shares will confer to Chancellor LA and Chancellor      
Mezzanine collectively only approximately 10.5% of the total voting power of    
Lamar.  Following the Share Issuance, RFLP will hold approximately 72% of the   
voting power of Lamar.  See "The Stock Purchase - Structure and Terms of the    
Stock Purchase."                                                                

THE COMPANIES                                                                   

Lamar has operated its outdoor advertising business under the Lamar name  
since 1902.  As of December 31, 1998, Lamar managed approximately 71,900        
outdoor advertising displays in 36 states, and as of June 30, 1999 Lamar        
managed approximately 75,700 outdoor advertising displays.  Lamar also operates 
the largest logo sign business in the United States.  (Logo signs are signs     
located near highway exits that deliver brand name information on available     
gas, food, lodging and camping services.)  As of December 31, 1998, Lamar       
maintained over 74,700 logo sign displays in 18 states, and as of June 30,      
1999, Lamar maintained approximately 81,100 logo sign displays in 20 states.    
Lamar also operates transit advertising displays on bus shelters, bus benches   
and buses in several markets.  Lamar is located at 5551 Corporate Boulevard,    
Baton Rouge, Louisiana 70808, telephone (225) 926-1000.  See "Business of the   
Companies - Description of the Business of Lamar."                              

Chancellor Outdoor is a wholly-owned subsidiary of Chancellor LA, and an  
indirect wholly-owned subsidiary of Chancellor Media Corporation, a Delaware    
corporation, which is a large national exclusive radio broadcasting and related 
media company.  Chancellor Whiteco is currently a wholly-owned subsidiary of    
Chancellor Outdoor.  Chancellor Outdoor's outdoor advertising portfolio         
includes over 42,700 billboards and outdoor displays in 38 states.   Chancellor 
Outdoor is located at 1845 Woodall Rodgers Freeway, Suite 1300, Dallas, Texas   
75201, telephone (214) 979-6700.  See "Business of the Companies - Description  
of the Business of Chancellor Outdoor."                                         

THE CLOSING DATE                                                                

The closing for the Stock Purchase (the "Closing") will take place on the 
tenth business day following the satisfaction of the conditions to the          
obligations of Lamar, Lamar Media and the Sellers as stated in the Stock        
Purchase Agreement (the "Closing Date").  See "The Stock Purchase - Hart-Scott- 
Rodino Clearance" and " -Other Conditions to the Stock Purchase."               

REASONS FOR THE STOCK PURCHASE                                                  

Lamar's Board believes that the terms of the Stock Purchase Agreement and 
related transactions are fair to, and in the best interests of, Lamar and its   
stockholders.  The Board believes that the Stock Purchase will improve access   
to major metropolitan and regional markets, increase per share earnings and     
improve economies of scale.  See "The Stock Purchase - Background of and        
Reasons for the Stock Purchase."                                                

BOARD RECOMMENDATION                                                            

Lamar's Board believes that the Stock Purchase and Share Issuance and     
related transactions are in the best interests of Lamar and its stockholders    
and has recommended to its stockholders the Share Issuance and the related      
transactions as described in this Information Statement.  The Board believes    
that consummating the Stock Purchase will increase Lamar's prospects for future 
success.  See "The Stock Purchase - Recommendation of the Lamar Board of        
Directors."                                                                     

OTHER TERMS AND CONDITIONS TO THE STOCK PURCHASE                                

In addition to the terms described above, the Stock Purchase Agreement and
related documents contain certain other terms and conditions, including the     
following:                                                                      

VOTING AGREEMENT.    As a condition to entering the Stock Purchase        
Agreement, the Sellers required  RFLP to enter into a voting agreement, dated   
as of June 1, 1999, as amended and restated as of July 12, 1999 and further     
amended and restated on August 11,1999, to ensure the approval of the Share     
Issuance (the "Voting Agreement").  Pursuant to the Voting Agreement by and     
among Lamar, the Sellers and RFLP, RFLP has agreed to vote its shares of Class  
B Common Stock in favor of the Share Issuance and any other transactions        
contemplated by the Stock Purchase Agreement.  The Voting Agreement prohibits   
RFLP from, at any time prior to the Closing Date:  (i) converting any shares of 
Class B Common Stock into Class A Common Stock or otherwise waiving its right   
to have each share of Class B Common Stock entitled to ten votes; (ii) selling, 
transferring or pledging any of its shares of its Lamar Common Stock; or (iii)  
entering into any voting arrangement with respect to its ownership of Lamar     
Common Stock.  See "The Stock Purchase - The Voting Agreement" and " -Certain   
Terms of the Stock Purchase Agreement."                                         

  FINANCING.  Prior to the consummation of the Stock Purchase, and to fund the
cash portion of the Purchase Price, the terms of the Stock Purchase Agreement   
require that Lamar Media:  (i) by June 16, 1999, obtain and deliver to the      
Sellers a commitment letter from Lamar Media's lenders, committing to fund at   
least $700 million at Closing specifically for the transactions contemplated by 
the Stock Purchase Agreement (the "Commitment Letter"); and (ii) by August 14,  
1999, (A) obtain and deliver to the Sellers definitive agreements, executed and 
delivered by Lamar Media's lenders, and in a form reasonably satisfactory to    
the Sellers, to disburse to Lamar Media at or prior to Closing, an aggregate    
amount of cash equal to at least $700 million, and containing no conditions to  
such disbursement other than those which are customary in such transactions     
(the "Definitive Agreements"), and (B) provide written certification to the     
Sellers that Lamar Media is currently meeting the covenants under its existing  
credit facility and that Lamar Media has no reason to believe that it will be   
unable to meet its obligations under the Definitive Agreements.  Lamar          
delivered the Commitment Letter on June 15, 1999.  Lamar Media                  
delivered to the Sellers the Definitive Agreements and written certification    
on August 13, 1999.  See "The Stock Purchase - Certain Terms of the Stock       
Purchase Agreement - Financing."                                                

STOCKHOLDERS AGREEMENT.  As a condition to the Stock Purchase, Lamar, the 
Sellers and RFLP must execute a Stockholders Agreement (the "Stockholders       
Agreement"), that provides, among other things, that immediately following the  
Closing, Lamar's Board will be increased from eight to ten directors, two of    
whom will be designated by the Sellers.  The Stockholders Agreement also        
requires the Sellers and RFLP to vote their shares of Lamar Common Stock in     
favor of the two candidates proposed by the Sellers.                            

 The Stockholders Agreement also prohibits Lamar from taking certain actions
without the Sellers' approval, including:  (i) transactions between Lamar and   
any affiliate (other than a wholly-owned subsidiary of Lamar); (ii) actions     
resulting in a change in control of Lamar (as defined in the Stockholders       
Agreement); and (iii) an acquisition or disposition of assets or stock with an  
aggregate fair market value of $500 million or more.  However, if certain       
conditions are met, these restrictions do not apply to, and no special approval 
of the Sellers is required for, the complete sale of Lamar, whether by means of 
a sale of assets or stock, or by merger.                                        

The Stockholders Agreement, including the Sellers' right to designate two 
directors on the Lamar Board, generally will terminate upon the earlier of 10   
years from the Closing or at such time as the Sellers hold in the aggregate     
less than 10% of the outstanding Lamar Common Stock, on a fully diluted basis.  
See "The Stock Purchase - Certain Terms of the Stock Purchase Agreement -       
Stockholders Agreement."                                                        

REGISTRATION RIGHTS AGREEMENT.  The Stock Purchase Agreement also requires
Lamar to execute a registration rights agreement (the "Registration Rights      
Agreement") with the Sellers, pursuant to which Lamar will (i) grant to the     
Sellers demand registration rights, exercisable at any time after ten months    
following the Closing Date, and (ii) at any time after ten months following the 
Closing Date as the Sellers may request, prepare and file a shelf registration  
statement for use by the Sellers and keep such shelf registration statement     
effective for one year. The Registration Rights Agreement also grants the       
Sellers the right to include its shares in any registration statement filed by  
Lamar to register the offer and sale of Lamar Common Stock by Lamar or other    
stockholders (including Lamar's universal shelf registration statement) on      
customary terms.  See "The Stock Purchase - Certain Terms of the Stock Purchase 
Agreement - the Registration Rights Agreement."                                 

HART-SCOTT-RODINO CLEARANCE.  The Sellers' obligation to consummate the   
Stock Purchase is conditioned upon the expiration or earlier termination of the 
requisite waiting period under the Hart-Scott-Rodino Antitrust Improvements Act 
of 1976, as amended (the "HSR Act").  Lamar and Chancellor LA made their        
required initial filings under the HSR Act on June 9, 1999 and June 10, 1999    
respectively.  Lamar's filing was withdrawn and re-submitted on July 12,        
1999.  On August 11, 1999, the DOJ requested additional information from Lamar, 
extending the statutory waiting period until the earlier of (a) 20 days         
following Lamar's substantial compliance with the DOJ request, or (b) the DOJ's 
grant of early termination of the statutory waiting period.  If Lamar and the   
Sellers have not obtained clearance pursuant to the HSR Act by November 30,     
1999, the Sellers have the right to terminate the Stock Purchase Agreement and  
hold Lamar in breach of its obligations under the Stock Purchase Agreement,     
regardless of Lamar's efforts to obtain clearance.  See "The Stock Purchase -   
Hart-Scott-Rodino Clearance."                                                   

 OTHER CONDITIONS TO CLOSING.  In addition to Lamar stockholder approval and
HSR Act clearance and the other matters discussed above, the consummation of    
the Stock Purchase is also conditioned upon the receipt of any necessary third  
party consents or approvals, the Sellers' elimination of any intercompany       
receivables, Chancellor LA's purchase of certain outdoor advertising assets     
pursuant to a settlement agreement and other customary closing conditions.  In  
addition, Chancellor LA must, by August 14, 1999, deliver to Lamar a            
certificate confirming that all necessary approvals and consents by its senior  
lenders to the consummation of the Stock Purchase (the "Approvals Certificate") 
have been obtained.   Chancellor LA delivered the Approvals Certificate on      
August 9, 1999.  See "The Stock Purchase - Other Conditions to the Stock        
Purchase."                                                                      

CONDUCT OF BUSINESS PENDING THE STOCK PURCHASE.  Prior to the Closing, the
Stock Purchase Agreement requires each of Lamar, Lamar Media and Chancellor     
Outdoor to conduct its business in the ordinary course consistent with past     
practice.  In particular, without the prior written consent of Lamar or Lamar   
Media, Chancellor Outdoor may not take certain extraordinary actions, including 
amending its charter or bylaws, acquiring other companies or selling or         
encumbering a material portion of its assets (except in the ordinary course of  
business), amending existing employee benefit or stock incentive arrangements   
(except in the ordinary course of business) or lending material amounts of      
money.   Also, prior to Closing, neither Lamar nor Lamar Media will be permitted
to take any of the actions that would require the Sellers' approval under the   
Stockholders Agreement if they were taken following the Closing.   See "The     
Stock Purchase - Conduct of Business by Chancellor Outdoor and Lamar Pending the
Closing" and "- Certain Terms of the Stock Purchase Agreement -  Stockholders   
Agreement."                                                                     

NO SOLICITATION.  The Stock Purchase Agreement provides that prior to     
Closing, the Sellers and their affiliates, officers, directors, employees,      
representatives and agents may not directly or indirectly encourage, solicit,   
participate in, initiate or conduct discussions or negotiations with, or        
provide any information to any persons concerning any merger, sale of assets,   
sale of shares of capital stock or similar transactions involving Chancellor    
Outdoor.  See "The Stock Purchase - No Solicitation."                           

AMENDMENT AND TERMINATION.  The Stock Purchase Agreement may be amended at
any time upon mutual written agreement of the parties and may also be           
terminated by each of the parties under certain customary circumstances.  The   
Stock Purchase Agreement may also be terminated by the Sellers if clearance     
under the HSR Act has not been obtained by November 30, 1999.  See "The Stock   
Purchase - Amendment and Termination."                                          

RIGHTS OF LAMAR STOCKHOLDERS; DILUTION                                          

 The rights of the Lamar stockholders will not be altered as a result of the
Stock Purchase, except as those rights are affected by the Stockholders         
Agreement.  The Stock Purchase will, however, significantly dilute the          
interests of Lamar's current stockholders.  If the Stock Purchase is completed, 
Lamar's current stockholders will own in the aggregate approximately 70% of the 
total number of shares of Lamar Common Stock then outstanding, with the Sellers 
owning in the aggregate the remaining 30%, and current holders of Class A       
Common Stock will own in the aggregate approximately 63% of the total number of 
shares of Class A Common Stock then outstanding, with the Sellers owning in the 
aggregate the remaining 37%.  However, because of the different voting rights   
of the Class A and Class B Common Stock, the Lamar Shares will confer to the    
Sellers collectively only approximately 10.5% of the total voting power of      
Lamar.  Following the Share Issuance, RFLP will hold approximately 72% of the   
voting power of Lamar.  See "The Stock Purchase - Rights of Lamar Stockholders; 
Dilution."                                                                      

ACCOUNTING TREATMENT                                                            

 For accounting purposes, the Stock Purchase will be accounted for using the
purchase method of accounting.  Under the purchase method of accounting, the    
purchase price is allocated to the identifiable assets and liabilities acquired 
based upon the estimated fair values of such assets and liabilities on the date 
of acquisition.  Any excess of the fair market value of the consideration given 
over the fair market value of the identifiable net assets acquired is reported  
as goodwill.  See "The Stock Purchase - Accounting Treatment."                  

FEDERAL INCOME TAX CONSEQUENCES                                                 

The Stock Purchase will constitute a taxable transaction to Chancellor LA 
and Chancellor Mezzanine and their affiliated group.  See "The Stock Purchase - 
Certain Federal Income Tax Consequences."                                       

DEFM14C
5th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 5th
COMPARATIVE PER SHARE DATA  

The following summary presents certain historical unaudited and pro forma 
per share data for Lamar. Chancellor Whiteco is currently a wholly-owned        
subsidiary of Chancellor Outdoor, and Chancellor Outdoor is a wholly-owned      
subsidiary of Chancellor LA, which is an indirect wholly-owned subsidiary of    
Chancellor Media Corporation;  therefore, neither Chancellor Whiteco nor        
Chancellor Outdoor per share data is presented in this analysis.  The pro forma 
amounts assume that the Stock Purchase took place as of the beginning of the    
period presented and was accounted for as a purchase transaction.  Lamar's pro  
forma amounts represent the combined pro forma results of Lamar and Chancellor  
Outdoor.  This pro forma information may not be indicative of actual results    
for any future period or of the results that would have been achieved had the   
Stock Purchase been completed on the date assumed.  The data presented in this  
table should be read together with the historical financial statements and      
related notes thereto included elsewhere, or incorporated by reference, in this 
Information Statement.                                                          

                                                                [Download Table]


                                                 YEAR ENDED      THREE MONTHS ENDED
                                              DECEMBER 31, 1998     MARCH 31, 1999 
                                              -----------------  ------------------
                                                                                   
Historical - Lamar                                                                 
   Net earnings (loss) per common share......    $  (0.24)            $   (0.18)   
   Loss before cumulative effect of a                                              
      change in accounting principle                                               
      per common share.......................        N/A              $   (0.16)   
   Cash dividends per common share(1)........        N/A                   N/A     
   Book value per common share...............    $   7.64             $    7.50    

Pro Forma per common share data                                                    
   Net earnings (loss) per common share......    $  (1.30)            $    N/A     
   Loss before cumulative effect of a                                              
      change in accounting principle                                               
      per common share.......................        N/A              $   (0.31)   
   Cash dividends per common share...........        N/A                   N/A     
   Book value per common share...............        N/A              $   16.08    

_______________                                                                 
(1)Lamar has not historically paid cash dividends on its Class A Common         
Stock.                                                                    

DEFM14C
6th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 6th
MARKET PRICES AND DIVIDENDS 

LAMAR                                                                           

  Lamar Class A Common Stock is traded on the Nasdaq National Market under the
symbol "LAMR."  The following table sets forth, for the period indicated, the   
high and low sales prices for Lamar Class A Common Stock as reported on the     
Nasdaq National Market (as adjusted for the three-for-two stock split effected  
on February 26, 1998).                                                          

  HIGH   LOW

Fiscal year ended December 31, 1997                                             
First Quarter.................17.08 11.83                           
Second Quarter................19.08 10.67                           
Third Quarter.................21.33 15.83                           
Fourth Quarter ...............27.17 17.67                           

Fiscal year ended December 31, 1998                                             
First Quarter.................38.50 24.42                           
Second Quarter................36.75 29.25                           
Third Quarter.................41.50 24.50                           
Fourth Quarter................39.25 19.25                           

Fiscal year ending December 31, 1999                                            
First Quarter.................41.63 32.25                           
Second Quarter................43.00 27.75                           
Third Quarter                                                       
(through August 4, 1999)......46.50 37.00                           

  On May 28, 1999, the last trading day preceding public announcement of
the Stock Purchase, the closing per share sale price of the Class A Common      
Stock was $34.13 and on August 4, 1999, the closing per share sale price of the 
Class A Common Stock was $37.06.  As of August 4, 1999, there were approximately
186 holders of record of the Class A Common Stock and one holder of record of   
the Class B Common Stock.                                                       

  Lamar does not plan to declare or pay cash dividends to holders of the
Class A Common Stock in the foreseeable future.  Shares of Lamar's Class        
A preferred stock are entitled to preferential dividends in an annual aggregate 
amount of $364,903 before any dividends may be paid on the Class A Common       
Stock.  In addition, the terms of Lamar Media's bank credit facilities and other
indebtedness have terms restricting the payment of dividends or other           
distributions by Lamar Media to Lamar.  It is anticipated that any new          
credit facility obtained will contain similar limitations.                      

CHANCELLOR OUTDOOR                                                              

    Neither the Whiteco Common Stock nor the Chancellor Outdoor Common Stock
is traded on any exchange and there is no established public trading market for 
such stock.  There are no bid or asked prices available for the Whiteco Common  
Stock or the Chancellor Outdoor Common Stock.                                   

DEFM14C
7th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 7th
GENERAL 

PURPOSE OF THIS INFORMATION STATEMENT                                           

     Lamar Advertising Company, a Delaware corporation ("Lamar") is furnishing
this Information Statement (the "Information Statement") to its stockholders in 
connection with the proposed purchase (the "Stock Purchase") by Lamar Media     
Corp., a Delaware corporation and wholly-owned subsidiary of Lamar ("Lamar      
Media"), of all of the outstanding common stock of Chancellor Media Outdoor     
Corporation ("Chancellor Outdoor") from its parent corporation, Chancellor Media
Corporation of Los Angeles ("Chancellor LA") and all of the outstanding common  
stock of Chancellor Media Whiteco Outdoor Corporation ("Chancellor Whiteco")    
from Chancellor LA's parent corporation, Chancellor Mezzanine Holdings          
Corporation ("Chancellor Mezzanine," and together with Chancellor LA, sometimes 
collectively referred to herein as the "Sellers"), for a combination of $700    
million in cash and 26,227,273 shares (the "Lamar Shares") of the Class A Common
Stock, $0.001 par value per share, of Lamar (the "Class A Common Stock").       

EXPLANATORY NOTE REGARDING CORPORATE RESTRUCTURING                              

On July 20, 1999, Lamar Advertising Company completed a corporate   
restructuring (the "Restructuring") to create a new holding company structure.  
The Restructuring was accomplished through a merger under Section 251(g) of the 
Delaware General Corporation Law ("DGCL").  At the effective time of the        
merger, all stockholders of Lamar Advertising Company became stockholders of a  
new holding company and Lamar Advertising Company became a wholly-owned         
subsidiary of the new holding company.  The new holding company took the Lamar  
Advertising Company name  and the old Lamar Advertising Company was renamed     
Lamar Media Corp.                                                               

  The new holding company's Class A Common Stock trades under the symbol
"LAMR" on the Nasdaq National Market with the same CUSIP number as the old Lamar
Advertising Company's Class A Common Stock.  In the merger, all outstanding     
shares of the old Lamar Advertising Company's capital stock were converted into 
shares of the new holding company with the same voting powers, designations,    
preferences and rights, and the same qualifications, restrictions and           
limitations, as the share of old Lamar Advertising Company.  Stockholders of    
Lamar do not need to take any action since their existing stock certificates    
represent the same number of shares of the same class of capital stock of the   
new holding company as were previously held of the old Lamar Advertising        
Company.                                                                        

VOTE REQUIRED; RECORD DATE                                                      

    Under the DGCL, neither the Stock Purchase nor the issuance of the Lamar
Shares upon consummation of the Stock Purchase (the "Share Issuance") is        
required to be approved by Lamar's stockholders.  However, the rules of the     
Nasdaq National Market ("Nasdaq"), upon which the Class A Common Stock is       
traded, require that the Share Issuance be submitted to the Lamar stockholders  
and approved by the holders of at least a majority of votes cast on the         
proposal.  In accordance with the DGCL and Lamar's Certificate of               
Incorporation, Lamar's Board has decided to obtain the necessary stockholder    
vote by a written consent in lieu of a special meeting of stockholders, and     
thus, under the DGCL, the Share Issuance must be approved by the holders of at  
least a majority of the voting power of the outstanding Class A and Class B     
Common Stock (collectively, the "Lamar Common Stock").                          

     The Board of Directors of Lamar has fixed the close of business on August
4, 1999 as the record date (the "Record Date") for the determination of         
stockholders entitled to receive notice of and to vote on the Share Issuance.   
As of the Record Date, Lamar had outstanding 43,568,340 shares of Class A       
Common Stock, each of which is entitled to one vote per share, and 17,699,997   
shares of Class B common stock, $0.001 par value per share (the "Class B Common 
Stock"), each of which is entitled to 10 votes per share.                       

THE WRITTEN CONSENT                                                             

  The Reilly Family Limited Partnership, a Louisiana limited partnership
("RFLP"), holder of 100% of the Class B Common Stock as of the Record Date,     
representing approximately 80% of the total voting power of Lamar, has advised  
the Lamar Board that it intends to execute a written consent (the "Written      
Consent") approving the Share Issuance.  Thus, no further stockholder vote will 
be necessary and the Written Consent obviates the need to incur the expense of  
conducting a formal stockholders' meeting to approve the Share Issuance.  In    
accordance with the DGCL and regulations promulgated under the Securities       
Exchange Act of 1934, as amended (the "Exchange Act"), Lamar has provided this  
Information Statement on or about August 13, 1999 to its stockholders of record 
as of the Record Date, and the Share Issuance may not be completed until 20     
business following the date of this Information Statement.  See "The Stock      
Purchase - The Voting Agreement."                                               

DEFM14C
8th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 8th
THE STOCK PURCHASE  

THE STOCK PURCHASE AGREEMENT                                                    

Lamar, Lamar Media and the Sellers will effect the Stock Purchase in
accordance with the terms and the conditions set forth in the Second Amended    
and Restated Stock Purchase Agreement dated as of August 11, 1999 (the "Stock   
Purchase Agreement"), a copy of which is attached to this Information Statement 
as Appendix A.  The following description is necessarily incomplete and is      
qualified in its entirety by reference to the Stock Purchase Agreement.         

STRUCTURE AND TERMS OF THE STOCK PURCHASE                                       

On June 1, 1999, Lamar and Chancellor LA executed the original Stock
Purchase Agreement; on July 12, 1999, Lamar, Chancellor LA and Chancellor       
Mezzanine executed the Amended and Restated Stock Purchase Agreement; and on    
August 11, 1999, Lamar, Lamar Media, Chancellor LA and Chancellor Mezzanine     
executed the Second Amended and Restated Stock Purchase Agreement, pursuant to  
which Lamar Media will purchase (i) 1,000 shares of the common stock, $0.01 par 
value per share, of Chancellor Outdoor (the "Chancellor Outdoor Common Stock"), 
representing all of the issued and outstanding common stock of Chancellor       
Outdoor, and (ii) 1,000 shares of the common stock, $0.01 par value per share,  
of Chancellor Whiteco (the "Whiteco Common Stock"), representing all of the     
issued and outstanding common stock of Chancellor Whiteco, for a combination of 
$700 million in cash and 26,227,273 shares of Class A Common Stock              
(collectively, the "Purchase Price"), and Chancellor Outdoor and Chancellor     
Whiteco will become wholly-owned subsidiaries of Lamar Media.                   

    Currently, Chancellor Whiteco is a wholly-owned subsidiary of Chancellor
Outdoor.  Due to certain restrictions under the indentures governing Chancellor 
LA's subordinated debt, the Stock Purchase has been structured such that,       
immediately prior to consummation of the Stock Purchase (the "Closing"),        
Chancellor Outdoor will effect a dividend of the Whiteco Common Stock to its    
immediate parent corporation, Chancellor LA, and Chancellor LA will in turn     
effect a dividend of the Whiteco Common Stock to its immediate parent           
corporation, Chancellor Mezzanine (such dividends referred to collectively as   
the "Whiteco Dividend").  Upon consummation of the Stock Purchase, Lamar Media  
will purchase the Whiteco Common Stock from Chancellor Mezzanine and in         
consideration therefor will pay to Chancellor Mezzanine $10 million in cash and 
Lamar will issue to Chancellor Mezzanine a number of shares of Class A Common   
Stock having an aggregate value of $940 million based on the closing sales      
price of the Class A Common Stock on the trading day immediately prior to the   
Closing, up to a maximum of 26,227,273 shares.  Upon consummation of the Stock  
Purchase, Lamar Media will also purchase the Chancellor Outdoor Common Stock    
from Chancellor LA and in consideration therefor will pay Chancellor LA $690    
million in cash and Lamar will issue to Chancellor LA a number of shares of     
Class A Common Stock, if any, obtained by subtracting the number of shares of   
Class A Common Stock issued to Chancellor Mezzanine from 26,227,273.            

The Lamar Shares to be issued to the Sellers will constitute in the 
aggregate approximately 37% of the Class A Common Stock, and approximately 30%  
of the Lamar Common Stock outstanding after such issuance. However, because of  
the different voting rights of the Class A and Class B Common Stock, the Lamar  
Shares will confer to the Sellers collectively only approximately 10.5% of the  
total voting power of Lamar.  Following the Share Issuance, RFLP will hold      
approximately 72% of the voting power of Lamar.                                 

   The Stock Purchase Agreement also contains a post-Closing adjustment in
the event that the net working capital of Chancellor Outdoor (considered before 
the Whiteco Dividend) as shown on a closing date balance sheet is greater or    
less than $12 million.  The closing date balance sheet will be provided within  
45 days of the Closing and any required adjustment will be made in cash within  
30 days thereafter, but in any event no later than 90 days thereafter if there  
is any disagreement regarding the closing date balance sheet.                   

THE VOTING AGREEMENT                                                            

As a condition to entering the Stock Purchase Agreement, the Sellers
required RFLP to enter into a voting agreement dated as of June 1, 1999, as     
amended and restated as of July 12, 1999 and further amended and restated on    
August 11, 1999, to ensure Lamar stockholder approval of the Share Issuance     
(the "Voting Agreement").  Pursuant to the Voting Agreement by and among Lamar, 
the Sellers and RFLP, RFLP has agreed to vote its shares of Class B Common      
Stock in favor of the Share Issuance and any other transactions contemplated by 
the Stock Purchase Agreement.  The Voting Agreement also prohibits RFLP from,   
at any time prior to the Closing date: (i) converting any shares of Class B     
Common Stock into Class A Common Stock or otherwise waiving its rights to have  
each share of Class B Common Stock entitled to 10 votes; (ii) selling,          
transferring or pledging any of its shares of its Lamar Common Stock; or (iii)  
entering into any voting arrangement with respect to its ownership of Lamar     
Common Stock.  The RFLP has advised the Lamar Board that it intends to vote its 
Class B Common Stock in accordance with the Voting Agreement in favor of the    
Share Issuance and will do so by executing the Written Consent as soon as       
practicable following 20 business days after the date of this Information       
Statement.                                                                      

BACKGROUND OF AND REASONS FOR THE STOCK PURCHASE                                

Lamar's business strategy is to provide high quality local sales and
service, centralized control and decentralized management and a middle market   
focus.  Its growth strategy is to pursue internal growth and to make strategic  
acquisitions to take advantage of the continued consolidation of the outdoor    
advertising industry.                                                           

The Stock Purchase is part of Lamar's strategic acquisition plan to 
increase operating efficiencies, provide geographic diversification and broaden 
its market.  From January 1, 1996 through July 31, 1999, Lamar has completed    
over 105 acquisitions of outdoor advertising businesses, which management       
believes has improved opportunities for inter-market cross-selling and economies
of scale.  Acquiring high-profile bulletin displays that become available in    
larger markets also enables Lamar to leverage its reputation for high quality   
local sales and services.                                                       

     On May 3, 1999, Lamar received a letter from Morgan Stanley Dean Witter &
Co. ("Morgan Stanley") and Greenhill & Co., L.L.C ("Greenhill") inviting Lamar  
to submit a final binding offer for the Chancellor Outdoor Common Stock by 5:00 
p.m. local time on Monday, May 10, 1999.  Lamar's Board reviewed the terms of   
the proposed stock purchase agreement with its financial, accounting and legal  
advisors and discussed various purchase options and prices.  On May 10, 1999,   
Sean Reilly, Lamar's Vice President of Mergers & Acquisitions, offered in       
writing to pay $1.5 billion in cash for Chancellor Outdoor.  His letter to      
Greenhill referenced some general considerations, including that Lamar would    
need to secure additional financing to acquire the Chancellor Outdoor Common    
Stock.  Chancellor LA did not accept Lamar's offer, and instead pursued an      
offer from another bidder.                                                      

     During the last week of May 1999, Chancellor LA informed Lamar management
that it wanted to reopen negotiations for the sale of Chancellor Outdoor and    
asked if Lamar's prior offer was still valid.  Lamar amended its offer by       
proposing to pay $1 billion in cash and $500 million worth of Class A Common    
Stock.  Chancellor LA indicated its interest in receiving more of the Purchase  
Price in the form of Class A Common Stock and the parties agreed that Lamar     
would pay $700 million in cash and issue 26,227,273 shares of Class A Common    
Stock to Chancellor LA.  As of May 28, 1999, the last trading day before the    
public announcement of the Stock Purchase, the closing sale price of the Class  
A Common Stock was $34.13 per share, making the total value of the Purchase     
Price as of that time approximately $1.6 billion.   From May 27, 1999 through   
May 31, 1999, representatives of Lamar and Chancellor LA and their respective   
legal, financial and accounting advisors participated in various meetings in    
which the final terms of the Stock Purchase Agreement were negotiated and legal 
and business information was exchanged.                                         

 On May 31, 1999, the Lamar Board met to review the final terms of the
proposed Stock Purchase.  At this meeting, Lamar's general counsel and          
representatives of Jones, Walker, Waechter, Poitevent, Carrere & Denegre,       
L.L.P., Lamar's counsel, discussed the terms of the Stock Purchase with Lamar's 
Board.  After discussion, the Board approved the Stock Purchase Agreement and   
related transactions.                                                           

    On June 1, 1999, Chancellor LA's Board of Directors met and approved the
sale of the Chancellor Outdoor Common Stock pursuant to the Stock Purchase      
Agreement and related documents.  On June 1, 1999, the Stock Purchase Agreement 
and the Voting Agreement were executed, and representatives of Lamar and        
Chancellor publicly announced the transactions.                                 

    The parties subsequently agreed to restructure the Stock Purchase and on
July 12, 1999, the first amended and restated Stock Purchase Agreement and      
amended and restated Voting Agreement were executed.  On July 19, 1999, Lamar,  
Chancellor LA, Chancellor Mezzanine and Lamar Media entered into a Limited      
Waiver and Consent, whereby each of Chancellor LA and Chancellor Mezzanine      
agreed to give its consent to and waiver of Section 5.7 of the Stock Purchase   
Agreement to permit the Restructuring and, together with Lamar and Lamar Media, 
agreed to amend the Stock Purchase Agreement and related agreements to reflect  
the Restructuring.  On August 11,1999 Lamar, Lamar Media, Chancellor LA and     
Chancellor Mezzanine executed the Second Amended and Restated Stock Purchase    
Agreement and the second amended and restated Voting Agreement reflecting the   
Restructuring.                                                                  

     Lamar's Board believes that the terms of the Stock Purchase Agreement and
related transactions are fair to, and in the best interests of, Lamar and its   
stockholders.  The Board believes that the Stock Purchase will improve access   
to major metropolitan and regional markets, increase per share earnings and     
improve economies of scale.                                                     

RECOMMENDATION OF THE LAMAR BOARD OF DIRECTORS                                  

After careful consideration, the Lamar Board has determined that the
Stock Purchase is advisable and in the best interest of its stockholders, has   
approved the Stock Purchase Agreement and the related documents and recommends  
that its stockholders vote in favor of the Share Issuance.                      

THE CLOSING DATE                                                                

    The Closing will occur and the Stock Purchase will be consummated on the
10th business day (the "Closing Date") following the satisfaction of the        
conditions to the obligations of Lamar, Lamar Media and the Sellers as          
stated in the Stock Purchase Agreement, or at such other time as the Sellers    
and Lamar may agree in writing.                                                 

CERTAIN TERMS OF THE STOCK PURCHASE AGREEMENT                                   

FINANCING                                                                 

 Prior to the consummation of the Stock Purchase, and to fund the cash
portion of the Purchase Price, the terms of the Stock Purchase Agreement        
require that Lamar Media:  (i) by June 16, 1999, obtain and deliver to the      
Sellers a commitment letter from Lamar Media's lenders, committing to fund no   
less than $700 million at Closing specifically for the transactions             
contemplated by the Stock Purchase Agreement (the "Commitment Letter"); and     
(ii) by August 14, 1999, (A) obtain and deliver to the Sellers definitive       
agreements executed and delivered by Lamar Media's  lenders, reasonably         
satisfactory to the Sellers, to disburse to Lamar Media at or prior to Closing, 
an aggregate amount of cash equal to at least $700 million, and containing no   
conditions to such disbursements other than those which are customary in such   
transactions (the "Definitive Agreements"), and (B) provide written             
certification that Lamar Media is meeting the covenants under its existing      
credit facility and that Lamar Media has no reason to believe that it will be   
unable to meet its obligations with respect to the Definitive Agreements.       

   Lamar delivered the Commitment Letter to Chancellor LA on June 15, 1999
and Lamar Media delivered to the Sellers the Definitive Agreements and written  
certification on August 13, 1999.                                               

STOCKHOLDERS AGREEMENT                                                    

  As a condition to the Stock Purchase, Lamar, the Sellers and RFLP must
execute a stockholders agreement (the "Stockholders Agreement"), that provides, 
among other things, that immediately following the Closing, Lamar's Board will  
be increased from eight to ten directors, two of whom will be designated by     
Sellers, and requires the Sellers and RFLP to agree to vote their shares of     
Lamar Common Stock in favor of the two candidates proposed by the Sellers (the  
"Chancellor Designees").  Lamar has further agreed to cause each Chancellor     
Designee (or such other persons as designated by the Sellers as the new         
Chancellor Designees in replacement of such persons) to be nominated and        
recommended by the Lamar Board for reelection as directors, and to permit at    
least one of the Chancellor Designees to serve on each committee of the Lamar   
Board (other than Lamar's Executive Committee).                                 

The Stockholders Agreement also prohibits Lamar from taking certain 
actions without the Sellers' approval (or, should the Sellers have transferred  
the Class A Common Stock to one or more affiliates, the approval of the holders 
of at least a majority of the total number of shares held by the Sellers and    
their affiliates).  The restricted actions include:   (i) transactions between  
Lamar and any affiliate (other than a wholly-owned subsidiary of Lamar); (ii)   
actions resulting in a change in control of Lamar (defined in the Stockholders  
Agreement as a change in the makeup of a majority of the Lamar Board or the     
failure of the RFLP and the Chancellor holders together to hold more than 50%   
percent of the voting power of Lamar); and (iii) an acquisition or disposition  
of assets or stock with an aggregate fair market value of $500 million or more. 
However, if certain conditions are met, these restrictions do not apply to, and 
no special approval of the Sellers is required for, the complete sale of Lamar, 
whether by means of a sale of assets or stock, or by merger.                    

     The Stockholders Agreement, including the Sellers' right to designate any
directors on the Lamar Board, will terminate upon the earlier of 10 years from  
the Closing or at such time as the Sellers hold in the aggregate less than 10%  
of the outstanding Lamar Common Stock on a fully diluted basis.                 

   The terms of the Stockholders Agreement also restrict Sellers' right to
sell any of the Lamar Shares for a period of 12 months following the Closing    
and require Lamar to deliver to the Sellers certain financial information       
within 80 days of the end of each of Lamar's fiscal years and within 35 days of 
the end of each of Lamar's fiscal quarters.  This financial information         
obligation will continue (despite any termination of the Stockholders Agreement)
for as long as the Sellers are required to include the Lamar financial          
information in their own financial statements.                                  

REGISTRATION RIGHTS AGREEMENT                                             

  As a condition to the Closing, Lamar and the Sellers will enter into a
registration rights agreement (the "Registration Rights Agreement"), pursuant   
to which Lamar will (i) grant to the Sellers, exercisable at any time after 10  
months from the Closing Date, demand registration rights, and (ii) at any time  
after 10 months from the Closing Date, upon the Sellers' request, prepare and   
file a shelf registration statement for use by the Sellers and keep the shelf   
registration statement effective for one year.  Under the terms of the          
Registration Rights Agreement, the Sellers may not demand that Lamar effect     
more than one registration pursuant to its demand registration rights (each a   
"Demand Registration") in any 12-month period nor require more than an          
aggregate of three Demand Registrations.  In addition, Lamar will not be        
obliged to (i) cause any Demand Registration to be effective on a date prior to 
the first anniversary of the Closing Date, or (ii) cause such a registration    
statement to be declared effective during any period during which a shelf       
registration statement remains effective.  The Registration Rights Agreement    
also grants to the Sellers the right to include their shares in any             
registration statement filed by Lamar to register the offer and sale of Lamar   
Common Stock by Lamar or other stockholders (including Lamar's universal shelf  
registration statement) on customary terms.                                     

HART-SCOTT-RODINO CLEARANCE                                                     

     The obligation of the Sellers to consummate the Stock Purchase is subject
to the expiration or earlier termination of the requisite waiting period under  
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR  
Act").  Under the HSR Act and the rules and regulations promulgated thereunder  
by the Federal Trade Commission (the "FTC"), the Stock Purchase may not be      
consummated until (i) notifications have been given and certain information has 
been furnished to the FTC and the Antitrust Division of the Department of       
Justice (the "DOJ"), and (ii) specific waiting periods have expired or          
terminated.                                                                     

  Lamar and the Sellers have each agreed, pursuant to the Stock Purchase
Agreement, to use its reasonable best efforts to file or cause to be filed with 
the FTC and the DOJ such notifications as are required to be filed under the    
HSR Act and the rules and regulations thereunder, and to respond to any         
requests for additional information made by either the FTC or the DOJ.          
Accordingly, Lamar and Chancellor LA each filed its Notification and Report     
Form with the FTC and DOJ on June 9, 1999, and June 10, 1999 respectively.      
Lamar's filing was withdrawn and re-submitted on July 12, 1999.  On August 11,  
1999, the DOJ requested additional information from Lamar, extending the        
statutory waiting period until the earlier of (a) 20 days following Lamar's     
substantial compliance with the DOJ request, or (b) the DOJ's grant of early    
termination of the statutory waiting period.                                    

   Under the Stock Purchase Agreement, Lamar is required to take all steps
necessary to cause the Stock Purchase to be consummated no later than November  
30, 1999.  If clearance under the HSR Act has not been obtained by such date,   
the Sellers have the right to terminate the Stock Purchase Agreement and hold   
Lamar in breach of this obligation, regardless of Lamar's efforts to obtain     
clearance.  See "- Amendment and Termination."                                  

 The DOJ and the FTC, as well as state antitrust enforcement agencies,
frequently scrutinize the legality under the antitrust laws of transactions     
such as the Stock Purchase.  The expiration or termination of the HSR Act       
waiting period would not preclude DOJ, the FTC or state antitrust enforcement   
agencies from challenging the Stock Purchase on antitrust grounds.              
Accordingly, at any time before or after the consummation of the Stock Purchase 
and notwithstanding the expiration or termination of the HSR Act waiting        
period, any federal or state antitrust authorities could take action under the  
antitrust laws as they deem necessary or desirable in the public interest.      
Such action could include seeking to enjoin the consummation of the Stock       
Purchase or seeking divestiture of all or part of the assets of Lamar or the    
Sellers.  Private parties may also seek to take legal action under the          
antitrust laws, if circumstances permit.                                        

OTHER CONDITIONS TO THE STOCK PURCHASE                                          

     In addition to the conditions described above, the respective obligations
of Lamar, Lamar Media and the Sellers to consummate the Stock Purchase are      
subject to the satisfaction of the following conditions:                        

<circle> No order, decree, statute, rule, regulation or filed complaint,        
 or notice by a governmental agency of its intention to file any
       complaint, seeking an order or decree to restrain, enjoin or prohibit
   the consummation of the transactions contemplated under the Stock
      Purchase Agreement, to render it ineffective or otherwise impede the
       transactions contemplated by the Stock Purchase Agreement shall be in
force.                                                        

<circle> Chancellor LA must have obtained all necessary approvals and           
     consents to the consummation of the transactions contemplated under
 the Stock Purchase Agreement from its senior lenders, including
       releases from all applicable liens and from all guarantees of each of
      Chancellor Outdoor and its subsidiaries.  In this regard, Chancellor
       LA must, by August 14, 1999 deliver to Lamar a certificate confirming
        that all necessary approvals and consents by its senior lenders to the
       consummation of the Stock Purchase (the "Approvals Certificate") have
      been obtained.  Chancellor LA delivered the Approvals Certificate on
August 9, 1999.                                               

     The obligations of Lamar and Lamar Media to consummate the Stock Purchase
are subject to the satisfaction of the following additional conditions unless   
waived in writing by Lamar and Lamar Media:                                     

<circle> Each of the Sellers' representations and warranties contained in       
       the Stock Purchase Agreement must be true and correct both on June 1,
      1999 and as of the Closing, and each of the covenants and agreements
   of the Sellers to be performed by the Closing must have been duly
        performed, except in each case for changes after June 1, 1999 that are
         contemplated or expressly permitted by the Stock Purchase Agreement and
         except for any breach or failure that would not have a material adverse
        effect on the business, operation or financial condition of Chancellor
Outdoor and its subsidiaries taken as a whole.                

<circle> Chancellor LA must deliver to Lamar and Lamar Media a certificate      
      signed by an officer of Chancellor LA, dated as of the Closing Date,
  certifying that, to the best of the knowledge and belief of such
     officer, the conditions to Lamar's and Lamar Media's obligations to
      consummate the Stock Purchase with respect to approval of Chancellor
         LA's senior lenders, the accuracy of its representations and warranties
and performance of its covenants have been fulfilled.         

<circle> Chancellor Mezzanine must deliver to Lamar and Lamar Media certificates
      signed by an officer of Chancellor Mezzanine dated as of the Closing
        Date, certifying that, to the best of the knowledge and belief of such
     officer, the conditions to Lamar's and Lamar Media's obligations to
   consummate the Stock Purchase with respect to the accuracy of its
      representations and warranties and performance of its covenants have
been fulfilled.                                               

<circle> The Sellers must have obtained all consents required for the           
     consummation of the transactions contemplated by the Stock Purchase
     Agreement under any material contract, unless the failure to obtain
   consent would not have a material adverse effect on the business,
 operations or financial condition of Chancellor Outdoor and its
subsidiaries, taken as a whole.                               

<circle> The Sellers must have delivered, or caused to be delivered, to         
      Lamar and Lamar Media executed affidavits dated no more than 30 days
 prior to the Closing Date, certifying that each Seller is not a
 foreign person in accordance with the Internal Revenue Code and
regulations thereunder.                                       

<circle> As of the Closing, the Sellers must have caused to be eliminated       
 all intercompany receivables and payables between and among the
Sellers, Chancellor Outdoor and its subsidiaries.             

<circle> Chancellor LA must have completed the acquisition of outdoor           
        advertising assets pursuant to the Compromise Settlement Agreement and
Mutual Release between Chancellor Outdoor, Chancellor Media   
        Corporation, Randy Burkett and Jeffrey Burkett, dated May 5, 1999, and
       the Asset Purchase Agreement between Chancellor Media Whiteco Outdoor
Corporation and Randy Burkett, dated May 5, 1999.             

The obligations of the Sellers to consummate the Stock Purchase are 
subject to the satisfaction of the following additional conditions unless       
waived in writing by the Sellers:                                               

<circle> Each of Lamar's and Lamar Media's representations and warranties       
       contained in the Stock Purchase Agreement must be true and correct on
       June 1, 1999 and as of the Closing in all material respects, and each
of the covenants and agreements of Lamar and Lamar Media to be
        performed by the Closing must have been duly performed in all material
       respects, except in each case for changes after June 1, 1999 that are
      contemplated or expressly permitted by the Stock Purchase Agreement.

<circle> Each of Lamar and Lamar Media must have delivered to Sellers a         
    certificate signed by one of its officers, dated as of the Closing
        Date, certifying that, to the best of the knowledge and belief of such
       officer, the conditions to the Sellers' obligations to consummate the
      Stock Purchase with respect to accuracy of Lamar's and Lamar Media's
  respective representations and warranties and performance of its
covenants have been fulfilled.                                

SELLERS' INDEMNIFICATION OBLIGATIONS                                            

The terms of the Stock Purchase Agreement provide that the Sellers' 
representations and warranties in the Stock Purchase Agreement survive for 12   
months following the Closing Date, except that those representations and        
warranties with respect to (i) Chancellor LA's title and ownership of the       
Chancellor Outdoor Common Stock and Chancellor Mezzanine's title and ownership  
of the Whiteco Common Stock will survive indefinitely, and (ii) taxes will      
survive for a period equal to the applicable statute of limitations for all     
taxes imposed as a result of a breach by the Sellers of their representations   
regarding taxes.                                                                

  Under the Stock Purchase Agreement, the Sellers agree to indemnify and
hold Lamar, Lamar Media and their officers, directors, employees and affiliates 
harmless from any damage, claim, liability or expense, including, without       
limitation, reasonable attorneys' fees (collectively, "Damages"), arising out   
of or relating to the breach of any warranty, representation, covenant or       
agreement of the Sellers contained in the Stock Purchase Agreement.  Lamar and  
Lamar Media will not be indemnified for any Damages, however, unless and until  
the amount of all Damages exceeds $2,500,000 (the "Threshold Amount"), and then 
only for those Damages that exceed the Threshold Amount, and Lamar and Lamar    
Media will not be indemnified for Damages that exceed a maximum of $25,000,000. 

  None of Lamar's or Lamar Media's representations and warranties in the
Stock Purchase Agreement survive the Closing, and neither Lamar nor Lamar Media 
has similar indemnification obligations.                                        

CONDUCT OF BUSINESS BY CHANCELLOR OUTDOOR AND LAMAR PENDING THE CLOSING         

    Chancellor LA has agreed to use commercially reasonable efforts to cause
Chancellor Outdoor and each of its subsidiaries (except as otherwise            
contemplated by the Stock Purchase Agreement, or as consented to by Lamar or    
Lamar Media in writing) to operate its business in the ordinary course,         
substantially in accordance with past practice and use commercially reasonable  
efforts not to take any action inconsistent with the Stock Purchase Agreement.  
Unless specifically consented to by Lamar in writing, Chancellor LA must ensure 
that Chancellor Outdoor and each of its subsidiaries do not, except as          
contemplated by the Stock Purchase Agreement:                                   

<circle>   change or amend its Certificate of Incorporation, Bylaws or          
          other organizational documents, except as otherwise required by law;

<circle>   enter into, extend, materially modify, terminate or renew any        
      material contract (except in the ordinary course of business) or
          settle or otherwise resolve any financial issue, claim or adjustment
under any such contract;                                  

<circle>   sell, assign, transfer, convey, lease or otherwise dispose of any    
     material assets or properties, except in the ordinary course of
business;                                                 

<circle>   except as otherwise required by law, (i) take any action with        
         respect to the grant of any severance or termination pay (otherwise
          than pursuant to policies or agreements of Chancellor Outdoor or any
         of its subsidiaries in effect on June 1, 1999) that will become due
          and payable from Chancellor Outdoor or any of its subsidiaries on or
after the Closing Date; or (ii) make any change in the key
management structure of Chancellor Outdoor or any of its  
subsidiaries, including, without limitation, the hiring of
        additional officers or the termination of existing officers, other
than in the ordinary course of business;                  

<circle>   acquire by merger or consolidation with, or merge or consolidate     
        with, or purchase substantially all of the assets of, or otherwise
 acquire any material assets or business of any corporation,
         partnership, association or other business organization or division
of such company;                                          

<circle>   make any material loans or advances to any partnership, firm or      
          corporation, or, except for expenses incurred in the ordinary course
of business, to any individual;                           

<circle>   amend any employee plan, pension plan or welfare plan for its        
         employees or increase the salary of any management employee, except
in the ordinary course of business;                       

<circle>   alter in any material respect the past practices of Chancellor       
          Outdoor or any of its subsidiaries with respect to the collection of
receivables or payment of payables; or                    

<circle>   enter into any agreement, or otherwise become obligated, to do       
any action prohibited under the Stock Purchase Agreement. 

   Each of Lamar and Lamar Media have agreed that prior to the Closing, it
will use commercially reasonable efforts to operate its business in the ordinary
course and substantially in accordance with past practice and use commercially  
reasonable efforts not to take any action inconsistent with the Stock Purchase  
Agreement.  Unless the Sellers consent in writing, neither Lamar nor Lamar Media
will change or amend its certificate of incorporation, bylaws or other          
organizational documents, except as otherwise required by law or take any action
that would be prohibited by the Stockholders Agreement if such actions were     
taken after the Closing.                                                        

NO SOLICITATION                                                                 

    The Stock Purchase Agreement provides that prior to Closing, the Sellers
and their affiliates, officers, directors, employees, representatives and       
agents may not directly or indirectly encourage, solicit, participate in,       
initiate or conduct discussions or negotiations with, or provide any            
information to any persons concerning any merger, sale of assets, sale of       
shares of capital stock or similar transactions involving Chancellor Outdoor.   

NO USE OF CHANCELLOR NAME                                                       

   The Stock Purchase Agreement requires Lamar and Lamar Media to take all
action to cause the corporate names of Chancellor Outdoor and its subsidiaries  
to be changed so that they no longer contain the name "Chancellor," and         
following the Closing, to keep Chancellor Outdoor, its subsidiaries and Lamar's 
affiliates from using the name "Chancellor" or any similar name for business    
purposes.                                                                       

CERTAIN EMPLOYEE BENEFIT MATTERS                                                

   The Stock Purchase Agreement provides that, with respect to all persons
who were employees of Chancellor Outdoor and its subsidiaries who continue as   
such after the Closing, Lamar Media will offer the same employee benefits as    
are offered by Lamar Media to its own employees and will cause its employee     
benefit plans to recognize all prior service of such employees for the purpose  
of determining vesting of benefits, participation, eligibility and benefit      
accrual, including service with predecessor employers, to the extent that such  
service was recognized under analogous plans of Chancellor Outdoor or any of    
its subsidiaries or of the Sellers.                                             

AMENDMENT AND TERMINATION                                                       

    The Stock Purchase Agreement provides that it may be amended or modified
in whole or in part at any time upon mutual written agreement of the parties.   
It also provides that the Stock Purchase Agreement may be terminated at any     
time prior to the Closing:                                                      

<circle>    by written consent of the Sellers, Lamar and Lamar Media;           

<circle>    by any party if consummation of any of the transactions             
 contemplated by the Stock Purchase Agreement is enjoined,
        prohibited or otherwise restrained by the terms of a final, non-
          appealable order or judgment of a court of competent jurisdiction;

<circle>    by Sellers, on the one hand, or Lamar or Lamar Media, on the        
    other hand, if the party or parties on the other side of the
       transaction has or have materially breached any representation,
         warranty, covenant or agreement, or if any such representation or
            warranty is untrue in any material respect, in either case such that
          the applicable closing condition is not satisfied, and, if capable
           of being cured, such breach or failure has not been cured within 30
days following notice thereof;                          

<circle>    by Lamar and Lamar Media, if the Closing has not occurred on        
         or before December 1, 1999, for reasons other than as a result of
     Lamar's or Lamar Media's breach or the failure of all waiting
        periods under the HSR Act to have expired or been terminated; or

<circle>    by the Sellers, if the Closing has not occurred on or before        
        December 1, 1999, other than as a result of the Sellers' breach.

FEES AND EXPENSES                                                               

 Each of Lamar, Lamar Media and the Sellers will bear its own expenses
incurred in connection with the Stock Purchase Agreement and the transactions   
contemplated in the Agreement, whether or not such transactions are             
consummated, including, without limitation, all fees of legal counsel,          
financial advisors and accountants, except that all fees paid to Antitrust      
Authorities in connection with the notification and reporting requirements of   
the HSR Act for the transactions contemplated by the Stock Purchase Agreement   
will be paid by Lamar Media.                                                    

RIGHTS OF LAMAR STOCKHOLDERS; DILUTION                                          

  The stockholders of Lamar will not be exchanging their shares of Lamar
Common Stock for other securities, and the rights of holders of Class A Common  
Stock will not be altered as a result of the consummation of the Stock          
Purchase, except as those rights are affected by the Stockholders Agreement.    
However, the Stock Purchase will significantly dilute the interests             
of current holders of Lamar Common Stock.  If the Stock Purchase is completed,  
Lamar's current stockholders will own in the aggregate approximately 70% of the 
total number of shares of Lamar Common Stock then outstanding, with the Sellers 
owning in the aggregate the remaining 30%, and current holders of Class A       
Common Stock will own in the aggregate approximately 63% of the total number of 
shares of Class A Common Stock then outstanding, with the Sellers owning in the 
aggregate the remaining 37%.  However, because of the different voting rights   
of the Class A and Class B Common Stock, the Lamar Shares will confer to the    
Sellers collectively only approximately 10.5% of the total voting power of      
Lamar.  Following the Share Issuance, RFLP will hold approximately 72% of the   
voting power of Lamar.                                                          

APPRAISAL RIGHTS                                                                

Under the DGCL, Lamar stockholders do not have appraisal rights in  
connection with the Stock Purchase or the Share Issuance.                       

ACCOUNTING TREATMENT                                                            

   For accounting purposes, the Stock Purchase will be accounted for using
the purchase method of accounting.  Under the purchase method of accounting,    
the purchase price is allocated to the identifiable assets and liabilities      
acquired based upon the estimated fair values of such assets and liabilities on 
the date of acquisition.  Any excess of the fair market value of the            
consideration given over the fair market value of the identifiable net assets   
acquired is reported as goodwill.                                               

CERTAIN FEDERAL INCOME TAX CONSEQUENCES                                         

The summary of tax consequences set forth below is for general      
information only and is based on the law as currently in effect.  The Stock     
Purchase will constitute a taxable transaction to Chancellor LA and its         
affiliated group for federal income tax purposes.  Generally, for federal       
income tax purposes, upon the Whiteco Dividend, Chancellor Outdoor will realize 
gain or loss (if any) in an amount equal to the difference between the fair     
market value of the Whiteco Common Stock and Chancellor Outdoor's adjusted tax  
basis in the Whiteco Common Stock.  That gain or loss (if any) will be          
recognized by Chancellor Outdoor's affiliated group upon the sale of the Whiteco
Common Stock by Chancellor Mezzanine to Lamar Media.  In addition, Chancellor LA
will recognize gain or loss (if any) in an amount equal to the difference       
between (i) the aggregate of the cash and the fair market value of the Class A  
Common Stock received pursuant to the Stock Purchase, and (ii) Chancellor LA's  
adjusted tax basis in the shares of Chancellor Outdoor Common Stock tendered.   
Limitations may exist on the deductibility of losses, if any.                   

FEDERAL SECURITIES LAW CONSEQUENCES                                             

  None of the Lamar Shares received by the Sellers in the Stock Purchase
will be registered under the Securities Act of 1933, as amended (the            
"Securities Act").  As a result, the Class A Common Stock received by the       
Sellers may be resold only in transactions permitted by the resale provisions   
of Rule 144 promulgated under the Securities Act or as otherwise permitted      
under the Securities Act.                                                       

The obligations of the Sellers to consummate the Stock Purchase are 
conditioned upon Lamar's executing the Registration Rights Agreement with the   
Sellers.  See "- Other Terms and Conditions to the Stock Purchase - Registration
Rights Agreement."                                                              

DEFM14C
9th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 9th
BUSINESS OF THE COMPANIES 

DESCRIPTION OF THE BUSINESS OF LAMAR                                            

GENERAL                                                           

    Lamar has operated its outdoor advertising business under the Lamar name
since 1902.  As of December 31, 1998, Lamar managed approximately 71,900        
outdoor advertising displays in 36 states, and as of June 30, 1999, Lamar       
managed approximately 75,700 outdoor advertising displays.  Lamar also operates 
the largest logo sign business in the United States.  These signs are located   
near highway exits and provide brand name information on available gas, food,   
lodging and camping services.  Lamar also operates transit advertising displays 
on bus shelters, bus benches and buses in several markets.                      

     Lamar seeks to continue growing its local advertising business by focused
strategic acquisitions.  Lamar has completed over 105 acquisitions of outdoor   
advertising businesses from January 1, 1996 through July 31, 1999.  In addition 
to acquiring positions in new markets, Lamar buys smaller outdoor advertising   
properties within existing or contiguous markets.  During 1998, Lamar increased 
the number of outdoor advertising displays that it operates by approximately 66%
by acquiring outdoor advertising assets, including the completion of 40         
strategic acquisitions of outdoor advertising businesses and isolated purchases 
of outdoor advertising displays.  As of June 30, 1999, Lamar's advertising      
business covered 107 primary outdoor advertising markets.                       

OPERATIONS                                                                

     OUTDOOR ADVERTISING.  For the year ended December 31, 1998, Lamar derived
approximately 63% of its outdoor advertising net revenue from the sale of space 
on bulletins, which are typically 14 feet high and 48 feet wide.  The other 37% 
of Lamar's outdoor advertising revenue for the year ended December 31, 1998 was 
derived from the sale of space on standardized and junior posters.              
Standardized posters are generally 12 feet high and 25 feet wide, and are the   
most common type of billboard.  Junior posters are usually six feet high and 12 
feet wide, with copy typically being applied using wallpaper pasting methods.   

 Lamar owns the physical structures on which the copy is applied.  The
structures are built on locations that Lamar either owns or leases.  Bulletin   
space is generally sold as individually selected displays for the duration of   
the advertising contract or in rotary plans in which the copy is periodically   
rotated from one location to another within a given market.                     

 Lamar maintains production staffs in 91 of its markets to perform the
full range of activities required to create and install outdoor advertising,    
including creating advertising copy, design and layout, painting the design or  
coordinating the printing and installation of the designs on displays.          

 LOGO SIGNS.  Since 1988, when Lamar entered the business of logo sign
advertising, it has become the largest provider of logo sign services in the    
United States, operating 20 of the 24 privatized state logo sign contracts.     

TRANSIT ADVERTISING.  Lamar has recently expanded into the transit  
advertising business through the operation of displays on bus shelters, benches 
and buses in 17 of its outdoor advertising markets and six other markets.       

DESCRIPTION OF THE BUSINESS OF CHANCELLOR OUTDOOR                               

GENERAL                                                                   

  Chancellor Outdoor, a wholly-owned subsidiary of Chancellor LA and the
parent corporation of Chancellor Whiteco, operates the fifth largest outdoor    
advertising company in the United States, owning over 42,700 billboards and     
outdoor displays in the United States as of June 30, 1999.  It entered the      
outdoor advertising business with the acquisition of Martin Media L.P. ("Martin 
Media"), Martin & MacFarlane, Inc. ("Martin & MacFarlane") and certain          
affiliated companies in July 1998, and further expanded its outdoor presence    
with the acquisition of the outdoor advertising division of Whiteco Industries, 
Inc. ("Whiteco") in December 1998.                                              

     The size and geographic diversity of its markets allow Chancellor Outdoor
to attract national advertisers by providing the opportunity to package         
displays in several of its markets in a single contract, allowing a national    
advertiser to simplify its purchasing process and simultaneously present its    
message in several markets.  National advertisers generally seek wide exposure  
in major markets and therefore tend to make larger purchases from a company     
that owns displays in a number of markets.                                      

OPERATIONS                                                                

 Chancellor Outdoor derives outdoor advertising revenue from contracts
with advertisers for the rental of outdoor advertising space generally covering 
periods of one month up to five years.  Rates are based on a particular         
display's exposure, or number of "impressions" delivered, in relation to the    
demographics of the particular market and/or its location within that market.   

     Chancellor Outdoor operates the following types of displays: bulletins on
major highways and freeways; thirty-sheet posters (usually 12 feet high and 25  
feet wide) concentrated on major traffic arteries; eight-sheet posters (usually 
six feet high and 12 feet wide) predominantly located on city streets targeting 
pedestrian traffic; transit displays on bus and commuter train exteriors,       
commuter rail terminals, interior train cars, bus shelters and subway           
platforms; and street furniture displays consisting of back-illuminated display 
faces located on bus and tram shelters, newsstands, bicycle racks, information  
kiosks, recycling bins and automatic public toilets.                            

The following table sets forth the outdoor advertising sales offices and  
total outdoor advertising displays by each sales office as of June 30, 1999:    

                                                              TOTAL DISPLAYS
Northern Region:                                                                
Chicago, IL                                                       3,063     
Pittsburgh, PA                                                    3,765     
Providence, RI                                                      580     
Harrisburg, PA                                                    1,275     
Milwaukee, WI                                                     1,183     
Hartford, CT                                                        399     
Scranton, PA                                                      1,014     
Albany, NY                                                          662     
Washington, D.C.                                                    594     
                                                            ------
Total                                                       12,535
                                                            ======

Southeastern Region:                                                            
Ocala, FL                                                         3,103     
Terre Haute, IN                                                   1,784     
Columbus, OH                                                      1,261     
Rocky Mt., NC                                                     1,618     
Atlanta, GA                                                         847     
Cincinnati, OH                                                      813     
Evansville, IN                                                    1,124     
                                                            ------
Total                                                       10,550
                                                            ======

Southwestern Region:                                                            
Dallas, TX                                                        1,734     
St. Joseph, MO                                                    2,841     
Tyler, TX                                                         1,745     
Amarillo, TX                                                      1,070     
Topeka, KS                                                        1,055     
Lubbock, TX                                                         679     
Midland, TX                                                         695     
Abilene, TX                                                         430     
San Angelo, TX                                                      251     
                                                            ------
Total                                                       10,500
                                                            ======

Western Region:                                                                 
Las Vegas, NV                                                     1,001     
Bakersfield, CA                                                   1,511     
Lancaster, CA                                                       718     
San Bernardino, CA                                                  397     
San Diego, CA                                                       301     
Laughlin, AZ                                                        349     
Yuma, AZ                                                            222     
                                                            ------
Total                                                        4,499
                                                            ======

Shelters/Street Furniture:                                                      

Las Vegas, NV                                                     2,291     
Denver, CO                                                        1,536     
New Orleans, LA                                                     458     
Providence, RI                                                      370     
                                                            ------
Total                                                        4,655
                                                            ======

Grand Total                                                 42,739
                                                            ======

____________________  

These displays are subject to regulation at federal, state and local levels.    

DEFM14C
10th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 10th
PRINCIPAL STOCKHOLDERS OF LAMAR 

 Except as noted below, the following table sets forth as of August 4,
1999, the beneficial ownership of the Lamar Common Stock, by (i) each           
stockholder known by Lamar to beneficially own five percent or more of the      
Lamar Common Stock, (ii) Lamar's Chief Executive Officer and each of the other  
executive officers of Lamar other than the Chief Executive Officer, (iii) each  
Lamar director and (iv) all current executive officers and directors of Lamar   
as a group.  Except as noted below, all shares indicated as beneficially owned  
are held with sole voting and investment power.                                 

                                                        [Enlarge/Download Table]

    Directors, Officers                Title of               Number of            Percent   
    and 5% Stockholders                  Class                 Shares             of Class   
--------------------------------   -----------------  -----------------------  --------------
                                                                                             
Kevin P. Reilly, Jr.                  Class A                   7,500              *         
                                      Class B(1)           17,699,997(2)        100%(3)      

Sean E. Reilly                        Class A                                                
                                      Class B              17,699,997(2)        100%(3)      

Charles W. Lamar, III                 Class A               4,745,508(4)       10.9%         

Keith A. Istre                        Class A                 99,512(5)            *         

Gerald H. Marchand                    Class A                121,843(6)            *         

Jack S. Rome, Jr.                     Class A                  3,750(7)            *         

T. Everett Stewart, Jr.               Class A                 57,400(8)            *         

Stephen P. Mumblow                    Class A                  1,000               *         

Putnam Investments, Inc.              Class A              7,609,810(9)        17.5%         
One Post Office Square                                                                       
Boston, MA  02109                                                                            

FMR Corp.                             Class A              4,402,500(10)       10.1%         
82 Devonshire Street                                                                         
Boston, MA  02109                                                                            

Pilgrim Baxter & Associates, Ltd.     Class A              2,997,450(11)        6.9%         
825 Duportail Road                                                                           
Wayne, PA  19087                                                                             

AMVESCAP PLC                          Class A              2,419,950(12)        5.6%         
11 Devonshire Square                                                                         
London ECZ2M 4YR                                                                             
England                                                                                      

All Directors and Executive           Class A              5,036,513(13)       11.5%(14)     
  Officers as a Group (8 Persons)     Class B             17,699,997(2)         100%         

____________________                                                            
*    Less than one percent                                                      

(1)  Upon the sale of any shares of Class B Common Stock to a person other than 
to a Permitted Transferee, such shares will automatically convert into shares   
of Class A Common Stock on a share-for-share basis. Permitted Transferees       
include (i) Kevin P. Reilly, Sr.; (ii) a descendant of Kevin P. Reilly, Sr.;    
(iii) a spouse or surviving spouse (even if remarried) of any individual named  
or described in (i) or (ii) above; (iv) any estate, trust, guardianship,        
custodianship, curatorship or other fiduciary arrangement for the primary       
benefit of any one or more of the individuals named or described in (i), (ii)   
and (iii) above; and (v) any corporation, partnership, limited liability        
company or other business organization controlled by and substantially all of   
the interests in which are owned, directly or indirectly, by any one or more of 
the individuals and entities named or described in (i), (ii), (iii) and (iv)    
above. Except for voting rights, the Class A and Class B Common Stock are       
substantially identical. The holders of Class A Common Stock and Class B Common 
Stock vote together as a single class (except as may otherwise be required by   
Delaware law), with the holders of Class A Common Stock entitled to one vote    
per share and the holders of Class B Common Stock entitled to ten votes per     
share, on all matters on which the holders of Lamar Common Stock are entitled   
to vote.                                                                        

(2)  Consists of shares held by RFLP, of which Kevin Reilly, the President and  
Chief Executive Officer of Lamar, is the managing general partner. Kevin        
Reilly's three siblings, Wendell S. Reilly, Sean E. Reilly (a director) and     
Anna Reilly Cullinan, are the other general partners of RFLP. The managing      
general partner has sole voting power over the shares but dispositions of the   
shares require the approval of 50% of the general partnership interests of      
RFLP.                                                                           

(3)  Represents 28.9% of the Class A Common Stock if all shares of Class B      
Common Stock were converted into Class A Common Stock.                          

(4)  Includes 1,369,966 shares of Class A Common Stock held in trust for Mr.    
Lamar's two minor children who reside with him, as to which Mr. Lamar disclaims 
beneficial ownership, and 1,500,000 shares of Class A Common Stock held by      
CWL3, LLC, as to which Mr. Lamar is deemed the beneficial owner.                

(5) Includes 98,200 shares of Class A Common Stock subject to stock options     
exercisable within 60 days.                                                     

(6) Includes 18,000 shares of Class A Common Stock subject to stock options     
exercisable within 60 days.                                                     

(7) Consists of 3,000 shares of Class A Common Stock held in trust for Mr.      
Rome's two children and 750 shares of Class A Common Stock owned jointly with   
J. King Woolf, III, as to which Mr. Rome is considered the beneficial owner.    

(8) Consists of 57,400 shares of Class A Common Stock subject to stock options  
exercisable within 60 days.                                                     

(9)  Putnam Investments, Inc. ("PI") shares voting power as to 341,251 of       
these shares with The Putnam Advisory Co., Inc. and shares dispositive power    
with Putnam Investment Management, Inc. and The Putnam Advisory Co., Inc. as    
to 7,068,972 and 540,838 of these shares, respectively. Based on the Schedule   
13-G/A for the year ended December 31, 1998 filed by PI with the Commission.    

(10)  FMR Corp. has sole dispositive power over these shares. FMR Corp. has     
sole voting power with respect to 65,200 of the shares. Based on the Schedule   
13-G/A for the year ended December 31, 1998 filed by FMR Corp. with the         
Commission.                                                                     

(11) Based on the Schedule 13G for the year ended December 31, 1998 filed by    
Pilgrim Baxter & Associates, Ltd. with the Commission.                          

(12) AMVESCAP PLC shares voting and dispositive power over these shares with    
AVZ, Inc., AIM Management Group, Inc., AMVESCAP Group Services, Inc., INVESCO   
Inc., INVESCO Capital Management, Inc., INVESCO Management & Research, Inc.,    
INVESCO Realty Advisers, Inc., INVESCO North America Holdings, Inc., INVESCO    
Funds Group, Inc. and INVESCO (NY) Asset Management, Inc. Based on the Schedule 
13-G for the year ended December 31, 1998 filed by AMVESCAP PLC with the        
Commission.                                                                     

(13) Includes 173,600 shares of Class A Common Stock subject to stock options   
exercisable within 60 days.                                                     

(14) Represents 37.1% of the Class A Common Stock if all shares of Class B      
Common Stock were converted into shares of Class A Common Stock.                

DEFM14C
11th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 11th
SELECTED FINANCIAL DATA 
OF  
LAMAR ADVERTISING COMPANY 

    The selected consolidated statement of operations and balance sheet data
presented below are derived from the audited consolidated financial statements  
of Lamar for the twelve months ended October 31, 1994, 1995 and 1996 and        
December 31, 1997 and 1998 and  the unaudited consolidated financial statements 
of Lamar for the three months ended March 31, 1998 and 1999.  The data          
presented below should be read in conjunction with Lamar's consolidated         
financial statements and the related notes thereto and Lamar's Management's     
Discussion and Analysis of Financial Condition and Results of Operations, which 
are incorporated by reference  herein.                                          

                                                        [Enlarge/Download Table]

                                                             For the Years Ended                                                
                                     ----------------------------------------------------------------        Three Months Ended 
                                                    October 31,                     December 31,                  March 31,     
                                     -------------------------------------     ----------------------    ---------------------- 
                                                                         (Dollars in thousands)                                 

                                      1994           1995           1996          1997          1998        1998          1999  
                                     ------         ------        -------      -------        -------    ---------    --------- 
                                                                                                                                
STATEMENT OF OPERATIONS DATA:                                                                                                   
Revenues:                                                                                                                       
  Net advertising revenues.....     $ 84,473       $ 102,408     $ 120,602     $ 201,062     $ 288,588     $ 58,397    $ 85,766 
Operating expenses:                                                                                                             
  Direct advertising expenses..       28,959          34,386        41,184        63,390        92,849       20,830      29,764 
  General & administrative                                                                                                      
    expenses...................       24,239          27,057        29,466        45,368        60,935       13,216      20,099 
  Depreciation & amortization..       11,352          14,942        16,470        48,037        88,572       17,605      31,561 
                                    --------       ---------     ---------     ---------     ---------     --------    -------- 
     Total operating expenses..       64,550          76,385        87,120       156,795       242,356       51,651      81,424 
                                    --------       ---------     ---------     ---------     ---------     --------    -------- 

Operating income ..............       19,923          26,023        33,482        44,267        46,232        6,746       4,342 
                                    --------       ---------     ---------     ---------     ---------     --------    -------- 

Other expense (income):                                                                                                         
  Interest income..............         (194)          (199)         (240)       (1,723)          (762)        (107)       (686)
  Interest expense.............       13,599         15,783        15,441        38,230         60,008       13,326      18,145 
  Loss (gain) on disposition of                                                                                                 
    assets.....................          675          1,476            91          (15)        (1,152)        (317)        (336)
  Other expense................          616            655           242           280            219         ---          --- 
                                    --------       ---------     ---------     ---------     ---------     --------     --------
     Total other expense........      14,696         17,715        15,534        36,772         58,313       12,902      17,123 
                                    --------       ---------     ---------     ---------     ---------     --------     --------
Earnings (loss) before income                                                                                                   
  taxes & cumulative effect of a                                                                                                
  change in accounting                                                                                                          
  principle.....................       5,227          8,308        17,948         7,495        (12,081)      (6,156)    (12,781)
Income tax expense (benefit)....      (2,072)        (2,390)        7,099         4,654           (191)      (1,565)     (2,842)
                                    --------      ---------      ---------     ---------     ---------     --------     --------
Net earnings (loss) before                                                                                                      
  cumulative effect of a change                                                                                                 
  in accounting principle.......       7,299         10,698        10,849         2,841        (11,890)      (4,591)     (9,939)
Cumulative effect of a change in                                                                                                
  in accounting principle, net                                                                                                  
  of tax........................        ---             ---           ---           ---            ---          ---        (767)
                                    --------      ---------      ---------     ---------     ---------     --------     --------
Net earnings (loss).............       7,299         10,698        10,849         2,841        (11,890)      (4,591)    (10,706)
Preferred stock dividends.......         ---            ---          (365)         (365)          (365)         (91)        (91)
                                    --------      ---------      ---------     ---------     ---------     --------     --------
Net earnings (loss) applicable                                                                                                  
  to common stock...............  $    7,299      $  10,698     $  10,484     $   2,476    $   (12,255)   $  (4,682) $  (10,797)
                                    ========      =========      =========     =========     =========     ========     ========
Net earnings (loss) before                                                                                                      
   cumulative effect of a change                                                                                                
   in accounting principle per                                                                                                  
   common share.................  $     0.14      $    0.21     $    0.25     $    0.05    $     (0.24)   $   (0.10) $    (0.16)
                                    ========      =========      =========     =========     =========     ========     ========
Net earnings (loss) per common                                                                                                  
   share........................  $     0.14      $    0.21     $    0.25     $    0.05    $     (0.24)   $   (0.10) $    (0.18)
                                    ========      =========      =========     =========     =========     ========     ========
Balance Sheet Data (end of                                                                                                      
period):                                                                                                                        
Cash & cash equivalents.........  $    8,016      $   5,886     $   8,430     $   7,246    $   128,597    $   4,041  $     8,171
Total assets....................  $  130,008      $ 133,885     $ 173,189     $ 651,336    $ 1,413,377    $ 699,542  $ 1,358,537
Total long-term obligations.....  $  147,957      $ 143,944     $ 130,211     $ 551,865    $   857,760    $ 600,470  $   859,063
Stockholders' equity (deficit)..  $  (37,352)     $ (28,154)    $  19,041     $  68,713    $   466,779    $  68,337  $   458,905

____________________  

SELECTED FINANCIAL DATA 
OF  
CHANCELLOR MEDIA OUTDOOR CORPORATION  
AND PREDECESSORS  

CHANCELLOR MEDIA OUTDOOR CORPORATION                                            

The following table sets forth selected historical financial data for     
Chancellor Outdoor as of and for the periods indicated.  The selected           
consolidated statement of operations and balance sheet data as of December 31,  
1998 and for the period from July 22, 1998 (inception) through December 31,     
1998 is derived from the audited consolidated financial statements of           
Chancellor Outdoor. The financial data as of and for the three months ended     
March 31, 1999 are derived from Chancellor Outdoor's unaudited consolidated     
financial statements which, in the opinion of management, include all           
adjustments (which consist only of normal recurring adjustments) necessary for  
a fair presentation of the financial position and results of operations of      
Chancellor Outdoor for such interim period.  The data presented below should be 
read in conjunction with the consolidated financial statements of Chancellor    
Outdoor and the related notes thereto included elsewhere herein.                

                                                        [Enlarge/Download Table]

                                                   For the Period                           For the Three   
                                                        from                                 Months Ended   
                                                  July 22, 1998 to                          March 31, 1999  
                                                  December 31, 1998                          (unaudited)    
                                                ---------------------                     ------------------
                                                                    (DOLLARS IN THOUSANDS)                  
                                                                                                            
STATEMENT OF OPERATIONS DATA:                                                                               
Net revenues...................................      $     47,605                               $    53,601 

Operating expenses.............................            23,505                                    28,451 
Corporate general & administrative expenses....             1,981                                     2,825 
Depreciation and amortization..................            25,990                                    31,396 
                                                     -------------                              ------------

Operating loss.................................            (3,871)                                   (9,071)
                                                     -------------                              ------------

Other income (expense).........................               156                                       (86)
Interest expense...............................              (105)                                      (64)
                                                     -------------                              ------------

Loss before income taxes.......................            (3,820)                                   (9,221)
Income tax expense (benefit)...................               345                                    (3,076)
                                                     -------------                              ------------

Net loss.......................................      $     (4,165)                              $    (6,145)
                                                     -------------                              ------------

Balance Sheet Data (end of period):                                                                         
Cash & cash equivalents........................      $      2,023                               $     3,620 
Total assets...................................      $  1,738,081                               $ 1,765,818 
Total long-term liabilities....................      $    100,724                               $    97,408 
Equity.........................................      $  1,614,526                               $ 1,645,570 

_______________ 

DEFM14C
12th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 12th
THE OUTDOOR ADVERTISING DIVISION OF WHITECO INDUSTRIES,  INC.                   

 The following table sets forth selected historical financial data for
Whiteco as of and for the periods indicated.  The selected statement of         
operations and balance sheet data as of and for the years ended December 31,    
1995, 1996 and 1997, and for the eleven months ended November 30, 1998 is       
derived from the audited financial statements of Whiteco.  The data presented   
below should be read in conjunction with the audited financial statements and   
the related notes thereto included elsewhere herein.                            

                                                        [Enlarge/Download Table]

                                                                                                        For the Eleven      
                                                             For the Years Ended                         Months Ended       
                                                                December 31,                             November 30,       
                                                    -------------------------------------------     ------------------------
                                                                            (DOLLARS IN THOUSANDS)                          
                                                    1995              1996             1997                  1998           
                                                   ---------        ----------       ----------     ------------------------
                                                                                                                            
STATEMENT OF OPERATIONS DATA:                                                                                               
Revenues......................................... $ 108,447         $ 117,268        $ 126,801           $    128,603       
Less: agency commissions.........................     6,616             8,401            8,703                  8,973       
                                                  ----------        ----------       ----------          -------------------

     Net revenues................................   101,831           108,867          118,098                119,630       

Cost of revenues.................................    40,659            42,021           45,615                 43,665       
Selling and administrative expenses..............    20,056            21,933           24,443                 23,719       
Depreciation and amortization....................     8,675            10,502           11,525                 10,342       
Management fee expense and other.................     2,101             2,248            2,322                  2,577       
                                                  ----------        ----------       ----------          -------------------

     Income from operations......................    30,340            32,163           34,193                 39,327       

Other income, less other expenses................     1,060             1,131            1,833                    ---       
Interest expense.................................       (38)              (18)              (4)                   (35)      
Interest income..................................       ---              ---              ---                     134       
Gain on sale of properties.......................       ---              ---              ---                   1,418       
                                                  ----------        ----------       ----------          -------------------

Net income                                         $ 31,362         $  33,276         $ 36,022               $ 40,844       
                                                  ==========        ==========       ==========          ===================

Balance Sheet Data (end of period)(1):                                                                                      
Cash & cash equivalents..........................  $    153         $     156         $    250                  -NA-        
Total assets.....................................  $ 66,850         $  76,814         $ 90,443                  -NA-        
Total long-term obligations......................  $    ---         $     ---         $    ---                  -NA-        
Divisional equity................................  $ 65,452         $  74,604         $ 87,262                  -NA-        

____________                                                                    
(1)   A balance sheet as  of November 30, 1998 was not prepared; therefore, the 
balance sheet data is not provided.                                 

____________________  

DEFM14C
13th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 13th
MARTIN MEDIA L.P.                                                               

 The following table sets forth selected historical financial data for
Martin Media as of and for the periods indicated.  The selected statements of   
operations and balance sheet data as of and for the years ended December 31,    
1994, 1995, 1996 and 1997 and the seven months ended July 31, 1998 is derived   
from the audited financial statements of Martin Media.  The data presented      
below should be read in conjunction with the audited financial statements of    
Martin Media and the related notes thereto included elsewhere herein.           

                                                        [Enlarge/Download Table]

                                                                                                            For the Seven 
                                                                                                             Months Ended 
                                                      For the Years Ended December 31,                         July 31,   
                                    ----------------------------------------------------------------------  --------------
                                        1994               1995               1996               1997            1998     
                                    -------------      -------------      -------------      -------------  --------------
                                                                     (Dollars in thousands)                               
                                                                                                                          
Statements of Operations Data:                                                                                            
Revenue............................. $    29,742        $    33,733        $    42,359        $    48,107     $    33,791 
Cost of revenue.....................       3,987              4,459              5,745              6,091           4,136 
                                    -------------      -------------      -------------      -------------  --------------

     Gross profit...................      25,755             29,274             36,614             42,016          29,655 

Operating expenses..................      16,739             16,862             20,929             21,202          14,364 

Depreciation and amortization.......       3,221              3,340              5,365              9,283          11,223 
Refinance and acquisition expenses..         ---                ---              3,823              9,645           3,276 
Management fees and other...........         895              1,111              1,278              1,937           3,174 
                                    -------------      -------------      -------------      -------------  --------------
Operating income (loss).............       4,900              7,961              5,219                (51)         (2,382)

Other income (expenses):                                                                                                  
     Interest income................          85                116                 96                 66              20 
     Interest expense...............      (4,387)            (5,030)            (6,022)            (8,024)         (8,527)
     Miscellaneous income...........         408                284                253              1,077             473 
     Miscellaneous expense..........         ---                (93)               (11)               ---             --- 
     Loss on disposal of assets.....        (406)              (378)              (459)              (512)            --- 
                                    -------------      -------------      -------------      -------------  --------------
        Net income (loss)........... $       600        $     2,860        $      (924)        $   (7,444)     $  (10,416)
                                    =============      =============      =============      =============  ==============
Balance Sheet Data (end of                                                                                                
period)(1):                                                                                                               
Cash & cash equivalents............. $     3,395        $     5,445        $     2,662        $        23        -NA-     
Total assets........................ $    58,406        $    58,668        $    77,474        $   142,074        -NA-     
Total long-term obligations......... $    53,440        $    47,897        $    67,415        $   109,681        -NA-     
Partners' capital (deficit)......... $       822        $     3,185        $     1,974        $   (5,470)        -NA-     

____________                                                                    
(1)     A balance  sheet  as of July 31, 1998  was not prepared; therefore, the 
balance sheet data is not provided.                             

____________________  

DEFM14C
14th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 14th
MARTIN & MACFARLANE, INC.                                                       

 The following table sets forth selected historical financial data for
Martin & MacFarlane, Inc. ("Martin & MacFarlane") as of and for the periods     
indicated.  The selected statements of operations and balance sheet data as of  
and for the years ended June 30, 1994 and 1995 and the six months ended         
December 31, 1995, the years ended December 31, 1996 and 1997 and the seven     
months ended July 31, 1998 is derived from the audited financial statements of  
Martin & MacFarlane.  The data presented below should be read in conjunction    
with the audited financial statements of Martin & MacFarlane and the related    
notes thereto included elsewhere herein.                                        

                                                        [Enlarge/Download Table]

                                              For the Year           For the Six            For the Year         For the Seven 
                                                 Ended               Months Ended              Ended              Months Ended 
                                                June 30,             December 31,           December 31,            July 31,   
                                         -----------------------   --------------     -----------------------   -------------- 
                                           1994           1995          1995            1996          1997           1998      
                                        ------------------------   --------------     -----------------------   -------------- 
                                                                     (Dollars in thousands)                                    
                                                                                                                               
Statements of Operations Data:                                                                                                 
Revenue                                  $ 14,915       $ 16,169    $      8,311      $ 16,994      $ 22,535     $     17,946  
Cost of revenue                             2,002          2,046           1,066         2,155         2,477            1,370  
Gross profit                               12,913         14,123           7,245        14,839        20,058           16,576  
Operating expense                           9,420         10,070           4,982         9,534        11,319           10,526  
Depreciation and amortization               1,083          1,100             575         1,317         2,903            3,471  
Management fees and other expenses            ---            ---             ---           473         2,210            2,623  
Refinance and acquisition expenses            ---            ---             ---            85           884            1,570  
                                         ---------      ---------    ------------      --------     ---------     -----------  
        Operating income (loss)             2,410          2,953           1,688         3,430         2,742           (1,614) 
                                         ---------      ---------    ------------      --------     ---------     -----------  
Other income (expense):                                                                                                        
     Interest income                          ---            ---             ---            10            15              ---  
     Interest expense                     (1,513)         (1,313)           (552)       (1,116)       (2,538)          (2,244) 
     Gain (loss) on disposal of assets      (204)          2,405              (2)         (137)         (207)             465  
     Employee separation expense              ---          (270)             ---           ---           ---              ---  
     Other income                             79            153              125           117           414              537  
                                         ---------      ---------    ------------      --------     ---------     -----------  
                                          (1,638)           975             (429)       (1,126)       (2,316)          (1,242) 
Income (loss before income taxes and                                                                                           
     cumulative effect of change in                                                                                            
     accounting principle)                   772          3,928            1,259         2,304            426           (2,856)
Income tax expense (benefit)                 553          1,520           (2,972)           58             23               10 
                                         ---------      ---------    ------------      --------     ---------     -----------  
Net income (loss) before cumulative          219          2,408            4,231         2,246            403           (2,866)
     effect of change in accounting                                                                                            
     principle                                                                                                                 
Cumulative effect of change in                                                                                                 
     accounting for income taxes            (575)            ---             ---           ---           ---              ---  
                                         ---------      ---------    ------------      --------     ---------     -----------  
     Net income (loss)                  $   (356)      $  2,408     $      4,231      $  2,246      $     403    $      (2,866)
                                        ==========     =========    =============     =========     ==========   ==============
Balance Sheet Data (end of period)(1)                                                                                          
Cash & cash equivalents                 $    451       $    352     $        376      $     11      $     138             -NA- 
Total assets                            $ 21,579       $ 21,693     $     20,700      $ 27,105      $  46,058             -NA- 
Total long-term obligations             $ 14,149       $ 12,067     $      8,233      $  6,947      $  36,144             -NA- 
Stockholders' equity                    $  3,309       $  5,531     $      9,639      $ 10,285      $   7,548             -NA- 

____________                                                                  
(1)     A balance sheet as of July 31, 1998  was not  prepared;  therefore, the 
balance sheet data is not provided.                             

                  ____________________

DEFM14C
15th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 15th
CHANCELLOR MEDIA OUTDOOR CORPORATION  
MANAGEMENT'S DISCUSSION AND ANALYSIS  
OF FINANCIAL CONDITION AND RESULTS  
OF OPERATIONS 

GENERAL                                                                         

Chancellor Outdoor was formed on July 22, 1998 and completed the    
following transactions between its inception date and March 31, 1999:           

<circle>    the acquisition of Martin Media, Martin & MacFarlane and certain    
           affiliated companies (collectively "Martin"), which operated 13,700
        billboards and outdoor displays in 12 states serving 23 markets,
      for a total purchase price of $615.1 million on July 31, 1998;

<circle>    the acquisition of approximately 1,000 billboards and outdoor       
       display faces from Kunz & Company for a purchase price of $40.3
million on November 13, 1998;                           

<circle>    the acquisition of Whiteco, which operated 22,500 billboards and    
     outdoor displays in 34 states, for a purchase price of $981.7
million on December 1, 1998; and                        

<circle>    the acquisition of over 5,200 additional billboards and outdoor     
         displays in various markets for a purchase price of $68.8 million
between September 1998 and March 1999.                  

The acquisitions were accounted for as purchases.  Consequently, the
results of operations of Chancellor Outdoor include the results of operations   
of the acquired entities from the respective dates of acquisition.              

 Following is a breakdown of the results of operations for the periods
noted of Chancellor Outdoor and its significant predecessor entities:  Whiteco, 
Martin Media and Martin & MacFarlane.                                           

RESULTS OF OPERATIONS                                                           

CHANCELLOR MEDIA OUTDOOR CORPORATION  

JULY 22, 1998 (INCEPTION) TO DECEMBER 31, 1998 COMPARED TO THE THREE MONTHS     
ENDED MARCH 31, 1999                                                            

  Results of operations for the period July 22, 1998 (inception) through
December 31, 1998 are not comparable to the results of operations for the three 
months ended March 31, 1999 due to the acquisitions completed during the period 
and the effect of seasonal fluctuations.                                        

    Net revenues during the period from July 22, 1998 through March 31, 1999
averaged $12.7 million per month and increased from $7.4 million in August 1998 
to $18.5 million in March 1999 as a result of the various acquisitions of       
billboards and outdoor display faces discussed above, most notably the          
acquisition of Whiteco on December 1, 1998.  Overall, monthly revenue per       
display remained fairly consistent throughout the period, with a slight         
seasonal decrease noted during the winter months and a slight decrease in       
average rates per display subsequent to the acquisition of Whiteco.  Average    
rates per display for Martin are higher than Whiteco, as Martin's boards are    
generally concentrated in more metropolitan areas.                              

    Operating expenses represented 49.4% of net revenues for the period from
July 22, 1998 through December 31, 1998 and 53.1% of net revenues for the three 
months ended March 31, 1999.  The increase is primarily due to the seasonal     
effect of lower occupancy and billing rates during the winter months.  Average  
monthly operating expenses per display were also slightly higher for the three  
months ended March 31, 1999.                                                    

   Corporate general and administrative expenses increased over the period
due to the acquisitions discussed above and the establishment of the Chancellor 
Outdoor Group corporate offices.                                                

 Depreciation and amortization expense averaged $7.2 million per month
from August 1998 through March 1999 and increased from $3.8 million in August   
1998 to $10.5 million in March 1999 due to the acquisitions discussed above.    

   For the period from July 22, 1998 through December 31, 1998, income tax
expense was $0.3 million, compared to a benefit of $3.1 million for the three   
months ended March 31, 1999.  The change was due to an increase in the book     
loss for the three months ended March 31, 1999, as compared to the period ended 
December 31, 1998, which exceeded both the permanent items and the state income 
tax expense recorded for the quarter.  Since the predecessor companies have a   
history of generating taxable income and due to the significant level of        
deferred tax liabilities, the likelihood of recognizing the deferred tax assets 
generated during the period is considered to be probable.                       

THE OUTDOOR ADVERTISING DIVISION OF WHITECO INDUSTRIES, INC.  

ELEVEN MONTHS ENDED NOVEMBER 30, 1998 COMPARED TO YEAR ENDED DECEMBER 31, 1997  

 Net revenues for the eleven months ended November 30, 1998 aggregated
$119.6 million and increased on a monthly basis compared to the year ended      
December 31, 1997 as a result of acquisitions during 1998 and an increase in    
monthly net revenues per display.  Monthly net revenues per display increased   
due to Whiteco's revenue growth in all of its main product lines, particularly  
bulletins.  Bulletin sales continued to increase primarily as a result of new   
promotions implemented by Whiteco, a new compensation plan and increased sales  
training.                                                                       

   Operating expenses as a percentage of net revenues were consistent from
period to period.  Cost of revenues was 36.5% of net revenues for the eleven    
months ended November 30, 1998 and 38.6% of net revenues for the year ended     
December 31, 1997.  Selling and administrative expenses were 19.8% of net       
revenues for the eleven months ended November 30, 1998 and 20.7% of net         
revenues for the year ended December 31, 1997.  Monthly cost per display for    
1998 was consistent with 1997.                                                  

YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996           

Net revenues for the year ended December 31, 1997 increased 8.5% to 
$118.1 million compared to $108.9 million for the year ended December 31, 1996. 
The increase in net revenues was primarily attributable to acquisitions during  
1997 and Whiteco's revenue growth in all of its main product lines,             
particularly bulletins.  The growth in the bulletin line is primarily the       
result of new promotions implemented by Whiteco, a new compensation plan and    
increased sales training.                                                       

Operating expenses as a percentage of net revenues were relatively  
consistent from year to year.  Cost of revenues for 1997 increased 8.6% to      
$45.6 million compared to $42.0 million in 1996.  Selling and administrative    
expenses for 1997 increased 11.4% to $24.4 million compared to $21.9 million in 
1996.                                                                           

MARTIN MEDIA L.P. 

  Prior to its acquisition by Chancellor Outdoor, Martin Media completed
several significant transactions during 1998, including the acquisition of over 
1,300 billboards and outdoor displays in the Las Vegas and Pittsburgh markets   
from Las Vegas Outdoor Advertising, Inc. and POA for a total purchase price of  
approximately $22.7 million.                                                    

 Martin Media began operating approximately 270 display faces owned by
Kunz & Company under a management agreement effective July 31, 1997.  On        
December 23, 1997, Martin Media acquired Connell Outdoor Advertising Company,   
an outdoor advertising company with 88 billboards in the Las Vegas market, for  
$30.0 million.                                                                  

SEVEN MONTHS ENDED JULY 31, 1998 COMPARED TO YEAR ENDED DECEMBER 31, 1997       

  Gross profit for the seven months ended July 31, 1998 aggregated $29.7
million and increased on a monthly basis compared to gross profit for the year  
ended December 31, 1997, which totaled $42.0 million, as a result of            
acquisitions during 1998 and an increase in monthly gross profit per display    
due to general market improvements, particularly in Nevada and Pittsburgh.      

Operating expenses remained relatively consistent at 48.4% of gross 
profit, or $14.4 million, for the seven months ended July 31, 1998 and 50.5% of 
gross profit, or $21.2 million, for the year ended December 31, 1997.           
Depreciation and amortization expense per month increased over the period due   
to the acquisitions discussed above.  Total depreciation expense for the seven  
months ended July 31, 1998 and for the year ended December 31, 1997 was $11.2   
million and $9.3 million, respectively.                                         

     Refinance and acquisition expenses were $3.3 million for the seven months
ended July 31, 1998 and $9.6 million for the year ended December 31, 1997.      
Martin Media's administrative functions are performed by MW Sign Corp., its     
general partner.  Martin Media pays to MW Sign Corp. refinancing fees of 4% of  
all debt refinanced and acquisition fees of 4% of the purchase price of         
acquired companies.                                                             

YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996           

Gross profit for the year ended December 31, 1997 increased 14.8% to
$42.0 million compared to $36.6 million for the year ended December 31, 1996.   
The increase in gross profit was primarily attributable to acquisitions during  
1997 and general market improvements.  The Nevada market experienced the        
greatest increase in sales with the average occupancy rate in that market       
increasing approximately 19.0%.                                                 

     Operating expenses for the year ended December 31, 1997 increased 1.3% to
$21.2 million compared to $20.9 million for the year ended December 31, 1996.   

  Depreciation and amortization expense for 1997 increased 73.0% to $9.3
million compared to $5.4 million in 1996, due to the acquisitions discussed     
above and newly constructed billboards.                                         

   Refinance and acquisition expenses were $9.6 million for the year ended
December 31, 1997 and $3.8 million for the year ended December 31, 1996.        
Martin Media's administrative functions are performed by MW Sign Corp., its     
general partner.  Martin Media pays to MW Sign Corp. refinancing fees of 4% of  
all debt refinanced and acquisition fees of 4% of the purchase price of         
acquired companies.                                                             

MARTIN & MACFARLANE, INC. 

On January 2, 1998, prior to its acquisition by Chancellor Outdoor, 
Martin & MacFarlane acquired Newman Outdoor of Texas, Inc., an outdoor          
advertising company with over 1,200 billboards and outdoor displays in three    
markets, for approximately $12.5 million.                                       

     Martin & MacFarlane began operating approximately 730 display faces owned
by Kunz & Company under a management agreement effective July 3, 1997.          

SEVEN MONTHS ENDED JULY 31, 1998 COMPARED TO YEAR ENDED DECEMBER 31, 1997       

  Gross profit for the seven months ended July 31, 1998 aggregated $16.6
million and increased on a monthly basis compared to gross profit for the year  
ended December 31, 1997, which totaled $20.1 million, as a result of            
acquisitions during 1998 and an increase in monthly gross profit per display    
due to general market improvements, particularly in the California markets.     

    Operating expenses were 63.5% of gross profit, or $10.5 million, for the
seven months ended July 31, 1998 compared to 56.4% of gross profit, or $11.3    
million, for the year ended December 31, 1997.  Martin & MacFarlane typically   
experiences its highest occupancy and advertising rates during the months of    
May through September.  Therefore, margins for the seven months ended July 31,  
1998 were less favorable than the margins for the twelve months ended December  
31, 1997.                                                                       

     Depreciation and amortization expense per month increased over the period
due to the acquisitions discussed above.  Total depreciation expense for the    
seven months ended July 31, 1998 and for the year ended December 31, 1997 was   
$3.5 million and $2.9 million, respectively.                                    

YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996           

Gross profit for the year ended December 31, 1997 increased 35.2% to
$20.1 million compared to $14.8 million for the year ended December 31, 1996.   
The increase in gross profit was primarily attributable to acquisitions during  
1997 and market growth, particularly Amarillo and Bakersfield.                  

   Operating expenses for the year ended December 31, 1997 increased 18.7%
to $11.3 million compared to $9.5 million for the year ended December 31, 1996, 
consistent with the increase in gross profit.                                   

   Depreciation and amortization expense for 1997 increased 120.4% to $2.9
million compared to $1.3 million in 1996, due to the acquisitions discussed     
above and newly constructed billboards.                                         

LIQUIDITY AND CAPITAL RESOURCES                                                 

Since its inception on July 22, 1998, Chancellor Outdoor's capital  
requirements have been financed primarily through cash flows from operations.   
Excess cash flow from operations is distributed to Chancellor LA.  Operating    
activities provided net cash of $22.9 million for the period July 22, 1998 to   
December 31, 1998 and $17.5 million for the three months ended March 31, 1999.  
Chancellor Outdoor does not maintain a separate credit facility.                

RECENTLY-ISSUED ACCOUNTING PRINCIPLE                                            

   In June 1998, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards ("SFAS") No. 133, Accounting for Derivative   
Instruments and Hedging Activities. This Statement establishes accounting and   
reporting standards for derivative instruments and hedging activities. SFAS No. 
133 is effective for all fiscal quarters of all fiscal years beginning after    
June 15, 1999. Management does not anticipate that this Statement will have a   
material impact on Chancellor Outdoor's consolidated financial statements.      

YEAR 2000 ISSUE                                                                 

The Year 2000 ("Y2K") issue is whether Chancellor Outdoor's computer
systems will properly recognize date sensitive information when the year        
changes to 2000, or "00." Systems that do not properly recognize such           
information could generate erroneous data or cause a system to fail.            

   Chancellor Outdoor has conducted a comprehensive review of its computer
systems to identify the systems that could be affected by the Y2K issue and has 
developed an implementation plan. Chancellor Outdoor uses proprietary software  
programs for its operations and is in the process of reviewing various          
modifications and replacement plans. Chancellor Outdoor  estimates that         
approximately 75% of its Y2K remediation had been completed as of June 15,      
1999. The remaining remediation efforts are expected to be completed by the end 
of the third quarter of 1999.  Chancellor Outdoor's Y2K implementation plan     
also includes ensuring that its computer hardware and other equipment with      
embedded chips or processors are Y2K compliant.                                 

     Costs associated with ensuring that Chancellor Outdoor's existing systems
are Y2K compliant and replacing certain existing systems are currently expected 
to be approximately $0.6 million, of which $0.5 million had been incurred       
through June 15, 1999. These costs, in conjunction with investments Chancellor  
Outdoor is making in information systems and technology, are expected to reduce 
the risks associated with Y2K issues.                                           

The ability of third parties with whom Chancellor Outdoor transacts 
business to address their Y2K issues adequately is outside of Chancellor        
Outdoor's control. Therefore, there can be no assurance that the failure of     
such third parties to address their Y2K issues adequately will not have a       
material adverse effect on Chancellor Outdoor's business, financial condition,  
cash flows and results of operations. Chancellor Outdoor has begun development  
of contingency plans intended to mitigate any possible disruption in business   
that may result from certain of Chancellor Outdoor's systems or the systems of  
third parties that are not Y2K compliant.                                       

   The Y2K cost estimates are subject to change based on further analysis,
and any change in the costs may be material. As solutions are implemented and   
new issues are recognized, the focus of Chancellor Outdoor's efforts and costs  
to address the Y2K issue may be adjusted. Furthermore, Chancellor Outdoor       
cannot guarantee that there will be no Y2K issues in spite of these efforts and 
if such modifications and replacements are not made, or are not completed in    
time, the Y2K issue could have a material impact on Chancellor Outdoor's        
operations.                                                                     

DEFM14C
16th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 16th
LAMAR ADVERTISING COMPANY 
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED  
FINANCIAL STATEMENTS  

The following sets forth unaudited pro forma condensed consolidated 
financial information for Lamar.  The unaudited pro forma condensed             
consolidated statement of operations for the year ended December 31, 1998 gives 
effect to the acquisition of Outdoor Communications, Inc.  (as filed in Lamar's 
Form 8-K/A filed June 8, 1999) and the proposed Stock Purchase as if the        
transactions had occurred on January 1, 1998.  The unaudited pro forma          
condensed consolidated statement of operations for the three months ended March 
31, 1999 gives effect to the proposed Stock Purchase as if the transaction had  
occurred on January 1, 1998.  The unaudited pro forma condensed consolidated    
balance sheet as of March 31, 1999 gives effect to the Stock Purchase as if the 
transaction had occurred on March 31, 1999.                                     

   For purposes of the pro forma financial information:  (i) the pro forma
statement of operations of Lamar for the year ended December 31, 1998 (as       
adjusted for the Outdoor Communications, Inc. acquisition) has been combined    
with the statement of operations of Chancellor Outdoor for the period July 22,  
1998 (inception) to December 31, 1998, the statement of operations of Martin    
Media for the seven months ended July 31, 1998, the statement of operations of  
Martin & MacFarlane for the seven months ended July 31, 1998 and the statement  
of income of Whiteco for the eleven months ended November 30, 1998; (ii) the    
statement of operations of Lamar for the three month period ended March 31,     
1999 has been combined with the statement of operations of Chancellor Outdoor   
for the same period, and (iii) the balance sheet of Lamar as of March 31, 1999  
has been combined with the balance sheet of Chancellor Outdoor as of March 31,  
1999.                                                                           

    The unaudited pro forma condensed consolidated financial statements give
effect to the acquisitions under the purchase method of accounting.  The pro    
forma adjustments are described in the accompanying notes and are based on      
preliminary estimates and certain assumptions that management of Lamar believes 
reasonable under the circumstances.                                             

    The unaudited pro forma condensed consolidated financial statements have
been prepared by Lamar's management.  The unaudited pro forma data is not       
designed to represent and does not represent what Lamar's results of operations 
or financial position would have been had the Stock Purchase and the            
acquisition of Outdoor Communications, Inc. been completed on or as of the      
dates assumed, and is not intended to project Lamar's results of operations for 
any future period or as of any future date.  The unaudited pro forma condensed  
consolidated financial statements should be read in conjunction with the        
audited and unaudited consolidated financial statements and notes of Lamar,     
Chancellor Outdoor, Martin Media, Martin & MacFarlane, Whiteco and Outdoor      
Communications, Inc. included elsewhere, or incorporated by reference, herein.  

LAMAR ADVERTISING COMPANY 
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS      
YEAR ENDED DECEMBER 31, 1998  
(dollars in thousands, except per share data)   

                                                        [Enlarge/Download Table]


                                         PRO FORMA                                                                      
                                           LAMAR          CHANCELLOR          MARTIN         MARTIN &                   
                                         ADJUSTED           OUTDOOR           MEDIA         MACFARLANE       WHITECO    
                                        FOR THE OCI     JULY 22, 1998 TO  JAN 1, 1998 TO  JAN 1, 1998 TO  JAN 1, 1998 TO
                                        ACQUISITION    DECEMBER 31, 1998  JULY 31, 1998   JULY 31, 1998    NOV 30, 1998 
                                      ---------------  -----------------  --------------  --------------  --------------
                                                                                                                        
Revenues, net                         $       332,754  $          47,605  $       29,655  $       16,576  $      119,630
                                      ---------------  -----------------  --------------  --------------  --------------

Direct advertising expenses                  108,781             23,505          14,364          10,526          43,665 
General and administrative expenses           69,662              1,981           6,450           4,193          26,296 
Depreciation and amortization                112,805             25,990          11,223           3,471          10,342 
                                      ---------------  -----------------  --------------  --------------  --------------
                                             291,248             51,476          32,037          18,190          80,303 
                                      ---------------  -----------------  --------------  --------------  --------------
Operating income (loss)                       41,506             (3,871)         (2,382)         (1,614)         39,327 
                                      ---------------  -----------------  --------------  --------------  --------------
Other expense (income):                                                                                                 
Interest income                                 (762)             - -               (20)          - -              (134)
Interest expense                              80,581                105           8,527           2,244              35 
Loss (gain) on disposition of assets            (729)             - -             - -              (465)         (1,418)
Other expenses                                   314               (156)           (473)           (537)          - -   
                                      ---------------  -----------------  --------------  --------------  --------------
                                              79,404                (51)          8,034           1,242          (1,517)
                                      ---------------  -----------------  --------------  --------------  --------------

Income (loss) before income taxes            (37,898)            (3,820)        (10,416)         (2,856)         40,844 

Income tax expense (benefit)                  (6,368)               345           - -                10           - -   
                                      ---------------  -----------------  --------------  --------------  --------------
Net income (loss)                            (31,530)  $         (4,165)  $     (10,416)  $      (2,866)  $      40,844 
                                                       =================  ==============  ==============  ==============
Preferred stock dividends                        365                                                                    
                                      ---------------                                                                   
Net loss applicable to common stock   $      (31,895)                                                                   
                                      ===============                                                                   

Net loss  per common share            $        (0.62)                                                                   
                                      ===============                                                                   

Weighted average number of shares                                                                                       
  outstanding                             51,361,522                                                                    
                                      ===============                                                                   
                                                        [Enlarge/Download Table]


                                         COMBINED                                         
                                        CHANCELLOR                                        
                                          OUTDOOR        ACQUISITION          PRO FORMA   
                                         12/31/98        ADJUSTMENTS          COMBINED    
                                      ---------------  ---------------     ---------------
                                                                                          
Revenues, net                         $      213,466   $       (3,810) (6) $      542,410 
                                      ---------------  ---------------     ---------------

Direct advertising expenses                   92,060           (1,993) (6)        198,848 
General and administrative expenses           38,920           (2,734) (1)        105,848 
Depreciation and amortization                 51,026           97,754  (2)        261,585 
                                      ---------------  ---------------     ---------------
                                             182,006           93,027             566,281 
                                      ---------------  ---------------     ---------------
Operating income (loss)                       31,460          (96,837)            (23,871)
                                      ---------------  ---------------     ---------------
Other expense (income):                                                                   
Interest income                                 (154)             154  (3)           (762)
Interest expense                              10,911           40,046  (4)        131,538 
Loss (gain) on disposition of assets          (1,883)           - -                (2,612)
Other expenses                                (1,166)           - -                  (852)
                                      ---------------  ---------------     ---------------
                                               7,708           40,200             127,312 
                                      ---------------  ---------------     ---------------

Loss before income taxes                      23,752         (137,037)           (151,183)

Income tax benefit                               355          (44,536) (5)        (50,549)
                                      ---------------  ---------------     ---------------
Net income (loss)                     $       23,397   $      (92,501)     $     (100,634)
                                      ===============  ===============                    
Preferred stock dividends                                                             365 
                                                                           ---------------
Net loss applicable to common stock                                        $     (100,999)
                                                                           ===============

Net loss  per common share                                                 $        (1.30)
                                                                           ===============

Weighted average number of shares                                                         
  outstanding                                              26,227,273          77,588,795 
                                                       ===============     ===============


DEFM14C
17th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 17th
     LAMAR ADVERTISING COMPANY
  UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
       THREE MONTHS ENDED MARCH 31, 1999
   (dollars in thousands, except per share data)

                                                        [Enlarge/Download Table]


                                                             CHANCELLOR     ACQUISITION         PRO FORMA   
                                               LAMAR          OUTDOOR       ADJUSTMENTS         COMBINED    
                                           --------------  --------------  --------------     --------------

                                                                                                            
Revenues, net                              $      85,766   $      53,601   $        (847) (6) $     138,520 
                                           --------------  --------------  --------------     --------------

Direct advertising expenses                       29,764          28,451            (480) (6)        57,735 
General and administrative expenses               20,099           2,825           - -               22,924 
Depreciation and amortization                     31,561          31,396           5,799  (2)        68,756 
                                           --------------  --------------  --------------     --------------
                                                  81,424          62,672           5,319            149,415 
                                           --------------  --------------  --------------     --------------
Operating income (loss)                            4,342          (9,071)         (6,166)           (10,895)
                                           --------------  --------------  --------------     --------------
Other expense (income):                                                                                     
Interest income                                     (686)          - -             - -                 (686)
Interest expense                                  18,145              64          12,501  (4)        30,710 
Gain on disposition of assets                       (336)          - -             - -                 (336)
Other expenses                                     - -                86           - -                   86 
                                           --------------  --------------  --------------     --------------
                                                  17,123             150          12,501             29,774 
                                           --------------  --------------  --------------     --------------

Loss before income taxes                         (12,781)         (9,221)        (18,667)           (40,669)

Income tax benefit                                (2,842)         (3,076)         (7,800) (5)       (13,718)
                                           --------------  --------------  --------------     --------------
Loss before cumulative effect of a change                                                                   
  in accounting principle                  $      (9,939)  $      (6,145)  $     (10,867)     $     (26,951)
                                           ==============  ==============  ==============     ==============

Loss before cumulative effect of a change                                                                   
  in accounting principle per common share $       (0.16)                                     $       (0.31)
                                           ==============                                     ==============

Weighted average number of shares                                                                           
  outstanding                                 61,143,351                      26,227,273         87,370,624 
                                           ==============                  ==============     ==============

DEFM14C
18th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 18th
LAMAR ADVERTISING COMPANY       
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET        
MARCH 31, 1999      
(dollars in thousands)      

                                                        [Enlarge/Download Table]


                                                           CHANCELLOR        PRO FORMA           PRO FORMA   
                                             LAMAR           OUTDOOR        ADJUSTMENTS          COMBINED    
                                        ---------------  ---------------  ---------------     ---------------
                                                                                                             

Cash                                    $        8,171   $        3,620   $        - -        $       11,791 
Net receivables                                 41,042           29,015            - -                70,057 
Other current assets                            17,573           18,945           (2,243) (7)         34,275 
                                        ---------------  ---------------  ---------------     ---------------
  Total current assets                          66,786           51,580           (2,243)            116,123 
                                        ---------------  ---------------  ---------------     ---------------

Property, plant and equipment, net             521,495        1,213,218         (571,627) (8)      1,163,086 
                                        ---------------  ---------------  ---------------     ---------------

Intangibles                                    752,809          499,852          610,013  (9)      1,862,674 
Other assets                                    17,447            1,168            - -                18,615 
                                        ---------------  ---------------  ---------------     ---------------
   Total assets                         $    1,358,537   $    1,765,818   $       36,143      $    3,160,498 
                                        ===============  ===============  ===============     ===============

Current maturities of long-term debt    $        4,165   $          671   $        - -        $        4,836 
Other current liabilities                       36,404           22,169           22,000  (10)        80,573 
                                        ---------------  ---------------  ---------------     ---------------
                                                40,569           22,840           22,000              85,409 
                                        ---------------  ---------------  ---------------     ---------------

Long-term debt                                 829,288            1,854          700,000  (11)     1,531,142 
Deferred income - Long term                      1,313            - -              - -                 1,313 
Other liabilities                                4,464            - -              - -                 4,464 
Deferred tax liability                          23,998           95,554           12,721  (12)       132,273 
                                        ---------------  ---------------  ---------------     ---------------
   Total Liabilities                           899,632          120,248          734,721           1,754,601 
                                        ---------------  ---------------  ---------------     ---------------

Stockholders' equity                           458,905        1,645,570         (698,578) (13)     1,405,897 

                                        ---------------  ---------------  ---------------     ---------------
   Total liabilities and stockholders'                                                                       
     equity                             $    1,358,537   $    1,765,818   $       36,143      $    3,160,498 
                                        ===============  ===============  ===============     ===============

DEFM14C
19th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 19th
LAMAR ADVERTISING COMPANY       
NOTES TO UNAUDITED CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS        
(dollars in thousands)          

For purposes of determining the pro forma effect of the Chancellor Outdoor      
acquisition on Lamar's Condensed Consolidated Statements of Operations for      
the year ended December 31, 1998 and the three months' ended March 31, 1999,    
the following adjustments have been made:                                       

                                                        [Enlarge/Download Table]


                                                                                 12/31/98          03/31/99  
                                                                             ---------------   --------------
                                                                                                             
(1)  To eliminate expenses in Chancellor Outdoor's combined financial                                        
     statement related to management fees that would not have existed had                                    
     the Stock Purchase taken place at the beginning of the year                                             

     General and administrative expenses                                              (2,734)            - - 
                                                                             ===============   ==============

(2)  To record incremental amortization and depreciation                                                     
     due to the application of purchase accounting.                                                          
     Depreciation and amortization are calculated using                                                      
     accelerated and straight line methods over the estimated                                                
     useful lives of the assets generally from 5-15 years.                            97,754            5,799
                                                                              ===============   =============

(3)  To eliminate historical interest income that would not                                                  
     have existed had the Stock Purchase taken place on                                                      
     January 1, 1998                                                                     154             - - 
                                                                              ===============   =============

(4)  To eliminate historical interest expense                                                                
     in Chancellor Outdoor's combined  financial statements                                                  
     and record interest expense related to the debt acquired                                                
     and incurred in the Stock Purchase. (A difference of .125% in the                                       
     rate of interest would have changed income by $875 and                                                  
     $216 for the year ended December 31, 1998 and three months                                              
     ended March 31, 1999, respectively.)                                                                    

     Historical interest expense                                                     (10,911)            (64)
     Interest expense on debt acquired and incurred in the Stock Purchase.            50,957          12,565 
                                                                              ---------------   -------------
                                                                                      40,046          12,501 
                                                                              ===============   =============

(5)  To record the tax effect on pro forma statements                                                        
     for the Stock Purchase.                                                         (44,536)         (7,800)
                                                                              ===============   =============

(6)  To record the effect on net revenues and direct expenses of the                                         
     divestiture required of Chancellor Outdoor by the Department of Justice                                 
     in May 1999.                                                                                            

     Net revenues                                                                     (3,810)           (847)
                                                                              ===============   =============

     Direct advertising expenses                                                      (1,993)           (480)
                                                                              ===============   =============


DEFM14C
20th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 20th
The terms of the Stock Purchase Agreement include the issuance of 26,227,273    
Class A Common Stock at an average stock price of  $36.11 per share and $700    
million in cash for a total purchase price of $1,646,992.  The acquisition      
will be accounted for under the purchase method of accounting.  The following   
is a summary of the preliminary allocation of the purchase price of the         
acquisition:                                                                    

                                                                [Download Table]

                                                                 
Current assets                                            49,337 
Property, plant and equipment                            641,591 
Goodwill                                                 312,371 
Customer lists                                           132,913 
Structure locations                                      628,649 
Other intangibles                                         35,932 
Other assets                                               1,168 
Current liabilities                                      (44,840)
Long-term liabilities                                   (110,129)
                                       --------------------------
                                                       1,646,992 

For purposes of determining the pro forma effect of the Stock Purchase on       
Lamar's unaudited Condensed Consolidated Balance Sheet as of March 31, 1999,    
the following adjustments have been made:                                       

                                                        [Enlarge/Download Table]


                                                                                    Pro Forma   
                                                                                   Adjustments  
                                                                                 ---------------
                                                                                                
 (7)  Other current assets                                                                      

      To eliminate historical deferred tax assets not acquired in the                           
      Stock Purchase.                                                                    (2,243)
                                                                                 ===============

 (8)  Property, Plant and Equipment, net:                                                       

      To record the decrease in property, plant and equipment                                   
      from the allocation of the Purchase Price of the Stock Purchase                  (571,627)
                                                                                 ===============

 (9)  Intangibles:                                                                              

      To record the increase in intangibles resulting from the                                  
      allocation of the Purchase Price of the Stock Purchase.                           610,013 
                                                                                 ===============

(10)  Other current liabilities:                                                                

      To record the  increase in the accrual of severance and other liabilities                 
      assumed in the Stock Purchase.                                                     22,000 
                                                                                 ===============

(11)  Long-term debt:                                                                           

      To record the increase in debt related to financing                                       
      the Stock Purchase.                                                                       

      Borrowings under the Credit Facility                                              700,000 
                                                                                 ===============

(12)  Deferred Tax Liability:                                                                   

      To record the increase in  the deferred tax liability                                     
      created as a result of the application of purchase                                        
      accounting.                                                                        12,721 
                                                                                 ===============

(13)  Stockholders' Equity                                                                      

      To eliminate Chancellor Outdoor's historical stockholders' equity                         
      as a result of the Stock Purchase.                                             (1,645,570)

      To record the issuance of Class A Common Stock as a result                                
      of the Stock Purchase.                                                            946,992 
                                                                                 ---------------
                                                                                       (698,578)
                                                                                 ===============


DEFM14C
21st “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 21st
  ADDITIONAL INFORMATION; INCORPORATION BY REFERENCE

   Additional information about Lamar is available in Lamar's filings with
the Commission.  See "Where You Can Find More Information" on the inside front  
cover of this Information Statement regarding documents incorporated by         
reference into this document.                                                   

FURTHER STOCKHOLDER ACTION NOT REQUIRED 

     Prior to the Closing, the proposed Share Issuance will be approved by the
Written Consent of RFLP, the holder of 100% of the Class B Common Stock,        
representing approximately 80% of the total voting power of Lamar.  Thus, such  
consent is sufficient to approve the Share Issuance and no other vote or        
consent of stockholders is required or will be sought in connection with the    
Stock Purchase or Share Issuance.                                               

  ACCORDINGLY, LAMAR IS NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED
NOT TO SEND LAMAR A PROXY.                                                      

                                      By Order of the Board of Directors

                         /S/ JAMES R. MCILWAIN

                     James R. McIlwain
             Secretary

Baton Rouge, Louisiana                                                          
August 13, 1999                                                                 

INDEX TO FINANCIAL STATEMENTS         

CHANCELLOR MEDIA OUTDOOR CORPORATION                                            

Report of Independent Accountants...........................................F-3 
Consolidated Balance Sheets as of December 31, 1998 and March 31, 1999          
    (unaudited)............................................................F-4
Consolidated Statements of Operations for the period from July 22, 1998 to      
December 31, 1998, and the three months ended March 31, 1999          
    (unaudited)............................................................F-5
Consolidated Statements of Equity for the period from July 22, 1998 to          
December 31, 1998, and the three months ended March 31, 1999          
    (unaudited)............................................................F-6
Consolidated Statements of Cash Flows for the period from July 22, 1998 to      
December 31, 1998, and the three months ended March 31, 1999          
    (unaudited)............................................................F-7
Notes to Consolidated Financial Statements..................................F-8 

THE OUTDOOR ADVERTISING DIVISION OF WHITECO INDUSTRIES, INC.                    

Report of Independent Accountants..........................................F-15 
Statement of Income for the eleven months ended November 30, 1998..........F-16 
Statement of Divisional Equity for the eleven months ended November             
    30, 1998..............................................................F-17
Statement of Cash Flows for the eleven months ended November 30, 1998......F-18 
Notes to Financial Statements..............................................F-19 

Independent Auditors' Report...............................................F-22 
Balance Sheets as of December 31, 1996 and 1997............................F-23 
Statements of Income for the years ended December 31, 1995, 1996 and 1997..F-24 
Statements of Cash Flows for the years ended December 31, 1995, 1996            
    and 1997..............................................................F-25
Notes to Financial Statements..............................................F-26 

MARTIN MEDIA L.P.                                                               

Report of Independent Accountants..........................................F-29 
Statement of Operations for the seven months ended July 31, 1998...........F-30 
Statement of Partners' Capital for the seven months ended July 31, 1998....F-31 
Statement of Cash Flows for the seven months ended July 31, 1998...........F-32 
Notes to Financial Statements..............................................F-33 

Report of Independent Public Accountants...................................F-37 
Balance Sheets as of December 31, 1997 and 1996............................F-38 
Statements of Operations for each of the years ended December 31, 1997,         
1996 and 1995..............................................................F-39 
Statements of Partners' Capital (Deficit) for each of the years ended           
    December 31, 1997, 1996 and 1995......................................F-40
Statements of Cash Flows for each of the years ended December 31, 1997,         
1996 and 1995..............................................................F-41 
Notes to Financial Statements..............................................F-43 

MARTIN & MACFARLANE, INC.                                                       

Report of Independent Accountants..........................................F-54 
Statement of Operations for the seven months ended July 31, 1998...........F-55 
Statement of Retained Earnings for the seven months ended July 31, 1998....F-56 
Statement of Cash Flows for the seven months ended July 31, 1998...........F-57 
Notes to Financial Statements..............................................F-58 

Report of Independent Public Accountants...................................F-62 
Balance Sheets as of December 31, 1997 and 1996............................F-63 
Statements of Income for each of the years ended December 31, 1997 and          
    1996 and the six-month period ended December 31, 1995.................F-64
Statements of Retained Earnings for each of the years ended December 31,        
    1997 and 1996 and the six-month period ended December 31, 1995........F-65
Statements of Cash Flows for each of the years ended December 31, 1997          
    and 1996 and the six-month period ended December 31, 1995.............F-66
Notes to Financial Statements..............................................F-68 

Independent Auditors' Report...............................................F-80 
Balance Sheet as of June 30, 1995..........................................F-81 
Statement of Income for the year ended June 30, 1995.......................F-83 
Statement of Retained Earnings for the year ended June 30,  1995...........F-84 
Statement of Cash Flows for the year ended June 30, 1995...................F-85 
Notes to Financial Statements..............................................F-87 

DEFM14C
22nd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 22nd
REPORT OF INDEPENDENT ACCOUNTANTS                 

June 9, 1999                                                                    
To the Board of Directors of                                                    
Chancellor Media Corporation                                                    

In  our  opinion,  the  accompanying consolidated balance sheet and the related 
consolidated statements of operations, equity and cash flows present fairly, in 
all material respects, the  financial  position  of  Chancellor  Media  Outdoor 
Corporation   (the  "Company"),  a  wholly-owned   subsidiary   of   Chancellor 
Media Corporation of Los Angeles, at December  31,  1998,  and  the  results of 
their operations and their cash flows for the period from July 22, 1998 through 
December 31, 1998, in conformity with generally accepted accounting principles. 
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 audit.  We  conducted  our audit of these statements in 
accordance with generally accepted auditing standards  which  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,  assessing  the  accounting  principles  used  and 
significant  estimates made by management, and evaluating the overall financial 
statement presentation.   We believe that our audit provides a reasonable basis 
for the opinion expressed above.                                                

/S/ PRICEWATERHOUSECOOPERS LLP                                                  

PricewaterhouseCoopers LLP                                                      

DEFM14C
23rd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 23rd
CHANCELLOR MEDIA OUTDOOR CORPORATION                                            
(A WHOLLY-OWNED SUBSIDIARY OF CHANCELLOR MEDIA CORPORATION OF LOS ANGELES)      

CONSOLIDATED BALANCE SHEETS                                                     
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]

                                                                          MARCH 31, 
                                                           DECEMBER 31,     1999    
                                                              1998       (Unaudited)
                                                           ------------  -----------
                                                                                    
ASSETS                                                                              
Current assets:                                                                     
  Cash                                                     $    2,023    $    3,620 
  Accounts receivable, net of allowance for uncollectible                           
    accounts of $5,053 and $5,286                              27,073        29,015 
  Prepaid land rent                                             7,325        10,655 
  Deferred tax asset                                            2,122         2,243 
  Inventories                                                   3,680         3,438 
  Other current assets                                          2,119         2,609 
                                                           ----------    ---------- 
            Total current assets                               44,342        51,580 
                                                           ----------    ---------- 
  Property and equipment:                                                           
      Land                                                     16,215        16,909 
      Advertising structures                                1,178,751     1,206,113 
      Buildings and improvements                               10,117        10,251 
      Equipment and vehicles                                    9,005        10,328 
      Construction-in-progress                                 13,114        17,382 
                                                           ----------    ---------- 
            Total cost                                      1,227,202     1,260,983 
                                                           ----------    ---------- 
            Accumulated depreciation                          (20,794)      (47,765)
                                                           ----------    ---------- 
            Net property and equipment                      1,206,408     1,213,218 
                                                           ----------    ---------- 

   Intangible assets:                                                               
      Goodwill                                                464,359       469,795 
      Other                                                    27,000        39,673 
                                                           ----------    ---------- 
            Total cost                                        491,359       509,468 
                                                           ----------    ---------- 
  Accumulated amortization                                     (5,196)       (9,616)
            Net intangible assets                             486,163       499,852 
  Prepaid land rent, non-current                                1,168         1,168 
                                                           ----------    ---------- 
            Total assets                                   $1,738,081    $1,765,818 
                                                           ==========    ========== 

LIABILITIES AND EQUITY                                                              
Current liabilities:                                                                
  Notes payable, current                                   $      698    $      671 
  Accounts payable                                              8,799         3,479 
  Accrued payroll and employee benefits                         5,327         7,029 
  Other accrued liabilities                                     8,007        11,661 
                                                           ----------    ---------- 
            Total current liabilities                          22,831        22,840 
Commitments and contingencies                                       -             - 
Deferred tax liabilities                                       99,009        95,554 
Notes payable, long-term                                        1,715         1,854 
Equity                                                      1,614,526     1,645,570 
                                                           ----------    ---------- 
            Total liabilities and equity                   $1,738,081    $1,765,818 
                                                           ==========    ========== 

See accompanying notes to consolidated financial statements.          

DEFM14C
24th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 24th
CHANCELLOR MEDIA OUTDOOR CORPORATION                                            
(A WHOLLY-OWNED SUBSIDIARY OF CHANCELLOR MEDIA CORPORATION OF LOS ANGELES)      

CONSOLIDATED STATEMENTS OF OPERATIONS                                           
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]

                                                FOR THE PERIOD  FOR THE THREE 
                                                 FROM JULY 22,  MONTHS ENDED  
                                                   1998 TO        MARCH 31,   
                                                 DECEMBER 31,       1999      
                                                    1998         (UNAUDITED)  
                                               ---------------  --------------
                                                                              
Revenues                                       $     52,750      $    57,992  

Less:  agency commissions                             5,145            4,391  
                                               ------------      -----------  

      Net revenues                                   47,605           53,601  

Operating expenses                                   23,505           28,451  
Corporate general and administrative expenses         1,981            2,825  
Depreciation and amortization                        25,990           31,396  
                                               ------------      -----------  

      Loss from operations                           (3,871)          (9,071) 

Other (income) expense                                 (156)              86  
Interest expense                                        105               64  
                                               ------------      -----------  
      Loss before taxes                              (3,820)          (9,221) 

Income tax expense (benefit)                            345           (3,076) 
                                               ------------      -----------  
      Net loss                                 $     (4,165)     $    (6,145) 
                                               ============      ===========  

See accompanying notes to consolidated financial statements.          

DEFM14C
25th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 25th
CHANCELLOR MEDIA OUTDOOR CORPORATION                                            
(A WHOLLY-OWNED SUBSIDIARY OF CHANCELLOR MEDIA CORPORATION OF LOS ANGELES)      

CONSOLIDATED STATEMENTS OF EQUITY                                               
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]

                                FOR THE PERIOD   FOR THE THREE 
                                 FROM JULY 22,    MONTHS ENDED 
                                   1998 TO          MARCH 31,  
                                 DECEMBER 31,        1999      
                                    1998          (UNAUDITED)  
                                ---------------  --------------
                                                               
Beginning balance               $         -        $ 1,614,526 

Contributions from parent, net    1,618,691             37,189 

Net loss                             (4,165)            (6,145)
                                -----------        ----------- 

                                $ 1,614,526        $ 1,645,570 
                                ===========        =========== 

See accompanying notes to consolidated financial statements.          

DEFM14C
26th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 26th
CHANCELLOR MEDIA OUTDOOR CORPORATION                                            
(A WHOLLY-OWNED SUBSIDIARY OF CHANCELLOR MEDIA CORPORATION OF LOS ANGELES)      

CONSOLIDATED STATEMENTS OF CASH FLOWS                                           
(DOLLARS IN THOUSANDS)                                                          

                                                        [Enlarge/Download Table]

                                                          FOR THE PERIOD   FOR THE THREE
                                                          FROM JULY 22,    MONTHS ENDED 
                                                             1998 TO         MARCH 31,  
                                                          DECEMBER 31,         1999     
                                                             1998           (UNAUDITED) 
                                                         ---------------  --------------
                                                                                        

Net loss                                                 $  (4,165)       $  (6,145)    
                                                         ---------        ---------     
Adjustments to reconcile net loss to net cash                                           
      provided by operating activities:                                                 
            Depreciation                                    20,794           26,981     
            Amortization of intangibles                      5,196            4,415     
            Deferred tax benefit                            (1,155)          (3,576)    
            Changes in assets and liabilities:                                          
                  Accounts receivable                       (1,165)          (1,578)    
                  Other assets                               1,649           (2,223)    
                  Accounts payable and accrued expenses      1,780             (379)    
                                                         ---------        ---------     

              Total adjustments                             27,099           23,640     
                                                         ---------        ---------     

              Net cash provided by operating activities     22,934           17,495     
                                                         ---------        ---------     

Cash flows from investing activities:                                                   
  Purchases of property and equipment and construction                                  
      of advertising structures                             (5,344)          (8,176)    
                                                         ---------        ---------     

              Net cash used in investing activities         (5,344)          (8,176)    
                                                         ---------        ---------     

Cash flows from financing activities:                                                   
  Distributions to parent                                  (15,347)          (7,584)    
  Principal payments on note payable                          (220)            (138)    
                                                         ---------        ---------     

              Net cash used in financing activities        (15,567)          (7,722)    
                                                         ---------        ---------     

Net increase in cash                                         2,023            1,597     
Cash, at beginning of period                                     -            2,023     
                                                         ---------        ---------     

Cash, at end of period                                   $   2,023        $   3,620     
                                                         =========        =========     

Supplemental disclosure of cash flow information:                                       
  Cash paid for interest                                 $     105        $      64     
                                                         =========        =========     

See accompanying notes to consolidated financial statements.          

DEFM14C
27th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 27th
CHANCELLOR MEDIA OUTDOOR CORPORATION                                            
(A WHOLLY-OWNED SUBSIDIARY OF CHANCELLOR MEDIA CORPORATION OF LOS ANGELES)      

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                                      
(DOLLARS IN THOUSANDS)                                                          

1.   ORGANIZATION AND SIGNIFICANT ACQUISITIONS                                  

    The  Chancellor  Media Outdoor Corporation (the "Company"), a wholly-owned
    subsidiary   of   Chancellor    Media    Corporation   of   Los    Angeles
("CMCLA"), operated approximately 38,000 outdoor advertising  display 
    faces in 37   states  as  of  December  31, 1998.  The Company  was formed
    on  July  22,  1998;  however,  the  Company  held  no  assets  until  the
    acquisition of Martin Media,  Martin  &  MacFarlane and certain affiliated
companies  on  July 31, 1998 and the Company had  no  results  of     
    operations until  August  1,  1998.   On  June  1,  1999, Chancellor Media
Corporation ("CMC"), the indirect parent of CMCLA,  announced that it 
had  entered into a definitive agreement to sell the Company  (see    
    Note 8).   The  accompanying  consolidated  financial  statements  do  not
include any effects related to the proposed transaction.              

On  July  31,  1998,  CMCLA  acquired  Martin  Media  L.P.,  Martin & 
    MacFarlane  and  certain  affiliated  companies  ("Martin")  for  a  total
    purchase  price  of  $615,117,  which  consisted  of  $612,848 in cash and
    included  various  other  direct acquisition costs and the  assumption  of
notes payable of $2,270.  As  part  of  the Martin transaction, CMCLA 
    acquired an asset purchase agreement with  Kunz  &  Company  and  paid  an
    additional $6,000 in cash for a purchase option deposit previously paid in
    by  Martin.   Martin operated 13,700 billboards and outdoor displays in 12
states serving 23 markets.                                            

On November 13,  1998,  CMCLA acquired approximately 1,000 billboards 
    and outdoor display faces  from  Kunz  &  Company  for $40,264 in cash, of
    which  $6,000  was  previously  paid  as  a  purchase  option  deposit  in
     connection  with  the  Martin  acquisition  on July 31, 1998.   The Company
     had previously been operating these properties under a management agreement
effective July 31, 1998.                                              

On December 1, 1998, CMCLA acquired the assets and working capital of 
    the outdoor advertising division of Whiteco Industries, Inc.  ("Whiteco"),
    which operated approximately 22,500 billboards and outdoor displays  in 34
    states,  for  $981,698 in cash, including various other direct acquisition
costs.                                                                

    The unaudited 1998  pro forma condensed consolidated results of operations
    data, as if the Whiteco  and  Martin transactions had occurred on July 22,
1998 are as follows:                                                  

Net revenues                                $     92,990  

Net loss                                          (9,856) 

 The pro forma results are not necessarily indicative of future results.

Between September and December 1998, CMCLA acquired approximately 670 
    additional  billboards  and  outdoor   displays  in  various  markets  for
approximately $23,582 in cash.                                        

On   January   21,  1999  and  February  9,  1999,   CMCLA acquired   
    approximately 4,500  outdoor  display  faces from Triumph Outdoor Holdings
    and certain affiliated companies for $37,006  in  cash  including  working
    capital  and  direct  acquisition  costs  ("the Triumph Acquisition").  In
connection  with  the Triumph Acquisition, CMCLA paid  approximately  
    $1,000 to an entity  controlled  by James A. McLaughlin, the President and
Chief Operating Officer of the Company.    An additional $700 that    
    may  be  paid  to  such  entity  is currently held in escrow,  subject  to
satisfaction of indemnity claims, if any.                             

Between  January  and  May  1999, CMCLA  acquired  approximately  250 
    additional billboards and outdoor  displays  in  various  transactions for
approximately $11,900 in cash.                                        

    The  above  acquisitions were accounted for under the purchase  method  of
accounting.   After  acquisition,  CMCLA  pushed  down the applicable 
     stock,  assets and/or liabilities of the acquired entities  to  the Company
as  non-cash  contributions.   The contributions were made at cost    
and therefore no related gain or loss was recognized by CMCLA.  These 
    acquisitions  are non-cash transactions that  are  not  reflected  in  the
    consolidated statement  of  cash  flows.   The  accompanying  consolidated
    financial  statements  include  the  results of operations of the acquired
entities from their respective date of acquisition.                   

A summary of net assets acquired during 1998 follows:                 

                                                                [Download Table]


                                                                                
Cash                                                                 $    6,716 
Accounts receivable, net                                                 25,908 
Other current assets                                                     14,747 
Property and equipment                                                1,221,858 
Intangible assets                                                       499,044 
Other assets                                                              1,195 
Accounts payable and accrued expenses                                   (10,752)
Deferred tax liabilities                                                (98,042)
Other liabilities                                                           (13)
                                                                     ---------- 
         Total net assets acquired                                    1,660,661 
                                                                     ========== 

Less:                                                                           
   Cash acquired                                                          6,716 
   Notes payable                                                          2,268 
                                                                     ---------- 
Cash paid for acquisitions by CMCLA                                  $1,651,677 
                                                                     ========== 

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                                 

BASIS OF PRESENTATION                                                 

    The accompanying consolidated financial  statements  have been prepared in
    accordance with generally accepted accounting principles.  All significant
    intercompany   balances   and   transactions   have  been  eliminated   in
consolidation.  Corporate overhead costs related to the Company are   
    included as expenses in the accompanying financial statements.  Management
    considers  the  inclusion  of  such  expenses reasonable.   The  corporate
    overhead expenses may not necessarily be indicative of expenses that would
have  been  incurred if the Company had  operated  as  a  separate    
entity.                                                               

INTERIM FINANCIAL STATEMENTS                                          

    The financial  information  as  of  March 31, 1999 and with respect to the
    three months then ended is unaudited.   In  the opinion of management, the
    financial  statements  contain  all  adjustments,   consisting  of  normal
    recurring accruals, necessary for the fair presentation of the results for
    such period.  The information is not necessarily indicative of the results
of operations to be expected for the fiscal year end.                 

ADVERTISING CONTRACTS AND REVENUE RECOGNITION                         

    Outdoor advertising revenue is derived from contracts with advertisers for
    the rental of outdoor advertising space and is recognized  on  an  accrual
    basis  ratably  over  the  terms  of  the contracts, which generally cover
    periods of one month up to five years.   Costs associated with the outdoor
    advertising operations, including contract  costs  and  land  rental,  are
expensed over the related contract term.                              

PREPAID LAND LEASES                                                   

The  majority  of  the Company's outdoor advertising structures are   
    located on leased land.   Land  rent  is  typically  paid  in  advance for
    periods  ranging  from  one  to  twelve  months.  Prepaid land leases  are
expensed ratably over the related rental term.                        

PROPERTY AND EQUIPMENT                                                

    Property and equipment are stated at cost.   Depreciation  of property and
    equipment  is  computed using the straight-line method over the  estimated
useful lives of the assets.  Estimated useful lives are as follows:   

Advertising structures                             15 years           
Building and improvements                          35 years           
Equipment and vehicles                           5-10 years           

Repaid and maintenance costs are charged to expense as incurred.      

GOODWILL AND OTHER INTANGIBLE ASSETS                                  

    Intangible assets  consist  of goodwill, non-compete agreements, municipal
    contracts  and franchise agreements.   Intangible  assets  resulting  from
    acquisitions  are  valued based  upon  estimated fair values.  The Company
amortizes such intangible assets  using  the  straight-line method    
    over estimated useful lives of 40 years for goodwill, five  years for non-
    compete  agreements  and  ten years for municipal contracts and  franchise
agreements.  The Company  evaluates  the  propriety of the carrying   
    amount of intangible assets and related amortization  periods to determine
    whether  current  events  or  circumstances  warrant  adjustments  to  the
    carrying  value and/or revised estimates of amortization  periods.   These
    evaluations  consist of the projection of undiscounted cash flows over the
remaining amortization periods of the related intangible assets.      

    The projections  are  based  on  historical trend lines of actual results,
    adjusted  for  expected  changes  in operating  results.   At  this  time,
the Company  believes that no  impairment  of  goodwill  or  other    
    intangible assets has  occurred  and that no revisions to the amortization
periods are warranted.                                                

CASH EQUIVALENTS                                                      

The Company considers temporary  cash  investments  purchased  with   
original maturities of three months or less to be cash equivalents.   

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
    the  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.   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 uncollectible
    trade receivables are maintained.   At  December  31,  1998, no receivable
    from any customer exceeded 5% of equity and no customer accounted for more
    than 10% of net revenues during the period July 22, 1998  through December
31, 1998.                                                             

3.   LEASE COMMITMENTS                                                          

The Company has  long-term  operating  leases  for office  space,     
    equipment and the majority of the land occupied by its outdoor advertising
    structures.  The leases expire at various dates, generally during the next
    ten years, and have varying options to renew and cancel.   Rental  expense
    for  operating  leases  (excluding those with lease terms of one month  or
    less that were not renewed)  was  approximately $8,234 for the period July
    22,  1998  to  December 31, 1998.  Future  minimum  lease  payments  under
    noncancelable operating  leases  (with initial or remaining lease terms in
excess of one year) as of December 31, 1998 are as follows:           

                                                                [Download Table]


YEARS                 
-----                 
                      

1999        $   33,624
2000            35,187
2001            35,836
2002            36,457
2003            36,970
Thereafter   1,259,991
            ----------
            $1,438,065
            ==========

4.   INCOME TAXES                                                               

The Company is a member of  a  group  that files a consolidated       
income  tax  return.   For  purposes  of separate financial  statement
presentation, the Company's current  and  deferred income taxes       
have  been  determined  as  if  the Company  were  a  separate        
taxpayer.                                                             

Income tax expense for the period from July 22, 1998 to  December  31,
1998 consists of the following:                                       

                                                                [Download Table]


                                                         
Current tax expense:                                     
                Federal                        $       - 
                State                              1,500 
                                               --------- 
                   Total current tax expense       1,500 

Deferred tax benefit:                                    
                Federal                           (1,103)
                State                                (52)
                   Total deferred tax benefit     (1,155)
                                               --------- 

Income tax expense                             $     345 
                                               ========= 

Total  income tax expense differed from the amount computed by applying the     
U.S. federal  statutory  income tax rate of 35% to the loss from operations     
for the period from July 22,  1998  to December 31, 1998 as a result of the     
following:                                                                      

                                                                [Download Table]

                                                     $                    %     
                                                -----------          -----------
                                                                                

Computed "expected" tax benefit                 $  (1,337)             (35.0)%  
Amortization of goodwill                              357                 9.3%  
Nondeductible meals and entertainment                 350                 9.2%  
State income taxes, net of federal benefit            975                25.5%  
                                                ---------            ---------  
Income tax expense                              $     345                 9.0%  
                                                =========            =========  

The tax effects of temporary differences  that  give  rise  to  significant     
portions  of  the deferred tax assets and liabilities at December 31,  1998     
are presented below:                                                            

                                                                [Download Table]


                                                                              
Deferred tax assets:                                                          

                  Net operating loss carryforwards                   $   8,290
                  Differences in book and tax bases                      2,122
                                                                     ---------
                    Total deferred tax assets                           10,412
                                                                     ---------

Deferred tax liabilities:                                                     

                  Property and equipment and intangibles, primarily           
                   related to acquisitions                             107,299
                                                                     ---------
                   Net deferred tax liability                        $  96,887
                                                                     =========

Deferred tax assets  and  liabilities  are  computed  by  applying the U.S.     
federal  and  state  income  tax  rate  in  effect to the gross amounts  of     
temporary differences and other tax attributes,  such as net operating loss     
carryforwards.                                                                  

In assessing the realizability of deferred tax assets, management considers     
whether it is more likely than not that some portion or all of the deferred     
tax assets will not be realized.  The ultimate realization  of deferred tax     
assets is dependent upon the generation of future taxable income during the     
periods in which those temporary differences become deductible.  Management     
considers  the  scheduled  reversal of deferred tax liabilities,  projected     
future  taxable  income,  and  tax   planning  strategies  in  making  this     
assessment.                                                                     

At  December  31,  1998, the Company  has  tax  net  operating  loss            
carryforwards available  to  offset  future taxable income of approximately     
$19,700, expiring in the year 2013.                                             

5.   CONTINGENCIES                                                              

The Company is involved in  various  claims and lawsuits, which       
are  generally  incidental  to  its business.  The Company is         
vigorously  contesting all of these  matters  and  believes  that  the
ultimate resolution  of  these  matters  will  not  have  a materially
adverse effect on its consolidated financial position, cash  flows  or
results of operations.                                                

The Company,  together with its consolidated subsidiaries, has        
guaranteed  certain  debt   obligations   issued   by   CMCLA  of     
approximately  $4,096,000.   In addition to the Company,  other       
subsidiaries of CMCLA guarantee the debt.                             

6.   STOCK OPTIONS                                                              

CMC has established Key Employee  Stock  Option  Plans  ("the Employee
Option  Plans")  which  provide  for the issuance of stock options  to
officers and other key employees of  CMC  and  its  subsidiaries.  The
Employee  Option  Plans  make  available  for  issuance  an  aggregate
15,105,000 shares of common stock of CMC.                             

The  total options available for grant were 2,171,939 at December  31,
1998.   During 1998, CMC granted options to purchase 360,000 shares of
CMC common  stock to an officer of the Company with an exercise       
price of $48.375.   Options  to  purchase 300,000 shares of CMC common
stock vest ratably 25% per year for  a  period of three years with the
first 25% vested on the grant date.  Options to purchase 60,000 shares
of CMC common stock vest ratably 25% per  year  on  each  of the first
four annual anniversaries of the date of grant.  At December 31, 1998,
75,000 shares were exercisable.                                       

The Company applies Accounting Principles Board Opinion  No. 25       
in  accounting  for  the  Employee  Option  Plans and, accordingly, no
compensation cost for Company employees  is  recognized  in           
the  consolidated  financial  statements  for stock options which have
exercise prices equal to or in excess of the  market  value  of  CMC's
common  stock on the date of grant.  Had the Company determined       
compensation  cost  based  on  fair  value at grant date for its stock
options  under Statement of Financial Accounting  Standards  No.  123,
the Company's  pro forma net loss for the period from July 22,        
1998 through December 31, 1998 would have been $5,440.  The fair value
for the stock options was  estimated  at  the  date of grant using the
Black-Scholes option pricing model assuming a dividend yield of 0%, an
expected volatility of 39.91%, a risk free interest  rate of 4.80% and
an expected life of seven years.                                      

7.   BENEFIT PLAN                                                               

CMC  offers  substantially all of its and its subsidiaries'  employees
voluntary participation in a 401(k) Plan.  Through the Company,       
CMC may make discretionary  contributions  to  the  plans; however, no
such contributions were made by the Company during 1998.              

8.   SUBSEQUENT EVENT                                                           

On  June  1, 1999, CMCLA entered into a definitive  agreement  to     
sell the Company  to  Lamar  Advertising Company ("Lamar") for        
approximately $1,600,000 in stock and  cash.   Under  the terms of the
agreement,   Lamar   will   pay   $700,000  in  cash  and  will  issue
approximately  26,227,000  shares  of  its  common  stock,  valued  at
approximately $900,000 based on the  value  of  the  stock  on May 27,
1999.   Following  the  transaction, CMCLA will own approximately     
30% of Lamar's common stock  and  will  have  the right to appoint two
members  to Lamar's board of directors, increasing  the  size  of  the
board to ten members.                                                 

DEFM14C
28th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 28th
REPORT OF INDEPENDENT ACCOUNTANTS                 

June 9, 1999                                                                    
To the Board of Directors of                                                    
Chancellor Media Corporation                                                    

In our opinion,  the  accompanying  statements of income, divisional equity     
and cash flows present fairly, in all  material  respects,  the  results of     
operations  and  cash  flows of The Outdoor Division of Whiteco                 
Industries, Inc. (the "Division")  for the eleven months ended November 30,     
1998, in conformity with generally accepted  accounting  principles.  These     
financial  statements are the responsibility of the Division's  management;     
our responsibility  is  to express an opinion on these financial statements     
based  on  our  audit.  We conducted  our  audit  of  these  statements  in     
accordance with generally accepted auditing standards which 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,  assessing  the accounting principles used and     
significant  estimates  made  by management,  and  evaluating  the  overall     
financial statement presentation.   We  believe  that  our audit provides a     
reasonable basis for the opinion expressed above.                               

/S/  PRICEWATERHOUSECOOPERS LLP                                                 

PricewaterhouseCoopers LLP                                                      

DEFM14C
29th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 29th
THE OUTDOOR DIVISION OF WHITECO INDUSTRIES, INC.                                

STATEMENT OF INCOME                                                             
ELEVEN MONTHS ENDED NOVEMBER 30, 1998                                           
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]


                                                 
Revenues                             $   128,603 
Less:  agency commissions                 (8,973)
                                     ----------- 

            Net revenues                 119,630 

Cost of revenues                          43,665 
Selling and administrative expenses       23,719 
Depreciation and amortization             10,342 
Management fee expense                     2,164 
Other                                        413 
                                     ----------- 

            Income from operations        39,327 

Interest expense                              35 
Interest income                             (134)
Gain on sale of properties                (1,418)
                                     ----------- 

Net income                           $    40,844 
                                     =========== 

See accompanying notes to financial statements.         

DEFM14C
30th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 30th
THE OUTDOOR DIVISION OF WHITECO INDUSTRIES, INC.                                

STATEMENT OF DIVISIONAL EQUITY                                                  
ELEVEN MONTHS ENDED NOVEMBER 30, 1998                                           
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]


                                                   
Divisional equity at December 31, 1997  $   87,262 

     Net income                             40,844 
     Interdivisional transactions, net     (21,968)
                                        ---------- 

Divisional equity at November 30, 1998  $  106,138 
                                        ========== 

See accompanying notes to financial statements.         

DEFM14C
31st “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 31st
THE OUTDOOR DIVISION OF WHITECO INDUSTRIES, INC.                                

STATEMENT OF CASH FLOWS                                                         
ELEVEN MONTHS ENDED NOVEMBER 30, 1998                                           
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]


                                                                           
Cash flows from operating activities:                                      
     Net income                                                  $  40,844 
                                                                 --------- 
     Adjustments to reconcile net income to net cash                       
           provided by operating activities:                               
                Depreciation and amortization                       10,146 
                Provision for doubtful accounts                        299 
                Gain on sale of assets                              (1,418)
                Changes in assets and liabilities:                         
                      Accounts receivable                           (4,812)
                      Other assets                                  (5,617)
                      Accounts payable and accrued expenses          2,088 
                                                                 --------- 

                      Total adjustments                                686 
                                                                 --------- 

                      Net cash provided by operating activities     41,530 
                                                                 --------- 

Cash flows from investing activities:                                      
     Proceeds from sale of assets                                      558 
     Expenditures for property and equipment                       (20,230)
                                                                 --------- 

                      Net cash used in investing activities        (19,672)
                                                                 --------- 

Cash flows from financing activities:                                      
     Interdivisional transactions, net                             (21,968)
                                                                 --------- 

                      Net cash used in financing activities        (21,968)
                                                                 --------- 

Net decrease in cash                                                  (110)
Cash at beginning of period                                            250 
                                                                 --------- 

Cash at end of period                                            $     140 
                                                                 ========= 

See accompanying notes to financial statements.         

DEFM14C
32nd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 32nd
THE OUTDOOR DIVISION OF WHITECO INDUSTRIES, INC.                                

NOTES TO FINANCIAL STATEMENTS                                                   
(DOLLARS IN THOUSANDS)                                                          

1.   THE COMPANY AND SALE                                                       

The  Outdoor  Advertising  Division of Whiteco Industries,  Inc.  (the
"Division") owns and operates outdoor advertising signs throughout the
United States.  The Division  is  wholly-owned  by Whiteco Industries,
Inc. ("Industries").                                                  

During  the period covered by the financial statements,  the  Division
was conducted  as  an  integral part of Industries' overall operations
and separate financial statements  were not prepared.  These financial
statements have been prepared from Industries'  historical  accounting
records.  Corporate overhead expenses are actual expenses incurred  by
the  Division;  however,  the  expenses  incurred  by the Division for
corporate overhead may not necessarily be indicative  of expenses that
would have been incurred had the Division been operated  as a separate
entity.                                                               

On  December  1,  1998,  Industries entered into an agreement  whereby
substantially all of the assets  of  the  Division  were purchased and
certain   of   the  liabilities  were  assumed  by  Chancellor   Media
Corporation of Los  Angeles.  The accompanying financial statements do
not reflect any adjustments relating to this transaction.             

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                                 

CONTRACTS AND REVENUE RECOGNITION                                     

Outdoor advertising signs are contracted to customers under individual
advertising contracts that primarily run from one month to five years.
Revenue is recognized  ratably  over  the life of the contract.  Costs
associated with the outdoor advertising operations, including contract
costs and land rental, are expensed over the related contract term.   

PREPAID SIGN COSTS                                                    

The  majority  of the Division's outdoor  advertising  structures  are
located on leased  land.   Land  rent is typically paid in advance for
periods ranging from one to twelve  months.   Prepaid  land leases are
expensed ratably over the related rental term.                        

PROPERTY AND EQUIPMENT                                                

Property and equipment are carried at cost, including interest charges
capitalized  during  construction.   Depreciation on these  assets  is
computed over various lives under the  straight-line  method  over the
various  useful  lives.   Depreciation  expense  for the eleven months
ended November 30, 1998 was $10,146.                                  

The  estimated  useful  lives  of  the various classes  of  buildings,
improvements and equipment are as follows:                            

Building and improvements                              15-40 years    
Advertising structures                                  5-12 years    
Equipment                                                3-8 years    

INCOME TAXES                                                          

The Division is part of Industries,  which  is an "S" corporation and,
as such, federal and most state income taxes are the responsibility of
the   stockholder  and  therefore  not  reflected  on  the  Division's
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.                                                 

3.   LEASE COMMITMENTS                                                          

The  Division  leases  office  facilities  and  property under various
operating leases.  The Division's primary office  premises  are leased
from a partnership in which Industries is the general partner.  Annual
minimum rental payments under leases that have an initial or remaining
term  in  excess  of  one  year  or  leases  expected to be renewed at
November 30, 1998 are as follows:                                     

                                                                [Download Table]


YEARS ENDING DECEMBER 31,   RELATED                       
-------------------------    PARTY      OTHER      TOTAL  
                           ---------  --------   -------- 
                                                          
    1999                   $    224   $  20,856  $  21,080
    2000                        224      20,983     21,207
    2001                        224      21,094     21,318
    2002                        224      21,217     21,441
    2003                         56      21,397     21,453
    Thereafter                    -     566,701    566,701
                           --------   ---------  ---------
                           $    952   $ 672,248  $ 673,200
                           ========   =========  =========

Total lease expense was approximately $20,080  for  the  eleven months
ended  November 30, 1998.  Lease expense to related parties  was  $216
for the eleven months ended November 30, 1998.                        

4.   MANAGEMENT AGREEMENT                                                       

In October  1984,  the  Division  entered into an agreement with Metro
Management  Associates (the "Partnership"),  a  partnership  in  which
several partners  are  employees of Industries, for the management and
operation of approximately  540  outdoor  advertising signs located in
Indiana,  Texas,  Rhode  Island,  Missouri, Ohio,  Florida,  Illinois,
Kentucky,  Pennsylvania  and  Virginia.   All  revenue  and  operating
expenses related to the management  and operation of the Partnership's
outdoor advertising signs are included  in  the  Division's results of
operations.   The  Division is required to pay a profit  participation
fee to the Partnership  which approximates the operating profit of the
management assets and is based upon a fixed monthly fee and a variable
fee based upon revenue.   For  the  eleven  months  ended November 30,
1998, the Division paid $2,164 to Metro Management in  connection with
the  agreement.  On August 31, 1998, the Partnership entered  into  an
agreement  to  sell  substantially  all  of  the  assets  and  certain
specified   liabilities   of   the  Partnership  to  Chancellor  Media
Corporation  of Los Angeles.  The  management  agreement  between  the
Division and the  Partnership  was terminated upon the consummation of
the acquisition by Chancellor Media  Corporation  of  Los  Angeles  on
December 1, 1998.                                                     

DEFM14C
33rd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 33rd
INDEPENDENT AUDITORS' REPORT        

The Board of Directors                                                          
Whiteco Industries, Inc.                                                        
Merrillville, Indiana                                                           

We have audited the accompanying balance sheets of the Outdoor  
Advertising Division of Whiteco Industries, Inc. as of December 31, 1996 and    
1997, and the related statements of income and cash flows for each of the       
three years in the period ended December 31, 1997. These financial statements   
are the responsibility of the Division'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, the financial statements referred to above present
fairly, in all material respects, the financial position of the Outdoor         
Advertising Division of Whiteco Industries, Inc. as of December 31, 1996 and    
1997, and the results of its operations and cash flows for each of the three    
years in the period ended December 31, 1997, in conformity with generally       
accepted accounting principles.                                                 

                                    /S/ BDO SEIDMAN, LLP

                                        BDO Seidman, LLP

Chicago, Illinois                                                               
September 17, 1998                                                              

DEFM14C
34th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 34th
OUTDOOR ADVERTISING DIVISION OF 
WHITECO INDUSTRIES, INC.  

BALANCE SHEETS  

ASSETS  

                                                                [Download Table]


                                                            DECEMBER 31,        
                                                     ---------------------------
                                                         1996           1997    
                                                     ------------   ------------
                                                                                
Current assets                                                                  
  Cash.............................................  $    155,781   $    249,733
  Accounts receivable (net of $631,000 and                                      
     $1,111,000 allowance for uncollectible                                     
     accounts for December 31, 1996 and 1997,                                   
     respectively).................................     9,112,798     10,718,470
  Prepaid expenses and other                                                    
     receivables...................................     2,520,913      2,684,801
  Prepaid sign costs...............................     4,880,789      5,064,178
                                                     ------------   ------------
          Total current assets.....................    16,670,281     18,717,182
                                                     ------------   ------------
Property and equipment                                                          
  Land, buildings and improvements.................     5,389,827      6,279,957
  Advertising signs................................   134,120,274    150,697,192
  Equipment........................................     4,226,984      4,925,336
                                                     ------------   ------------
          Total cost...............................   143,737,085    161,902,485
  Accumulated depreciation.........................    84,300,457     91,601,392
                                                     ------------   ------------
Net property and equipment.........................    59,436,628     70,301,093
                                                     ------------   ------------
Other sign costs...................................       707,273      1,424,848
                                                     ------------   ------------
                                                     $ 76,814,182   $ 90,443,123
                                                     ============   ============


LIABILITIES AND DIVISIONAL EQUITY   

                                                                [Download Table]

                                                                                
Current liabilities                                                             
  Accounts payable.................................  $    505,561   $    900,145
  Customers' advance payments and deposits.........       127,925         70,174
  Accrued expenses.................................     1,577,194      2,210,355
                                                     ------------   ------------
          Total current liabilities................     2,210,680      3,180,674
                                                     ------------   ------------
Commitments                                                                     
Divisional equity..................................    74,603,502     87,262,449
                                                     ------------   ------------
                                                     $ 76,814,182   $ 90,443,123
                                                     ============   ============

See accompanying notes to financial statements. 

DEFM14C
35th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 35th
OUTDOOR ADVERTISING DIVISION OF 
WHITECO INDUSTRIES, INC.  

STATEMENTS OF INCOME    

                                                                [Download Table]


                                          YEAR ENDED DECEMBER 31,           
                                 ------------------------------------------ 
                                     1995           1996           1997     
                                 ------------   ------------   ------------ 
                                                                            
Revenues.......................  $108,447,476   $117,268,324   $126,800,754 
Less: Agency discounts.........     6,616,011      8,400,821      8,702,563 
                                 ------------   ------------   ------------ 
  Net revenues.................   101,831,465    108,867,503    118,098,191 
Cost of revenues...............    40,659,116     42,021,229     45,615,461 
Selling and administrative                                                  
  expenses.....................    14,878,784     16,288,955     18,369,034 
Corporate overhead expenses....     5,176,832      5,644,490      6,073,671 
Depreciation and                                                            
  amortization.................     8,675,204     10,501,844     11,525,410 
Profit participation fee.......     2,101,620      2,248,329      2,321,884 
                                 ------------   ------------   ------------ 
Income from operations before                                               
  other income and interest                                                 
  expense......................    30,339,909     32,162,656     34,192,731 
(Other income), less other                                                  
  expenses.....................    (1,060,355)    (1,131,033)    (1,833,411)
Interest expense...............        38,556         17,927          3,794 
                                 ------------   ------------   ------------ 
Net income.....................  $ 31,361,708   $ 33,275,762   $ 36,022,348 
                                 ============   ============   ============ 


See accompanying notes to financial statements. 

DEFM14C
36th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 36th
OUTDOOR ADVERTISING DIVISION OF 
  WHITECO INDUSTRIES, INC.

STATEMENTS OF CASH FLOWS

                                                        [Enlarge/Download Table]


                                                               YEAR ENDED                 
                                                              DECEMBER 31,                
                                               ------------------------------------------ 
                                                   1995           1996           1997     
                                               ------------   ------------   ------------ 
                                                                                          
Cash flows from operating activities                                                      
Net income...................................  $ 31,361,708   $ 33,275,762   $ 36,022,348 
  Adjustments to reconcile net income to net                                              
    cash provided by operating activities                                                 
    Provision for depreciation and                                                        
      amortization...........................     8,675,204     10,501,844     11,525,410 
    Gain on disposals of assets..............      (795,498)      (812,482)    (1,488,665)
    Increase in accounts receivable..........      (694,344)    (1,853,160)    (1,605,672)
    Decrease (increase) in prepaid expenses                                               
      and other receivables..................      (220,881)    (1,202,910)      (163,888)
    Increase in prepaid sign costs and other                                              
      sign costs.............................    (1,044,722)      (815,916)    (1,840,672)
    (Decrease) increase in accounts payable                                               
      and accrued expenses...................       (66,319)       869,627      1,027,745 
    Increase (decrease) in customers' advance                                             
      payments and deposits..................       185,750        (57,825)       (57,751)
                                               ------------   ------------   ------------ 
        Total adjustments....................     6,039,190      6,629,178      7,396,507 
                                               ------------   ------------   ------------ 
Net cash provided by operating activities....    37,400,898     39,904,940     43,418,855 
                                               ------------   ------------   ------------ 
Cash flows from investing activities                                                      
  Proceeds from sales of assets..............     1,352,297      1,115,793      2,474,779 
  Expenditures for advertising signs.........   (26,033,225)   (14,713,166)   (19,541,162)
  Expenditures for property and equipment....    (1,986,847)    (2,180,644)    (2,895,119)
                                               ------------   ------------   ------------ 
Net cash used in investing activities........   (26,667,775)   (15,778,017)   (19,961,502)
                                               ------------   ------------   ------------ 
Cash flows from financing activities                                                      
  Interdivisional transactions...............   (11,489,912)   (24,124,287)   (23,363,401)
                                               ------------   ------------   ------------ 
Net cash used in financing activities........   (11,489,912)   (24,124,287)   (23,363,401)
                                               ------------   ------------   ------------ 
Net (decrease) increase in cash..............      (756,789)         2,636         93,952 
Cash, at beginning of year...................       909,934        153,145        155,781 
                                               ------------   ------------   ------------ 
Cash, at end of year.........................  $    153,145   $    155,781   $    249,733 
                                               ============   ============   ============ 


See accompanying notes to financial statements. 

DEFM14C
37th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 37th
OUTDOOR ADVERTISING DIVISION OF                                                 
WHITECO INDUSTRIES, INC.                                                        

NOTES TO FINANCIAL STATEMENTS                                                   

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                                   

Basis of Presentation                                                       

     Whiteco Industries, Inc. ("Whiteco") has entered into an agreement to
sell substantially all of the assets and certain liabilities of its Outdoor     
Advertising Division (the "Division"). The Division owns and operates outdoor   
advertising signs throughout the United States.                                 

    During the periods covered by the financial statements, the Division
was conducted as an integral part of Whiteco's overall operations and separate  
financial statements were not prepared. These financial statements have been    
prepared from Whiteco's historical accounting records. Corporate overhead       
expenses are actual expenses incurred by the Division. The Division operated    
independently from Whiteco Industries, Inc. However, the expenses incurred by   
the Division for corporate overhead may not necessarily be indicative of        
expenses that would have been incurred had the Division been operated as a      
separate entity.                                                                

Contracts and Revenue Recognition                                           

      Outdoor advertising signs are contracted to customers under individual
advertising contracts that primarily run from one month to five years. Revenue  
is recognized ratably over the life of the contract. Costs associated with the  
outdoor advertising operations, including contract costs and land rental, are   
expensed over the related contract term.                                        

Prepaid Sign Costs and Other Sign Costs                                     

 Prepaid sign costs and other sign costs are primarily land rental
payments relating to future periods.  Amortization on these assets was          
$1,020,942, $1,075,827 and $939,708 for the years ended December 31, 1995, 1996 
and 1997.                                                                       

Property and Equipment                                                      

Land, Buildings and Improvements and Equipment                              

   Land, buildings and improvements and equipment are carried at cost,
including interest charges capitalized during construction. Depreciation on     
these assets is computed over various lives under the straight-line method and  
amounted to $767,872, $911,890 and $1,092,869 for the years ended December 31,  
1995, 1996 and 1997.                                                            

Advertising Signs                                                           

       Advertising sign structures are depreciated by the straight-line method
over lives principally from eight to twelve years. Depreciation of advertising  
signs was $6,886,390, $8,514,127 and $9,492,833 for the years ended December 31,
1995, 1996 and 1997.                                                            

Income Taxes                                                                

    The Division is part of Whiteco, which is an "S" corporation and, as
such, federal and most state income taxes are the responsibility of the         
stockholder and therefore not reflected on the Division's financial statements. 

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 amounts reported in the financial statements and    
accompanying notes. Actual results could differ from those estimates.           

2. LEASES                                                                       

The Division leases office facilities and property under various
operating leases. The Division's primary office premises are leased from a      
partnership in which Whiteco Industries, Inc. is the general partner. Annual    
minimum rental payments under leases that have an initial or remaining term in  
excess of one year at December 31, 1997 are as follows:                         

                                                                [Download Table]


                                              RELATED                        
                        YEAR                   PARTY      OTHER       TOTAL  
                        ----                 --------   --------   ----------
                                                                             
1998.......................................  $224,000   $270,000   $  494,000
1999.......................................   224,000    131,000      355,000
2000.......................................   224,000    130,000      354,000
2001.......................................   224,000    131,000      355,000
2002.......................................   224,000    131,000      355,000
Thereafter.................................    56,000    962,000    1,018,000

     Total lease expense was approximately $675,000, $646,000 and $665,000
for the years ended December 31, 1995, 1996 and 1997, respectively. Related     
party lease expense was $254,000, $230,000 and $117,000 for the years ended     
December 31, 1995, 1996 and 1997, respectively.                                 

3. RETIREMENT SAVINGS PLAN                                                      

   The Division is a part of Whiteco Industries, Inc. ("Whiteco"), who
maintains a qualified plan under Section 401(k) of the Internal Revenue Code.   
This plan is available for all employees who have completed one year or more of 
continuous service. The plan permits employees to contribute up to 15% of their 
annual compensation. The plan allows for discretionary Whiteco contributions.   
Currently, Whiteco matches 20% of the employees' contributions, to a maximum of 
6% of earnings, and also makes a 1% quarterly matching contribution.            
Contributions were $154,160, $171,270 and $177,100 for the years ended December 
31, 1995, 1996 and 1997, respectively.                                          

4. MANAGEMENT AGREEMENT                                                         

  In October 1984, the Division entered into an agreement with Metro
Management Associates (the "Partnership"), a partnership in which several       
partners are employees of Whiteco, for the management and operation of          
approximately 540 outdoor advertising signs located in Indiana, Texas, Rhode    
Island, Missouri, Ohio, Florida, Illinois, Kentucky, Pennsylvania and Virginia. 
All revenue and operating expenses related to the management and operation of   
the Partnership's outdoor advertising signs are included in the Division's      
results of operations. The Division is required to pay a profit participation   
fee to the Partnership which approximates the operating profit of the managed   
assets and is based upon a fixed monthly fee and a variable fee based upon      
revenue. On August 31, 1998, the Partnership entered into an agreement to sell  
substantially all of the assets and certain specified liabilities of the        
Partnership to Chancellor Media Corporation. The management agreement between   
the Division and the Partnership will be terminated upon consummation of the    
acquisition by Chancellor Media Corporation.                                    

5. SUBSEQUENT EVENT                                                             

      On August 31, 1998, Whiteco Industries, Inc. entered into an agreement
to sell substantially all of the assets and certain specified liabilities of the
Division to Chancellor Media Corporation.                                       

DEFM14C
38th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 38th
REPORT OF INDEPENDENT ACCOUNTANTS                 

June 9, 1999                                                                    
To the Board of Directors of                                                    
Chancellor Media Corporation                                                    

In  our  opinion,  the  accompanying  statements  of  operations, partners'     
capital  and  cash  flows  present  fairly, in all material  respects,  the     
operations and cash flows of  Martin  Media, L.P.  (the "Company")  for the     
seven  months  ended  July  31, 1998, in conformity with generally accepted     
accounting principles.  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 audit.  We conducted  our  audit     
of   these  statements  in  accordance  with  generally  accepted  auditing     
standards  that  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,  assessing  the  accounting  principles  used  and  significant     
estimates  made  by  management,   and  evaluating  the  overall  financial     
statement presentation.  We believe  that  our  audit provides a reasonable     
basis for the opinion expressed above.                                          

/S/ PRICEWATERHOUSECOOPERS LLP                                                  

PricewaterhouseCoopers LLP                                                      

DEFM14C
39th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 39th
MARTIN MEDIA L.P.                                                               

STATEMENT OF OPERATIONS                                                         
SEVEN MONTHS ENDED JULY 31, 1998                                                
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]


                                                         
Revenue                                        $  33,791 
Cost of revenue                                    4,136 
                                               --------- 

            Gross profit                          29,655 

Managers' controlled operating expenses           14,364 
                                               --------- 

            Income from managers' operations      15,291 

Other operating expenses:                                
           Depreciation and amortization          11,223 
           Refinance and acquisition expenses      3,276 
           Other                                   3,174 
                                               --------- 

Operating loss                                    (2,382)

Other income (expenses):                                 
           Interest income                            20 
           Other income                              473 
           Interest expense                       (8,527)
                                               --------- 

            Net loss                           $ (10,416)
                                               ========= 

See accompanying notes to financial statements.         

DEFM14C
40th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 40th
MARTIN MEDIA L.P.                                                               

STATEMENT OF PARTNERS' CAPITAL                                                  
SEVEN MONTHS ENDED JULY 31, 1998                                                
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]


                                                             
Balance at December 31, 1997                       $  18,143 

Distributions and redemption of partnership units    (23,613)

Net loss                                             (10,416)
                                                   --------- 

Balance at July 31, 1998                           $ (15,886)
                                                   ========= 

See accompanying notes to financial statements.         

DEFM14C
41st “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 41st
MARTIN MEDIA L.P.                                                               

STATEMENT OF CASH FLOWS                                                         
SEVEN MONTHS ENDED JULY 31, 1998                                                
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]


                                                                                 
Cash flows from operating activities:                                 $  (10,416)
     Net loss                                                                    
     Adjustments to reconcile net loss to net cash used                          
     by operating activities:                                                    
           Depreciation and amortization                                  11,223 
           Provision for doubtful accounts                                   407 
           Changes in operating assets and liabilities (exclusive of             
           acquisitions):                                                        
                Accounts receivable                                       (1,276)
                Other current assets                                        (953)
                Other assets                                                  20 
                Accounts payable and accrued expenses                     (6,026)
                                                                      ---------- 

               Net cash used by operating activities                      (7,021)

Cash flows from investing activities:                                            
           Acquisitions, net of cash acquired                            (22,667)
           Capital expenditures                                          (14,795)
                                                                      ---------- 

               Net cash used in investing activities                     (37,462)

Cash flows from financing activities:                                            
           Deposit received from Chancellor Media Corporation            185,860 
           Payments on long-term debt                                   (112,456)
           Redemption of partnership units                               (23,612)
                                                                      ---------- 

               Net cash provided by financing activities                  49,792 

Net increase in cash and cash equivalents                                  5,309 
Cash and cash equivalents at beginning of period                              23 
                                                                      ---------- 
Cash and cash equivalents at end of period                            $    5,332 
                                                                      ========== 

Supplemental disclosures of cash flow information:                               
           Interest paid                                              $    5,313 
                                                                      ========== 

See accompanying notes to financial statements.         

DEFM14C
42nd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 42nd
MARTIN MEDIA L.P.                                                               

NOTES TO FINANCIAL STATEMENTS                                                   
(DOLLARS IN THOUSANDS)                                                          

1.   NATURE OF BUSINESS                                                         

Martin  Media L.P. ("Martin"  or the "Company"), a California  limited
partnership,  was formed in December 1984 and operated under the  name
of  Colorado  River   Markets   until  August  1991.  The  Company has
operating   divisions  located  in  Pennsylvania,  Ohio , Connecticut,
Washington, D.C., Arizona  and  Nevada.   The Company owns and leases 
billboards  on   a  contractual  basis  nationwide  for the purpose of
providing outdoor advertising  services.   The Company extends  credit
in  the  form  of  accounts  receivable  on   a  short-term  basis  to
businesses and advertisers doing business in the above noted areas.   

On  July  31,  1998,  Martin  and  related companies were  acquired by
Chancellor  Media  Corporation for a total purchase price of $615,117,
which  consisted of  $612,848 in  cash  and  included  various  direct
acquisition  costs and the assumption of notes payable of $2,270.  The
accompanying financial  statements  do  not  reflect  any  adjustments
related to this transaction.                                          

2.   SIGNIFICANT ACCOUNTING POLICIES                                            

USE OF ESTIMATES                                                      

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

CASH AND CASH EQUIVALENTS                                             

The Company considers cash and cash equivalents  to  be  all  highly  
liquid investments purchased with a maturity of three months or less. 

INVENTORIES                                                           

Inventories  are stated at the lower of cost or market using the first
in, first out (FIFO) cost method.                                     

PROPERTY AND EQUIPMENT                                                

Property  and equipment  are  stated  at  cost  and  depreciated  over
estimated useful  lives  primarily  using  the  straight-line  method.
Repairs  and  maintenance  are  expensed  as  incurred.   Depreciation
expense  for  the  seven  months  ended  July  31,  1998  was  $2,059.
Expenditures   which   significantly   increase   asset   values   are
capitalized.  Estimated useful lives are as follows:                  

                                                                [Download Table]

                                                                YEARS    
                                                             ------------
                                                                         

Building and improvements                                          15-31 
Posters                                                             7-25 
Bulletins                                                           7-25 
Shop equipment                                                      3-10 
Office furniture and equipment                                      5-10 
Auto and trucks                                                     5-7  

CONTRACTS AND REVENUE RECOGNITION                                               

Outdoor  advertising  signs  are  contracted  to customers under individual     
advertising  contracts that primarily run from one  month  to  five  years.     
Revenue is recognized  ratably  over  the  life  of  the  contract.   Costs     
associated  with  the  outdoor  advertising  operations, including contract     
costs and land rental, are expensed over the related contract term.             

INCOME TAXES                                                                    

Under  provision  of  the Internal Revenue Code and  the  respective  state     
taxation codes, partnerships are not subject to income taxes; any income or     
loss realized is taxed  to  the  individual  partners.   Certain  states do     
impose a minimum tax or franchise fee.                                          

INTANGIBLE ASSETS                                                               

Covenants  not to compete are recorded at cost and are amortized using  the     
straight-line  method  over  the contractual period specified.  Advertising     
rights, permits and licenses,  acquisition  fees, lease rights and goodwill     
are recorded at cost and are amortized using  the straight-line method over     
five years.  Loan fees are amortized over the life  of  the  loan  to which     
they are associated.                                                            

PROFIT-SHARING PLAN                                                             

The Company  has  adopted   profit-sharing  plans which are qualified under     
Section 401(k) of the Internal  Revenue Code.  All full-time employees with     
twelve months of service who are  18  years  old  or  older are eligible to     
participate.  Each employee may voluntarily contribute  up to the lesser of     
15%  of  their  pay or $9.  The Company  has made no contributions  to  the     
plan.                                                                           

3.   SIGNIFICANT ACQUISITIONS                                                   

On  January  2,   1998,   Martin acquired  Las  Vegas  Outdoor        
Advertising, Inc., an outdoor  advertising  company with 90 billboards
and  outdoor  displays  in  the  Las Vegas market,  for  approximately
$16,800 in cash plus various other direct acquisition costs.          

On July 9, 1998, Martin  acquired  POA,  an  outdoor  advertising     
company  with  over  1,240  billboards  and  outdoor  displays  in the
Pittsburgh market, for approximately $5,867 in cash plus various other
direct acquisition costs.                                             

These  acquisitions  were  accounted  for under the purchase method of
accounting and, accordingly, the accompanying  statement of operations
includes the results of the acquired companies'  operations  from  the
respective dates of acquisition.                                      

4.   COMMITMENTS                                                                

The Company leases land, buildings, and equipment in connection with  
its outdoor  advertising business under operating leases.  The leasing
of land relates  to  the  posters  and  bulletins.   The Company also 
leases property, equipment and buildings to house and support division
administrative and field offices.                                     

Future annual minimum lease payments are as follows:                            

                                                                [Download Table]


YEARS ENDING            
DECEMBER 31,     TOTAL  
-------------  ---------
                        

1999           $   6,397
2000               7,130
2001               7,404
2002               7,658
2003               7,914
Thereafter       353,578
               ---------
               $ 390,081
               =========

Lease   expense  for  the  seven  months  ended  July  31,  1998   was
approximately $5,328.                                                 

ACQUISITION, PURCHASE AND PURCHASE OPTION                             

On July 31, 1997, the Company  entered into an agreement with Martin &
MacFarlane,  Inc.  (related  party), relative to an agreement Martin &
MacFarlane, Inc. had with another  company to purchase certain assets,
to acquire certain assets including  sign  structures,  equipment, and
related  intangibles  located  in  the  Las  Vegas and Colorado  River
markets  for  a  total  purchase  price  of  $14,350.   This  purchase
agreement  has  two  segments,  the first of which  provided  for  the
purchase  of  assets during the year  ending  December  31,  1997  for
$11,273.  The second  segment  of  the agreement provides an option to
the Company  to purchase additional assets for $3,077.  Upon execution
of the option agreement, the Company   deposited  $464  in  good faith
with Martin & MacFarlane, Inc.                                        

PREFERRED PARTNERSHIP UNITS                                           

On December 23, 1997, the Company  entered into an agreement  to  sell
preferred limited partnership units (PPUs), warrants and warrant units
to  a  select group of purchasers.  The Company  issued 25,000 PPUs at
$1 each, calling for the holders of the PPUs to receive an initial 14%
preferred  rate  of  return,  which  escalates  on  certain dates to a
maximum  of 20%.  The Company  can redeem PPUs for 102%  of  the  PPUs
capital account  amount  until  September  23,  1998 and thereafter to
redeem  all  outstanding  PPUs  on  December  23, 2006.   Warrants  to
purchase additional PPUs, based upon terms of the  agreement, shall be
issuable   upon   the  270th  day  following  the  purchase  date  and
quarterly thereafter, if any PPUs shall then be outstanding.          

5.   RELATED PARTY TRANSACTIONS                                                 

Substantially all administrative functions are performed  by  MW  Sign
Co.,  the  general  partner.   The  partnership  pays  management fees
approximating 4% of gross revenue, refinancing fees of 4%  of all debt
refinanced  and  acquisition  fees  of  4%  of  the purchase price  of
acquired  companies.   Total fees paid to MW Sign Co.  for  the  seven
month period ended July  31,  1998  were  approximately $1,340 and are
included in other operating expenses.                                 

DEFM14C
43rd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 43rd
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS        

To the Partners of                                                              
Martin Media:                                                                   

We have audited the accompanying balance sheets of Martin Media,
(a California limited partnership) as of December 31, 1997 and                  
1996 and the related statements of operations, partners' capital (deficit),     
and cash flows for each of the three years in the period ended December 31,     
1997.  These financial statements are the responsibility of the Partnership'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, the financial statements referred to above present
fairly, in all material respects, the financial position of Martin Media, as of 
December 31, 1997 and 1996, and the results of its operations and its cash      
flows for each of the three years in the period ended December 31, 1997, in     
conformity with generally accepted accounting principles.                       

                                       /S/ ARTHUR ANDERSEN LLP

                                           ARTHUR ANDERSEN LLP

Bakersfield, California                                                         
February 13, 1998                                                               

DEFM14C
44th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 44th
MARTIN MEDIA  

BALANCE  SHEETS 
DECEMBER 31, 1997 AND 1996

ASSETS  

                                                        [Enlarge/Download Table]

                                                                   1997          1996    
                                                               ------------   -----------
                                                                                         
Current Assets                                                                           
  Cash and equivalents.........................................$     23,254  $ 2,661,610 
  Trade accounts receivable, net of allowance for doubtful                               
     accounts of $142,515 and $100,000 as of December 31,                                
     1997 and 1996, respectively...............................   5,658,379    4,726,301 
  Current maturities of long-term notes receivable, limited                              
     partners..................................................     136,030      132,956 
  Other receivables............................................     113,514      100,892 
  Inventories, raw materials...................................     520,725      209,323 
  Prepaid expenses.............................................   1,566,582    1,085,324 
                                                                 ----------   ---------- 
          Total current assets.................................   8,018,484    8,916,406 
                                                                 ----------   ---------- 
Long-Term Notes Receivable, limited partners, less                                       
  current maturities...........................................     281,279      317,309 
Property and Equipment, net of accumulated depreciation........  74,863,597   52,367,653 
Intangible Assets, net of accumulated amortization.............  58,446,919   15,872,530 
Deposit on purchase option.....................................     463,800           -- 
                                                               ------------  ----------- 
                                                               $142,074,079  $77,473,898 
                                                               ============  =========== 

LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)     

                                                        [Enlarge/Download Table]


                                                                                        
Current Liabilities                                                                     
  Current maturities of long-term debt....................... $   3,690,436  $ 5,339,365
  Current maturities of capital lease obligations............       214,380      135,586
  Accounts payable...........................................       627,590      928,712
  Accrued expenses...........................................     8,112,132    1,569,048
  Unearned income............................................       219,022      112,961
                                                               ------------  -----------
          Total current liabilities..........................    12,863,560    8,085,672
                                                               ------------  -----------
Long-Term Liabilities                                                                   
  Long-term debt, less current maturities....................   109,232,810   66,752,424
  Capital lease obligations, less current maturities...             447,865      662,245
                                                               ------------  -----------
          Total long-term liabilities........................   109,680,675   67,414,669
                                                               ------------  -----------
Commitments (Note 10)                                                                   
Mandatorily Redeemable                                                                  
  Preferred partnership units................................    25,000,000           --
                                                               ------------   ----------
Partners' Capital (Deficit)..................................    (5,470,156)   1,973,557
                                                               ------------   ----------
                                                               $142,074,079  $77,473,898
                                                               ============  ===========


The accompanying notes are an integral part of these statements.

DEFM14C
45th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 45th
MARTIN MEDIA  

STATEMENTS OF OPERATIONS    
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995    

                                                        [Enlarge/Download Table]

                                                          1997          1996          1995     
                                                       -----------   -----------   ----------- 
                                                                                               
Income................................................ $48,106,851   $42,359,472   $33,732,821 
Cost of sales.........................................   6,091,333     5,745,308     4,459,240 
                                                       -----------   -----------   ----------- 
          Gross profit................................  42,015,518    36,614,164    29,273,581 
Managers' controlled operating expenses...............  21,201,914    20,929,536    16,861,406 
                                                       -----------   -----------   ----------- 
          Income from managers' operations............  20,813,604    15,684,628    12,412,175 
                                                       -----------   -----------   ----------- 
Other operating expenses:                                                                      
  Depreciation and amortization.......................   9,282,574     5,364,835     3,339,377 
  Management fees.....................................   1,937,326     1,277,431     1,111,350 
  Refinance and acquisition...........................   9,644,819     3,822,894            -- 
                                                       -----------   -----------   ----------- 
                                                        20,864,719    10,465,160     4,450,727 
                                                       -----------   -----------   ----------- 
          Operating income (loss).....................     (51,115)    5,219,468     7,961,448 
                                                       -----------   -----------   ----------- 
Nonoperating income (expenses):                                                                
  Interest income.....................................      66,260        96,103       116,154 
  Interest expense....................................  (8,023,704)   (6,022,001)   (5,030,100)
  Miscellaneous income................................   1,077,184       252,653       283,597 
  Miscellaneous expense...............................          --       (11,437)      (92,682)
  Loss on disposal of assets..........................    (512,338)     (458,464)     (378,358)
                                                       -----------   -----------   ----------- 
                                                        (7,392,598)   (6,143,146)   (5,101,389)
                                                       -----------   -----------   ----------- 
          Net income (loss)........................... $(7,443,713)  $  (923,678)  $ 2,860,059 
                                                       ===========   ===========   =========== 

    The accompanying notes are an integral part of these statements.

DEFM14C
46th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 46th
MARTIN MEDIA    
(A CALIFORNIA LIMITED PARTNERSHIP)    
   STATEMENTS OF PARTNERS' CAPITAL (DEFICIT)
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

                                                        [Enlarge/Download Table]


                                                          1997          1996          1995     
                                                       -----------   -----------   ----------- 
                                                                                               
Balance, beginning of year............................ $ 1,973,557   $ 3,184,665   $   822,406 
  Issuance of partnership units.......................          --     5,300,000            -- 
  Redemption of partnership units.....................          --    (5,260,230)           -- 
  Distributions.......................................          --      (327,200)     (497,800)
  Net income (loss)...................................  (7,443,713)     (923,678)    2,860,059 
                                                       -----------   -----------   ----------- 
Balance, end of year.................................. $(5,470,156)  $ 1,973,557   $ 3,184,665 
                                                       ===========   ===========   =========== 

The accompanying notes are an integral part of these statements.

DEFM14C
47th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 47th
MARTIN MEDIA    

STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995    

                                                        [Enlarge/Download Table]


                                                          1997           1996          1995     
                                                      ------------   ------------   ----------- 
                                                                                                
Cash flows from operating activities:                                                           
  Net income (loss).................................  $ (7,443,713)  $   (923,678)  $ 2,860,059 
     Adjustments to reconcile net income (loss)                                                 
       to net cash provided by operating activities:                                            
       Depreciation and amortization................     9,282,574      5,364,835     3,339,377 
       Loss on disposal of assets...................       512,338        458,464       378,358 
       Changes in operating assets and liabilities                                              
          (exclusive of acquisitions):                                                          
          (Increase) decrease in accounts receivable      (932,078)    (1,047,834)      223,315 
          (Increase) decrease in other receivables..       (12,622)       (72,759)       24,091 
          (Increase) decrease in inventories, raw                                               
            materials...............................      (311,402)       105,466        35,645 
          (Increase) decrease in prepaid expenses...      (481,258)      (136,610)       53,372 
          Decrease in accounts payable..............      (301,122)        (7,055)     (195,463)
          Increase in accrued expenses..............     6,543,084        793,490        24,624 
          (Increase) decrease in unearned income....       106,061         84,915       (14,020)
                                                      ------------   ------------   ----------- 
          Net cash provided by operating                                                        
            activities..............................     6,961,862      4,619,234     6,729,358 
                                                      ------------   ------------   ----------- 
Cash flows from investing activities:                                                           
  Principal payments on notes receivable............        32,956        374,740        20,692 
  Issuance of notes receivable......................            --       (400,000)           -- 
  Proceeds from sale of property and equipment......        49,460         63,801        79,236 
  Cash paid for acquisitions........................   (67,164,295)   (17,200,000)   (1,575,000)
  Capital expenditures..............................    (7,750,411)    (7,114,708)   (1,762,978)
  Proceeds from sale of investment..................            --             --       970,482 
  Purchase option deposit...........................      (463,800)            --            -- 
                                                      ------------   ------------   ----------- 
          Net cash used in investing activities.....   (75,296,090)   (24,276,167)   (2,267,568)
                                                      ------------   ------------   ----------- 
Cash flows from financing activities:                                                           
  Net (payments)borrowings on line-of-credit........            --     (1,395,052)      601,324 
  Proceeds from issuance of long-term debt..........    41,014,131     75,915,869     1,006,400 
  Principal payments on long-term debt..............      (318,259)   (57,059,619)   (3,522,394)
  Distributions to partners.........................            --       (327,200)     (497,800)
  Redemption of partnership units...................            --     (5,260,230)           -- 
  Issuance of mandatorily redeemable preferred                                                  
     partnership units..............................    25,000,000             --            -- 
  Issuance of partnership units.....................            --      5,000,000            -- 
                                                      ------------   ------------   ----------- 
          Net cash provided by (used in) financing                                              
            activities..............................    65,695,872     16,873,768    (2,412,470)
                                                      ------------   ------------   ----------- 
Net increase (decrease) in cash and cash                                                        
  equivalents.......................................    (2,638,356)    (2,783,165)    2,049,320 
Cash and cash equivalents at beginning of year......     2,661,610      5,444,775     3,395,455 
                                                      ------------   ------------   ----------- 
Cash and cash equivalents at end of year............  $     23,254   $  2,661,610   $ 5,444,775 
                                                      ============   ============   =========== 
     Supplemental disclosures of cash flow                                                      
       information:                                                                             
       Interest paid................................  $  8,085,486   $  6,357,207   $ 5,036,375 
                                                      ============   ============   =========== 
       Income taxes paid............................  $         --   $      7,349   $       800 
                                                      ============   ============   =========== 

DEFM14C
48th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 48th
MARTIN MEDIA  

STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995    

Supplemental disclosures of noncash investing and financing activities:         

    During the year ended December 31, 1997 long-term debt in the amount
of $84,845,560 was refinanced.                                              

    During the year ended December 31, 1996 long-term debt in the amount
of $1,684,215 was incurred to purchase fixed assets and intangible assets.  

During the year ended December 31, 1996 notes receivables to    
shareholders  in the amount of $300,000 were issued for partnership units.  

    During the year ended December 31, 1995 long-term debt in the amount
of $318,900 was incurred to purchase sign structures.                       

The accompanying notes are an integral part of these statements.

DEFM14C
49th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 49th
MARTIN MEDIA    

NOTES TO FINANCIAL STATEMENTS   
 DECEMBER 31, 1997

1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES                       

Nature of business                                                          

Martin Media, a California limited partnership (the Company),   
was formed in December, 1984 and operated under the name of Colorado River      
Markets until August, 1991. The Company has operating divisions located in      
Pennsylvania, Ohio, Connecticut, Washington, D.C., Arizona and Nevada.          

The Company owns and leases billboards on a contractual basis   
nationwide for the purpose of providing outdoor advertising services. The       
Company extends credit in the form of accounts receivable on a short-term basis 
to businesses and advertisers doing business in the above noted areas.          

Significant accounting policies                                             

Basis of accounting                                                         

The financial statements are prepared on an accrual basis, which
recognizes income when earned and expenses when incurred.                       

Use of estimates                                                            

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

Cash and cash equivalents                                                   

       The Company considers cash and cash equivalents to be all highly liquid
investments purchased with a maturity of three months or less.                  

Inventories, raw materials                                                  

     Inventories are stated at the lower of cost or market using the first
in, first out (FIFO) cost method.                                               

Property and equipment                                                      

        Property and equipment are stated at cost and depreciated over estimated
useful lives primarily using the straight-line method. Repairs and maintenance  
and small equipment purchases are expensed as incurred. Expenditures which      
significantly increase asset values or extend useful lives are capitalized.     
Estimated useful lives are as follows:                                          

                                                 YEARS
                                                 -----
Buildings and improvements..................................  15-31             
Posters.....................................................     25             
Bulletins...................................................     25             
Shop equipment..............................................   3-10             
Office furniture and equipment..............................   5-10             
Auto and trucks.............................................    5-7             

Income taxes                                                                    

     Under provision of the Internal Revenue Code and the respective state
Taxation Codes, partnerships are not subject to income taxes; any income or loss
realized is taxed to the individual partners. Certain states do impose a minimum
tax (franchise fee).                                                            

Intangible assets                                                           

       Covenants not to compete are recorded at cost and are amortized using the
straight-line method over the contractual period specified.                     

Organization costs, advertising rights, permits and licenses,   
acquisition fees, lease rights and goodwill are recorded at cost and are        
amortized using the straight-line method over five years.                       

   Loan fees are amortized over the life of the loan to which they are
associated.                                                                     

Profit sharing plan                                                         

      The Company adopted a profit sharing plan which is a qualified pension
trust under Section 401(k) of the Internal Revenue Code. All full-time employees
with twelve months of service who are 18 years old or older are eligible to     
participate. Each employee may voluntarily contribute up to the lesser of 15% of
their pay or $9,500. The Company has made no contributions to the plan.         

Fair value of financial instruments                                         

  The carrying amount of the long-term debt approximates fair value.

Reclassifications                                                           

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

2. LONG-TERM NOTES RECEIVABLE, LIMITED PARTNERS                                 

Notes receivable, limited partners at December 31, 1997 and 1996
consisted of the following:                                                     

                                                                [Download Table]


                                                                1997      1996   
                                                              --------  -------- 
                                                                                 
Barry Heffner, Manager of Pittsburgh Division, prime plus                        
  2%, collateralized by subscription of one unit of Martin                       
  Media, payable $717 per month including interest, due                          
  September 27, 2001........................................  $ 18,758  $ 25,036 
Mary Ellen Coleman, Manager of Scranton Division, prime plus                     
  2%, collateralized by subscription of one unit of Martin                       
  Media, payable $717 per month including interest, due                          
  September 27, 2001........................................    18,975    25,229 
Brent Baer, Manager of Washington D.C. Division, 8%,                             
  collateralized by  1/4 of one partnership unit, payable                        
  $838 per month including interest, due December 28,                            
  2001......................................................    69,894    75,000 
Thomas Jones, Manager of Las Vegas Division, 8%,                                 
  collateralized by  1/4 of one partnership unit, payable                        
  $838 per month including interest, due December 28,                            
  2001......................................................    69,894    75,000 
David Lamberger, National Sales Manager, 8%, collateralized                      
  by  1/4 of one partnership unit, payable $838 per month                        
  including interest, due December 28, 2001.................    69,894    75,000 
Lynn Terlaga, Manager of Hartford Division, 8%,                                  
  collateralized by  1/4 of one partnership unit, payable                        
  $838 per month including interest, due December 28,                            
  2001......................................................  $ 69,894  $ 75,000 
David Weyrich, 10%, unsecured, payable $833 per month                            
  interest only, due November 27, 1997, paid in full                             
  subsequent to December 31, 1997...........................   100,000   100,000 
                                                              --------  -------- 
                                                               417,309   450,265 
Less current maturities.....................................   136,030   132,956 
                                                              --------  -------- 
                                                              $281,279  $317,309 
                                                              ========  =========

      Prime rate was 8.5% and 8.25% at December 31, 1997 and 1996, respectively.

3. ACQUISITIONS                                                                 

   During 1997, the Company purchased substantially all the assets and
assumed certain liabilities of three outdoor advertising companies; during 1996,
the Company purchased substantially all of the assets and assumed certain       
liabilities of one outdoor advertising company and exchanged partnership        
interests and other consideration for substantially all of the assets, and      
assumed certain liabilities, for another outdoor advertising company (the       
"Exchange"). Funds used to make the acquisitions and facilitate the Exchange    
were provided through the Company's credit facility. The majority of the        
intangible assets acquired through the acquisitions and Exchange are being      
amortized over a five year period. See Note 10 for acquisitions included above  
which were acquired from a related party. Acquisitions during 1995 were not     
significant.                                                                    

The acquisitions were accounted for using the purchase method of
accounting and the purchase price was allocated to the various tangible and     
intangible assets acquired. For the Exchange, the Company recorded the assets   
acquired and liabilities assumed based on the fair value of the partnership     
interests granted. Accordingly, the results of operations for the acquisitions, 
and the Exchange, have been included in the results of the Company from the     
respective effective dates.                                                     

        A summary of the cash consideration and allocation of the purchase price
as of the acquisition dates are as follows:                                     

                                                        [Enlarge/Download Table]


                                                               1997          1996    
                                                            -----------   -----------
                                                                                     
Fair value of tangible assets acquired..................... $20,293,392  $ 8,420,000 
Fair value of intangible assets acquired...................  46,870,903   11,870,455 
Liabilities assumed........................................          --   (2,790,455)
Book value of partnership interests granted................          --     (300,000)
                                                            -----------   -----------
Cash paid.................................................. $67,164,295  $17,200,000 
                                                            ===========  =========== 


  Of the cash paid in 1996, approximately $5 million was utilized to
redeem existing partnership units in connection with the Exchange.              

4. PREPAID EXPENSES                                                             

Prepaid expenses at December 31, 1997 and 1996 consisted of the 
following:                                                                      

                                                                [Download Table]

                                                                1997        1996   
                                                             ----------  ----------
                                                                                   
Leases...................................................... $1,279,243  $  903,154
Insurance...................................................     41,541      32,545
Other.......................................................    196,064     124,726
Deposits....................................................     49,734      24,899
                                                             ----------  ----------
                                                             $1,566,582  $1,085,324
                                                             ==========  ==========

5. PROPERTY AND EQUIPMENT                                                       

    Major classes of property and equipment and accumulated depreciation
at December 31, 1997 and 1996 are as follows:                                   

                                                                [Download Table]

                                                               1997         1996    
                                                            -----------  -----------
                                                                                    
Land....................................................... $10,578,202  $   936,954
Buildings and improvements.................................   5,349,404      218,947
Posters....................................................  26,855,790   25,114,090
Bulletins..................................................  44,189,355   36,314,244
Shop equipment.............................................     722,278      519,319
Office furniture and equipment.............................     649,696      449,391
Autos and trucks...........................................   1,951,625    1,662,820
Construction in process....................................     402,892      215,744
                                                            -----------  -----------
                                                             90,699,242   65,431,509
Less accumulated depreciation..............................  15,835,645   13,063,856
                                                            -----------  -----------
                                                            $74,863,597  $52,367,653
                                                            ===========  ===========

See Note 7 for collateralization of property and equipment.     

    Depreciation expense for the years ended December 31, 1997, 1996 and
1995 was $2,943,826, $2,624,212 and $2,392,186.                                 

    During the years ended December 31, 1997, 1996 and 1995, the Company
took down a number of boards located in the Pittsburgh, Scranton, Hartford,     
Las Vegas and Cincinnati divisions. These disposals were initiated by management
due to high operating costs and/or high site lease costs, which resulted in     
marginal operating results. Losses on board disposals amounted to $515,056,     
$440,746 and $418,957 in the years ended December 31, 1997, 1996 and 1995.      

6. INTANGIBLE ASSETS                                                            

       Intangible assets and accumulated amortization at December 31, 1997 and
1996 are as follows:                                                            

                                                                [Download Table]

                                                               1997         1996    
                                                            -----------  -----------
                                                                                    
Organization costs......................................... $ 1,238,376  $ 1,238,376
Covenants not to compete...................................   2,452,096    2,452,096
Advertising rights.........................................   2,925,800    1,291,338
Permits and licenses.......................................  10,705,122    2,547,274
Lease rights...............................................  14,307,733   11,970,722
Goodwill...................................................  33,979,535      220,453
Acquisition fees...........................................   3,718,759    1,053,423
Loan fees..................................................     359,398    1,577,500
                                                            -----------  -----------
                                                             69,686,819   22,351,182
Less accumulated amortization..............................  11,239,900    6,478,652
                                                            -----------  -----------
                                                            $58,446,919  $15,872,530
                                                            ===========  ===========

See Note 7 for collateralization of intangible assets.          

    Amortization expense for the years ended December 31, 1997, 1996 and
1995 was $6,338,748, $2,740,623 and $947,191.                                   

7. LONG-TERM DEBT                                                               

Long-term debt at December 31, 1997 and 1996 consisted of the   
following:                                                                      

                                                        [Enlarge/Download Table]


                                                                1997         1996    
                                                            ------------  -----------
                                                                                     
Canadian Imperial Bank of Commerce, as administrative                                
  agent for lenders, under the Credit Agreement dated July                           
  31, 1997, Term A loan, interest at LIBOR plus 2%,                                  
  collateralized by accounts receivable, inventory, sign                             
  structures, and intangible assets, payable quarterly,                              
  due June 2004**.........................................  $ 60,000,000  $        --
Canadian Imperial Bank of Commerce, as administrative                                
  agent for lenders, under the Credit Agreement dated July                           
  31, 1997, Term B loan, interest at LIBOR plus 2.25%,                               
  collateralized by accounts receivable, inventory, sign                             
  structures, and intangible assets, payable quarterly,                              
  due December 2005**.....................................    35,000,000           --
Canadian Imperial Bank of Commerce, as administrative                                
  agent for lenders, under the Credit Agreement dated July                           
  31, 1997, Revolving Line of Credit, interest ranging                               
  from prime plus 2% LIBOR plus 2.75%, collateralized by                             
  accounts receivable, inventory, sign structures, and                               
  intangible assets, payable quarterly, due June 2004**...    17,300,000           --
Jackson Poster Advertising, 8%, collateralized by sign                               
  structures, payable $912 per month including interest,                             
  due December 2000.......................................        29,124       37,381
Dominion Signs, 8%, collateralized by sign structures and                            
  personally guaranteed by E. Thomas Martin, payable                                 
  $68,475 plus interest annually, due August 1999.........       136,950      205,425
Elaine Perlroth, 7%, collateralized by mortgage, payable                             
  $989 monthly including interest, due November 2008......        90,381       95,715
Ronco Media, non-interest bearing, uncollateralized,                                 
  payable $3,000 monthly, due April 2001..................       120,000      156,000
Ronald Rieger, non-interest bearing, uncollateralized,                               
  payable $167 monthly, due July 2001.....................         6,667        8,667
Rose Marie Rieger, non-interest bearing, uncollateralized,                           
  payable $167 monthly, due April 2001....................         6,667        8,667
Daniel H. Bradley, non-interest bearing, uncollateralized,                           
  payable $1,667 monthly, due April 2001..................        66,667       86,667
Pamela Lynn Rieger, non-interest bearing,                                            
  uncollateralized, payable $1,667 monthly, due April                                
  2001....................................................        66,667       86,667
Kory William Rieger, non-interest bearing,                                           
  uncollateralized, payable $1,667 monthly, due April                                
  2001....................................................        66,667       86,667
Rembrandt Outdoor Services, non-interest bearing,                                    
  uncollateralized, payable $608 monthly, due July 2001...        33,456       34,065
Canadian Imperial Bank of Commerce, as administrative                                
  agent for Lenders under the Credit Agreement dated July                            
  15, 1996, Term A Loan, interest at LIBOR plus 2.5%,                                
  collateralized by accounts receivable, inventory, sign                             
  structures, and intangible assets, payable quarterly,                              
  due March 2003**........................................            --   40,000,000
Canadian Imperial Bank of Commerce, as administrative                                
  agent for Lenders under the Credit Agreement dated July                            
  15, 1996, Term B Loan, interest at LIBOR plus 3%,                                  
  collateralized by accounts receivable, inventory, sign                             
  structures, and intangible assets, payable quarterly,                              
  due December 2004**.....................................            --   15,000,000
Canadian Imperial Bank of Commerce, as administrative                                
  agent for Lenders under the Credit Agreement dated July                            
  15, 1996, Revolving Line of Credit, interest ranging                               
  from prime plus 1.25% to LIBOR plus 2.50%,                                         
  collateralized by accounts receivable, inventory, sign                             
  structures, and intangible assets, payable annually, due                           
  March 2003**............................................            --   16,285,868
                                                            ------------  -----------
                                                             112,923,246   72,091,789
Less current maturities...................................     3,690,436    5,339,365
                                                            ------------  -----------
                                                            $109,232,810  $66,752,424
                                                            ============  ===========


   Aggregate maturities of long-term debt at December 31, 1997 were as
follows:                                                                        

                                                                [Download Table]


YEAR ENDING                                                                
DECEMBER 31,                                                               
------------                                                               
                                                                           
1998........................................................   $  3,690,436
1999........................................................      7,691,592
2000........................................................     13,124,365
2001........................................................     14,545,258
2002........................................................     15,007,561
Thereafter..................................................     58,864,034
                                                               ------------
                                                               $112,923,246
                                                               ============

** Loan has varying interest rates based on  Company performance and            
indexes found in Credit Agreement dated July 31, 1997. At December 31, 1997     
effective interest rates ranged from 7.1875% to 8.5%.                           

    The Company has entered into interest rate caps primarily to protect
against rising interest exposure of its floating rate long-term debt. The       
difference to be paid or received on the cap is included in interest expense as 
payments are made or received. At December 31, 1997, the Company had            
outstanding interest rate cap agreements with two commercial bank, having a     
total notional principal amount of $135,000,000. This agreement effectively     
changes the Company's interest exposure on up to $135,000,000 of floating       
rate debt to a fixed 6.5% with a floor of 5.5%. The interest rate cap           
agreements mature September 1998 ($35,000,000) and September 2000               
($100,000,000).                                                                 

  During 1997, the Company sold an interest rate floor for a gain of
$440,000. This gain is included in other income.                                

   The counterparties to the Company's derivative financial instrument
contract are substantial and creditworthy commercial banks which are recognized 
market makers. Neither the risks of counterparty nonperformance nor the         
economic consequence of counterparty nonperformance associated with these       
contracts were considered by the Company to be material.                        

   Interest expense consists of interest on notes payable and the cost
associated with the purchased of the interest rate cap instrument.              

Prime rate was 8.5% and 8.25% at December 31, 1997 and 1996,    
respectively.                                                                   

LIBOR rate was 5.9% and 6.5% at December 31, 1997 and 1996,     
respectively.                                                                   

8. LONG-TERM CAPITAL LEASE OBLIGATIONS                                          

   The Company leases certain sign structures with lease terms through
July 2000. Obligations under capital leases have been recorded in the           
accompanying financial statements at the discounted present value of future     
minimum lease payments. The cost and accumulated amortization for such equipment
as of December 31, 1997 was $1,029,200 and $58,321, respectively. Amortization  
included in depreciation expense for the year ended December 31, 1997 was       
$41,168. Interest paid on these leases was $130,118 for the year ended December 
31, 1997.                                                                       

        The future minimum lease payments under these capital leases and the net
present value of the future minimum lease payments are as follows:              

                                                                [Download Table]


YEAR ENDING                                                            
DECEMBER 31:                                                           
------------                                                           
                                                                       
1998........................................................   $316,628
1999........................................................    399,627
2000........................................................    113,280
                                                               --------
Total future minimum lease payments.........................    829,535
Less amount representing interest...........................    167,290
                                                               --------
Present value of future minimum lease payment...............    662,245
Less current portion........................................    214,380
                                                               --------
Long-term portion...........................................   $447,865
                                                               ========

9. RELATED PARTY TRANSACTIONS                                                   

     Transactions occurring between the Company and a related party, which
are not presented elsewhere in these financial statements, are as follows:      

  Martin and MacFarlane, Inc., a California Corporation (M&M, Inc.),
which has stockholders who are also partners in the Company,    
performed substantially all administrative functions for the partnership during 
the year ended December 31, 1995 and January 1996. Beginning February 1, 1996,  
administrative functions were performed by MW Sign Co., the general partner. The
partnership pays management fees approximating 3% of gross revenue, refinancing 
fees of 4% of all debt refinanced and acquisition fees of 4% of the purchased   
price of acquired companies. On January 1, 1997, management fees increased to   
4% of gross revenue. Total fees paid to M&M, Inc. for the years ended           
December 31, 1997 and 1996 amounted to $-0- and $78,263, respectively. Total    
fees paid/accrued to MW Sign Co. for the years ended December 31, 1997 and 1996 
amounted to $11,231,815 and $5,050,039. Total fees paid to M&M, Inc.            
and MW Sign Co. for the year ended December 31, 1995 amounted to $1,111,350.    

10. COMMITMENTS                                                                 

Leases                                                                      

    The Company leases land, buildings, and equipment in connection with
its outdoor advertising business under operating leases. The leasing of land    
relates to the posters and bulletins. The Company also leases property,         
equipment and buildings to house and support division administrative and field  
offices.                                                                        

       Future minimum lease payments under cancelable and noncancelable leases
at December 31, 1997 are as follows:                                            

                                                                [Download Table]

YEAR ENDING                                        POSTERS,                         
DECEMBER 31,                                      BULLETINS   BUILDINGS      TOTAL  
------------                                      ----------  ----------  ----------
                                                                                    
1998............................................. $1,199,353  $  229,539  $1,428,892
1999.............................................  1,219,818     205,164   1,424,982
2000.............................................  1,244,566     193,264   1,437,830
2001.............................................  1,270,536     183,836   1,454,372
2002.............................................  1,295,506     173,628   1,469,134
Thereafter.......................................  1,670,042     289,380   1,959,422
                                                  ----------  ----------  ----------
                                                  $7,899,821  $1,274,811  $9,174,632
                                                  ==========  ==========  ==========

    Certain of the Company's noncancelable lease payments are based on a
percentage of revenue generated from the poster or bulletin rather than having a
minimum rental. The percentage of rent ranges from 15% to 20% of revenue. An    
estimate of the future payments under these leases has been included in the     
above table under posters, bulletins. Historically, rental payments under these 
leases have approximated $1,180,000 annually.                                   

      Lease expense for the years ended December 31, 1997, 1996 and 1995 was
as follows:                                                                     

                                                                [Download Table]

                                                     1997        1996         1995  
                                                  ----------  ----------  ----------
                                                                                    
Land for posters and bulletins................... $8,042,746  $6,817,196  $5,226,956
Buildings........................................    518,306     549,069     406,277
Equipment, other.................................     27,041      28,198      31,881
                                                  ----------  ----------  ----------
                                                  $8,588,093  $7,394,463  $5,665,114
                                                  ==========  ==========  ==========

Acquisition, purchase and purchase option                                       

     On July 31, 1997, the Company entered into an agreement with Martin &
MacFarlane, Inc. (related party), relative to an agreement Martin &             
MacFarlane, Inc. had with another company to purchase certain assets, to acquire
certain assets including sign structures, equipment, and related intangibles    
located in the Las Vegas and Colorado River markets for a total purchase price  
of $14,350,400.  This purchase agreement has two segments, the first of which   
provided for the purchase of assets during the year ending December 31, 1997 for
$11,273,400. The second segment of the agreement provides an option to the      
Company to purchase additional assets for $3,077,000. Upon execution of the     
option agreement, the Company deposited $463,800 in good faith with             
Martin & MacFarlane, Inc. The option agreement can only be exercised upon       
Martin & MacFarlane, Inc. exercising its option to purchase those assets and    
other assets it has under option with the seller; the option agreement expires  
October 1, 1998.                                                                

Preferred partnership units                                                 

   On December 23, 1997, the Company entered into an agreement to sell
preferred limited partnership units (PPU's), warrants and warrant units to a    
select group of purchasers. The Company issued 25,000 PPU's at $1,000 each      
($25,000,000), calling for the holders of the PPU's to receive an initial 14%   
preferred rate of return, which escalates on certain dates to a maximum of 20%. 
The Company can redeem PPU's for 102% of the PPU's capital account amount until 
September 23, 1998 and thereafter for 100% of the PPU's capital account amount. 
The Company is obligated under the agreement to redeem all outstanding PPU's    
on December 23, 2006. Warrants to purchase additional PPU's, based upon terms of
the agreement, shall be issuable upon the 270th day following the purchase date 
(December 23, 1997) and quarterly thereafter, if any PPU's shall then be        
outstanding.                                                                    

Credit facilities                                                           

On December 23, 1997, the Company entered into an agreement with
Canadian Imperial Bank of Commerce in which their Term B loan maximum borrowing 
limit was increased to $40,000,000. As of December 31, 1997, the Company had    
$5,000,000 available under the term of the loan.                                

     On July 31, 1997, the Company entered into an agreement with Canadian
Imperial Bank of Commerce, as administrative agent for Lenders under the        
credit agreement dated July 31, 1997. Under the terms of this agreement, Swing  
Loan is available in the amount of $5,000,000. As of December 31, 1997, the     
Company's outstanding obligation was $-0-.                                      

11. SUBSEQUENT EVENTS                                                           

       Subsequent to December 31, 1997, the Company acquired substantially all
of the assets and assumed certain liabilities of three outdoor advertising      
companies at an aggregate purchase price of $18,350,000. Funds used to make     
the purchase were provided through the Company's credit facility.               

DEFM14C
50th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 50th
REPORT OF INDEPENDENT ACCOUNTANTS                 

June 9, 1999                                                                    
To the Board of Directors of                                                    
Chancellor Media Corporation                                                    

In  our  opinion,  the  accompanying  statements  of  operations,  retained     
earnings  and  cash  flows  present fairly, in all material  respects,  the     
operations and cash flows of  Martin  &  MacFarlane,  Inc.  (the "Company")     
for   the   seven   months   ended   July  31,  1998,  in  conformity  with     
generally accepted accounting principles.   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 audit.  We     
conducted our  audit  of  these  statements in  accordance  with  generally     
accepted auditing standards  that  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,  assessing  the  accounting  principles  used  and  significant     
estimates   made  by  management,  and  evaluating  the  overall  financial     
statement presentation.   We  believe  that  our audit provides a               
reasonable basis for the opinion expressed above.                               

/S/ PRICEWATERHOUSECOOPERS LLP                                                  

PricewaterhouseCoopers LLP                                                      

DEFM14C
51st “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 51st
MARTIN & MACFARLANE, INC.                                                       

STATEMENT OF OPERATIONS                                                         
SEVEN MONTHS ENDED JULY 31, 1998                                                
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]


                                                          
Revenue                                        $   17,946 
Cost of revenue                                     1,370 
                                               ---------- 

             Gross profit                          16,576 

Managers' controlled operating expenses            10,526 
                                               ---------- 

             Income from managers' operations       6,050 

Other operating expenses:                                 
           Depreciation and amortization            3,471 
           Refinance and acquisition expenses       1,570 
           Other expenses                           2,623 
                                               ---------- 

             Operating loss                        (1,614)

Other income (expense):                                   
           Interest expense                        (2,244)
           Gain on disposal of assets                 465 
           Other income                               537 
                                               ---------- 

Loss before income taxes                           (2,856)
Income tax expense                                     10 
                                               ---------- 

             Net loss                          $   (2,866)
                                               ========== 

See accompanying notes to financial statements.         

DEFM14C
52nd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 52nd
MARTIN & MACFARLANE, INC.                                                       

STATEMENT OF RETAINED EARNINGS                                                  
SEVEN MONTHS ENDED JULY 31, 1998                                                
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]


                                        
Balance at December 31, 1997  $   7,949 

Dividends                          (743)
Net loss                         (2,866)
                              --------- 

Balance at July 31, 1998      $   4,340 
                              ========= 

See accompanying notes to financial statements.         

DEFM14C
53rd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 53rd
MARTIN & MACFARLANE, INC.                                                       

STATEMENT OF CASH FLOWS                                                         
SEVEN MONTHS ENDED JULY 31, 1998                                                
(DOLLARS IN THOUSANDS)                                                          

                                                                [Download Table]


                                                                                   
Cash flows from operating activities:                                              
          Net Loss                                                     $    (2,866)
          Adjustments to reconcile net loss to net cash provided                   
          by operating activities:                                                 
            Depreciation and amortization                                    3,471 
            Provision for doubtful accounts                                    593 
            Changes in operating assets and liabilities (exclusive of              
            acquisitions):                                                         
              Accounts receivable                                           (1,061)
              Other current assets                                           1,075 
              Other assets                                                      31 
              Accounts payable and accrued expenses                            502 
              Other liabilities                                                 91 
                                                                       ----------- 

                Net cash provided by operating activities                    1,836 

Cash flows from investing activities:                                              
          Acquisitions, net of cash acquired                               (12,500)
          Capital expenditures                                              (1,881)
                                                                       ----------- 

                Net cash used in investing activities                      (14,381)

Cash flows from financing activities:                                              
          Dividends paid                                                      (743)
          Payments on long-term debt                                       (35,680)
          Deposit received from Chancellor Media Corporation                50,000 
                                                                       ----------- 

                Net cash provided by financing activities                   13,577 

Net increase in cash                                                         1,032 
Cash and cash equivalents at beginning of period                                16 
                                                                       ----------- 
Cash and cash equivalents at end of period                             $     1,048 
                                                                       =========== 

Supplemental disclosures of cash flow information:                                 
          Interest paid                                                $     1,913 
                                                                       =========== 
          Income taxes paid                                            $         4 
                                                                       =========== 

See accompanying notes to financial statements.         

DEFM14C
54th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 54th
MARTIN & MACFARLANE, INC.                                                       

NOTES TO FINANCIAL STATEMENTS                                                   
(DOLLARS IN THOUSANDS)                                                          

1.   NATURE OF BUSINESS                                                         

Martin  &  MacFarlane,  Inc.  (the "Company")  was   incorporated   on
December  2,  1971  and owns, leases,  and  manages  billboards  on  a
contractual basis nationwide  for  the  purpose  of  providing outdoor
advertising   services.   The  Company  also  owns   and   operates  a
small  winery  located   in  Paso  Robles,  California.   The  Company
extends short-term credit  in  the  form  of  accounts  receivable  to
businesses and advertisers doing business in the above noted areas.   

On July 31, 1998, Martin & MacFarlane, Inc. and related companies were
acquired by Chancellor Media Corporation for a total purchase price of
$615,117, which consisted of $612,848  in  cash  and  included various
direct  acquisition  costs  and  the  assumption  of notes payable  of
$2,270.   The  accompanying  financial statements do not  reflect  any
adjustments related to this transaction.                              

2.   SIGNIFICANT ACCOUNTING POLICIES                                            

USE OF ESTIMATES                                                      

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

CASH AND CASH EQUIVALENTS                                             

The  Company  considers  cash  and  cash  equivalents to be all highly
liquid investments purchased with a maturity of three months or less. 

INVENTORIES                                                           

Inventories are stated at  the lower of cost or market using the first
in, first out (FIFO) cost method.                                     

PROPERTY AND EQUIPMENT                                                

Property  and  equipment  are stated  at  cost  and  depreciated  over
estimated  useful  lives primarily  using  the  straight-line  method.
Depreciation expense  for  the  seven  months  ended July 31, 1998 was
$927.  Repairs and maintenance are expensed as incurred.  Expenditures
which significantly increase asset values are capitalized.   Estimated
useful lives are as follows:                                          

                                                                [Download Table]

                                   YEARS   
                                -----------
                                           

Building and improvements          15-31   
Posters                             7-25   
Bulletins                           7-25   
Shop equipment                      3-10   
Office furniture and equipment      5-10   
Auto and trucks                     5-7    

DEFM14C
55th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 55th
CONTRACTS AND REVENUE RECOGNITION                                     

Outdoor advertising signs are contracted to customers under individual
advertising contracts that primarily run from one month to five years.
Revenue is recognized ratably over the  life  of  the contract.  Costs
associated with the outdoor advertising operations, including contract
costs and land rental, are expensed over the related contract term.   

INCOME TAXES                                                          

Effective  July 1, 1995,  the   Company's   shareholders   elected  to
be taxed  under the provisions of Subchapter S of the Internal Revenue
Code.  Under such election, the shareholders of an "S" Corporation are
taxed  individually  on  their  proportionate  share  of the Company's
taxable income.  Therefore, no  provision  or  liability for   federal
income  tax  has been included in  these  financial statements.  State
income taxes are  provided  based  on  statutory  rates.  State income
taxes  currently  payable and  deferred relate primarily to  temporary
differences from the use  of  accelerated  methods of depreciation and
the direct  write-off  method  of  accounting for bad debts.          

INTANGIBLE ASSETS                                                     

Covenants not to compete are recorded at cost and are  amortized using
the  straight-line  method  over  the  contractual  period  specified.
Advertising  rights,  permits  and  licenses,  acquisition fees, lease
rights and goodwill are recorded at cost and are  amortized  using the
straight-line  method  over five years.  Loan fees are amortized  over
the life of the loan to which they are associated.                    

PROFIT-SHARING PLAN                                                   

The Company  has  adopted  profit-sharing  plans  which  are qualified
under Section  401(k)  of  the  Internal  Revenue Code.  All full-time
employees with twelve months of service who are 19 years old  or older
are eligible to participate.  Each employee may voluntarily contribute
up  to  the  lesser of 15% of their pay or $10.  The Company  has made
no contributions to the plan.                                         

3.   DEFERRED INCOME TAXES                                                      

For  state  tax  purposes, the  applicable  states  do  recognize  "S"
corporation status;  however, they still impose a tax at the corporate
level,  generally at a  rate  significantly  lower  than  the  regular
corporate  rate.   Deferred  tax  assets  and  liabilities  relate  to
temporary  differences associated with state income taxes.  Income tax
expense for  the  seven months ended July 31, 1998 consisted of $10 of
current state income taxes.                                           

4.   SIGNIFICANT ACQUISITION                                                    

On January 2, 1998, the Company  acquired  Newman  Outdoor  of  Texas,
Inc., an outdoor advertising company with over 1,200 billboards    and
outdoor  displays  in  three  markets, for  approximately  $12,500  in
cash plus various other direct acquisition costs.  The acquisition was
accounted   for   under   the  purchase  method  of  accounting   and,
accordingly, the accompanying  statement  of  operations  includes the
results of the acquired operations from the date of acquisition.      

5.   COMMITMENTS                                                                

The Company leases land in connection  with  its  outdoor  advertising
posters and panels as well as for office and yard  spaces.  These  are
long-term  operating  leases  which  the  Company  and lessor have the
option  to  terminate  with  thirty  days  notice.  Certain leases are
subject to renewal options.                                           

The Company also leases  office  and  shop buildings which are located
at  various  divisions.   A  portion of these  are  long-term  leases.

Future annual minimum lease payments at July 31, 1998 are as follows: 

                                                                [Download Table]


YEARS ENDING             
DECEMBER 31,             
-------------            
                         

1999           $    6,147
2000                6,850
2001                7,114
2002                7,358
2003                7,603
Thereafter     $  339,712
               ----------
               $  374,784
               ==========

Certain  of  the Company's noncancelable  lease  payments  are   based
on a percentage  of  revenue  generated  from  the  poster or bulletin
rather than having  a  minimum  rental.  The percentage of rent ranges
from 15% to 20% of revenue.                                           

Lease expense for the seven months July 31, 1998 was $2,782.          

ACQUISITION, PURCHASE AND PURCHASE OPTION                             

On  July 31, 1997, the  Company  entered  into   an   agreement   with
another company  to acquire certain assets, including sign structures,
equipment, and related  intangibles  located  in  Nevada, Arizona, and
California  for  a  total  purchase price of $60,000.   This  purchase
agreement has two segments,  the  first  of  which  provided  for  the
purchase  of  assets totaling $20,500.  Simultaneously, and as part of
the master agreement,  the Company  entered  into  an  agreement  with
Martin Media  (related party)  to  sell  them  those assets located in
their geographical area, primarily  the  Las  Vegas and Colorado River
markets,  for  $11,273.  The Company's net acquisition price under the
first segment of the agreement was $9,227.                            

The second segment of the agreement provides an option for the Company
to  purchase  additional  assets  for  $39,500.   As  part   of   this
transaction, the Company has also provided Martin Media with an option
to purchase the assets  located  in  the Las Vegas and Colorado  River
markets for $3,077.  The Company's net acquisition price for assets to
be received under the second  segment  of  the agreement was $36,423. 

Upon execution of the option agreement, the  Company  deposited $6,000
in  good  faith  with  the  seller.  Similarly, Martin Media deposited
$464 with the Company resulting  in  a  net  deposit  of  $5,536.  The
option agreement expired on October 1, 1998.                          

The Company contracts with M.W. Sign Company, a  company  wholly-owned
by  related  shareholders,  to  provide  the  Company  with management
services at 4% of gross revenue.  Management fees of $1,841 were  paid
to M.W. Sign Company during the seven months ended  July 31,  1998 and
are included in other operating expenses.                             

DEFM14C
56th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 56th
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors                                                       
Martin & MacFarlane, Inc.:                                                      

       We have audited the accompanying balance sheets of Martin & MacFarlane,
Inc., (a California  corporation), as  of December 31, 1997  and 1996, and  the 
related statements of income, retained earnings and cash flows for each of  the 
two years in the period ended December 31, 1997  and  six  months in the period 
ended December 31, 1995. 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 audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting 
the amounts and disclosures in the financial statements. An audit also includes 
assessing the accounting principles used and significant estimates made by      
management, as well as evaluating the overall financial statement presentation. 
We believe that our audits provide a reasonable basis for our opinion.          

  In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Martin &      
MacFarlane, Inc. as of December 31, 1997 and 1996 and the results of its  
 operations and its cash flows for each of the two years in the period ended
December 31, 1997 and six months in the period ended December 31, 1995, in
conformity with generally accepted accounting principles.                 

                                                     /S/ ARTHUR ANDERSEN LLP
                                                         ARTHUR ANDERSEN LLP

Bakersfield, California                                                         
February 13, 1998                                                               

DEFM14C
57th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 57th
MARTIN & MACFARLANE, INC. 
BALANCE SHEETS  
DECEMBER 31, 1997 AND 1996  

ASSETS    

                                                        [Enlarge/Download Table]

                                                                       1997          1996    
                                                                    -----------   -----------
                                                                                             
Current Assets                                                                               
Cash and equivalents............................................... $   138,294  $    10,519 
  Trade accounts receivable, less allowance for doubtful                                     
   accounts of $96,051 and $100,000 at December 31, 1997 and 1996..   2,973,646    1,836,944 
  Current maturity of note receivable..............................       6,856        6,206 
  Other receivables................................................      78,723      331,419 
  Inventories......................................................   1,764,872    1,104,190 
  Prepaid expenses.................................................     928,416      565,971 
  Current deferred income taxes....................................       1,441        1,500 
                                                                    -----------  ----------- 
                                                                      5,892,248    3,856,749 
                                                                    -----------  ----------- 
Note Receivable....................................................      24,381       31,083 
Property and Equipment, net of accumulated depreciation............  23,527,457   20,187,460 
Intangible Assets, net of accumulated amortization.................  11,053,092    3,007,566 
Other Assets                                                                                 
  Deposits.........................................................      24,197       22,047 
  Deposit on Purchase Option.......................................   5,536,200           -- 
                                                                    -----------  ----------- 
                                                                      5,560,397       22,047 
                                                                    -----------  ----------- 
                                                                    $46,057,575  $27,104,905 
                                                                    ===========  =========== 

    LIABILITIES AND STOCKHOLDERS' EQUITY

                                                        [Enlarge/Download Table]

                                                                                           
Current Liabilities                                                                        
  Bank overdraft.................................................. $   166,083  $   523,360
  Current maturities of long-term debt............................     690,718    7,460,727
  Note payable, bank..............................................          --      800,000
  Accounts payable................................................     543,648      465,372
  Accrued expenses................................................     391,069      444,798
  Distributions payable...........................................      61,832       61,658
  Unearned income.................................................     506,348       84,530
  Income taxes payable............................................       6,408       33,205
                                                                   -----------  -----------
                                                                     2,366,106    9,873,650
                                                                   -----------  -----------
Long-Term Debt, less current maturities...........................  36,041,494    6,835,699
                                                                   -----------  -----------
Deferred Income Taxes.............................................     102,375      111,008
                                                                   -----------  -----------
Commitments (Note 13)                                                                      
Stockholders' Equity                                                                       
  Common stock, no par or stated value, authorized 150,000                                 
     shares, issued and outstanding 82,443 shares, stated at         1,113,070    1,113,070
  Retained earnings..............................................    6,434,530    9,171,478
                                                                   -----------  -----------
                                                                     7,547,600   10,284,548
                                                                   -----------  -----------
                                                                   $46,057,575  $27,104,905
                                                                   ===========  ===========

    The accompanying notes are an integral part of these balance sheets.

DEFM14C
58th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 58th
MARTIN & MACFARLANE, INC. 

STATEMENTS OF INCOME    
YEARS ENDED DECEMBER 31, 1997 AND 1996    
AND SIX MONTH PERIOD ENDED DECEMBER 31, 1995    

                                                        [Enlarge/Download Table]


                                                           1997          1996          1995    
                                                        -----------   -----------   ---------- 
                                                                                               
Revenues............................................... $22,535,117   $16,994,368   $8,311,295 
Cost of sales..........................................   2,476,991     2,155,013    1,065,709 
                                                        -----------   -----------   ---------- 
          Gross profit.................................  20,058,126    14,839,355    7,245,586 
Managers' controlled operating expenses................  11,318,791     9,534,848    4,982,152 
                                                        -----------   -----------   ---------- 
          Income from managers' operations.............   8,739,335     5,304,507    2,263,434 
                                                        -----------   -----------   ---------- 
Other operating expenses                                                                       
  Depreciation and amortization expense................   2,902,472     1,316,520      575,291 
  Management fees......................................   2,210,351       472,931           -- 
  Refinance and acquisitions...........................     884,083        85,175           -- 
                                                        -----------   -----------   ---------- 
                                                          5,996,906     1,874,626      575,291 
                                                        -----------   -----------   ---------- 
          Operating income.............................   2,742,429     3,429,881    1,688,143 
                                                        -----------   -----------   ---------- 
Other income (expense)                                                                         
  Interest income......................................      15,302         9,773           -- 
  Interest expense.....................................  (2,537,908)   (1,115,772)    (552,412)
  Other income.........................................     414,138       117,025      125,286 
  Loss on disposition of assets........................    (207,372)     (136,875)      (1,744)
                                                        -----------   -----------   ---------- 
                                                         (2,315,840)   (1,125,849)    (428,870)
                                                        -----------   -----------   ---------- 
Income before income taxes.............................     426,589     2,304,032    1,259,273 
Income tax (expense) benefit...........................     (23,458)      (57,653)   2,972,317 
                                                        -----------   -----------   ---------- 
          Net income................................... $   403,131   $ 2,246,379   $4,231,590 
                                                        ===========   ===========   ========== 

The accompanying notes are an integral part of these statements.

DEFM14C
59th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 59th
MARTIN & MACFARLANE, INC. 

STATEMENTS OF RETAINED EARNINGS 
YEARS ENDED DECEMBER 31, 1997 AND 1996    
AND SIX MONTH PERIOD ENDED DECEMBER 31, 1995    

                                                        [Enlarge/Download Table]


                                                           1997          1996          1995    
                                                        -----------   -----------   ---------- 
                                                                                               
Balance, beginning of period........................... $ 9,171,478   $ 8,526,046   $4,418,120 
  Net income...........................................     403,131     2,246,379    4,231,590 
  Dividends............................................  (3,140,079)   (1,600,947)    (123,664)
                                                        -----------   -----------   ---------- 
Balance, end of period................................. $ 6,434,530   $ 9,171,478   $8,526,046 
                                                        ===========   ===========   ========== 

The accompanying notes are an integral part of these statements.

DEFM14C
60th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 60th
MARTIN & MACFARLANE, INC.   

STATEMENTS OF CASH FLOWS    
YEARS ENDED DECEMBER 31, 1997 AND 1996      
AND SIX MONTH PERIOD ENDED DECEMBER 31, 1995      

                                                        [Enlarge/Download Table]


                                                          1997          1996          1995     
                                                      ------------   -----------   ----------- 
                                                                                               
Cash flows from operating activities:                                                          
  Net income......................................... $    403,131   $ 2,246,379   $ 4,231,590 
  Adjustments to reconcile net income to net cash                                              
     provided by operating activities:                                                         
     Depreciation and amortization...................    2,902,472     1,316,520       575,291 
     Loss on disposition of assets...................      207,372       136,875         1,744 
  Changes in operating assets and liabilities                                                  
     (exclusive of acquisitions):                                                              
     (Increase) decrease in accounts receivable......   (1,136,702)     (410,142)      119,579 
     (Increase) decrease in other receivables........      252,697      (312,755)       59,985 
     Increase in inventory...........................     (660,682)     (220,401)     (115,754)
     (Increase) decrease in prepaid expenses.........     (362,445)     (135,739)      200,316 
     Decrease in deferred income tax asset...........           59            --            -- 
     (Increase) decrease in other                                                              
       assets -- deposits............................       (2,150)       (5,000)        3,124 
     Increase (decrease) in bank overdraft...........     (357,277)      523,360            -- 
     Increase (decrease) in accounts payable.........       78,276       (60,260)     (126,935)
     Increase (decrease) in accrued expenses.........      (53,555)      169,057        (8,073)
     Increase (decrease) in unearned income..........      421,818         1,185       (73,536)
     Increase (decrease) in income taxes payable.....      (26,797)        9,835      (868,116)
     Increase (decrease) in deferred income taxes....       (8,633)        7,826    (2,961,731)
                                                      ------------   -----------   ----------- 
          Net cash provided by operating                                                       
            activities...............................    1,657,584     3,266,740     1,037,484 
                                                      ------------   -----------   ----------- 
Cash flows from investing activities:                                                          
  Increase in purchase option deposit................   (5,536,200)           --            -- 
  Proceeds from certificates of deposit..............           --            --       200,000 
  Proceeds from sale of investments..................           --        11,859            -- 
  Proceeds from sale of property and equipment.......      107,400       217,320        14,082 
  Cash paid for acquisitions.........................  (10,723,930)   (5,849,000)     (240,000)
  Capital expenditures...............................   (2,646,168)     (748,741)     (201,925)
  Issuance of notes receivable.......................           --       (38,901)      (50,000)
  Principal payments on notes receivable.............        6,052         1,612            -- 
  Principal payments on notes receivable,                                                      
     shareholder.....................................           --        50,000            -- 
                                                      ------------   -----------   ----------- 
          Net cash used in investing activities......  (18,792,846)   (6,355,851)     (277,843)
                                                      ------------   -----------   ----------- 
Cash flows from financing activities:                                                          
  Proceeds from notes payable........................   21,459,216     5,500,000       809,400 
  Net (payments) borrowings on line of credit........     (950,000)      800,000       (50,000)
  Principal payments on notes payable................     (106,100)   (1,975,159)   (1,677,500)
  Distributions to shareholders......................   (3,140,079)   (1,600,947)     (123,664)
                                                      ------------   -----------   ----------- 
          Net cash provided by (used in) financing                                             
            activities...............................   17,263,037     2,723,894    (1,041,764)
                                                      ------------   -----------   ----------- 
Net increase (decrease) in cash and cash                                                       
  equivalents........................................      127,775      (365,217)     (282,123)
Cash and cash equivalents at beginning of year.......       10,519       375,736       657,859 
                                                      ------------   -----------   ----------- 
Cash and cash equivalents at end of year............. $    138,294   $    10,519   $   375,736 
                                                      ============   ===========   =========== 

Supplemental disclosures of cash flow information:                                             
  Interest paid...................................... $  2,634,036   $ 1,093,501   $   563,494 
                                                      ============   ===========   =========== 
  Payment of income taxes............................ $     50,255   $    47,818   $   857,530 
                                                      ============   ===========   =========== 

Supplemental disclosures of non cash financing activities:                      

    During the year ended December 31, 1997 long term debt in the amount
of $18,245,035 was refinanced.                                  

     During the year ended December 31, 1996, long-term debt in the amount
of $783,285 was incurred to purchase property and equipment and 
intangible assets.                                              

The accompanying notes are an integral part of these statements.

DEFM14C
61st “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 61st
MARTIN & MACFARLANE, INC. 

NOTES TO FINANCIAL STATEMENTS   

1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES                       

Nature of business                                                          

     Martin & MacFarlane, Inc. (the Company) was incorporated December  2,
1971. The Company owns, leases, and manages  billboards on  a contractual basis 
nationwide  for  the  purpose  of  providing outdoor advertising services.  The 
Company  also  owns  and  operates  a  small  winery  located in Paso Robles,   
California.  The  Company  extends  short-term  credit  in  the  form  of       
accounts receivable to businesses and advertisers doing business in  the  above 
noted areas.                                                                    

Significant accounting policies                                             

BASIS OF ACCOUNTING                                                             

The financial statements are prepared on an accrual basis, which
recognizes income when earned and expenses when incurred.                       

CHANGE IN ACCOUNTING PERIOD                                                     

Pursuant to the adoption by the Company of S Corporation status 
for income tax purposes, the Company changed from a fiscal year end to          
a calendar year end for the period ending December 31, 1995, as required by the 
Internal Revenue Service, to coincide with shareholders' tax year end.          
Therefore, the reporting periods for the financial statements cover the years   
ended December 31, 1997 and 1996 and six month period ended December 31, 1995.  

USE OF ESTIMATES                                                                

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

CASH AND CASH EQUIVALENTS                                                       

The Company considers cash and cash equivalents to be all highly
liquid investments purchased with a maturity of three months or less.           
Throughout the year, the Company may have amounts in banks in excess of         
federally insured limits and as of December 31, 1997, the Company held funds    
in one financial institution in excess of federally insured limits in the       
amount of $115,360.                                                             

INVENTORY                                                                       

Inventory is valued at the lower of cost or market. Valuation is
determined using the first-in, first-out method.                                

PROPERTY AND EQUIPMENT                                                          

        Property and equipment are stated at cost and depreciated over estimated
useful lives on a straight-line or accelerated basis. Repairs and maintenance   
and small equipment purchases are expensed as incurred.  Expenditures which     
significantly increase asset values or extend useful lives are capitalized.     
Estimated useful lives in years are as follows:                                 

                                                                [Download Table]

                                                              YEARS
                                                              -----
                                                                   
Buildings and improvements..................................  15-31
Posters.....................................................   7-25
Bulletins...................................................   7-25
Shop equipment..............................................   3-10
Office furniture and equipment..............................   5-10
Autos and trucks............................................    3-7
Irrigation equipment........................................   7-30
Vineyards...................................................  10-25

INTANGIBLE ASSETS                                                               

   Goodwill is amortized using the straight-line method over primarily
five year periods.                                                              

     Covenants not to compete are amortized using the straight-line method
over the contractual period specified, which ranges from five to ten years.     

        Advertising rights, permits and licenses, and lease rights are amortized
using the straight-line method over five years.                                 

INCOME TAXES                                                                    

Effective July 1, 1995, the Company's shareholders elected to be
taxed under the provisions of Subchapter S of the Internal Revenue Code. Under  
such election, the shareholders of an "S" Corporation are taxed individually on 
their proportionate share of the Company's taxable income.  Therefore,          
no provision or liability for federal income tax has been included in these     
financial statements.  State income taxes are provided based on statutory rates.
State income taxes currently payable and deferred relate primarily to temporary 
differences from the use of accelerated methods of depreciation and the direct  
write-off method of accounting for bad debts.                                   

PROFIT SHARING PLAN                                                             

The Company adopted a profit sharing plan which is a qualified  
pension trust under Section 401(k) of the Internal Revenue Code. All full time  
employees with twelve months of service who are 19 year old or older are        
eligible to participate. Each employee may voluntarily contribute up to the     
lesser of 15% of their pay or $9,500. The Company has made no matching          
contributions to the plan.                                                      

FAIR VALUE OF FINANCIAL INSTRUMENTS                                             

  The carrying amount of the long-term debt approximates fair value.

RECLASSIFICATIONS                                                               

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

2. ACQUISITIONS                                                                 

During 1997, the Company purchased substantially all of the     
assets and assumed certain liabilities of three outdoor advertising companies;  
during 1996, the Company purchased substantially all of the assets and          
assumed certain liabilities of four outdoor advertising companies.              
Concurrently with one of the 1996 acquisitions, the Company exchanged           
the assets acquired and liabilities assumed for similar assets and liabilities  
of another outdoor advertising company to enable the Company to expand          
its existing market share in that locality. The exchange was recorded at the    
fair market value of the assets acquired. Funds used to make the acquisitions   
were provided through the Company's credit facility. The majority of            
the intangible assets acquired are being amortized over a five year period.     
See Note 13 for acquisitions included above, which also includes a related      
party.                                                                          

The acquisitions were accounted for using the purchase method of
accounting and the purchase price was allocated to the various tangible and     
intangible assets acquired. Accordingly, the results of operations for the      
various acquisitions have been included in the results of the Company           
from the respective effective dates.                                            

        A summary of the cash consideration and allocation of the purchase price
as of the acquisition dates are as follows:                                     

                                                                [Download Table]

                                                               1997        1996  
                                                         -----------  ---------- 
                                                                                 
Fair value of tangible assets acquired.................. $ 2,756,703  $3,302,000 
Fair value of intangible assets acquired................   9,199,897   2,597,000 
Liabilities assumed.....................................  (1,232,670)    (50,000)
                                                         -----------   --------- 
Cash paid............................................... $10,723,930  $5,849,000 
                                                         =========== =========== 

3. NOTE RECEIVABLE                                                              

                                                                [Download Table]

                                                               1997      1996  
                                                              -------   -------
                                                                               
Ferguson Henderson Investments, 10%, secured by real                           
  property, payable $806 monthly, due November 10, 2001.....  $31,237   $37,289
Less current maturity.......................................    6,856     6,206
                                                              -------   -------
                                                              $24,381   $31,083
                                                              =======   =======

4. INVENTORIES                                                                  

Inventories are as follows at December 31, 1997 and 1996:       

                                                                [Download Table]

                                                                1997        1996   
                                                             ----------  ----------
                                                                                   
Raw material................................................ $  244,328  $  139,309
Winery:                                                                            
  Materials and grape production costs......................    198,033     138,266
  In process................................................    746,996     494,817
  Finished goods............................................    529,953     299,240
  Tasting room, miscellaneous and resale....................     45,562      32,558
                                                             ----------  ----------
                                                             $1,764,872  $1,104,190
                                                             ==========  ==========

5. PREPAID EXPENSES                                                             

  Prepaid expenses consist of the following at December 31, 1997 and
1996:                                                                           

                                                                [Download Table]


                                                               1997      1996  
                                                             --------  --------
                                                                               
Leases...................................................... $798,887  $505,539
Insurance...................................................   15,256    13,258
Miscellaneous...............................................  114,273    47,174
                                                             --------  --------
                                                             $928,416  $565,971
                                                             ========  ========

6. PROPERTY AND EQUIPMENT                                                       

        Major classes of property and equipment and accumulated depreciation are
as follows at December 31, 1997 and 1996:                                       

                                                                [Download Table]


                                                               1997          1996   
                                                            -----------  -----------
                                                                                    
Outdoor Advertising                                                                 
  Buildings and improvements............................... $   870,719  $   593,537
  Posters..................................................   8,072,315    7,510,907
  Bulletins................................................  18,486,149   15,656,034
  Shop equipment...........................................     458,691      329,493
  Office furniture and equipment...........................     224,069      211,215
  Autos and trucks.........................................   1,414,986    1,268,485
  Land.....................................................     838,807      571,107
  Construction in process, boards..........................     363,913      178,736
                                                            -----------  -----------
                                                             30,729,649   26,319,514
  Less accumulated depreciation............................   9,497,838    8,334,374
                                                            -----------  -----------
                                                             21,231,811   17,985,140
                                                            -----------  -----------
Winery                                                                              
  Buildings and improvements............................... $   864,672  $   844,850
  Irrigation and wells.....................................      45,752       45,752
  Vineyards................................................     316,981      278,219
  Landscaping..............................................      26,194       26,194
  Auto.....................................................      23,800       19,500
  Vineyard equipment.......................................     129,356      125,502
  Winery equipment.........................................     859,375      707,482
  Office furniture and equipment...........................      50,349       40,749
  Land.....................................................     376,133      376,133
                                                            -----------  -----------
                                                              2,692,612    2,464,381
  Less accumulated depreciation............................     992,798      873,402
                                                            -----------  -----------
                                                              1,699,814    1,590,979
                                                            -----------  -----------
Corporate                                                                           
  Buildings and improvements............................... $   699,474  $   689,293
  Office furniture and equipment...........................      18,647       18,647
  Land.....................................................      41,448       42,783
                                                            -----------  -----------
                                                                759,569      750,723
  Less accumulated depreciation............................     163,737      139,382
                                                            -----------  -----------
                                                                595,832      611,341
                                                            -----------  -----------
                                                            $23,527,457  $20,187,460
                                                            ===========  ===========

       Depreciation expense for the years ended December 31, 1997 and 1996 and
the six months ended December 31, 1995 was $1,468,013, $1,086,108, and $522,293,
respectively.                                                                   

7. INTANGIBLE ASSETS                                                            

Intangible assets and accumulated amortization are as follows at
December 31, 1997 and 1996:                                                     

                                                                [Download Table]


                                                                1997          1996  
                                                             -----------  ----------
                                                                                    
Loans fees.................................................. $   278,750  $       --
Goodwill....................................................   5,339,883     438,965
Covenants not to compete....................................     353,079     203,079
Advertising rights..........................................   1,553,639     708,100
Permits and licenses........................................   2,365,719     377,567
Lease rights................................................   3,193,624   1,877,001
                                                             -----------  ----------
                                                              13,084,694   3,604,712
Less accumulated amortization...............................   2,031,602     597,146
                                                             -----------  ----------
                                                             $11,053,092  $3,007,566
                                                             ===========  ==========

       Amortization expense for the years ended December 31, 1997 and 1996 and
the six months ended December 31, 1995 was $1,434,459, $230,412, and $52,998,   
respectively.                                                                   

8. LONG-TERM DEBT                                                               

       Long-term debt consists of the following at December 31, 1997 and 1996:

                                                                [Download Table]


                                                               1997          1996   
                                                            -----------  -----------
                                                                                    
Canadian Imperial Bank of Commerce, as administrative                               
  agent for lenders under the Credit Agreement dated July                           
  31, 1997, Term A loan, interest at LIBOR plus 2.75%,                              
  collateralized by accounts receivable, inventory, sign                            
  structures, and intangible assets, payable quarterly,                             
  due June 2004**.........................................  $30,000,000  $        --
Canadian Imperial Bank of Commerce, as administrative                               
  agent for lenders under the Credit Agreement dated July                           
  31, 1997, Revolving Line of Credit, interest ranging                              
  from prime plus 2% or LIBOR plus 2.75%, collateralized                            
  by accounts receivable, inventory, sign structures, and                           
  intangible assets, payable quarterly, due June 2004**...    3,400,000           --
Canadian Imperial Bank of Commerce, as administrative                               
  agent for lenders under the Credit Agreement dated July                           
  31, 1997, Swing Loan, interest ranging from prime plus                            
  2% or LIBOR plus 2.75%, collateralized by accounts                                
  receivable, inventory, sign structures, and intangible                            
  assets, payable at termination date, due June 2004**....    1,455,565           --
Palmer Outdoor Advertising, Inc., 10.5%, collateralized by                          
  sign structures, equipment, and inventory, payable                                
  $10,266 monthly including interest, due January 2002....      406,349           --
Anthony E. and Laverne L. Brum, 7%, collateralized by deed                          
  of trust, payable $1,742 monthly including interest, due                          
  August 2004.............................................      111,067           --
American Commercial Bank, 8%, collateralized by vehicle,                            
  payable $394 monthly including interest, due March                                
  2001....................................................       13,443           --
American Commercial Bank, 8%, collateralized by vehicle,                            
  payable $474 monthly including interest, due March                                
  2001....................................................       16,176           --
William H. and Jannette L. Kunz, 12.25%, uncollateralized,                          
  payable $6,631 monthly including interest, due May                                
  2010....................................................      505,043           --
LarMark, Inc., non-interest bearing, unsecured, due                                 
  January 1998............................................      425,000           --
Virgil and Ruth Rose, 7%, collateralized by deed of trust,                          
  payable $931 monthly including interest, due February                             
  2026....................................................      137,315      138,822
Paragon Outdoor Advertising, non-interest bearing,                                  
  uncollateralized, payable $608 monthly, due July 2001...       26,157       33,456
Gaechter Outdoor Advertising, non-interest bearing,                                 
  uncollateralized, payable in decreasing annual                                    
  installments ranging from $28,000 to $21,600, due August                          
  2001....................................................       96,000      124,000
Ken Lyons and Michael Burkett, non-interest bearing,                                
  uncollateralized, payable $710 monthly, due May 2001....       29,097       37,613
Pesenti Winery, noninterest bearing, collateralized by                              
  sign structure, payable $1,500 per year, due December                             
  2003....................................................        9,000       10,500
Advanced Outdoor, noninterest bearing, collateralized by                            
  sign structures, payable $9,500 per month, due December                           
  1998....................................................      102,000      214,000
Antelope Valley Bank, 8.5%, collateralized by vehicle,                              
  payable $466 monthly including interest, payable August                           
  2001....................................................           --       21,471
Don Enger and Clayton Enger, 8.5%, collateralized by deed                           
  of trust, payable $256 monthly including interest, due                            
  July 2001...............................................           --       11,648
Massachusetts Mutual Life Insurance Co., 11.05%,                                    
  unsecured, payable $500,000 per year beginning November                           
  11, 1994, interest payable quarterly, due November                                
  1999....................................................           --    1,500,000
Massachusetts Mutual Life Insurance Co., 10.9%, unsecured,                          
  payable $687,500 per year, interest payable quarterly,                            
  due August 1999.........................................           --    2,062,500
Massachusetts Mutual Life Insurance Company, 11.55%,                                
  unsecured, payable $500,000 per year beginning June 1,                            
  1996, interest payable quarterly, due June 2002.........           --    3,000,000
Bank of Santa Maria, interest at prime plus 2.5%,                                   
  collateralized by deed of trust, payable $1,188 per                               
  month including interest, due May 2002..................           --      119,695
Bank of Santa Maria, 9.5%, collateralized by vehicle,                               
  payable $1,168 per month including interest, due August                           
  1997....................................................           --        4,244
Alta and Fred Higginbotham, 8%, collateralized by deed of                           
  trust, payable $150 per month, due January 2000.........           --        6,771
Estates Trust, Inc., 9%, collateralized by deed of trust                            
  and personally guaranteed by E. Thomas Martin, payable                            
  $862 per month including interest, due October 2009.....           --       78,578
Barbara Lehmann, 10%, collateralized by deed of trust,                              
  interest payable monthly, due March 1998................           --       20,000
Christine and Alice Henderson, 9%, collateralized by deed                           
  of trust, payable $805 per month including interest, due                          
  April 2011..............................................           --       96,034
Central Coast Federal Land Bank, 7.5%, collateralized by                            
  winery deed of trust, products and crops inventory and                            
  accounts receivable, payable $7,126 per month including                           
  interest, due November 2015.............................           --      797,081
Central Coast Production Credit Association, 9.75%,                                 
  collateralized by winery accounts receivable and                                  
  inventory, interest payable quarterly, due January                                
  1999....................................................           --      150,000
Canadian Imperial Bank of Commerce, interest at LIBOR plus                          
  2.5%, collateralized by the Amarillo Division's accounts                          
  receivable, inventory, sign structures and intangible                             
  assets and personally guaranteed by E. Thomas Martin and                          
  David Weyrich, interest payable monthly, due May                                  
  1997**..................................................           --    5,500,000
Central Coast Production Credit Association, interest at                            
  prime plus 1.5%, collateralized by winery equipment,                              
  payable $5,590 monthly including interest, due August                             
  2000....................................................           --      198,165
Homer Hensley and Rick Hensley, 8.5%, collateralized by                             
  deed of trust, payable $1,231 monthly including                                   
  interest, due January 2001..............................           --       50,813
Paragon Outdoor Advertising, 8%, collateralized by sign                             
  structures, payable $2,636 monthly including interest,                            
  due July 2001...........................................           --      121,035
                                                            -----------  -----------
                                                             36,732,212   14,296,426
Less current maturities...................................      690,718    7,460,727
                                                            -----------  -----------
                                                            $36,041,494  $ 6,835,699
                                                            ===========  ===========

  Aggregate maturities of long-term debt at December 31, 1997 are as
follows:                                                                        

                                                                [Download Table]


                        YEARS ENDING                                      
                        DECEMBER 31,                                      
                        ------------                                      
                                                                          
1998........................................................   $   690,718
1999........................................................     5,676,502
2000........................................................     6,189,260
2001........................................................     6,937,451
2002........................................................    10,084,059
Thereafter..................................................     7,154,222
                                                               -----------
                                                               $36,732,212
                                                               ===========

** Loan has varying interest rates based on  Company performance                
and indexes found in the Credit Agreement dated July 31, 1997. At December 31,  
1997 the effective interest rates ranged from 7.1875% to 8.5%.                  

The Company has entered into an interest rate cap primarily to  
protect against rising interest exposure of its floating rate long-term debt.   
The difference to be paid or received on the cap is included in interest expense
as payments are made or received. At December 31, 1997, the Company had         
outstanding interest rate cap agreements with two commercial banks having a     
total notional principal amount of $50,000,000. This agreement effectively      
changes the Company's interest exposure on $50,000,000 of floating rate         
debt to a fixed 6.5% with a floor of 5.5%. The interest rate cap agreement      
matures September 18, 2000.                                                     

During 1997, the Company sold an interest rate floor for a gain 
of $220,000. This gain is included in other income.                             

   The counterparties to the Company's derivative financial instrument
contract are substantial and creditworthy commercial banks which are            
recognized market makers. Neither the risks of counterparty nonperformance nor  
the economic consequence of counterparty nonperformance associated with these   
contracts were considered by the Company to be material.                        

       Interest expense consists of interest on notes payable, management fees
and the cost associated with the purchase of the interest rate cap instrument.  

Prime rate was 8.5% and 8.25% at December 31, 1997 and 1996,    
respectively.                                                                   

LIBOR rate was 5.938% and 5.625% at December 31, 1997 and 1996, 
respectively.                                                                   

9. NOTE PAYABLE, BANK                                                           

Note payable, bank is as follows at December 31, 1997 and 1996: 

                                                                [Download Table]


                                                               1997      1996  
                                                             --------  --------
                                                                               
Heritage Oaks Bank, interest at prime plus .5%,                                
  uncollateralized, interest payable monthly, due May                          
  1997...................................................... $     --  $800,000
                                                             ========  ========

Prime rate was 8.25% at December 31, 1996.                      

10. DISTRIBUTIONS                                                               

       In January, May, August, and October 1997 and January, May, August, and
October 1996 and in July and October 1995, the Company declared a $.75          
per share cash distribution for 82,443 shares outstanding. At December 31, 1997 
and 1996, $61,832 and $61,658 were payable January 1, 1998 and 1997,            
respectively. Subsequent to conversion of the Company to an                     
S-corporation, effective July 1, 1995, the Company began making                 
distributions equal to approximately 49% of estimated taxable income to its     
shareholders to cover their tax liabilities. Distributions during the year ended
December 31, 1997, amounted to $3,140,079, including a $2,000,000 special       
distribution occurring as a result of an acquisition. Distributions during the  
year ended December 31, 1996, related to 1995 and 1996 taxable income, amounted 
to $1,353,618.                                                                  

11. DEFERRED INCOME TAXES                                                       

For state tax purposes, the applicable states do recognize "S"  
Corporation status; however, they still impose a tax at the corporate level,    
generally at a rate significantly lower than the regular corporate rate.        
Deferred tax assets and liabilities relate to temporary differences associated  
with state income taxes.                                                        

      Income tax expense (benefit) for the years ended December 31, 1997 and
1996 and six months ended December 31, 1995 consisted of the following:         

                                                                [Download Table]

                                                       1997     1996        1995    
                                                      -------  -------  ----------- 
                                                                                    
Current.............................................. $23,458  $49,827  $    24,170 
Deferred.............................................      --    7,826   (2,996,487)
                                                      -------  -------  ----------- 
Income tax expense (benefit)......................... $23,458  $57,653  $(2,972,317)
                                                      =======  =======  =========== 


   Components of deferred income tax balances at December 31, 1997 and
1996 consisted of:                                                              

                                                                [Download Table]

                                                       1997       1996  
                                                      --------  ------- 
                                                                        
Current deferred tax assets.......................... $  1,441  $  1,500
                                                      ========  ========
Long-term deferred tax liabilities................... $102,375  $111,008
                                                      ========  ========

       Deferred income taxes arise primarily from temporary differences due to
use of accelerated depreciation methods for income tax purposes and the         
straight-line method and the use of the allowance method of accounts receivable 
for financial reporting purposes.                                               

12. RELATED PARTY TRANSACTIONS                                                  

Through February 1, 1996 the Company provided management        
services to Martin Media, a company having common shareholders/partners, at a   
rate approximating 3% of Martin Media's gross revenue. Management fees of       
$78,263 were received by the Company from Martin Media during the year          
ended December 31, 1996.                                                        

    Subsequent to December 31, 1995, and effective February 1, 1996, the
Company divested itself of all management and administrative employees and      
contracted with M.W. Sign Company, a company wholly owned by E. Thomas Martin   
and David Weyrich, to provide the Company with management services at           
3% of gross revenue. As of January 1, 1997, management fees increased to 4% of  
gross revenue. Management fees of $895,281 and $472,931 were paid to M.W. Sign  
Company during the years ended December 31, 1997 and 1996, respectively.        

13. COMMITMENTS                                                                 

Leases:                                                                     

The Company leases land in connection with its outdoor          
advertising posters and panels as well as for office and yard space. The        
Company also leases office and shop buildings which are located in different    
geographic areas within the various divisions. A portion of these are long-term 
leases.                                                                         

    Lease expense for the years ended December 31, 1997 and 1996 and six
months ended December 31, 1995 was $4,748,420, $2,333,218 and $1,064,875,       
respectively.                                                                   

     Future minimum lease payments under noncancellable leases at December
31, 1997 are as follows:                                                        

                                                                [Download Table]


                                                               POSTERS,            
YEARS ENDING DECEMBER 31,                          BUILDINGS  BULLETINS     TOTAL  
-------------------------                          ---------  ----------  ---------
                                                                                   
1998.............................................. $ 19,533   $  162,400  $ 181,933
1999..............................................   19,944      162,400    182,344
2000..............................................   19,944      162,400    182,344
2001..............................................   21,285      162,400    183,685
2002..............................................   21,732      162,400    184,132
Thereafter........................................   48,897      454,400    503,297
                                                   --------   ----------  ---------
                                                   $151,335   $1,266,400 $1,417,735
                                                   ========   ========== ==========

On August 1, 1995, the Company entered into a lease with Outdoor
Systems Company of Kansas City. Under the terms of the lease Outdoor Systems    
leased 87 outdoor advertising structures from the Company for $12,500           
per month. The agreement terminated December 31, 1997.                          

Acquisition, purchase and sales options                                     

On July 31, 1997, the Company entered into an agreement with    
another company to acquire certain assets, including sign structures, equipment,
and related intangibles located in Nevada, Arizona, and California for a total  
purchase price of $60,000,000. This purchase agreement has two segments, the    
first of which provided for the purchase of assets totaling $20,500,000.        
Simultaneously, and as part of the master agreement, the Company                
entered into an agreement with Martin Media (related party) to sell them those  
assets located in their geographical service area, primarily the Las Vegas and  
Colorado River markets, for $11,273,400. The Company's net acquisition          
price under the first segment of the agreement was $9,226,600.                  

The second segment of the agreement provides an option for the  
Company to purchase additional assets for $39,500,000. As part of this          
transaction, the Company has also provided Martin Media with an option          
to purchase the assets located in the Las Vegas and Colorado River markets for  
$3,077,000. The Company's net acquisition price for assets to be                
received under the second segment of the agreement will be $36,423,000.         

Upon execution of the option agreement, the Company deposited   
$6,000,000 in good faith with the seller. Similarly, Martin Media deposited     
$463,800 with the Company resulting in a net deposit of $5,536,200. The option  
agreement expires October 1, 1998. Should the Company not exercise the option,  
the seller holds an option agreement whereby it can repurchase the assets       
originally sold to the Company and assets owned by the Company in and around    
the Bakersfield area.                                                           

As part of the option agreement, the Company will manage those  
assets covered by the option agreement. The payment for the use of these assets 
through the option period will approximate $285,000 per month. Revenue earned   
through the managed assets is subject to the 4% management fee paid to M.W.     
Sign, Inc.                                                                      

Credit facility                                                             

On July 31, 1997, the Company entered into an agreement with    
Canadian Imperial Bank of Commerce, as administrative agent for Lenders under   
the credit agreement dated July 31, 1997. Under the terms of this agreement, the
Term B Loan is available to fund future acquisitions in the amount of           
$20,000,000. As of December 31, 1997, the Company's outstanding                 
obligation was $-0-.                                                            

14. SUBSEQUENT EVENTS                                                           

Subsequent to December 31, 1997, the Company acquired           
substantially all of the assets and assumed certain liabilities of one outdoor  
advertising company at an aggregate purchase price of $12,500,000. Funds used   
to make the purchase were provided through the Company's existing credit        
facility.                                                                       

DEFM14C
62nd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 62nd
INDEPENDENT AUDITORS' REPORT    

To the Board of Directors                                                       
Martin & MacFarlane, Inc.                                                       
Paso Robles, California                                                         

      We have audited the accompanying balance sheet of Martin & MacFarlane,
Inc. as of June 30, 1995 and the related statements of income, retained earnings
and cash flows for the year then ended. These financial statements are the      
responsibility of Martin & MacFarlane, Inc.'s management. 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, the financial statements referred to above present
fairly, in all material respects, the financial position of Martin & MacFarlane,
Inc. as of June 30, 1995 and the results of its operations and its cash flows   
for the year then ended in conformity with generally accepted accounting        
principles.                                                                     

                                               BARBICH LONGCRIER HOOPER & KING
                                       ACCOUNTANCY CORPORATION

                                               By:   /s/ GEOFFREY B. KING, CPA

                                                         Geoffrey B. King, CPA

Bakersfield, California                                                         
August 25, 1995                                                                 

DEFM14C
63rd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 63rd
MARTIN & MACFARLANE, INC.   

BALANCE SHEET   
JUNE 30, 1995   

ASSETS    

                                                                [Download Table]


                                                                 1995    
                                                              -----------
                                                                         
Current Assets                                                           
  Cash and equivalents (Note 7).............................  $   351,705
  Restricted cash (Note 6)..................................      306,154
  Certificates of deposit...................................      200,000
  Investments...............................................        8,400
  Trade accounts receivable, less allowance for doubtful                 
     accounts of $100,000...................................    1,546,381
  Other receivables.........................................       78,649
  Inventories (Note 2)......................................      768,035
  Prepaid expenses (Note 3).................................      630,548
  Current deferred income taxes (Note 10)...................      145,554
                                                              -----------
                                                                4,035,426
                                                              -----------
Property and Equipment, net of accumulated depreciation                  
  (Notes 4, 7 and 8)........................................   16,872,469
                                                              -----------
Intangible Assets, net of accumulated amortization (Note5)..      764,898
                                                              -----------
Other Assets................................................       20,171
                                                              -----------
                                                              $21,692,964
                                                              ===========

    LIABILITIES AND STOCKHOLDERS' EQUITY

                                                                [Download Table]

                                                                         
Current Liabilities                                                      
  Current maturities of long-term debt (Note 7).............  $ 1,848,465
  Note payable, bank (Note 8)...............................      200,000
  Accounts payable..........................................      652,567
  Accrued expenses..........................................      319,021
  Dividends payable (Note 9)................................       26,451
  Unearned income...........................................      156,881
  Income taxes payable (Note 10)............................      891,486
                                                              -----------
                                                                4,094,871
                                                              -----------
Long-Term Debt, less current maturities (Note 7)............    8,857,936
                                                              -----------
Long-Term Deferred Income Taxes (Note 10)...................    3,208,967
                                                              -----------
Commitments (Note 13)                                                    
Stockholders' Equity                                                     
  Common stock, no par or stated value, authorized 150,000               
     shares, issued and outstanding 82,443 shares (Note 9)..    1,113,070
  Retained earnings.........................................    4,418,120
                                                              -----------
                                                                5,531,190
                                                              -----------
                                                              $21,692,964
                                                              ===========


  The accompanying notes are an integral part of this balance sheet.

DEFM14C
64th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 64th
MARTIN & MACFARLANE, INC. 

STATEMENT OF INCOME   
YEAR ENDED JUNE 30, 1995  

                                                                [Download Table]


                                                                 1995     
                                                              ----------- 
                                                                          
Income......................................................  $16,168,763 
Cost of sales...............................................    2,045,552 
                                                              ----------- 
          Gross profit......................................   14,123,211 

Managers' controlled operating expenses.....................   10,070,408 
                                                              ----------- 
          Income from managers' operations..................    4,052,803 
                                                              ----------- 
Other operating expenses                                                  
  Depreciation and amortization expense.....................    1,100,305 
                                                              ----------- 
          Operating income..................................    2,952,498 
                                                              ----------- 
Other income (expense)                                                    
  Interest expense..........................................   (1,313,456)
  Other income..............................................      152,804 
  Gain on disposition of assets.............................    2,405,522 
  Employee separation expense...............................     (269,803)
                                                              ----------- 
Income before income taxes..................................    3,927,565 
     Income tax expense (Note 10)...........................    1,519,542 
                                                              ----------- 
          Net income........................................  $ 2,408,023 
                                                              =========== 

The accompanying notes are an integral part of this statement.  

DEFM14C
65th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 65th
MARTIN & MACFARLANE, INC. 

STATEMENT OF RETAINED EARNINGS  
YEAR ENDED JUNE 30, 1995  

                                                                [Download Table]


                                                                 1995    
                                                              ---------- 
                                                                         
Balance, beginning of year..................................  $2,195,593 
  Net income................................................   2,408,023 
  Dividends (Note 9)........................................    (185,496)
                                                              ---------- 
Balance, end of year........................................  $4,418,120 
                                                              ========== 

The accompanying notes are an integral part of this statement.  

DEFM14C
66th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 66th
MARTIN & MACFARLANE, INC. 

STATEMENT OF CASH FLOWS   
YEAR ENDED JUNE 30, 1995    

                                                                [Download Table]

                                                                 1995     
                                                              ----------- 
                                                                          
Cash flows from operating activities:                                     
  Net income................................................  $ 2,408,023 
  Adjustments to reconcile net income to net cash provided                
     by operating activities:                                             
     Depreciation and amortization..........................    1,100,305 
     Gain on disposition of assets..........................   (2,405,522)
     Increase in deferred income taxes......................      469,749 
  Changes in operating assets and liabilities:                            
     Increase in accounts receivable........................      (57,463)
     Increase in other receivables..........................      (66,187)
     Decrease in inventory..................................       11,117 
     Decrease in prepaid expenses...........................       34,520 
     Increase in other assets...............................       (9,065)
     Increase in accounts payable...........................        5,887 
     Decrease in accrued liabilities........................     (176,570)
     Increase in unearned income............................       30,106 
     Increase in income taxes payable.......................      820,732 
                                                              ----------- 
          Net cash provided by operating activities.........    2,165,632 
                                                              ----------- 
Cash flows from investing activities:                                     
  Proceeds from sale of investments.........................        5,000 
  Increase in certificates of deposit.......................     (200,000)
  Proceeds from sale of fixed assets........................    2,656,384 
  Capital expenditures......................................     (736,258)
  Construction of capital improvements......................     (281,102)
  Principal payments on loans and notes receivable..........       32,000 
  Purchase of intangible assets.............................     (310,001)
                                                              ----------- 
          Net cash provided by investing activities.........    1,166,023 
                                                              ----------- 
Cash flows from financing activities:                                     
  Proceeds from notes payable...............................    1,007,317 
  Principal payments on notes payable.......................   (3,946,286)
  Dividends paid............................................     (185,496)
                                                              ----------- 
          Net cash used in financing activities.............   (3,124,465)
                                                              ----------- 
Net increase in cash and cash equivalents...................      207,190 
Cash and cash equivalents at beginning of year..............      450,669 
                                                              ----------- 
Cash and cash equivalents at end of year....................  $   657,859 
                                                              =========== 
Unrestricted cash...........................................  $   351,705 
Restricted cash.............................................      306,154 
                                                              ----------- 
                                                              $   657,859 
                                                              =========== 

Supplemental disclosures of cash flow information:                        
  Interest paid.............................................  $ 1,339,278 
                                                              =========== 
  Payment of income taxes...................................  $   229,061 
                                                              =========== 

Schedule of noncash investing:                                  

 The   Company   entered   into   an   exchange   agreement   with
   National Outdoor Media (3M) during the year ended June 30, 1995. In
accordance with the terms of the exchange agreement, the Company
        traded boards in Kansas City, Missouri to 3M in exchange for posters and
        bulletins in Bakersfield, California and Kansas at a value of $1,033,850
and $2,614,150 cash.                                            

The accompanying notes are an integral part of this statement.  

DEFM14C
67th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 67th
MARTIN & MACFARLANE, INC. 

NOTES TO FINANCIAL STATEMENTS   

1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES                       

Nature of business                                                          

Martin & MacFarlane, Inc. (the Company) was incorporated        
December 2, 1971.  The Company owns, leases, and manages billboards on          
a contractual basis nationwide for the purpose of providing outdoor advertising 
services. The Company also owns and operates a small winery located in          
Paso Robles, California. The Company extends credit in the form of              
accounts receivable to businesses and advertisers doing business in the above   
noted areas.                                                                    

Significant accounting policies                                             

BASIS OF ACCOUNTING                                                             

The financial statements are prepared on an accrual basis, which
recognizes income when earned and expenses when incurred.                       

CASH AND CASH EQUIVALENTS                                                       

The Company considers cash and cash equivalents to be all highly
liquid debt instruments purchased with a maturity of three months or less. As of
June 30, 1995, the Company held funds of $646,293 in one financial              
institution.                                                                    

ALLOWANCE FOR DOUBTFUL ACCOUNTS                                                 

       Bad debts are recognized under the allowance method of accounting which
is based on an average of actual write-offs in past years.                      

INVESTMENTS                                                                     

       Investments in marketable equity securities are carried at the lower of
cost or market. Decline in market values below cost, which are temporary in     
nature, are not recognized as losses until the decline in value is deemed       
permanent or until the security is sold.                                        

INVENTORY                                                                       

Inventory is valued at the lower of cost or market. Valuation is
determined using the first-in, first- out method.                               

PROPERTY AND EQUIPMENT                                                          

        Property and equipment are stated at cost and depreciated over estimated
useful lives on a straight-line or accelerated basis. Repairs and maintenance   
and small equipment purchases are expensed as incurred. Expenditures which      
significantly increase asset values or extend useful lives are capitalized.     
Estimated useful lives in years are as follows:                                 

                                                                [Download Table]

                                                              YEARS
                                                              -----
                                                                   
Buildings and improvements..................................  15-31
Posters.....................................................   7-25
Bulletins...................................................   7-25
Shop equipment..............................................   3-10
Office furniture and equipment..............................   5-10
Autos and trucks............................................    3-7
Irrigation equipment........................................   7-30
Vineyards...................................................  10-25


INTANGIBLE ASSETS                                                               

     Goodwill is recorded at cost and is amortized using the straight-line
method over a forty year period.                                                

     Covenants not to compete are recorded at cost and are amortized using
the straight-line method over the contractual period specified, which ranges    
from five to ten years.                                                         

INCOME TAXES                                                                    

  Effective July 1, 1993, as required by professional standards, the
Company adopted Statement of Financial Accounting Standards No. 109,            
Accounting for Income Taxes. Deferred income taxes are provided on timing       
differences between financial statement and taxable incomes. Timing differences 
arise primarily from the use of the accelerated methods of depreciation, the    
direct write-off method of accounting for bad debts, and the carryforward of net
operating losses for income tax purposes.  Determination of current or long-term
status of the asset or liability is based upon when the particular timing       
difference reverses.                                                            

2. INVENTORIES                                                                  

Inventories are as follows at June 30, 1995:                    

                                                                [Download Table]

                                                                1995  
                                                              --------
                                                                      
Raw material................................................  $ 84,383
Winery:                                                               
  Materials and grape production costs......................   141,255
  In process................................................   162,669
  Finished goods............................................   359,060
  Tasting room, miscellaneous and resale....................    20,668
                                                              --------
                                                              $768,035
                                                              ========

3. PREPAID EXPENSES                                                             

Prepaid expenses consist of the following at June 30, 1995:     

                                                                [Download Table]

                                                                1995  
                                                              --------
                                                                      
Leases......................................................  $519,079
Insurance...................................................    36,600
Miscellaneous...............................................    74,869
                                                              --------
                                                              $630,548
                                                              ========

4. PROPERTY AND EQUIPMENT                                                       

        Major classes of property and equipment and accumulated depreciation are
as follows at June 30, 1995:                                                    

                                                                [Download Table]

                                                                 1995    
                                                              -----------
                                                                         
Outdoor Advertising                                                      
  Buildings and improvements................................  $   500,731
  Posters...................................................    5,987,468
  Bulletins.................................................   13,850,302
  Shop equipment............................................      278,749
  Office furniture and equipment............................      191,692
  Autos and trucks..........................................    1,063,156
  Land......................................................      414,472
  Construction in process, boards...........................       69,038
                                                              -----------
                                                               22,355,608
  Less accumulated depreciation.............................    7,105,290
                                                              -----------
                                                               15,250,318
                                                              -----------
Winery                                                                   
  Buildings and improvements................................      664,515
  Irrigation and wells......................................       45,752
  Vineyards.................................................      278,219
  Landscaping...............................................       26,194
  Auto......................................................       19,500
  Vineyard equipment........................................      119,142
  Winery equipment..........................................      320,720
  Office furniture and equipment............................       37,604
  Land......................................................      206,133
                                                              -----------
                                                                1,717,779
  Less accumulated depreciation.............................      755,093
                                                              -----------
                                                                  962,686
                                                              -----------
Corporate                                                                
  Buildings and improvements................................  $   654,970
  Office furniture and equipment............................      267,308
  Land......................................................       42,783
                                                              -----------
                                                                  965,061
  Less accumulated depreciation.............................      305,596
                                                              -----------
                                                                  659,465
                                                              -----------
                                                              $16,872,469
                                                              ===========

     Depreciation expense for the year ended June 30, 1995 was $1,021,709.

5. INTANGIBLES                                                                  

     Intangible assets and accumulated amortization are as follows at June
30, 1995:                                                                       

                                                                [Download Table]

                                                                 1995   
                                                              ----------
                                                                        
Goodwill....................................................  $  438,965
Covenants not to compete....................................      69,000
Advertising rights..........................................     136,100
Permits and licenses........................................     168,567
Lease rights................................................     335,001
                                                              ----------
                                                               1,147,633
Less accumulated amortization...............................     382,735
                                                              ----------
                                                              $  764,898
                                                              ==========

  Amortization expense for the year ended June 30, 1995 was $78,596.

6. RESTRICTED CASH                                                              

Restricted cash at June 30, 1995 consisted of the following:    

                                                                [Download Table]

                                                                       1995  
                                                                     --------
                                                                             
Cash, interest bearing account, holdback account, held for the mutual        
  benefit of the Company and National Advertising Company,                   
  by Chicago Title & Trust Company, until released by joint order of         
  the parties.  Cash is to be released within twelve months of the           
  June 30, 1995 balance sheet date. Cash subsequently received               
  July 7, 1995...................................................... $306,154
                                                                     ========

7. LONG-TERM DEBT                                                               

Long-term debt consists of the following at June 30, 1995:      

                                                                [Download Table]

                                                                 1995    
                                                              -----------
                                                                         
Federal Land Bank, 5.75% and 6.73%, at 1995 and 1994,                    
  collateralized by first trust deed, payable $3,510 per                 
  month including interest, due May 1, 2011.................  $   410,068
Massachusetts Mutual Life Insurance Co., 11.05%, unsecured,              
  payable $500,000 per year beginning November 11, 1994,                 
  interest payable quarterly, due November 15, 1999.........    2,500,000
Massachusetts Mutual Life Insurance Co., 10.9%, unsecured,               
  payable $687,500 per year beginning August 15, 1992,                   
  interest payable quarterly, due August 15, 1999...........    3,437,500
Massachusetts Mutual Life Insurance Company, 11.55%,                     
  unsecured, payable $500,000 per year beginning June 1,                 
  1995, interest payable quarterly, due June 1, 2002........    3,500,000
Boatmen's First National Bank, interest at prime plus 1.5%,              
  collateralized by first deed of trust, payable $1,420 per              
  month including interest, due July 8, 2002................       91,056
Citizens Bank of Paso Robles, interest at prime plus 2.5%,               
  collateralized by first trust deed, payable $1,188 per                 
  month including interest, due May 13, 2002................      124,134
Sierra Outdoor, 8%, collateralized by bulletins, payable                 
  $940 per month including interest, due April 15, 1996.....        9,065
Citizens Bank of Paso Robles, interest at 9.5%,                          
  collateralized by vehicle, payable $555 per month                      
  including interest, due August 15, 1997...................       12,962
Citizens Bank of Paso Robles, interest at 9.5%,                          
  collateralized by vehicle, payable $613 per month                      
  including interest, due August 15, 1997...................       14,206
Alta and Fred Higginbotham, 8%, collateralized by deed of                
  trust, payable $150 per month, due January 1, 2000........        8,544
Estates Trust, Inc., 9%, collateralized by deed of trust,                
  payable $862 per month including interest, due October 1,              
  2009......................................................       82,916
Barbara Lehmann, 10%, collateralized by deed of trust,                   
  interest payable monthly, due March 30, 1998..............       20,000
Christine and Alice Henderson, 9%, collateralized by deed of             
  trust, payable $805 per month including interest, due                  
  April 8, 2011.............................................       97,450
Pesenti Winery, non-interest bearing, collateralized by sign             
  structure, payable $1,500 per year, due December 15,                   
  2003......................................................       13,500
Advanced Outdoor, non-interest bearing, collateralized by                
  sign structures, payable $8,500 per month, due December                
  10, 1998..................................................      357,000
Advanced Outdoor, non-interest bearing, collateralized by                
  sign structures, payable $1,000 per month, due October 1,              
  1997......................................................       28,000
                                                              -----------
                                                               10,706,401
Less current maturities.....................................    1,848,465
                                                              -----------
                                                              $ 8,857,936
                                                              ===========

Prime rate was 9% at June 30, 1995.                             

       Aggregate maturities of long-term debt at June 30, 1995 are as follows:

                                                                [Download Table]

                        YEARS ENDING                                      
                          JUNE 30,                                        
                        ------------                                      
                                                                          
1996........................................................   $ 1,848,465
1997........................................................     1,853,095
1998........................................................     1,850,465
1999........................................................     1,775,319
2000........................................................     1,728,146
Thereafter..................................................     1,650,911
                                                               -----------
                                                               $10,706,401
                                                               ===========

8. NOTE PAYABLE, BANK                                                           

Note payable, bank is as follows at June 30, 1995:              

                                                                [Download Table]

                                                                   1995  
                                                                 --------
                                                                         
Citizens Bank of Paso Robles, interest at 8.5%,                          
  collateralized by certificate of deposit, annually                     
  renewable on April 3, interest payable monthly, due April              
  3, 1996...................................................     $200,000
                                                                 ========

Prime rate was 9% at June 30, 1995.                             

9. DIVIDENDS PAYABLE                                                            

In July 1994, October 1994 and January 1995, the Company        
declared a $.50 per share cash dividend, for 82,443 shares outstanding. In May  
1995 the  Company declared a $.75 per share dividend, for 82,443 shares         
outstanding. At June 30, 1995 $26,451 was payable July 1, 1995.                 

10. DEFERRED INCOME TAXES                                                       

     Income tax expense for the year ended June 30, 1995 is computed under
SFAS 109 and consisted of the following:                                        

                                                        [Enlarge/Download Table]

                                                    FEDERAL      STATE       TOTAL   
                                                   ----------   --------   ----------
                                                                                     
Current........................................... $  808,602   $241,191  $1,049,793 
Deferred..........................................    657,023    100,162     757,185 
Tax benefit of net operating loss carryforward....   (251,439)   (35,997)   (287,436)
                                                   ----------   --------   ----------
Income tax expenses............................... $1,214,186   $305,356  $1,519,542 
                                                   ==========   ========  ========== 

     Components of deferred income tax balances at June 30, 1995 consisted
of:                                                                             

                                                                [Download Table]

                                                     FEDERAL     STATE       TOTAL  
                                                   -----------  --------   ---------
                                                                                    
Current deferred tax assets....................... $  136,254   $  9,300  $  145,554
                                                   ==========   ========  ==========
Long-term deferred tax liabilities................ $2,539,860   $669,107  $3,208,967
                                                   ==========   ========  ==========

       Deferred income tax liabilities arise primarily from timing differences
due to use of accelerated depreciation methods for income tax purposes and the  
straight-line method for financial reporting purposes. Deferred income tax      
assets arise primarily from the application of federal and state net operating  
loss carryovers.                                                                

At June 30, 1995, the Company had alternative minimum tax       
credits in the amount of $16,837, available to offset future taxes. Tax credits 
are included in deferred tax assets.                                            

11. RELATED PARTY TRANSACTIONS                                                  

The following transaction occurring between the  Company and a  
related party, which is not presented elsewhere in these financial statements,  
is as follows:                                                                  

 Martin Media, which has partners who are also stockholders in the
Company, contracts the Company to perform management duties. Martin             
Media pays a management fee to the Company which is approximately 3% of         
Martin Media's gross revenue. Management fees of $986,356 were received from    
the partnership during the fiscal year ending June 30, 1995.                    

12. PROFIT SHARING PLAN                                                         

       Discretionary contributions under a defined contribution profit sharing
plan, which are determined by the  Company's Board of Directors, have           
been accrued to a trust for the benefit of qualified employees in the amount of 
$50,000 for the year ended June 30, 1995. All costs are funded currently.       

13. COMMITMENTS                                                                 

The Company leases land in connection with its outdoor          
advertising posters and panels as well as for office and yard spaces. These are 
long-term operating leases which the Company and lessor have the option         
to terminate with thirty days notice.                                           

Lease expense for the year ended June 30, 1995 was $2,218,480.  

The Company leases office and shop buildings which are located  
at various divisions. A portion of these are long-term leases.                  

     Future minimum lease payments under noncancellable leases at June 30,
1995 are as follows:                                                            

                                                                [Download Table]


Years ending June 30,                                                 
                                                                      
  1996......................................................  $ 47,747
  1997......................................................    22,665
  1998......................................................    18,711
  1999......................................................    19,944
  2000......................................................    19,944
  Thereafter................................................   121,830
                                                              --------
                                                              $250,841
                                                              ========

DEFM14C
68th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 68th
SECOND AMENDED AND RESTATED     
STOCK PURCHASE AGREEMENT      

dated as of     

August 11, 1999     

by and among      

LAMAR ADVERTISING COMPANY     

AS PURCHASER PARENT,      

LAMAR MEDIA CORP.     

AS PURCHASER      

and     

CHANCELLOR MEZZANINE HOLDINGS CORPORATION     

and     

CHANCELLOR MEDIA CORPORATION OF LOS ANGELES     

AS SELLERS      

DEFM14C
69th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 69th
TABLE OF CONTENTS     

                                                                  PAGE

Article 1.     PURCHASE AND SALE OF SHARES                              2       

Section 1.1. Dividend of Whiteco Shares                            2  

Section 1.2. Purchase and Sale of Chancellor Shares                2  

Section 1.3. Purchase Price                                        2  

Section 1.4. Closing                                               2  

Section 1.5. Purchase Price Adjustment                             3  

Article 2.     REPRESENTATIONS AND WARRANTIES OF SELLERS                4       

Section 2.1. Corporate Organization and Authority of Chancellor       
   Mezzanine and Chancellor LA                                   5

Section 2.2. No Conflict                                           5  

Section 2.3. Corporate Organization of the Company                 6  

Section 2.4. Capital Stock of the Company                          6  

Section 2.5. Subsidiaries                                          6  

Section 2.6. Capitalization of Subsidiaries of the Company         6  

Section 2.7. Pro Forma Financial Statements                        7  

Section 2.8. Contracts; No Defaults                                7  

Section 2.9. Intellectual Property                                 9  

Section 2.10. Owned Real Property                                  9  

Section 2.11. Litigation and Proceedings                           9  

Section 2.12. Employee Benefit Plans                               10 

Section 2.13. Labor Relations                                      11 

Section 2.14. Legal Compliance                                     12 

Section 2.15. Environmental Matters                                12 

Section 2.16. Taxes                                                13 

Section 2.17. Governmental Authorities; Consents                   14 

Section 2.18. Interest in Competitors, Suppliers, and Customers    14 

Section 2.19. Insurance                                            14 

Section 2.20. Brokers' Fees                                        14 

Section 2.21. Events Subsequent to March31, 1999                   14 

Section 2.22. Chancellor Mezzanine Securities Act Representations  14 

Section 2.23. Chancellor LA Securities Act Representations         15 

Section 2.24. Divesture Assets                                     17 

Section 2.25. Necessary Lender Approvals                           17 

Article 3.     REPRESENTATIONS AND WARRANTIES  OF PURCHASER AND                 
         PURCHASER PARENT                                         17

Section 3.1. Corporate Organization and Authority of Purchaser        
    and Purchaser Parent                                          17

Section 3.2. No Conflict                                           18 

Section 3.3. Litigation and Proceedings                            18 

Section 3.4. Governmental Authorities; Consents                    18 

Section 3.5. Brokers' Fees                                         19 

Section 3.6. Capital Structure of Purchaser Parent and Purchaser   19 

Section 3.7. SEC Documents; Financial Statements                   20 

Section 3.8. Legal Compliance                                      20 

Section 3.9. Interest in Competitors, Suppliers and Customers      21 

Section 3.10. State Takeover Statutes                              21 

Section 3.11. Subsequent Events                                    21 

Section 3.12. Securities Act Representations                       21 

Section 3.13. Commitment Letters                                   22 

Article 4.     COVENANTS AND AGREEMENTS OF SELLERS                      22      

Section 4.1. Preliminary Transactions                              22 

Section 4.2. Conduct of Business                                   23 

Section 4.3. Inspection                                            24 

Section 4.4. HSR Act                                               24 

Section 4.5. No Solicitations                                      24 

Section 4.6. No Solicitation or Hiring                             24 

Section 4.7. Registration Rights Agreement and Stockholders           
    Agreement                                                     24

Section 4.8. Requests for Information                              25 

Section 4.9. Payment of Certain Employee Obligations               25 

Article 5.     COVENANTS AND AGREEMENTS OF PURCHASER AND PURCHASER              
         PARENT                                                   25

Section 5.1. HSR Act                                               25 

Section 5.2. No Use of "Chancellor" Name                           25 

Section 5.3. Investigation; Purchaser and Purchaser Parent            
    Acknowledgment                                                26

Section 5.4. No Solicitations or Hiring                            26 

Section 5.5. Stockholder Consent                                   27 

Section 5.6. Definitive Documentation                              27 

Section 5.7. Conduct of Business                                   28 

Section 5.8. Registration Rights Agreement and Stockholders           
    Agreement                                                     28

Section 5.9. Inspection                                            28 

Article 6.     JOINT COVENANTS AND AGREEMENTS                           28      

Section 6.1. Confidentiality                                       28 

Section 6.2. Support of Transaction                                29 

Section 6.3. [Intentionally Left Blank]                            29 

Section 6.4. Tax Matters                                           29 

Section 6.5. Certain Employee Benefits Matters                     32 

Article 7.     CONDITIONS TO OBLIGATIONS                                34      

Section 7.1. Conditions to Obligations of Purchaser, Purchaser        
    Parent and Sellers                                            34

Section 7.2. Conditions to Obligations of Purchaser and Purchaser     
    Parent                                                        35

Section 7.3. Conditions to the Obligations of Sellers              36 

Article 8.     TERMINATION                                              37      

Section 8.1. Termination                                           37 

Section 8.2. Effect of Termination                                 38 

Section 8.3. Other Termination                                     38 

Article 9.     INDEMNIFICATION                                          38      

Section 9.1. Survival of Representations                           38 

Section 9.2. Indemnification of Purchaser and Purchaser Parent     38 

Section 9.3. Indemnification of Sellers                            39 

Section 9.4. Conduct of Proceedings                                39 

Section 9.5. Sole Remedy; Time Limitation                          39 

Article 10.    CERTAIN DEFINITIONS                                      40      

Article 11.    MISCELLANEOUS                                            45      

Section 11.1. Waiver                                               45 

Section 11.2. Notices                                              46 

Section 11.3. Termination of Subscription Agreement                47 

Section 11.4. Assignment                                           47 

Section 11.5. Rights of Third Parties                              48 

Section 11.6. Expenses                                             48 

Section 11.7. Construction                                         48 

Section 11.8. Captions; Counterparts                               48 

Section 11.9. Entire Agreement                                     48 

Section 11.10. Amendments                                          49 

Section 11.11. Publicity                                           49 

Section 11.12. Dispute Resolution                                  49 

DEFM14C
70th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 70th
SCHEDULES                                                                       

Schedule 2.2: No Conflict                                                       
Schedule 2.4: Capitalization of the Company                                     
Schedule 2.5: Subsidiaries of the Company                                       
Schedule 2.6: Capitalization of Subsidiaries of the Company                     
Schedule 2.7: Pro Forma Financial Statements                                    
Schedule 2.8: Contracts; No Defaults                                            
Schedule 2.9: Intellectual Property                                             
Schedule 2.10: Owned Real Property                                              
Schedule 2.11: Litigation and Proceedings                                       
Schedule 2.12: Employee Benefits Plans                                          
Schedule 2.13: Labor Relations                                                  
Schedule 2.14: Legal Compliance                                                 
Schedule 2.15: Environmental Matters                                            
Schedule 2.16: Taxes                                                            
Schedule 2.17: Governmental Authorities; Consents                               
Schedule 2.18: Transactions with Affiliates                                     
Schedule 2.21: Events Subsequent to March 31, 1999                              
Schedule 3.4: Purchaser Governmental Authorities; Consents                      
Schedule 4.9: Payments of Certain Employee Obligations                          

ANNEXES                                                                         

Annex A:  Description of Divestiture Assets                                     
Annex B:  Description of Burkett Assets                                         
Annex C:  [Intentionally Left Blank]                                            
Annex D:  Registration Rights Agreement                                         
Annex E:  Stockholders Agreement                                                
Annex F:  [Intentionally Left Blank]                                            
Annex G:  Voting Agreement                                                      

DEFM14C
71st “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 71st
SECOND AMENDED AND RESTATED     
STOCK PURCHASE AGREEMENT      

This Second Amended and Restated Stock Purchase Agreement (this 
"AGREEMENT") is entered into by and among LAMAR ADVERTISING COMPANY, a          
Delaware corporation ("PURCHASER PARENT"), LAMAR MEDIA CORP., a Delaware        
corporation and a wholly-owned subsidiary of Purchaser Parent                   
("PURCHASER"), CHANCELLOR MEZZANINE HOLDINGS CORPORATION, a Delaware            
corporation ("CHANCELLOR MEZZANINE"), and CHANCELLOR MEDIA CORPORATION OF       
LOS ANGELES, a Delaware corporation ("CHANCELLOR LA" and, collectively with     
Chancellor Mezzanine, "SELLERS"), as of this 11th day of August, 1999.          

RECITALS:       

     WHEREAS, Chancellor LA is the sole record and beneficial owner of one
thousand (1,000) shares (the "COMPANY SHARES") of the common stock, par         
value $0.01 per share, of Chancellor Media Outdoor Corporation, a Delaware      
corporation (the "COMPANY"), which Company Shares constitute all of the         
issued and outstanding shares of the capital stock of the Company;              

   WHEREAS, the Company is the sole record and beneficial owner of one
thousand (1,000) shares (the "WHITECO SHARES" and, together with the            
Company Shares, the "CHANCELLOR SHARES") of the common stock, par value         
$0.01 per share, of Chancellor Media Whiteco Outdoor Corporation, a             
Delaware corporation and a wholly owned subsidiary of the Company               
("WHITECO"), which Whiteco Shares constitute all of the issued and              
outstanding shares of the capital stock of Whiteco;                             

      WHEREAS, pursuant to that certain Stock Purchase Agreement dated as of
June 1, 1999 (the "ORIGINAL AGREEMENT"), Chancellor LA agreed to sell to        
Purchaser, and Purchaser agreed to purchase from Chancellor LA, the Company     
Shares, upon the terms and subject to the conditions set forth in the           
Original Agreement;                                                             

       WHEREAS, the Original Agreement was amended and restated as of July 12,
1999 (the "Restated Agreement");                                                

       WHEREAS, the parties desire to amend certain provisions of the Restated
Agreement pursuant to this Agreement, with this Agreement being deemed to       
amend and restate the Restated Agreement in its entirety; and                   

WHEREAS, certain capitalized terms used herein have the meanings
assigned to them in Article 10 hereof.                                          

AGREEMENT:    

 In consideration of the mutual covenants and agreements contained
herein, and other good and valuable consideration, the receipt and adequacy of  
which is hereby acknowledged, the parties hereto agree as follows:              

ARTICLE 1.      
PURCHASE AND SALE OF SHARES     

    Section 1.1.   DIVIDEND OF WHITECO SHARES.  On the Closing Date, and
immediately prior to the Closing, (i) the Company will effect a dividend to its 
immediate parent corporation, Chancellor LA, of the Whiteco Shares and (ii)     
Chancellor LA will cause the Whiteco Shares to be distributed as a dividend with
such shares ultimately being held by Chancellor Mezzanine.  Such dividends are  
referred to herein collectively as the "DIVIDEND."                              

       Section 1.2.    PURCHASE AND SALE OF CHANCELLOR SHARES.  Upon the terms
and subject to the conditions contained herein, on the Closing Date and         
immediately after the Dividend is effected, (i) Chancellor Mezzanine will sell, 
convey and transfer to Purchaser, and Purchaser will purchase and acquire from  
Chancellor Mezzanine, the Whiteco Shares, and (ii) Chancellor LA will sell,     
convey and transfer to Purchaser, and Purchaser will purchase and acquire from  
Chancellor LA, the Company Shares.                                              

  Section 1.3.    PURCHASE PRICE.  Upon the terms and subject to the
conditions contained herein, on the Closing Date, (a) as consideration for the  
Whiteco Shares, (i) Purchaser will pay to Chancellor Mezzanine Ten Million      
Dollars ($10,000,000) (the "WHITECO CASH CONSIDERATION") and (ii) Purchaser     
Parent will issue to Chancellor Mezzanine the number of shares of Class A       
Common Stock, par value $0.001, of Purchaser Parent ("PURCHASER PARENT CLASS A  
COMMON STOCK") as shall represent an aggregate value of Nine Hundred Forty      
Million Dollars ($940,000,000), valued based on the closing price of such       
shares on the Nasdaq National Market on the trading day immediately prior       
to the Closing Date, but in no event more than 26,227,273 of such shares        
(the "LAMAR MEZZANINE SHARES") and (b) as consideration for the Company         
Shares, (i) Purchaser will pay to Chancellor LA Six Hundred Ninety Million      
Dollars ($690,000,000) (the "COMPANY CASH CONSIDERATION" and, collectively      
with the Whiteco Cash Consideration, the "CASH CONSIDERATION") and              
(ii) Purchaser Parent will issue to Chancellor LA the positive number of        
shares of Purchaser Parent Class A Common Stock, if any, obtained by            
subtracting the number of Lamar Mezzanine Shares from 26,227,273 (the           
"LAMAR LA SHARES" and, collectively with the Lamar Mezzanine Shares, the        
"LAMAR SHARES"), subject to the adjustments set forth in Section 1.5 hereof     
(the "TOTAL CONSIDERATION").                                                    

Section 1.4.    CLOSING.                                        

                (a)  The consummation of the purchase and sale of the Chancellor
Shares (the "CLOSING") shall take place at 10:00 a.m., local time, on the tenth 
(10th) Business Day following the satisfaction of the conditions to the         
obligations of the parties set forth in Article 7 hereof, at the offices of     
Sellers, 1845 Woodall Rodgers Freeway, Suite 1300, Dallas, Texas, or at         
such other time or place as Sellers and Purchaser may agree in writing (the     
day on which the Closing takes place being referred to herein as the            
"CLOSING DATE").                                                                

              (b)  At the Closing, (i) Chancellor Mezzanine shall deliver or
cause to be delivered to Purchaser (A) one or more stock certificates evidencing
the Whiteco Shares, duly endorsed in blank or accompanied by a stock power duly 
executed in blank, and (B) the other documents required to be delivered by      
Chancellor Mezzanine pursuant to Article 7 hereof, and (ii) Chancellor LA       
shall deliver or cause to be delivered to Purchaser (A) one or more stock       
certificates evidencing the Company Shares, duly endorsed in blank or           
accompanied by a stock power duly executed in blank, and (B) the other          
documents required to be delivered by Chancellor LA pursuant to Article 7       
hereof.                                                                         

                (c)  At the Closing, (i) Purchaser Parent shall deliver or cause
to be delivered to (A) Chancellor Mezzanine one or more stock certificates      
evidencing the Lamar Mezzanine Shares and (B) Chancellor LA one or more stock   
certificates evidencing the Lamar LA Shares, if any, (ii) Purchaser shall pay to
(X) Chancellor Mezzanine the Whiteco Cash Consideration and (Y) Chancellor LA   
the Company Cash Consideration in each case, prior to giving effect to any      
adjustment provided for in Section 1.5 hereof,  and in each case by             
intrabank transfer or wire transfer of immediately available funds to an        
account or accounts designated in writing by Chancellor Mezzanine and           
Chancellor LA, respectively, and (iii) each of Purchaser and Purchaser          
Parent shall deliver to each Seller the documents required to be delivered      
by Purchaser and Purchaser Parent to such Seller pursuant to Article 7          
hereof.                                                                         

Section 1.5.    PURCHASE PRICE ADJUSTMENT.                      

            (a)  As soon as reasonably practicable following the Closing
Date, and in any event within forty-five (45) calendar days thereof, Chancellor 
LA shall prepare and deliver to Purchaser (i) a consolidated balance sheet of   
the Company as of the Closing (after giving effect to the Preliminary           
Transactions but prior to giving effect to the Dividend) which shall be         
audited by PriceWaterhouseCoopers LLP ("PWC"), together with the related        
audit report of such firm (the "CLOSING BALANCE SHEET"), and (ii) a             
calculation of the Net Working Capital of the Company as set forth on the       
Closing Balance Sheet (the "CLOSING DATE NET WORKING CAPITAL").  The            
Closing Balance Sheet shall be prepared in accordance with United States        
generally accepted accounting principles ("GAAP") consistent with the           
preparation of the Pro Forma Balance Sheet, and shall fairly present the        
consolidated financial position of the Company (including Whiteco) as of        
the Closing.  "Net Working Capital" shall mean (i) current assets of the        
Company, minus (ii) current liabilities of the Company.  Current                
liabilities of the Company shall (A) include, without limitation, any           
severance payments provided on SCHEDULE 2.13 which have been paid, or will      
be paid, by the Company or its Subsidiaries and which are accrued and           
incurred after the Closing but prior to the time of the calculation of          
Closing Date Net Working Capital pursuant to this Section 1.5(a), and           
(B) exclude, without limitation, any liability of the Company or its            
Subsidiaries, including, but not limited to, any liability for Taxes and        
severance payments, which Chancellor LA has agreed to or is otherwise           
obligated to pay.  Notwithstanding the foregoing, in calculating Net            
Working Capital, all intercompany payables and receivables between              
Chancellor LA, the Company and its Subsidiaries shall be disregarded.           

              (b)  Upon delivery of the Closing Balance Sheet, Chancellor LA
will provide Purchaser with access to its records and will use commercially     
reasonable efforts to provide Purchaser and its accountants access to the work  
papers of PWC, to the extent reasonably related to Purchaser's evaluation of the
Closing Balance Sheet and the calculation of the Closing Date Net Working       
Capital.  The Purchaser may dispute the calculation of the Closing Date Net     
Working Capital or any element of the Closing Balance Sheet relevant            
thereto, by notifying Chancellor LA of such disagreement in writing,            
setting forth in detail the particulars of such disagreement, within thirty     
(30) calendar days after its receipt of the Closing Balance Sheet; provided     
that the basis of any such dispute shall be limited to the failure of the       
calculation of Closing Date Net Working Capital or any amount reflected on      
the Closing Balance Sheet to have been determined in accordance with GAAP       
applied on a basis consistent with this Section 1.5.  In the event that         
Purchaser does not provide such a notice of disagreement within such thirty     
(30) calendar day period, Purchaser shall be deemed to have accepted the        
Closing Balance Sheet and the calculation of the Closing Date Net Working       
Capital delivered by Chancellor LA, which shall be final, binding and           
conclusive for all purposes hereunder.  In the event any such notice of         
disagreement is timely provided, Purchaser and Chancellor LA shall use          
commercially reasonable efforts for a period of thirty (30) calendar days       
(or such longer period as they may mutually agree) to resolve any               
disagreements with respect to the calculation of the Closing Date Net           
Working Capital.  If, at the end of such period, they are unable to resolve     
such disagreements, then the Chicago, Illinois office of Ernst & Young LLP      
(or such other independent accounting firm of recognized national standing      
as may be mutually selected by Purchaser and Chancellor LA) (the "AUDITOR")     
shall resolve any remaining disagreements.  The Auditor shall determine as      
promptly as practicable, but in any event within thirty (30) calendar days      
of the date on which such dispute is referred to the Auditor, whether the       
Closing Balance Sheet was prepared in accordance with the standards set         
forth in Section 1.5(a) and (only with respect to the remaining                 
disagreements submitted to the Auditor) whether and to what extent (if any)     
the Closing Date Net Working Capital requires adjustment.  The fees and         
expenses of the Auditor shall be paid one-half by Purchaser and one-half by     
Chancellor LA.  The determination of the Auditor shall be final, conclusive     
and binding on the parties.  The date on which the Closing Date Net Working     
Capital is finally determined in accordance with this Section 1.5(b) is         
hereinafter referred as to the "DETERMINATION DATE."                            

               (c)  The "ADJUSTMENT AMOUNT," shall mean the difference between
(i) the Closing Date Net Working Capital, and (ii) Twelve Million Dollars       
($12,000,000) (the "MINIMUM NET WORKING CAPITAL").  If the Closing Date Net     
Working Capital exceeds the Minimum Net Working Capital, then, promptly and in  
any event within five (5) Business Days following the Determination Date,       
Purchaser shall pay to Chancellor LA, by wire transfer of immediately           
available funds to an account designated in writing by Chancellor LA, the       
Adjustment Amount, together with interest on such amount from the Closing       
Date to the date of payment at the prime rate of interest (the "APPLICABLE      
RATE") published in the "Money Rates" column of the Eastern Edition of THE      
WALL STREET JOURNAL (or the average of such rates if more than one rate is      
indicated) on the Closing Date.  If the Minimum Net Working Capital exceeds     
the Closing Date Net Working Capital, then, promptly and in any event           
within five (5) Business Days following the Determination Date, Chancellor      
LA shall pay to Purchaser, by wire transfer of immediately available funds      
to an account designated in writing by Purchaser, the Adjustment Amount,        
together with interest on such amount from the Closing Date to the date of      
payment at the Applicable Rate.                                                 

ARTICLE 2.      
REPRESENTATIONS AND WARRANTIES OF SELLERS     

      Sellers, jointly and severally, represent and warrant to Purchaser and
Purchaser Parent that as of the date of this Agreement (provided, however,      
that any representation or warranty made herein that relates (i) solely to      
Chancellor Mezzanine is being made solely by Chancellor Mezzanine or (ii)       
solely to Chancellor LA is being made solely by Chancellor LA):                 

  Section 2.1.    CORPORATE ORGANIZATION AND AUTHORITY OF CHANCELLOR
MEZZANINE AND CHANCELLOR LA.                                                    

           (a)  Chancellor Mezzanine has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the State  
of Delaware and has the corporate power and authority to enter into and perform 
its obligations under this Agreement.  The execution and delivery of this       
Agreement and the consummation of the transactions contemplated hereby have     
been duly and validly authorized and approved by the Board of Directors of      
Chancellor Mezzanine, and no other corporate proceeding on the part of          
Chancellor Mezzanine is necessary to authorize this Agreement or the            
transactions contemplated hereby.  This Agreement has been duly and validly     
executed and delivered by Chancellor Mezzanine and, assuming this Agreement     
constitutes a valid and binding agreement of each of Purchaser, Purchaser       
Parent and Chancellor LA, constitutes a legally valid and binding               
obligation of Chancellor Mezzanine, enforceable against Chancellor              
Mezzanine in accordance with its terms, subject to applicable bankruptcy,       
insolvency, fraudulent conveyance, reorganization, moratorium and similar       
laws affecting creditors' rights generally and subject, as to                   
enforceability, to general principles of equity.                                

            (b)  Chancellor LA has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of       
Delaware and has the corporate power and authority to enter into and perform its
obligations under this Agreement.  The execution and delivery of this           
Agreement and the consummation of the transactions contemplated hereby have     
been duly and validly authorized and approved by the Board of Directors of      
Chancellor LA, and no other corporate proceeding on the part of Chancellor      
LA is necessary to authorize this Agreement or the transactions                 
contemplated hereby.  This Agreement has been duly and validly executed and     
delivered by Chancellor LA and, assuming this Agreement constitutes a valid     
and binding agreement of each of Purchaser, Purchaser Parent and Chancellor     
Mezzanine, constitutes a legally valid and binding obligation of Chancellor     
LA, enforceable against Chancellor LA in accordance with its terms, subject     
to applicable bankruptcy, insolvency, fraudulent conveyance,                    
reorganization, moratorium and similar laws affecting creditors' rights         
generally and subject, as to enforceability, to general principles of           
equity.                                                                         

      Section 2.2,    NO CONFLICT.  Except as set forth on SCHEDULE 2.2, the
execution and delivery of this Agreement by each of Chancellor Mezzanine and    
Chancellor LA and the consummation of the transactions contemplated hereby do   
not and will not violate any provision of, or result in the breach of:  (a) any 
law, rule or regulation of any Governmental Authority, any Contract listed      
pursuant to Section 2.8(a), or any order, judgment or decree applicable to      
such entity, the Company or any Subsidiary of the Company, or terminate or      
result in the termination of any such Contract, or result in the creation       
of any Lien, charge or encumbrance upon any of the properties or assets of      
such entity, the Company or any Subsidiary of the Company, or constitute an     
event which, after notice or lapse of time or both, would result in any         
such violation, breach, acceleration, termination or creation of a Lien; or     
(b) the Certificate of Incorporation, Bylaws or other organizational            
documents of such entity, the Company or any Subsidiary of the Company.         

       Section 2.3.    CORPORATE ORGANIZATION OF THE COMPANY.  The Company has
been duly incorporated and is validly existing as a corporation in good standing
under the laws of the State of Delaware and has the corporate power and         
authority to own or lease its properties and to conduct the Business as it      
is now being conducted.  The copies of the Certificate of Incorporation and     
Bylaws of the Company previously delivered by the Company to Purchaser are      
true, correct and complete.  The Company is duly licensed or qualified and      
in good standing as a foreign corporation in each jurisdiction in which the     
ownership of its property or the character of its activities is such as to      
require it to be so licensed or qualified, except where the failure to be       
so licensed or qualified would not have a material adverse effect on the        
business, operations or financial condition of the Company and its              
Subsidiaries, taken as a whole.                                                 

 Section 2.4.    CAPITAL STOCK OF THE COMPANY.  The Company Shares
constitute all the issued and outstanding shares of capital stock of the        
Company.  The Company Shares have been duly authorized and validly issued and   
are fully paid and nonassessable and were not issued in violation of any        
preemptive rights.  There are no options, warrants, agreements, arrangements,   
or other rights relating to the capital stock of the Company or other securities
exercisable or exchangeable for any capital stock of the Company that           
either (i) obligates the Company to issue, sell, transfer, repurchase,          
redeem or otherwise acquire or vote any shares of its capital stock, or         
(ii) restricts the transfer of its capital stock.  Chancellor LA is the         
sole record and beneficial owner of the Company Shares and owns the Company     
Shares free and clear of any Liens other than the Liens described on            
SCHEDULE 2.4 hereto.                                                            

     Section 2.5.    SUBSIDIARIES.  Set forth on SCHEDULE 2.5 is a list of
all Subsidiaries of the Company.  Each Subsidiary of the Company has been duly  
formed and is validly existing under the laws of the jurisdiction of its        
formation and has the corporate or limited liability company power and          
authority, as applicable, to own or lease its properties and to conduct its     
business as it is now being conducted.  The Company has previously provided,    
or shall provide prior to the Closing, to Purchaser copies of the organizational
documents of each Subsidiary of the Company, and such copies are true,          
correct and complete.  Each such Subsidiary is duly licensed or qualified       
and in good standing in each jurisdiction in which its ownership of             
property or the character of its activities is such as to require such          
Subsidiary to be so licensed or qualified, except where the failure to be       
so licensed or qualified would not have a material adverse effect on the        
business, operations or financial condition of the Company and its              
Subsidiaries, taken as a whole.  The jurisdiction of incorporation or           
organization of the Subsidiaries of the Company are set forth on                
SCHEDULE 2.5 hereto.                                                            

Section 2.6.    CAPITALIZATION OF SUBSIDIARIES OF THE COMPANY.  

                (a)  Except as set forth on SCHEDULE 2.6 or in the last sentence
of this Section 2.6, (i) each Subsidiary of the Company including, without      
limitation, Whiteco prior to the Dividend, is wholly-owned of record and        
beneficially by the Company or another wholly-owned Subsidiary of the           
Company, and (ii) the ownership interests of the Company in each such           
Subsidiary are owned of record and beneficially by the Company, free and        
clear of any Liens other than Liens described on SCHEDULE 2.6 hereto.           
Except as set forth on SCHEDULE 2.6, there are no options, warrants,            
agreements, arrangements or other rights relating to, or other securities       
exercisable or exchangeable for, any capital stock or other equity security     
of any Subsidiary of the Company that either (i) obligates any Subsidiary       
of the Company to issue, sell, transfer, repurchase, redeem or otherwise        
acquire or vote any shares of capital stock of any Subsidiary of the            
Company, or (ii) restricts the transfer of the capital stock of any             
Subsidiary of the Company.                                                      

     (b)  The Whiteco Shares constitute all the issued and
outstanding shares of capital stock of Whiteco.  The Whiteco Shares have been   
duly authorized and validly issued and are fully paid and nonassessable and were
not issued in violation of any preemptive rights.  On the Closing Date,         
immediately prior to the Closing (after giving effect to the Dividend), Whiteco,
which, as of the date hereof, is a wholly-owned Subsidiary of the Company, will 
be a wholly-owned Subsidiary of Chancellor Mezzanine.                           

     Section 2.7.    Pro Forma Financial Statements.  Attached as SCHEDULE
2.7 hereto are (i) the unaudited consolidated balance sheet of the Company as of
March 31, 1999 (the "PRO FORMA BALANCE SHEET"), which has been adjusted to give 
effect to the Preliminary Transactions, including any accruals for Taxes        
associated therewith, as if such transactions had been consummated on such      
date, and (ii) the unaudited consolidated statement of operations of the        
Company for the twelve-month period ended March 31, 1999, which has been        
adjusted to give effect to the Preliminary Transactions as if such              
transactions had been consummated on April 1, 1998 (the "pro forma              
Statement of operations").  The Pro Forma Balance Sheet was prepared in         
accordance with the books and records of Chancellor LA and its Subsidiaries     
and fairly presents the assets and liabilities of the Company as of             
March 31, 1999, after giving effect to the Preliminary Transactions as if       
the Preliminary Transactions had been consummated on such date, and the Pro     
Forma Statement of Operations was prepared in accordance with the books and     
records of Chancellor LA and its Subsidiaries and fairly present the            
results of operations of the Company for the twelve-month period ended          
March 31, 1999, after giving effect to the Preliminary Transactions as if       
such transactions had been consummated on April 1, 1998, to the extent          
required by GAAP, subject to the notes and ancillary information included       
in such financial statements.                                                   

Section 2.8.    CONTRACTS; NO DEFAULTS.                         

               (a)  SCHEDULE 2.8 contains a listing of all Contracts described
in clauses (i) through (xi) below to which the Company or any of its            
Subsidiaries is a party, other than any such Contract (A) which will be         
terminated at or prior to the Closing, or (B) as to which the Company and its   
Subsidiaries will have no further liability following the Closing.  True,       
correct and complete copies of contracts referred to in clauses (i)-(xi) below  
have been delivered to or made available to Purchaser and its agents and        
representatives.                                                                

                     (i)    Each Contract providing for the performance of
services or the delivery of goods and/or materials by or to the Company or any  
of its Subsidiaries entered into outside the ordinary course of business of the 
Company and itsSubsidiaries and which provides for consideration to be furnished
to or by the Company or any of its Subsidiaries of value in excess of $150,000  
in any one year;                                                                

              (ii)   Each note, debenture, other evidence of
indebtedness, guarantee, loan, credit or financing agreement or instrument or   
other contract for money borrowed, including any agreement or commitment for    
future loans, credit or financing;                                              

                (iii)  Each lease, rental or occupancy agreement
involving aggregate payments in excess of $150,000 in any one year;             

                 (iv)   Each material licensing agreement or other
Contract with respect to patents, trademarks, copyrights, or other intellectual 
property, including agreements with current or former employees, consultants, or
contractors regarding the appropriation or the nondisclosure of Intellectual    
Property (as hereinafter defined) other than customary employee, vendor and     
other non-disclosure agreements;                                                

                    (v)    Each collective bargaining agreement or other
Contract to or with any labor union or other employee representative of a group 
of employees relating to wages, hours, and other conditions of employment;      

                (vi)   Each joint venture agreement, partnership
agreement, or limited liability company agreement;                              

                      (vii)  Each material distribution, franchise, license,
sales, commission, consulting or agency agreement for advertising to be provided
to the Company or its Subsidiaries, excluding Advertising Contracts, providing  
for annual payments in excess of $150,000, which are not cancelable on thirty   
(30) calendar days' notice;                                                     

                        (viii) Each material option to buy any property, real or
personal, or material options to sell any Owned Real Property or personal       
property;                                                                       

                     (ix)   Each Contract (except personal property leases
and construction contracts) involving expenditures or liabilities in excess of  
$250,000, or otherwise material to the Business; and                            

                  (x)    Each material Contract containing covenants
limiting the freedom of the Company or its Subsidiaries to engage in the        
Business or compete with any Person other than in connection with any license   
agreements to which Chancellor LA is a party (other than provisions in any      
lease that limit the type of advertising messages or advertising that may be    
displayed on outdoor advertising structures or the types of advertisers);       

                     (xi)   Each written employment or severance agreement
pertaining to the Business to which either the Company or any of its Affiliates 
is a party with any employee which may not be terminated at will, or by giving  
notice of thirty (30) calendar days or less, without cost or penalty.           

                (b)  Except as set forth on Schedule 2.8, no condition exists or
event has occurred which, with notice or lapse of time or both, would constitute
a default by the Company or any of its Subsidiaries under the Contracts         
listed pursuant to paragraph (a) of this Section 2.8, or, to the best           
knowledge of the Company, any other party thereto.                              

          (c)  Except as set forth on Schedule 2.8, to the Company's
knowledge, all of the Contracts set forth on Schedule 2.8 are valid and in full 
force and effect.  The Company and its Subsidiaries have duly performed all of  
their material obligations under such Contracts to the extent those obligations 
to perform have accrued, and no violation of, or default or breach under, such  
Contracts by the Company or its Subsidiaries, or, to the Company's              
knowledge, any other party has occurred, and neither the Company nor its        
Subsidiaries, nor, to the Company's knowledge, any other party has              
repudiated any provisions thereof.  Since November 30, 1998, to the             
Company's knowledge, the Company and its Subsidiaries have performed, in        
all material respects, their obligations under the Advertising Contracts        
and agreements for Leased Real Property, to the extent those obligations to     
perform have accrued.                                                           

        Section 2.9.    Intellectual Property.  SCHEDULE 2.9 lists each material
patent, registered trademark, service mark or trade name or registered copyright
and applications for any of the foregoing (collectively, "INTELLECTUAL          
PROPERTY"), held by the Company or any of its Subsidiaries and used in the      
operation of the Business.  The Contracts listed on SCHEDULE 2.8 include        
all material license or sublicense agreements entered into by the Company       
or any of its Subsidiaries in connection with the conduct of the Business       
with respect to any patent, trademark, service mark, logo, trade name or        
copyright to which the Company or any of its Subsidiaries is a party and        
which is material to the operation of the Business, as presently being          
conducted.  Except as set forth on SCHEDULE 2.9, to the best knowledge of       
the Company, (i) the Company or one of its Subsidiaries has good title to,      
or has the right to use pursuant to license, sublicense, agreement or           
permission each such item of Intellectual Property owned or used by it,         
free and clear of any Liens other than Permitted Liens, and (ii) there is       
no claim of infringement pending or threatened against the Company or any       
of its Subsidiaries relating to any item of Intellectual Property used in       
the operation of the Business, as presently conducted.                          

Section 2.10.   OWNED REAL PROPERTY.                            

              (a)  SCHEDULE 2.10 lists all Owned Real Property.  The Company
or one of its Subsidiaries has (or at the Closing will have) good and marketable
fee simple title to all Owned Real Property, subject only to any (i) Permitted  
Liens, (ii) Lien constituting a lease, sublease or occupancy agreement that     
gives any third party any right to occupy any portion of the Owned Real         
Property, and (iii) Lien reflected on any survey or in any title report         
made available to Purchaser prior to the date of this Agreement.                

               (b)  Except as set forth on SCHEDULE 2.10, there are no pending
or, to the knowledge of Chancellor LA, threatened condemnation proceedings with 
respect to any portion of Owned Real Property, or litigation or                 
administrative actions relating to any portion of Owned Real Property.          

             (c)  All Owned Real Property and the improvements thereon are
supplied with utilities and other services necessary for the operation of such  
facilities as currently operated.                                               

   Section 2.11.   LITIGATION AND PROCEEDINGS.  Except as set forth on
SCHEDULE 2.11, there are no lawsuits, actions, suits, claims or other           
proceedings at law or in equity, or to the knowledge of the Company,            
investigations, before or by any court or Governmental Authority or before any  
arbitrator pending or, to the knowledge of the Company, threatened, against the 
Company or any of its Subsidiaries (a) in which the relief sought includes      
damages in excess of $100,000 in any individual case, (b) seeking as of the date
hereof to delay, limit or enjoin the transactions contemplated by this          
Agreement, or (c) that would materially impair the ability of Chancellor        
Mezzanine, Chancellor LA, the Company or its Subsidiaries to perform their      
obligations hereunder.  Except as set forth on SCHEDULE 2.11, there is no       
unsatisfied judgment, order or decree requiring payment in excess of $100,000 or
any open injunction binding upon the Company or any of its Subsidiaries.        
Neither the Company nor any of its Subsidiaries is in default with respect      
to or subject to any judgment, order, writ, injunction or decree of any         
court or governmental agency in any material matter.                            

Section 2.12.   EMPLOYEE BENEFIT PLANS.                         

         (a)  DEFINITIONS.  The following terms, when used in this
Section 2.12, shall have the following meanings.  Any of these terms may, unless
the context otherwise requires, be used in the singular or the plural depending 
on the reference.                                                               

                       (i)    EMPLOYEE PLANS.  "Employee Plans" shall mean all
Multiemployer Plans, Pension Plans and Welfare Plans.                           

              (ii)   ERISA.  "ERISA" shall mean the Employee
Retirement Income Security Act of 1974, as amended.                             

                      (iii)  MULTIEMPLOYER PLAN.  "Multiemployer Plan" shall
mean any "multiemployer plan," as defined in Section 4001(a)(3) of ERISA, (A) to
which the Company or any of its Subsidiaries maintains, administers, contributes
or is required to contribute, and (B) which covers any employee or former       
employee of the Company or any of its Subsidiaries (with respect to their       
relationship with such entities).                                               

                    (iv)   PBGC.  "PBGC" shall mean the Pension Benefits
Guaranty Corporation.                                                           

                   (v)    PENSION PLAN.  "Pension Plan" shall mean any
"employee pension benefit plan" as defined in Section 3(2) of ERISA (other than 
a Multiemployer Plan) (A) which the Company or any of its Subsidiaries          
maintains, administers, contributes to or is required to contribute to, and (B) 
which covers any employee or former employee of the Company or any of its       
Subsidiaries (with respect to their relationship with such entities).           

                   (vi)   WELFARE PLAN.  "Welfare Plan" shall mean any
"employee welfare benefit plan" as defined in Section 3(1) of ERISA, (A) which  
the Company or any of its Subsidiaries maintains, administers, contributes to or
is required to contribute to, and (B) which covers any employee or former       
employee of the Company or any of its Subsidiaries (with respect to their       
relationship with such entities).                                               

           (b)  DISCLOSURE.  SCHEDULE 2.12 contains a complete list of
Employee Plans.                                                                 

               (c)  REPRESENTATIONS.  Chancellor LA represents and warrants as
follows:                                                                        

(i)    PENSION PLANS            

                             (A)  Except as set forth on SCHEDULE 2.12, each
Pension Plan and each related trust agreement, annuity contract or other funding
instrument which is intended to be qualified and tax-exempt under the provisions
of Code Sections 401(a) and 501(a) has been determined by the Internal Revenue  
Service to be so qualified and tax-exempt or application for such               
determination has been made.                                                    

                             (B)  Except as set forth on SCHEDULE 2.12, each
Pension Plan and each related trust agreement, annuity contract or other funding
instrument is in material compliance with its terms and, both as to form and in 
operation, with the requirements prescribed by any and all statutes, orders,    
rules and regulations which are applicable to such plans, including without     
limitation ERISA and the Code.                                                  

                            (C)  The Company does not sponsor, and has not
sponsored at any time during the five (5) year period ending on the Closing     
Date, a Pension Plan that is subject to Title IV of ERISA.  None of the Company,
nor any of its Subsidiaries has incurred any material liability, directly or    
indirectly, for breach of any provision of ERISA.                               

                 (ii)   MULTIEMPLOYER PLANS.  None of the Company,
Chancellor Mezzanine, Chancellor LA or any Subsidiary of any of the foregoing,  
has been a participating employer in, or has assumed any liabilities under, a   
Multiemployer Plan at any time during the five (5) year period ending on the    
Closing Date.                                                                   

                      (iii)  WELFARE PLANS.  Except as set forth on Schedule
2.12, each Welfare Plan is in material compliance with its terms and, both as to
form and operation, with the requirements prescribed by any and all statutes,   
orders, rules and regulations which are applicable to such Welfare Plan,        
including without limitation ERISA and the Code.                                

      Section 2.13.   LABOR RELATIONS.  SCHEDULE 2.13 contains a list of all
collective bargaining agreements to which the Company or any of its Subsidiaries
is a party and all written employment or severance agreements pertaining to the 
Business to which either the Company or any of its Affiliates is a party        
with respect to any employee, which may not be terminated at will, or by        
giving notice of thirty (30) calendar days or less, without cost or             
penalty, to employ or terminate executive officers or other personnel, or       
that will result in the payment by, or the creation of, any commitment or       
obligation (absolute or contingent) to pay on behalf of Purchaser,              
Chancellor Mezzanine, Chancellor LA, the Company or any Subsidiaries of the     
Company, any severance, termination, "golden parachute" or other similar        
payments as a result of the consummation of the transactions contemplated       
hereby.  Chancellor LA has delivered or made available to Purchaser true,       
correct and complete copies of each such Contract, as amended to date.          
Except as set forth on SCHEDULE 2.13, in the last twelve (12) months,           
neither the Company nor its Subsidiaries have experienced any attempt by        
organized labor or its representatives to make the Company or its               
Subsidiaries conform to demands of organized labor relating to its              
employees or enter into a binding agreement with organized labor that would     
cover the employees.  Except as set forth on SCHEDULE 2.13, there is no         
labor strike or labor disturbance pending or, to Chancellor LA's knowledge,     
threatened against the Company or its Subsidiaries, and in the past three       
(3) years the Company and its Subsidiaries have not experienced a work          
stoppage or other labor difficulty.  The Company and its Subsidiaries are       
in material compliance with all applicable laws respecting employment           
practices, employee documentation, terms and conditions of employment and       
wages and hours and, to Chancellor LA's knowledge, neither the Company nor      
its Subsidiaries has engaged in any unfair labor practice.  There is no         
unfair labor practice charge or complaint against the Company or its            
Subsidiaries pending, or to the knowledge of Chancellor LA, threatened          
before the National Labor Relations Board or any other domestic or foreign      
government agency arising out of the conduct of the business of the Company     
or its Subsidiaries.                                                            

     Section 2.14.   LEGAL COMPLIANCE.  Except with respect to matters set
forth on SCHEDULE 2.14, and compliance with Environmental Laws (as to which     
certain representations and warranties are made pursuant to Section 2.15), the  
Company and each of its Subsidiaries is in compliance with all laws             
(including rules and regulations thereunder) of federal, state, local and       
foreign governments (and all agencies thereof) applicable thereto, except       
where such instances of noncompliance would not have a material adverse         
effect on the business, operations or financial condition of the Company        
and its Subsidiaries, taken as a whole.                                         

       Section 2.15.   ENVIRONMENTAL MATTERS.  Except as set forth on SCHEDULE
2.15, (i) the Company and each of its Subsidiaries is in compliance with all    
Environmental Laws, except where such instances of noncompliance would not      
have a material adverse effect on the business, operations or financial         
condition of the Company and its Subsidiaries, (ii) neither the Company nor     
any of its Subsidiaries has any liability under any Environmental Law which     
is material to the business, operations or financial condition of the           
Company and its Subsidiaries, (iii) no notices of any violation or alleged      
violation of any Environmental Law relating to the operations or properties     
of the Company or any of its Subsidiaries have been received by the Company     
or any of its Subsidiaries, (iv) to the knowledge of Chancellor LA, there       
are no circumstances, based on currently available information, that are        
reasonably likely to prevent such compliance, except where such instances       
would not have a material adverse effect on the business, operations or         
financial condition of the Company and its Subsidiaries, (v) to the             
knowledge of Chancellor LA, there are no underground storage tanks, above-      
ground storage tanks, or polychlorinated biphenyls located on, in or under      
Owned Real Property or real property leased by the Company or its               
Subsidiaries, except in compliance with Environmental Laws, except where        
such instances would not have a material adverse effect on the business,        
operations or financial condition of the Company and its Subsidiaries, and      
(vi) no hazardous substances, wastes or materials, as defined by                
Environmental Laws, have been stored, released, recycled or disposed of,        
on, under or at any such property such that the property is currently           
subject to a lawful order by a Governmental Authority that requires             
remediation of such property, except where such instances would not have a      
material adverse effect on the business, operations or financial condition      
of the Company and its Subsidiaries.                                            

Section 2.16.   TAXES.  Except as set forth on SCHEDULE 2.16:   

         (a)  The Company and each of its Subsidiaries have timely
filed all income Tax Returns required to be filed by it (subject to any         
applicable extensions).  Each Affiliated Group with which the Company or its    
Subsidiaries files a consolidated, combined or unitary Tax Return has timely    
filed all such income Tax Returns that it was required to file (subject to any  
applicable extensions) for each taxable period during which the Company or its  
Subsidiaries was a member of the group;                                         

              (b)  Each of the Company and its Subsidiaries has duly paid in
full (or there has been paid on its behalf) or will have established (or there  
will have been established on its behalf) an adequate reserve on the Closing    
Balance Sheet for all Taxes that are payable or may become payable by the       
Company or its Subsidiaries (i) in respect of any taxable period ending on or   
before the Closing Date and (y) for any taxable period that begins before       
the Closing Date and ends thereafter, to the extent such Taxes are              
attributable to the portion of such period ending on the Closing Date under     
the terms of Section 6.4(b);                                                    

               (c)  The Company and each Subsidiary has withheld and paid over
all Taxes required to have been withheld and paid over on or before the Closing 
Date, and complied with all information reporting and backup withholding        
requirements required to be complied with on or before the Closing Date,        
including maintenance of required records with respect thereto, in              
connection with amounts paid or owing to any employer, creditor,                
independent contractor or other third party.  There are no Liens on any of      
the assets of the Company or any of its Subsidiaries with respect to Taxes,     
other than liens for Taxes not yet due and payable or for Taxes being           
contested in good faith through appropriate proceedings and for which           
reserves have been or will be established on the Closing Balance Sheet in       
accordance with GAAP;                                                           

              (d)  None of the Company or any of its Subsidiaries has waived
any law or regulation fixing, or consenting to the extension of, any period of  
time for assessment of any Taxes which waiver or consent is currently in effect.
None of Chancellor Mezzanine, Chancellor LA or any of their stockholders        
has waived any law or regulation fixing, or consenting to the extension of,     
any period of time for assessment of any Taxes of the Company or any of the     
Subsidiaries which waiver or consent is currently in effect.  There is no       
pending examination or proceeding by any authority or agency with respect       
to the Company or any Subsidiary relating to the assessment or collection       
of Taxes;                                                                       

             (e)  There will not be as of the Closing Date any outstanding
balances of deferred gain or loss accounts related to deferred intercompany     
transactions with respect to the Company or its Subsidiaries under Treasury     
Regulation Section 1.1502-13.  As of the Closing Date, neither the  Company     
nor any of its Subsidiaries will have any obligation or will have any           
obligation that could arise under any Tax sharing agreement between it and      
another entity; and                                                             

        (f)  None of the Company, any of its Subsidiaries or any
stockholders of the Company has made or will become obligated to make, as a     
result of the sale of the Company Shares or the Whiteco Shares, any payments    
that would be nondeductible by the Company or its Subsidiaries (in whole or in  
part) pursuant to Section 280G of the Code.                                     

       Section 2.17.   GOVERNMENTAL AUTHORITIES; CONSENTS.  Assuming the truth
and completeness of the representations and warranties of Purchaser contained in
this Agreement, no consent, approval or authorization of, or designation,       
declaration or filing with, any Governmental Authority or other third party     
is required on the part of Chancellor Mezzanine or Chancellor LA with           
respect to each of such parties' execution or delivery of this Agreement or     
the consummation of the transactions contemplated hereby, except for (i)        
applicable requirements of the HSR Act, or (ii) as otherwise disclosed in       
SCHEDULE 2.17.                                                                  

  Section 2.18.   INTEREST IN COMPETITORS, SUPPLIERS, AND CUSTOMERS.
Except as set forth on Schedule 2.18 attached hereto, to the knowledge of       
Chancellor LA, no stockholder, officer, or director of Chancellor Media         
Corporation or any Affiliate of any such stockholder, officer, or director has  
any ownership interest in any competitor, supplier, or customer of the Company  
or any property used in the operation of the Business.                          

     Section 2.19.   INSURANCE.  All material assets and properties of the
Company and its Subsidiaries are covered by valid and currently effective       
insurance policies or programs of self-insurance in such types and amounts as   
are consistent with customary practices and standards of companies engaged in   
businesses similar to that of the Company and its Subsidiaries.                 

       Section 2.20.   BROKERS' FEES.  No broker, finder, investment banker or
other Person is entitled to any brokerage fee, finders' fee or other commission 
in connection with the transactions contemplated by this Agreement based upon   
arrangements made by the Company or any of its Affiliates, except for any       
arrangement with Morgan Stanley Dean Witter & Co. or Greenhill & Co., LLC,      
for which Chancellor LA shall be solely responsible.                            

   Section 2.21.   EVENTS SUBSEQUENT TO MARCH 31, 1999.  Except as set
forth on Schedule 2.21, from March 31, 1999 to the date hereof, there has not   
occurred any material adverse change in the business, financial condition or    
results of operations of the Company or its Subsidiaries, taken as a whole.     

    Section 2.22.   CHANCELLOR MEZZANINE SECURITIES ACT REPRESENTATIONS.

          (a)  Chancellor Mezzanine is acquiring the Lamar Mezzanine
Shares for investment for its own account, not as a nominee or agent, and not   
with a view to the resale or distribution of any part thereof in violation of   
the Securities Act.  Chancellor Mezzanine does not have any present intention   
of selling, granting any participation in, or otherwise distributing the Lamar  
Mezzanine Shares otherwise than pursuant to an effective registration           
statement under the Securities Act or in a transaction exempt from the          
registration requirements under the Securities Act and applicable state         
securities laws.  Other than the possible contribution of the Lamar             
Mezzanine Shares to a Subsidiary, Chancellor Mezzanine does not have any        
contract, undertaking, agreement or arrangement with any Person to sell,        
transfer or grant participations to such Person or to any third Person,         
with respect to any of the Lamar Mezzanine Shares.                              

               (b)  Chancellor Mezzanine acknowledges that the issuance of the
Lamar Mezzanine Shares will not be registered under the Securities Act or any   
state securities laws on the basis of a claimed exemption by Purchaser Parent   
that the issuance of the Lamar Mezzanine Shares as provided for herein is       
exempt from registration under the Securities Act and applicable state          
securities laws.  Chancellor Mezzanine acknowledges that the availability       
of such exemptions is predicated in part on Chancellor Mezzanine's              
representations set forth in this Section 2.22 and that Purchaser Parent is     
relying on such representations.                                                

             (c)  Chancellor Mezzanine has received all the information it
considers necessary or appropriate for deciding whether to accept the Lamar     
Mezzanine Shares.  Chancellor Mezzanine has had an opportunity to ask questions 
of and to receive answers from Purchaser and Purchaser Parent regarding the     
terms and conditions of the issuance of the Lamar Mezzanine Shares and the      
business, properties, financial condition and prospects of Purchaser and        
Purchaser Parent and to obtain additional information (to the extent            
Purchaser or Purchaser Parent possessed such information or could acquire       
it without unreasonable effort or expense) necessary to verify the accuracy     
of any information furnished to Chancellor Mezzanine or to which Chancellor     
Mezzanine had access.                                                           

              (d)  Chancellor Mezzanine acknowledges that it is able to bear
the economic risk of the investment in the Lamar Mezzanine Shares, and has such 
knowledge and experience in financial and business matters that it is capable of
evaluating the benefits and risks of the investment in the Lamar Mezzanine      
Shares.                                                                         

                (e)  Chancellor Mezzanine is an "accredited investor" as defined
in Rule 501(a) of Regulation D promulgated under the Securities Act.            

               (f)  Chancellor Mezzanine acknowledges that the Lamar Mezzanine
Shares may not be sold, transferred or otherwise disposed of without            
registration under the Securities Act or an applicable exemption therefrom and  
that in the absence of any effective registration statement covering the Lamar  
Mezzanine Shares or an available exemption from registration under the          
Securities Act, the Lamar Mezzanine Shares must be held indefinitely.           
Chancellor Mezzanine further acknowledges that the Lamar                        
Mezzanine Shares may not be sold pursuant to Rule 144 promulgated under the     
Securities Act unless all of the conditions of that rule are met.               

            (g)  Chancellor Mezzanine acknowledges that each certificate
representing any of the Lamar Mezzanine Shares will be endorsed with a legend   
substantially similar to the following:                                         

    THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
    REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR
         PURSUANT TO THE SECURITIES OR "BLUE SKY" LAWS OF ANY STATE.  SUCH
  SECURITIES MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED,
    HYPOTHECATED OR OTHERWISE ASSIGNED, EXCEPT PURSUANT TO (i) A
       REGISTRATION STATEMENT WITH RESPECT TO SUCH SECURITIES WHICH IS
            EFFECTIVE UNDER SUCH ACT, (ii) RULE 144 UNDER SUCH ACT, OR (iii) ANY
OTHER EXEMPTION FROM REGISTRATION UNDER SUCH ACT.       

Section 2.23.   CHANCELLOR LA SECURITIES ACT REPRESENTATIONS.   

       (a)  Chancellor LA is acquiring the Lamar LA Shares for
investment for its own account, not as a nominee or agent, and not with a view  
to the resale or distribution of any part thereof in violation of the Securities
Act.  Chancellor LA does not have any present intention of selling, granting any
participation in, or otherwise distributing the Lamar LA Shares otherwise       
than pursuant to an effective registration statement under the Securities       
Act or in a transaction exempt from the registration requirements under the     
Securities Act and applicable state securities laws.  Chancellor LA does        
not have any contract, undertaking, agreement or arrangement with any           
Person to sell, transfer or grant participations to such Person or to any       
third Person, with respect to any of the Lamar LA Shares.                       

              (b)  Chancellor LA acknowledges that the issuance of the Lamar
LA Shares will not be registered under the Securities Act or any state          
securities laws on the basis of a claimed exemption by Purchaser Parent that the
issuance of the Lamar LA Shares as provided for herein is exempt from           
registration under the Securities Act and applicable state securities laws.     
Chancellor LA acknowledges that the availability of such exemptions is          
predicated in part on Chancellor LA's representations set forth in this Section 
2.23 and that Purchaser Parent is relying on such representations.              

                (c)  Chancellor LA has received all the information it considers
necessary or appropriate for deciding whether to accept the Lamar LA Shares.    
Chancellor LA has had an opportunity to ask questions of and to receive answers 
from Purchaser and Purchaser Parent regarding the terms and conditions of the   
issuance of the Lamar LA Shares and the business, properties, financial         
condition and prospects of Purchaser and Purchaser Parent and to obtain         
additional information (to the extent Purchaser or Purchaser Parent             
possessed such information or could acquire it without unreasonable effort      
or expense) necessary to verify the accuracy of any information furnished       
to Chancellor LA or to which Chancellor LA had access.                          

           (d)  Chancellor LA acknowledges that it is able to bear the
economic risk of the investment in the Lamar LA Shares, and has such knowledge  
and experience in financial and business matters that it is capable of          
evaluating the benefits and risks of the investment in the Lamar LA Shares.     

            (e)  Chancellor LA is an "accredited investor" as defined in
Rule 501(a) of Regulation D promulgated under the Securities Act.               

            (f)  Chancellor LA acknowledges that the Lamar LA Shares may
not be sold, transferred or otherwise disposed of without registration under    
the Securities Act or an applicable exemption therefrom and that in the absence 
of any effective registration statement covering the Lamar LA Shares or an      
available exemption from registration under the Securities Act, the Lamar LA    
Shares must be held indefinitely.  Chancellor LA further acknowledges that the  
Lamar LA Shares may not be sold pursuant to Rule 144 promulgated under the      
Securities Act unless all of the conditions of that rule are met.               

     (g)  Chancellor LA acknowledges that each certificate
representing any of the Lamar LA Shares will be endorsed with a legend          
substantially similar to the following:                                         

    THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
    REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR
         PURSUANT TO THE SECURITIES OR "BLUE SKY" LAWS OF ANY STATE.  SUCH
  SECURITIES MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED,
    HYPOTHECATED OR OTHERWISE ASSIGNED, EXCEPT PURSUANT TO (i) A
       REGISTRATION STATEMENT WITH RESPECT TO SUCH SECURITIES WHICH IS
        EFFECTIVE UNDER SUCH ACT, (ii) RULE 144 UNDER SUCH ACT, OR (iii)
ANY OTHER EXEMPTION FROM REGISTRATION UNDER SUCH ACT.   

      Section 2.24.   DIVESTURE ASSETS.  Chancellor LA has effected the sale
or other disposal of the outdoor advertising assets mandated by the United      
States Department of Justice pursuant to the Final Judgments, as more           
particularly described on Annex A hereto (the "Divestiture Assets").            

       Section 2.25.   NECESSARY LENDER APPROVALS.  Chancellor LA has received
all necessary approvals and consents from its senior Lenders to the consummation
of the transactions contemplated hereby, including, without limitation, the     
Dividend and releases from any and all applicable Liens created by such         
Lenders and releases from any and all guarantees of each of the Company and     
its Subsidiaries, in each case, effective as of the Closing, a copy of          
which approval and consent has been delivered to Purchaser.                     

ARTICLE 3.      
REPRESENTATIONS AND WARRANTIES      
OF PURCHASER AND PURCHASER PARENT     

    Purchaser and Purchaser Parent, jointly and severally, represent and
warrant to each Seller that, as of the date of this Agreement:                  

     Section 3.1.    CORPORATE ORGANIZATION AND AUTHORITY OF PURCHASER AND
PURCHASER PARENT.                                                               

        (a)  Purchaser has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of       
Delaware and has the corporate power and authority to enter into and perform its
obligations under this Agreement.  The execution and delivery of this           
Agreement by Purchaser and the consummation of the transactions                 
contemplated hereby have been duly and validly authorized and approved by       
the Board of Directors of Purchaser and no other corporate proceeding on        
the part of Purchaser is necessary to authorize this Agreement or the           
transactions contemplated hereby.  This Agreement has been duly and validly     
executed and delivered by Purchaser and, assuming this Agreement                
constitutes a valid and binding agreement of each Seller, constitutes a         
legally valid and binding obligation of Purchaser, enforceable against          
Purchaser in accordance with its terms, subject to applicable bankruptcy,       
insolvency, fraudulent conveyance, reorganization, moratorium and similar       
laws affecting creditors' rights generally and subject, as to                   
enforceability, to general principles of equity.                                

               (b)  Purchaser Parent has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of       
Delaware and has the corporate power and authority to enter into and perform its
obligations under this Agreement.  The execution and delivery of this           
Agreement by Purchaser Parent and the consummation of the transactions          
contemplated hereby have been duly and validly authorized and approved by       
the Board of Directors of Purchaser Parent, and except for the consent of       
the stockholders of Purchaser Parent provided in Section 5.5 hereof, no         
other corporate proceeding on the part of Purchaser Parent is necessary to      
authorize this Agreement or the transactions contemplated hereby.  This         
Agreement has been duly and validly executed and delivered by Purchaser         
Parent and, assuming this Agreement constitutes a valid and binding             
agreement of each Seller, constitutes a legally valid and binding               
obligation of Purchaser Parent , enforceable against Purchaser Parent in        
accordance with its terms, subject to applicable bankruptcy, insolvency,        
fraudulent conveyance, reorganization, moratorium and similar laws              
affecting creditors' rights generally and subject, as to enforceability, to     
general principles of equity.                                                   

Section 3.2.    NO CONFLICT.  The execution and delivery of this
Agreement by each of Purchaser and Purchaser Parent and the consummation of the 
transactions contemplated hereby does not and will not violate any provision of,
or result in the breach of:  (a) any applicable law, rule or regulation of any  
Governmental Authority, or any agreement, indenture or other instrument to      
which such entity is a party or by which such entity may be bound, or of        
any order, judgment or decree applicable to such entity, or terminate or        
result in the termination of any such agreement, indenture or instrument,       
or result in the creation of any Lien, charge or encumbrance upon any of        
the properties or assets of Purchaser or constitute an event which, after       
notice or lapse of time or both, would result in any such violation,            
breach, acceleration, termination or creation of a Lien; or (b) the             
Certificate of Incorporation, Bylaws, or other organizational documents of      
such entity.                                                                    

   Section 3.3.    LITIGATION AND PROCEEDINGS.  Except as disclosed in
the Purchaser SEC Documents or the Purchaser Parent SEC Documents, there are no 
lawsuits, actions, suits, claims or other proceedings at law or in equity, or,  
to the knowledge of Purchaser or Purchaser Parent, investigations, before or by 
any court or Governmental Authority or before any arbitrator pending or, to     
the knowledge of Purchaser or Purchaser Parent, threatened, against             
Purchaser, Purchaser Parent or any of their Affiliates which, if determined     
adversely, could reasonably be expected to have a material adverse effect       
on (a) the ability of each of Purchaser and Purchaser Parent to enter into      
and perform its obligations under this Agreement, or (b) the business,          
financial condition or results of operations of Purchaser or Purchaser          
Parent.  There is no unsatisfied judgment, order or decree or any open          
injunction binding upon Purchaser or Purchaser Parent or any of their           
Affiliates which could reasonably be expected to have a material adverse        
effect on the ability of each of Purchaser and Purchaser Parent to enter        
into and perform its obligations under this Agreement.                          

       Section 3.4.    GOVERNMENTAL AUTHORITIES; CONSENTS.  Assuming the truth
and completeness of the representations and warranties of each Seller contained 
in this Agreement, no consent, approval or authorization of, or designation,    
declaration or filing with, any governmental authority or other third party     
is required on the part of Purchaser or Purchaser Parent with respect to        
Purchaser's and Purchaser Parent's execution or delivery of this Agreement      
or the consummation of the transactions contemplated hereby, except for (i)     
applicable requirements of the HSR Act or (ii) the preparation and filing       
of a proxy or information statement of Purchaser Parent with the Securities     
and Exchange Commission (the "SEC") pursuant to Section 5.5.                    

       Section 3.5.    BROKERS' FEES.  No broker, finder, investment banker or
other Person is entitled to any brokerage fee, finders' fee or other commission 
in connection with the transactions contemplated by this Agreement based upon   
arrangements made by Purchaser, Purchaser Parent or any of their                
Affiliates.                                                                     

    Section 3.6.    CAPITAL STRUCTURE OF PURCHASER PARENT AND PURCHASER.

              (a)  The authorized capital stock of Purchaser Parent consists
of (i) 125,000,000 shares of Purchaser Parent Class A Common Stock,             
(ii) 37,500,000 shares of Class B Common Stock, par value $0.001 per share      
(the "PURCHASER PARENT CLASS B COMMON STOCK"), of Purchaser Parent,             
(iii) 10,000 shares of Class A Preferred Stock, $638.00 par value per share     
(the "PURCHASER PARENT CLASS A PREFERRED STOCK"), of Purchaser Parent, and      
(iv) 1,000,000 shares of Preferred Stock, $0.001 par value per share (the       
"PURCHASER PARENT PREFERRED STOCK"), of Purchaser Parent.  At the close of      
business on August 4, 1999 (a) 43,568,340 shares of Purchaser Parent Class      
A Common Stock were issued and outstanding, (b) no more than 1,000,000          
shares of Purchaser Parent Class A Common Stock were reserved for issuance      
pursuant to outstanding options (the "PURCHASER PARENT STOCK OPTIONS") to       
purchase shares of Purchaser Parent Class A Common Stock granted under          
Purchaser Parent's 1996 Equity Incentive Plan, (c) 17,700,000 shares of         
Purchaser Parent Class A Common Stock were reserved for issuance upon           
conversion of outstanding shares of Purchaser Parent Class B Common Stock,      
(d) 17,699,997 shares of Purchaser Parent Class B Common Stock were issued      
and outstanding, (e) 5,719.49 shares of Purchaser Parent Class A Preferred      
Stock were issued and outstanding, and (f) no shares of Purchaser Parent        
Class A Common Stock, Purchaser Parent Class B Common Stock, Purchaser          
Parent Class A Preferred Stock or Purchaser Parent Preferred Stock were         
held as treasury shares by Purchaser Parent or any Subsidiary of Purchaser      
Parent.  Except as set forth above, at the close of business on August 4,       
1999, no shares of capital stock or other equity securities of Purchaser        
Parent were authorized, issued, reserved for issuance or outstanding.  All      
outstanding shares of capital stock of Purchaser Parent are, and all shares     
which may be issued (1) upon the exercise of outstanding Purchaser Parent       
Stock Options, or (2) to Chancellor Mezzanine and Chancellor LA pursuant to     
the terms of this Agreement will be, when issued, duly authorized, validly      
issued, fully paid and nonassessable and not subject to preemptive rights.      
No bonds, debentures, notes or other indebtedness of Purchaser Parent or        
any Subsidiary of Purchaser Parent having the right to vote (or convertible     
into, or exchangeable for, securities having the right to vote) on any          
matters on which the stockholders of Purchaser Parent or any Subsidiary of      
Purchaser Parent may vote are issued or outstanding.  All the outstanding       
shares of capital stock or other equity interests of each Subsidiary of         
Purchaser Parent have been validly issued and are fully paid and                
nonassessable and are owned by Purchaser Parent, by one or more wholly-         
owned subsidiaries of Purchaser Parent or by Purchaser Parent and one or        
more such wholly-owned subsidiaries, free and clear of all Liens.  Except       
as set forth above, or except as set forth in Purchaser Parent SEC              
Documents (as defined in Section 3.7), neither Purchaser Parent nor any         
Subsidiary of Purchaser Parent has any outstanding option, warrant,             
agreement, arrangement or other rights, relating to the capital stock of        
Purchaser Parent or any Subsidiary of Purchaser Parent that either (x)          
obligates Purchaser Parent or any Subsidiary of Purchaser Parent to issue,      
sell or transfer, repurchase, redeem, purchase, register for sale or            
otherwise acquire or vote any shares of the capital stock or other equity       
securities of Purchaser Parent or any of its Subsidiaries or (y) restricts      
the transfer of the Purchaser Parent Class A Common Stock.  From the close      
of business on August 4, 1999, neither Purchaser Parent nor any Subsidiary      
of Purchaser Parent has issued any capital stock or securities or other         
rights convertible into or exercisable or exchangeable for shares of such       
capital stock, other than any issuances of shares of Purchaser Parent           
Class A Common Stock pursuant to the exercise of Purchaser Parent Stock         
Options outstanding on the date hereof.                                         

                (b)  The authorized capital stock of Purchaser consists of 1,000
shares of common stock, par value $.01 per share (the "PURCHASER COMMON STOCK").
As of the date hereof, 100 shares of Purchaser Common Stock were issued and     
outstanding.  All outstanding shares of capital stock of Purchaser are          
owned beneficially and of record by Purchaser Parent and are duly               
authorized, validly owned, fully paid and nonassessable and not subject to      
preemptive rights.                                                              

 Section 3.7.    SEC DOCUMENTS; FINANCIAL STATEMENTS.  (i) Each of
Purchaser and Purchaser Parent has filed with the SEC all required reports,     
schedules, forms, statements and other documents since, with respect to         
Purchaser, Purchaser's initial public offering and, with respect to Purchaser   
Parent, the Restructuring (such reports, schedules, forms, statements and any   
other documents filed with the SEC and publicly available prior to the date of  
this Agreement are hereinafter referred to as the "PURCHASER SEC DOCUMENTS"     
and the "PURCHASER PARENT SEC DOCUMENTS," respectively); (ii) as of their       
respective dates, the Purchaser SEC Documents and the Purchaser Parent SEC      
Documents complied in all material respects with the requirements of the        
Securities Act of 1933, as amended (the "SECURITIES ACT"), or the               
Securities and Exchange Act of 1934, as amended (the "EXCHANGE ACT"), as        
the case may be, and the rules and regulations of the SEC promulgated           
thereunder applicable to such Purchaser SEC Documents and such Purchaser        
Parent SEC Documents, and none of the Purchaser SEC Documents or the            
Purchaser Parent SEC Documents as of such dates contained any untrue            
statement of a material fact or omitted to state a material fact required       
to be stated therein or necessary in order to make the statements therein,      
in light of the circumstances under which they were made, not misleading;       
and (iii) as of their respective dates, the consolidated financial              
statements of (a) Purchaser and its predecessors included in the Purchaser      
SEC Documents and (b) Purchaser Parent and its predecessors included in the     
Purchaser Parent SEC Documents complied as to form in all material respects     
with applicable accounting requirements and the published rules and             
regulations of the SEC with respect thereto, have been prepared in              
accordance with GAAP applied on a consistent basis during the periods           
involved (except as may be indicated in the notes thereto or, in the case       
of unaudited statements, as permitted by Rule 10-01 of Regulation S-X) and      
fairly present, in all material respects, the consolidated financial            
position of Purchaser and Purchaser Parent, as the case may be, and their       
respective consolidated Subsidiaries (or predecessors and their respective      
consolidated Subsidiaries) as of the dates thereof and the consolidated         
results of their operations and cash flows for the periods then ended (on       
the basis stated therein and subject, in the case of unaudited quarterly        
statements, to normal year-end audit adjustments).                              

 Section 3.8.    LEGAL COMPLIANCE.  Except with respect to matters
disclosed in the Purchaser SEC Documents or the Purchaser Parent SEC Documents, 
Purchaser Parent and each of its Subsidiaries (including, without limitation,   
Purchaser) is in compliance with all laws (including rules and regulations      
thereunder) of federal, state, local and foreign governments (and all           
agencies thereof) applicable thereto, except where such instances of            
noncompliance would not have a material adverse effect on the business,         
operations or financial condition of Purchaser Parent and its Subsidiaries,     
taken as a whole.                                                               

 Section 3.9.    INTEREST IN COMPETITORS, SUPPLIERS AND CUSTOMERS.
Except as set forth on Schedule 3.9, to the knowledge of Purchaser or Purchaser 
Parent, no stockholder, officer, or director of Purchaser or Purchaser Parent or
any Affiliate of any such stockholder, officer or director has any ownership    
interest in any competitor, supplier, or customer of Purchaser or any           
property used in the operation of the business of Purchaser or Purchaser        
Parent.                                                                         

        Section 3.10.   STATE TAKEOVER STATUTES.  The Board of Directors of each
of Purchaser and Purchaser Parent has approved the terms of this Agreement and  
the consummation of the transactions contemplated by this Agreement and such    
approval is sufficient to render the provisions of Section 203 of the           
Delaware General Corporation Law inapplicable to the acquisition of the         
Lamar Shares and the other transactions contemplated by this Agreement.  To     
the knowledge of Purchaser or Purchaser Parent, no other state takeover         
statute or similar statute or regulation applies or purports to apply to        
the acquisition of the Lamar Shares to be issued pursuant to this Agreement     
or any of the transactions contemplated hereby.                                 

Section 3.11.   SUBSEQUENT EVENTS.                              

          (a)  From March 31, 1999 to the date hereof, there has not
occurred any material adverse change in the business, financial condition or    
results of operations of Purchaser.                                             

              (b)  From the date of incorporation of Purchaser Parent to the
date hereof, there has not occurred any material adverse change in the business,
financial condition or results of operations of Purchaser Parent.               

Section 3.12.   SECURITIES ACT REPRESENTATIONS.                 

              (a)  Purchaser is acquiring the Company Shares and the Whiteco
Shares for investment for its own account, not as a nominee or agent, and not   
with a view to the resale or distribution of any part thereof in violation of   
the Securities Act.  Other than the possible contribution of the Company Shares 
or the Whiteco Shares to a Subsidiary, Purchaser does not have any present      
intention of selling, granting any participation in, or otherwise               
distributing any of the Company Shares or the Whiteco Shares otherwise than     
pursuant to an effective registration statement under the Securities Act or     
in a transaction exempt from the registration requirements under the            
Securities Act and applicable state securities laws.  Purchaser does not        
have any contract, undertaking, agreement or arrangement with any Person to     
sell, transfer or grant participations to such Person or to any third           
Person, with respect to any of the Company Shares or the Whiteco Shares.        

           (b)  Purchaser acknowledges neither the sale of the Company
Shares nor the Whiteco Shares will be registered under the Securities Act or any
state securities laws on the basis of a claimed exemption by either Seller that 
the sale of the Company Shares and the Whiteco Shares as provided for           
herein is exempt from registration under the Securities Act and applicable      
state securities laws.  Purchaser acknowledges that the availability of         
such exemptions is predicated in part on Purchaser's representations set        
forth in this Section 3.12 and that each Seller is relying on such              
representations.                                                                

            (c)  Purchaser has received all the information it considers
necessary or appropriate for deciding whether to accept the Company Shares and  
the Whiteco Shares.  Purchaser has had an opportunity to ask questions of and   
to receive answers from each Seller regarding the terms and conditions of       
the sale of the Company Shares and the Whiteco Shares and the business,         
properties, financial condition and prospects of each Seller and to obtain      
additional information (to the extent either Seller possessed such              
information or could acquire it without unreasonable effort or expense)         
necessary to verify the accuracy of any information furnished to Purchaser      
or to which Purchaser had access.                                               

                (d)  Purchaser acknowledges that it is able to bear the economic
risk of the investment in the Company Shares and the Whiteco Shares, and has    
such knowledge and experience in financial and business matters that it is      
capable of evaluating the benefits and risks of the investment in the           
Company Shares and the Whiteco Shares.                                          

             (e)  Purchaser is an "accredited investor" as defined in Rule
501(a) of Regulation D promulgated under the Securities Act.                    

               (f)  Purchaser acknowledges that neither the Company Shares nor
the Whiteco Shares may be sold, transferred or otherwise disposed of without    
registration under the Securities Act or an applicable exemption therefrom      
and that in the absence of any effective registration statement covering        
such Shares or an available exemption from registration under the               
Securities Act, the Company Shares and the Whiteco Shares must be held          
indefinitely.  Purchaser further acknowledges that the neither the Company      
Shares nor the Whiteco Shares may be sold pursuant to Rule 144 promulgated      
under the Securities Act unless all of the conditions of that rule are met.     

Section 3.13.   COMMITMENT LETTERS.  Purchaser has delivered to 
Chancellor LA a letter of its lenders committing to fund no less than Seven     
Hundred Million Dollars ($700,000,000) at Closing specifically for the          
transactions contemplated by this Agreement (the "COMMITMENT LETTER").  Such    
Commitment Letter contains no conditions to the funding of such amounts, other  
than those which are customary for transactions of the type contemplated        
hereunder.  The Commitment Letter shall remain in full force and effect until   
the date on which Definitive Documentation (as defined in Section 5.6(a)) has   
been executed, is binding and has been delivered to Chancellor LA.              

ARTICLE 4.
COVENANTS AND AGREEMENTS OF SELLERS 

      Section 4.1.    PRELIMINARY TRANSACTIONS.  Prior to or concurrent with
the Closing, Chancellor LA shall cause the Company and its Subsidiaries to      
effect, or cause to be effected, the acquisition of outdoor advertising assets  
pursuant to the Compromise Settlement Agreement and Mutual Release between      
the Company, Chancellor Media Corporation, Randy Burkett and Jeffrey            
Burkett, dated May 5, 1999, and the Asset Purchase Agreement between            
Whiteco and Randy Burkett, dated May 5, 1999, all as more particularly          
described on ANNEX B hereto (the "BURKETT ASSETS").  The transactions           
contemplated by (i) the sale or other disposal of the Divestiture Assets        
and (ii) the acquisition of the Burkett Assets shall be referred to herein,     
collectively, as the "PRELIMINARY TRANSACTIONS."                                

      Section 4.2.    CONDUCT OF BUSINESS.  From the date hereof through the
Closing, Chancellor LA shall use commercially reasonable efforts to cause the   
Company and each of its Subsidiaries, except as may be necessary to effect the  
Preliminary Transactions and except as otherwise contemplated by this Agreement 
or as consented to by Purchaser or Purchase Parent in writing (which consent    
will not be unreasonably withheld), to operate its business in the ordinary     
course and substantially in accordance with past practice and use               
commercially reasonable efforts not to take any action inconsistent with        
this Agreement.  Without limiting the generality of the foregoing, unless       
consented to by Purchaser or Purchaser Parent in writing (which consent         
shall not be unreasonably withheld), Chancellor LA shall cause the Company      
and each of its Subsidiaries not to, except as contemplated by this             
Agreement:                                                                      

                (a)  change or amend its Certificate of Incorporation, Bylaws or
other organizational documents, except as otherwise required by law;            

            (b)  (i) enter into, extend, materially modify, terminate or
renew any Contract of a type required to be listed on SCHEDULE 2.8, except in   
the ordinary course of business, or (ii) settle or otherwise resolve any        
financial issue, claim or adjustment under any such Contract;                   

               (c)  sell, assign, transfer, convey, lease or otherwise dispose
of any material assets or properties, except in the ordinary course of business;

              (d)  except as otherwise required by law, take any action with
respect to the grant of any severance or termination pay (otherwise than        
pursuant to policies or agreements of the Company or any of its Subsidiaries in 
effect on the date hereof) which will become due and payable from the Company or
any of its Subsidiaries on or after the Closing Date; make any change in        
the key management structure of the Company or any of its Subsidiaries,         
including, without limitation, the hiring of additional officers or the         
terminations of existing officers, other than in the ordinary course of         
business;                                                                       

         (e)  acquire by merger or consolidation with, or merge or
consolidate with, or purchase substantially all of the assets of, or otherwise  
acquire any material assets or business of any corporation, partnership,        
association or other business organization or division thereof;                 

            (f)  make any material loans or advances to any partnership,
firm or corporation, or, except for expenses incurred in the ordinary course of 
business, any individual;                                                       

          (g)  amend any Employee Plan or increase the salary of any
management Employee, except in the ordinary course of business;                 

            (h)  alter in any material respect the past practices of the
Company or its Subsidiaries with respect to the collection of receivables or    
payment of payables; or                                                         

                (i)  enter into any agreement, or otherwise become obligated, to
do any action prohibited hereunder; provided, however, that none of the         
foregoing shall restrict or prohibit the consummation of the Dividend.          

       Section 4.3.    INSPECTION.  Subject to confidentiality obligations and
similar restrictions that may be applicable to information furnished to any     
Seller, the Company or any Subsidiary of the Company by third parties that may  
be in the possession of any Seller or the Company from time to time,            
Chancellor LA shall afford to Purchaser, Purchaser Parent and their             
accountants, counsel and other representatives reasonable access, during        
normal business hours, to the properties, books, contracts, commitments,        
tax returns, records and appropriate officers and employees of the Company      
and its Subsidiaries, and shall furnish such representatives with all           
financial and operating data and other information concerning the affairs       
of the Company and its Subsidiaries as they may reasonably request.             

Section 4.4.    HSR ACT.                                        

             (a)  In connection with the transactions contemplated by this
Agreement, each Seller (and, to the extent required, its Affiliates) shall      
comply promptly with the notification and reporting requirements of the HSR Act 
and use reasonable best efforts to obtain early termination of the waiting      
period under the HSR Act.  Each Seller shall promptly comply with any additional
requests for information, including requests for production of documents        
and production of witnesses for interviews or depositions, by any Antitrust     
Authority.                                                                      

          (b)  Neither the Company nor any of its Subsidiaries shall
acquire any outdoor advertising assets in any county in which the (i) Company or
its Subsidiaries and (ii) Purchaser or its Affiliates, own a material number of 
outdoor advertising assets.  For purposes of this Section 4.4(b), "a            
material number of outdoor advertising assets" shall mean a significant         
number of outdoor advertising assets in a county, given the total number of     
outdoor advertising assets in that county.                                      

   Section 4.5.    NO SOLICITATIONS.  From the date hereof through the
Closing, each Seller shall not, and shall not knowingly permit its Affiliates,  
officers, directors, employees, representatives and agents to, directly or      
indirectly, encourage, solicit, participate in, initiate or conduct             
discussions or negotiations with, or provide any information to, any Person     
or group of Persons (other than Purchaser, Purchaser Parent or any of their     
Affiliates) concerning any merger, sale of assets, sale of shares of            
capital stock or similar transactions involving the Company or any              
Subsidiary or division of the Company.                                          

    Section 4.6.    NO SOLICITATION OR HIRING.  For a period of five (5)
years following the Closing, each Seller shall not, directly or indirectly, hire
or offer employment to any employee of the Business whose employment is         
continued by Purchaser after the Closing Date, unless (a) Purchaser or Purchase 
Parent first terminates the employment of such employee or gives its prior      
written consent to such employment or offer of employment, (b) such employee    
contacts a Seller regarding employment opportunities, (c) such employee         
responds to any general solicitation by any Seller for employment by such       
Seller, or (d) the employment of such employee by Purchaser or Purchase         
Parent has been terminated.                                                     

Section 4.7.    REGISTRATION RIGHTS AGREEMENT AND STOCKHOLDERS  
AGREEMENT.  Each of Chancellor Mezzanine and Chancellor LA shall, on the Closing
Date, execute and deliver to Purchaser Parent each of the Registration Rights   
Agreement and the Stockholders Agreement.                                       

      Section 4.8.    REQUESTS FOR INFORMATION.  Each Seller shall cooperate
with Purchaser Parent in Purchaser Parent's preparation and filing with the SEC 
of a preliminary proxy or information statement, as applicable, as provided in  
Section 5.5, including providing Purchaser Parent with such information         
about such Seller, the Company and its Subsidiaries, for use in connection      
with any such preliminary proxy or information statement as Purchaser           
Parent may reasonably request.  The information so provided by each Seller      
shall not contain any untrue statement or alleged untrue statement of a         
material fact or any omission of a material fact required to be stated          
therein or necessary to make such statements not misleading, but only to        
the extent that such untrue statement or omission is contained in any           
written information so furnished by such Seller specifically for inclusion      
in such preliminary proxy or information statement.                             

        Section 4.9.    PAYMENT OF CERTAIN EMPLOYEE OBLIGATIONS.  From and after
the Closing Date, Chancellor LA shall pay any severance obligations and any     
payments to enforce non-competition provisions (whether such payments are       
voluntary or not), arising pursuant to the contracts set forth on SCHEDULE 4.9. 

ARTICLE 5.  
COVENANTS AND AGREEMENTS OF PURCHASER AND PURCHASER PARENT    

Section 5.1.    HSR ACT.                                        

             (a)  In connection with the transactions contemplated by this
Agreement, Purchaser and Purchaser Parent (and, to the extent required, their   
Affiliates) shall comply promptly with the notification and reporting           
requirements of the HSR Act and use reasonable best efforts to obtain early     
termination of the waiting period under the HSR Act.  Purchaser and             
Purchaser Parent shall comply promptly with any additional requests for         
information, including requests for production of documents and production      
of witnesses for interviews or depositions, by any Antitrust Authorities.       

             (b)  In connection with the transactions contemplated hereby,
Purchaser and Purchaser Parent shall take any and all steps needed to cause the 
transactions contemplated by this Agreement and the Ancillary Agreements to     
be consummated at the earliest practicable time, and no later than              
November 30, 1999.                                                              

                (c)  Neither Purchaser nor Purchaser Parent shall, nor shall any
of their Affiliates, agents or representatives, take, or fail to take,          
any action which is intended, or is reasonably likely, to impede, hinder or     
delay approval of the transactions contemplated by this Agreement by the        
Antitrust Authorities.                                                          

            (d)  No Seller need give Purchaser or Purchaser Parent prior
notice or any opportunity to cure a breach of this Section 5.1 prior to the     
exercise by any Seller of its right to terminate this Agreement in the event of 
such breach by Purchaser or Purchaser Parent, in accordance with Section 8.1.   

    Section 5.2.    NO USE OF "CHANCELLOR" NAME.  Promptly following the
Closing, each of Purchaser and Purchaser Parent shall take all necessary action 
to cause the name of the Company and its Subsidiaries to be changed to a name   
specified in a writing and delivered to Sellers by Purchaser and Purchaser      
Parent at least ten (10) Business Days prior to the Closing.  Following the     
Closing, Purchaser, Purchaser Parent the Company and its Subsidiaries shall have
no rights to the name "Chancellor" or any variant thereof or any trademark,     
service mark, trade dress, logo or trade name including the name                
"Chancellor" or any name similar to it.  Following the Closing, each of         
Purchaser and Purchaser Parent shall cause the Company and each Affiliate       
of Purchaser and Purchaser Parent to refrain from making any use of the         
name "Chancellor" or any variant thereof or any trademark, service mark,        
trade dress, logo or trade name including the name "Chancellor" or any name     
similar to it within a commercially reasonable period of time.                  

Section 5.3.    INVESTIGATION; PURCHASER AND PURCHASER PARENT   
ACKNOWLEDGMENT.                                                                 

           (a)  As of the date hereof, each of Purchaser and Purchaser
Parent acknowledges and agrees that (i) it has made its own inquiry and         
investigation into, and, based thereon, has formed an independent judgment      
concerning, the Company, its Subsidiaries and the Business, (ii) in the course  
of such inquiry, neither Purchaser nor Purchaser Parent has become aware of any 
facts which would cause or constitute a breach of any representation or         
warranty of either Seller set forth herein, and (iii) it has been furnished     
with or given adequate access to such information about the Company, its        
Subsidiaries and the Business as it has requested.                              

          (b)  In connection with Purchaser's and Purchaser Parent's
investigation of the Company, its Subsidiaries and the Business, each of        
Purchaser and Purchaser Parent has received from Chancellor LA certain          
projections, forecasts, plans and budget information concerning the Company, its
Subsidiaries and the Business.  Each of Purchaser and Purchaser Parent          
acknowledges that there are uncertainties inherent in attempting to make such   
projections, forecasts, plans and budgets; that each of Purchaser and Purchaser 
Parent is familiar with such uncertainties; each of Purchaser and Purchaser     
Parent is taking full responsibility for making its own evaluation of the       
adequacy and accuracy of all estimates, projections, forecasts, plans and       
budgets so furnished to it; and that neither Purchaser nor Purchaser Parent will
assert any claim against either Seller or any of either Seller's directors,     
officers, employees, agents, stockholders, Affiliates, consultants,             
counsel, accountants, or representatives, or hold such Seller or any such       
persons liable, with respect thereto.                                           

                (c)  Each of Purchaser and Purchaser Parent acknowledges that no
Seller makes any representations or warranties concerning the Company, its      
Subsidiaries, their respective assets or the Business, other than as expressly  
set forth in Article 2 hereof, and that each Seller expressly disclaims all     
other representations and warranties, including, without limitation, any        
warranty of merchantability or fitness for a particular purpose.                

      Section 5.4.    NO SOLICITATIONS OR HIRING.  Prior to Closing, without
the prior consent of Chancellor LA, each of Purchaser and Purchaser Parent shall
not, and shall not knowingly permit its Affiliates, officers, directors,        
employees, representatives and agents to, directly or indirectly, hire, offer,  
participate in, or initiate negotiations concerning, employment to or with      
any employee of the Company or any of its Subsidiaries.                         

Section 5.5.    STOCKHOLDER CONSENT.                            

 (a)  As soon as practicable following the date of
this Agreement, Purchaser Parent shall prepare and file with the SEC a          
preliminary proxy or information statement, as applicable, with respect to its  
proposal to issue the Lamar Shares and shall use its best efforts to cause the  
proxy or information statement to be mailed to Purchaser Parent 's stockholders 
as promptly as practicable after the review process at the SEC has been         
completed.                                                                      

             (b)  Purchaser Parent agrees and represents and warrants that
the proxy or information statement will not, at the date it is first mailed to  
Purchaser Parent's stockholders or at the time of the Purchaser Parent's        
stockholders meeting, if any, contain any statement which, at the time and in   
light of the circumstances under which it is made, is false or misleading with  
respect to any material fact, or omits to state any material fact necessary     
in order to make the statements therein not false or misleading or              
necessary to correct any statement in any earlier communication with            
respect to the solicitation of a proxy for the same meeting or subject          
matter thereof which has become false or misleading except for information      
provided to Purchaser Parent by any Seller, for inclusion therein, as to        
which Purchaser Parent makes no such representation or warranty.  Purchaser     
Parent agrees that the proxy or information statement will comply as to         
form in all material respects with the requirements of the Exchange Act and     
the rules and regulations promulgated thereunder.                               

         (c)  Purchaser Parent agrees that it will take all action
necessary in accordance with applicable law and its Certificate of Incorporation
and Bylaws to convene a meeting of its stockholders or obtain the written       
consent of its stockholders for the approval of the issuance of the Lamar       
Shares.  Purchaser Parent will use its best efforts to obtain the approval      
of its stockholders as soon as practicable after the date hereof.               

Section 5.6.    DEFINITIVE DOCUMENTATION.                       

            (a)  Purchaser will deliver to Chancellor LA, on or prior to
August 14, 1999, definitive agreements (which have been executed and delivered  
by the applicable parties and which are binding), reflecting the commitment by  
equity and/or senior debt sources reasonably satisfactory to Chancellor LA      
to provide funding to Purchaser at or prior to Closing in an aggregate          
amount equal to at least $700,000,000 (the "DEFINITIVE DOCUMENTATION").         
The Definitive Documentation shall contain no conditions to the funding of      
such amounts, other than those which are customary for transactions of the      
type contemplated hereunder.  The Definitive Documentation must remain in       
full force and effect until the Closing.                                        

     (b)  Concurrently with the delivery of the Definitive
Documentation, an executive officer of Purchaser will certify to Sellers, in    
writing, that (i) Purchaser currently is meeting the covenants under its        
existing lending facility and other existing instruments of indebtedness, and   
(ii) Purchaser has no reason to believe that it will be unable to meet the      
covenants set forth under the Definitive Documentation.                         

     (c)  If the Purchaser fails to deliver the Definitive
Documentation and the Certificate provided for in Section 5.6(b) by August 14,  
1999, then Sellers shall have the right, by delivery of written notice to       
Purchaser within the five (5) calendar days following August 14, 1999, to elect 
to terminate this Agreement.  In the event of termination by Sellers pursuant to
this Section 5.6(c), this Agreement shall forthwith become void and have no     
effect, without any liability on the part of any party hereto or their          
respective Affiliates, officers, directors or stockholders.                     

      Section 5.7.    CONDUCT OF BUSINESS.  From the date hereof through the
Closing, each of Purchaser and Purchaser Parent shall use commercially          
reasonable efforts to operate its business in the ordinary course and           
substantially in accordance with past practice and use commercially reasonable  
efforts not to take any action inconsistent with this Agreement. Without        
limiting the generality of the foregoing, unless consented to by Sellers in     
writing, neither Purchaser nor Purchaser Parent shall:                          

                (a)  change or amend its certificate of incorporation, bylaws or
other organizational documents, except as otherwise required by law; or         

               (b)  take any action that would be prohibited by Article IV the
Stockholders Agreement if such agreement were in effect.                        

Section 5.8.    REGISTRATION RIGHTS AGREEMENT AND STOCKHOLDERS  
AGREEMENT.  Purchaser Parent shall, on the Closing Date, execute and deliver to 
Sellers the Registration Rights Agreement.  Each of Purchaser Parent and Reilly 
Family Limited Partnership, a Louisiana limited partnership and a stockholder of
Purchaser Parent ("RFLP"), shall, on the Closing Date, execute and deliver to   
Sellers the Stockholders Agreement.                                             

       Section 5.9.    INSPECTION.  Subject to confidentiality obligations and
similar restrictions that may be applicable to information furnished to         
Purchaser or Purchaser Parent by third parties that may be in the possession of 
Purchaser or Purchaser Parent from time to time, each of Purchaser and          
Purchaser Parent shall afford to Sellers and their accountants, counsel and     
other representatives reasonable access, during normal business hours, to       
the properties, books, contracts, commitments, tax returns, records and         
appropriate officers and employees of the Purchaser and Purchaser Parent,       
and shall furnish such representatives with all financial and operating         
data and other information concerning the affairs of the Purchaser and          
Purchaser Parent as they may reasonably request.                                

ARTICLE 6.  
JOINT COVENANTS AND AGREEMENTS    

Section 6.1.    CONFIDENTIALITY.                                

             (a)  Except for any governmental filings required in order to
complete the transactions contemplated herein and as Sellers, Purchaser and     
Purchaser Parent may otherwise agree or consent in writing, all information     
received by Purchaser, Purchaser Parent and Sellers and their respective        
representatives in contemplation, or pursuant to the terms, of this             
Agreement shall be kept in confidence by the receiving party and its            
representatives; provided, however, that any party hereto may disclose such     
information to (i) its legal and financial advisors, lenders, financing         
sources and their respective legal advisors and representatives, and (ii)       
such third parties as are reasonably necessary to negotiate or consummate       
the sale or other disposition by Purchaser or Purchaser Parent of assets or     
lines of business of the Company or any of its Subsidiaries pursuant to a       
request or governmental order by any Antitrust Authority, so long as such       
Persons agree to maintain the confidentiality of such information in            
accordance with this Section 6.1.  If the transactions contemplated hereby      
shall fail to be consummated, all copies of documents or extracts thereof       
containing information and data as to one of the other parties, including       
all information prepared by the receiving party's representatives may be        
destroyed at the option of the receiving party, with notice of such             
destruction (or return) to be confirmed in writing to the disclosing party.     
Any information not so destroyed (or returned) will remain subject to these     
confidentiality provisions (notwithstanding any termination of this             
Agreement) until the fifth (5th) anniversary of the Closing Date.               

                (b)  The foregoing confidentiality provisions shall not apply to
such portions of the information received which (i) are or become generally     
available to the public through no action by the receiving party or by such     
party's representatives, (ii) are or become available to the receiving party on 
a nonconfidential basis from a source, other than the disclosing party or its   
representatives, which the receiving party believes, after reasonable           
inquiry, is not prohibited from disclosing such portions to it by a             
contractual legal or fiduciary obligation, or (iii) are required by law to      
be disclosed, and shall not apply to any disclosure by Purchaser or             
Purchaser Parent after the Closing of any information disclosed by the          
Company.                                                                        

        Section 6.2.    SUPPORT OF TRANSACTION.  Purchaser, Purchaser Parent and
each Seller shall each (i) use commercially reasonable efforts to assemble,     
prepare and file any information (and, as needed, to supplement such            
information) as may be reasonably necessary to obtain as promptly as practicable
all governmental and regulatory consents required to be obtained in connection  
with the transactions contemplated hereby, (ii) use commercially reasonable     
efforts to obtain all material consents and approvals of third parties that any 
of Purchaser, Purchaser Parent, either Seller, or their respective Affiliates   
are required to obtain in order to consummate the transactions contemplated     
hereby, (iii) take such other action as may reasonably be necessary or as       
another party may reasonably request to satisfy the conditions of Article 7     
or otherwise to comply with this Agreement, and (iv) provide the other          
parties, and such other parties employees, officers, accountants, lawyers,      
financial advisors and other representatives with access to its personnel,      
properties, business and records under all reasonable circumstances.            

Section 6.3.    [Intentionally Left Blank].                     

       Section 6.4.    TAX MATTERS.  The following provisions shall govern the
allocation of responsibility as between Purchaser and Purchaser Parent, on the  
one hand, and Sellers, on the other hand, for certain Tax matters following the 
Closing Date:                                                                   

         (a)  Chancellor LA shall prepare and file (or cause to be
prepared and filed) in a timely manner all Tax Returns for the Company and its  
Subsidiaries that relate to tax periods that end on or before the Closing Date. 
All such Tax Returns shall be prepared in a manner consistent with past         
practices.  Purchaser shall prepare and file (or cause to be prepared and filed)
in a timely manner all other Tax Returns for the Company and any of its         
Subsidiaries.  All Tax Returns prepared by the Purchaser for any Straddle       
Period shall be prepared in a manner consistent with past practices.            

              (b)  In order to apportion any Taxes that relate to a Straddle
Period, the parties hereto will, to the extent permitted by applicable law,     
elect with the relevant taxing authorities to treat for all purposes the Closing
Date as the last day of a taxable period of the Company and of its Subsidiaries,
and such period shall be treated as a "Short Period" and a "Pre-Closing         
Period" for purposes of this Agreement.  In any case where applicable law       
does not permit the Closing Date to be treated as the last day of a Short       
Period, then for purposes of this Agreement, the portion of such Taxes that     
is attributable to the operation of the Company or any of its Subsidiaries      
for the "Pre-Closing Partial Period" (as defined below) shall be (i) in the     
case of Taxes that are not based on income gross receipts, the total amount     
of such Taxes for the period in question multiplied by a fraction, the          
numerator of which is the number of days in the Pre-Closing Partial Period      
and the denominator of which is the number of days in the entire period in      
question and (ii) in the case of any Taxes that are based on income or          
gross receipts, the Taxes that would be due with respect to the Straddle        
Period, if such Straddle Period were a Short Period.  "Pre-Closing Partial      
Period" means with respect to any Taxes imposed on the Company or any of        
its Subsidiaries for which the Closing Date is not the last day of the          
Short Period, the period of time beginning on the first day of the actual       
taxable period that includes (but does not end on) the Closing Date and         
ending on and including the Closing Date.                                       

       (c)  Each of Purchaser and Purchaser Parent covenants that it will not,
and it will not cause or permit the Company, the Company's Subsidiaries or any  
Affiliate of the Purchaser or Purchaser Parent to, (i) take any action on       
the Closing Date other than in the ordinary course of business, including,      
but not limited to, the distribution of any dividend or the effectuation of     
any redemption that could give rise to any Tax liability of any Seller or       
any of their Affiliates, (ii) make any election or deemed election under        
Section 338 of the Code (or any analogous or similar rules in any relevant      
tax jurisdiction), or (iii) make or change any tax election, amend any Tax      
Return, take any action, omit to take any action or enter into any              
transaction, in each case, that results in any increased Tax liability,         
reduction of any Tax Asset of any Seller, the Company or any Subsidiary of      
the Company in respect of any period that ends on or before the Closing         
Date or any Straddle Period without obtaining the Sellers' consent, which       
consent shall not be unreasonably withheld.                                     

           (d)  Each Seller or the parent of the consolidated group of
which each of them is a member may, at its or their option, elect to reattribute
certain Tax Assets of the Company or of any Subsidiary of the Company pursuant  
to Treasury Regulations Section 1.1502-20(g).                                   

          (e)  Sellers, Purchaser and Purchaser Parent agree to give
prompt notice to each other of any proposed adjustment to taxes for periods     
for which the other may have liability under this agreement.  Sellers,          
Purchaser and Purchaser Parent shall cooperate with each other in the           
conduct of any audit or other proceedings involving the Company or any of       
its Subsidiaries for such periods and each may participate at its own           
expense.  Purchaser and Purchaser Parent shall cause powers of attorney         
authorizing Sellers or its representative to represent the Company and its      
subsidiaries before the relevant taxing authority and such other documents      
as are reasonably necessary for Sellers or their representative to control      
the conduct of any such audit; provided, however, that Sellers shall not        
compromise or settle any such audit without obtaining Purchaser's consent,      
which consent shall not be unreasonably withheld, if such compromise or         
settlement would result in an increased tax liability or a reduction in any     
Tax Assets or have the effect of increasing any Tax liability of the            
Company, any of its Subsidiaries, Purchaser or Purchaser Parent in each         
case for any taxable period ending after the Closing Date.                      

              (f)  Purchaser and Purchaser Parent shall make (or cause to be
made), an election under Section 172(b)(3) of the Code (or any analogous or     
similar rules in any relevant tax jurisdiction, to the extent permitted by      
law) to relinquish the entire carryback period with respect to any net          
operating loss attributable by the Company or any of its Subsidiaries in        
any taxable period beginning after the Closing Date that could be carried       
back to a taxable year of the company and its subsidiaries ending on or         
before the closing date.  Except for any carrybacks of Tax credits, neither     
Seller nor any Affiliate of either Seller shall be required to pay to           
Purchaser, Purchaser Parent, the Company or the Company's Subsidiaries any      
refund or credit of Taxes that results from the carryback to any tax period     
ending on or before the closing date of any net operating loss, capital         
credit or other Tax Asset attributable to the Company or any of its             
Subsidiaries from any tax period beginning after the Closing Date.              

             (g)  Sellers, Purchaser and Purchaser Parent agree to furnish
or cause to be furnished to each other, upon request, as promptly as            
practicable, such information and assistance (including access to books and     
records) relating to the Company or any of its Subsidiaries as is               
reasonably necessary for the preparation of any Tax Return, claim for           
refund or audit, and the prosecution or defense of any claim, suit or           
proceeding relating to any proposed adjustment.                                 

            (h)  After the Closing, Purchaser shall pay to Chancellor LA
any refunds of or credits for Taxes (net of any income Tax liability            
incurred as a result of receiving such refund or credit) relating to the        
Company or any of its Subsidiaries for periods ending on or before the          
Closing Date and for Pre-Closing Partial Periods except to the extent any       
such refund or credit is reflected as an asset on the Closing Balance           
Sheet.  Purchaser shall cause powers of attorneys authorizing Chancellor LA     
or its representatives to represent the Company and its Subsidiaries before     
the relevant taxing authority and such other documents as are reasonably        
necessary for Chancellor LA or its representatives to receive any refunds       
or credits that Chancellor LA is entitled to receive pursuant to the            
preceding sentence; provided, however, that Chancellor LA shall not be          
permitted to file for any refund or credit without obtaining the                
Purchaser's consent, which consent shall not be unreasonably withheld, if       
the receipt of such refund or credit would have the effect of increasing        
any Tax liability or reducing any Tax Asset of the Company, any of its          
Subsidiaries, Purchaser or Purchaser Parent (except for an increase of          
income Tax liability incurred as a result of receiving such refund or           
credit) for any taxable period ending after the Closing Date.                   

           (i)  Sellers, Purchaser and Purchaser Parent agree that all
transfer documentary, sales, use, stamp, registration and other similar         
taxes ("CONVEYANCE TAXES") incurred solely as a result of a change of           
control of the Company or its Subsidiaries occurring upon consummation of       
this Agreement shall be borne 50% by Purchaser and 50% by Chancellor LA.        
Chancellor LA's liability for its share of Conveyance Taxes shall be            
discharged exclusively through an accrual on the Closing Balance Sheet of       
its share of Conveyance Taxes.                                                  

              (j)  Chancellor LA shall be liable for and shall pay all Taxes
(i) of the Company or any of the Company's Subsidiaries in respect of any       
taxable period ending on or before the Closing Date; (ii) of the Company or     
any of the Company's Subsidiaries in respect of any Straddle Period to the      
extent such Taxes are attributable to the Pre-Closing Partial Period as         
determined in Section 6.4(b); (iii) that are imposed on the Company or any      
of the Company's Subsidiaries under Treasury Regulation 1.1502-6 (or any        
similar provision of state, local or foreign law) as a transferee or            
successor with respect to any taxable period ending on or before the            
Closing Date or with respect to any Pre-Closing Partial Period;                 
(iv) imposed on the Company or any of the Company's Subsidiaries pursuant       
to any Tax sharing agreement existing as of the Closing Date; provided,         
however, that in each case Chancellor LA shall not be liable for and shall      
not be required to pay such Taxes to the extent such Taxes are accrued on       
the Closing Balance Sheet; and (v) of the Company or any of the Company's       
Subsidiaries resulting from the payment of the Dividend for any taxable         
period, whether such period begins before or after the Closing.                 

Section 6.5.    CERTAIN EMPLOYEE BENEFITS MATTERS.              

       (a)  Purchaser shall or shall cause the Company and its
Subsidiaries to employ, effective as of the Closing Date, each of the           
employees of the Company and its Subsidiaries who are, immediately prior to     
the Closing, actively employed or on vacation, leave of absence, disability     
or sick leave or lay-off (the "TRANSFERRED EMPLOYEES").  For purposes of        
vacation entitlement only, Purchaser shall cause Purchaser's employee           
benefit plans to recognize all service for the purpose of determining           
vesting of benefits, participation eligibility and benefit accrual by           
Transferred Employees with the Company, any of its Subsidiaries and             
Chancellor LA, including service with predecessor employers to the extent       
that such service was recognized by the analogous plans of the Company, any     
of its Subsidiaries or either Seller such that no break or interruption of      
employment or participation shall be deemed to have occurred with respect       
to the Transferred Employees by reason of the transactions contemplated by      
this Agreement.                                                                 

     (b)  Purchaser agrees that any pre-existing condition
exclusions or waiting periods imposed under Purchaser's welfare benefit         
plans will be no more restrictive than the analogous provisions under the       
applicable plans of Chancellor LA or the Company (and shall be applied          
utilizing the service crediting rules set forth in the last sentence of         
Section 6.5(a)) with respect to any Transferred Employee and his or her         
covered dependents and Purchaser (or Purchaser's employee benefit plans)        
shall assume all liabilities relating to all claims by Transferred              
Employees (and their dependents and beneficiaries) for benefits under all       
medical, dental, employee assistance, life, accidental death and                
dismemberment, dependent life, short- and long-term disability plans which      
are submitted on and after the Closing Date (including claims related to        
hospital stays commenced on or before the Closing Date).  Purchaser shall       
provide that any expenses incurred under any Welfare Plan by a Transferred      
Employee or his or her covered dependents during the plan year that             
includes the Closing Date shall be taken into account under any applicable      
health plan maintained by Purchaser for such plan year for purposes of          
satisfying applicable deductible, coinsurance and maximum out-of-pocket         
provisions.                                                                     

     (c)  Purchaser shall provide continuation coverage to
Transferred Employees and former employees of the Company and its               
Subsidiaries (and their covered dependents and qualified beneficiaries) who     
are receiving continuation coverage required under Code Section 4980B(f)        
("COBRA CONTINUATION COVERAGE") at the Closing, with respect to whom a          
qualifying event occurred prior to the Closing and for which the applicable     
election period for COBRA Continuation Coverage has not expired as of the       
Closing Date, or with respect to whom a qualifying event occurs as a result     
of the Closing of the transaction contemplated by this Agreement in             
compliance with the provisions of Code Section 4980B and ERISA Section 601      
et seq.                                                                         

(d)  SAVINGS PLANS.                             

               (i) As soon as is practicable after the Closing Date,
but effective as of such date, Purchaser shall adopt or designate a   
401(k) Savings Plan (the "PURCHASER SAVINGS PLAN") and shall establish
a trust pursuant thereto (the "PURCHASER SAVINGS TRUST").  As soon as 
is practicable after the Closing Date, Purchaser shall furnish to     
Sellers a determination letter finding the Purchaser Savings Plan and 
the Purchaser Savings Trust to be qualified and tax-exempt under      
Sections 401(a) and 501(a) of the Code.                               

                 (ii) As soon as practicable after Sellers' receipt of a
copy of such letter, Sellers shall cause the Chancellor Media         
Corporation 401(k) Savings Plan (the "SELLER SAVINGS PLAN") and the   
Trust pursuant thereto (the "SELLER SAVINGS TRUST") to transfer to the
Purchaser Savings Plan and Purchaser Savings Trust the accounts under 
the Seller Savings Plan and the Seller Savings Trust (and the assets  
and liabilities therein) attributable to any employee of the Company  
as of immediately prior to the Closing Date or any employee of either 
Seller or any of their Affiliates, in any case, who will continue     
their employment with or shall become an employee, of the Company or  
Purchaser or any of its Affiliates as of the Closing Date (the        
"EMPLOYEES").  Sellers shall cause all of such accounts to be fully   
vested upon such transfer.  Such transfer shall be made in the form of
cash.  Such transfer shall satisfy the requirements of Code Sections  
401(a)(12) and 414(l) and the regulations pursuant thereto.  Prior to 
such transfer, Purchaser will provide Sellers with such documents and 
other information as Sellers shall reasonably request to assure itself
that the Purchaser Savings Plan and the Purchaser Savings Trust       
contain participant loan provisions and procedures necessary to effect
the orderly transfer of participant loan balances associated with the 
transfer of assets.  Prior to such transfer, Sellers will provide     
Purchaser with such documents and other information as Purchaser shall
reasonably request to assure itself that the Seller Savings Plan and  
Seller Savings Trust are qualified and tax-exempt under the provisions
of Code Sections 401(a) and 501(a) respectively as of the date of such
transfer.  The Purchaser Savings Plan shall preserve for the Employees
all benefits, rights and features as required under Section 411(d)(6) 
of the Code and Purchaser agrees not to eliminate the ability to make 
participant loans without giving all participants in the Purchaser    
Savings Plan at least three (3) months advance notice.  Sellers shall 
provide to Purchaser copies of such personnel and other records of    
Sellers pertaining to the Employees and such records of any agent or  
representative of either Seller, in each case pertaining to the Seller
Savings Plan and Seller Savings Trust and as Purchaser may reasonably 
request in order to administer and manage the accounts and assets     
transferred to the Purchaser Savings Plan and Purchaser Savings Trust.
Upon such transfer, the Purchaser Savings Plan shall assume all       
liabilities and obligations whatsoever with respect to all amounts    
transferred from the Seller Savings Plan and Seller Savings Trust to  
the Purchaser Savings Plan and Purchaser Savings Trust in respect of  
the Employees and each Seller and its Affiliates and the Seller       
Savings Plan and Seller Savings Trust shall be relieved of all such   
liabilities and obligations.  Purchaser and Sellers shall cooperate in
the filing of documents required by the transfer of assets and        
liabilities described herein.                                         

                 (iii) The Purchaser Savings Plan shall preserve for the
Employees all of their benefits accrued under the Seller Savings Plan 
as of the date of transfer.  The Purchaser Savings Plan shall also    
provide that an Employee's period of employment with either Seller,   
the Company, any of their Subsidiaries or any predecessor thereof (as 
applicable) for which credit was given under the Seller Savings Plan  
shall be given equivalent credit under the Purchaser Savings Plan to  
the effect that if any Employee becomes an employee of the Company or 
Purchaser as of the Closing Date, or thereafter by reason of recall,  
no interruption in participation, benefit accrual or vesting service  
shall be deemed to have occurred for such Employee under the Purchaser
Savings Plan by reason of the change in employment contemplated by    
this Agreement.  The Purchaser Savings Plan shall further contain all 
such provisions as are necessary for the transfer not to cause Seller 
Savings Plan to fail to satisfy requirements of Code Sections 401(a)  
or 401(k).                                                            

               (iv) As soon as is practicable after the Closing Date
and prior to the transfer contemplated under this Section 6.5(d),     
Sellers AND Purchaser shall make such filings as are required under   
Code Section 6058(b) with respect to such transfers including the     
filing of form 5310-A.                                                

       (e)  Purchaser shall be liable for all obligations with
respect to claims of Transferred Employees for workers compensation for         
incidents remaining unpaid on the Closing Date to the extent reflected as a     
liability or reserved for on the Closing Balance Sheet.                         

              (f)  Nothing contained in this Agreement shall confer upon any
Transferred Employee any rights with respect to continuance of employment       
by purchaser, nor shall any provision of this agreement create any third        
party beneficiary rights in any Transferred employee, any beneficiary or        
dependents thereof, or any collective bargaining representative thereof.        

             (g)  Notwithstanding the foregoing provisions of this Section
6.5, Sellers agree to cause the termination, prior to the Closing (the          
"Pre-Closing Terminations"), of any Transferred Employees that Purchaser or     
Purchaser Parent requests in writing at least ten (10) days prior to the        
Closing Date; provided, that the indemnification provisions set forth in        
Section 9.3 shall apply.                                                        

ARTICLE 7.        
CONDITIONS TO OBLIGATIONS     

        Section 7.1.    CONDITIONS TO OBLIGATIONS OF PURCHASER, PURCHASER PARENT
AND SELLERS.  The obligations of Purchaser, Purchaser Parent and Sellers to     
consummate, or cause to be consummated, the transactions contemplated           
hereby are subject to the satisfaction of the following conditions, any one     
or more of which may be waived in writing by such parties:                      

              (a)  there shall not be in force any order or decree, statute,
rule or regulation nor shall there be on file any complaint by a                
governmental agency seeking an order or decree, restraining, enjoining or       
prohibiting the consummation of the transactions contemplated hereby, and       
none of Purchaser, Purchaser Parent or either seller shall have received        
notice from any Governmental Authority that it has determined to institute      
any suit or proceeding to restrain or enjoin the consummation of the            
transactions contemplated hereby or to nullify or render ineffective this       
Agreement if consummated, or to take any other action which would result in     
the prohibition or a material change in the terms of the transactions           
contemplated hereby.                                                            

            (b)  In connection with the consummation of the transactions
contemplated by this Agreement, Chancellor LA shall have obtained all           
necessary approvals and consents to the consummation of the transactions        
contemplated hereby from its senior lenders, including without limitation,      
the Dividend and releases from any and all applicable Liens created by such     
lenders and releases from any and all guarantees of each of the Company and     
its Subsidiaries.                                                               

          (c)  THE ISSUANCE OF THE LAMAR SHARES SHALL HAVE BEEN DULY
APPROVED BY THE STOCKHOLDERS OF PURCHASER PARENT.                               

    Section 7.2.    CONDITIONS TO OBLIGATIONS OF PURCHASER AND PURCHASER
PARENT.  The obligations of Purchaser and Purchaser Parent to consummate, or    
cause to be consummated, the transactions contemplated by this Agreement are    
subject to the satisfaction of the following additional conditions, any one or  
more of which may be waived in writing by Purchaser and Purchaser Parent:       

              (a)  Each of the representations and warranties of each Seller
contained in this Agreement shall be true and correct both on the date          
hereof and as of the Closing, as if made anew at and as of that time            
(unless to the extent that any such representations and warranties              
expressly relate to an earlier time, in which case they shall be true and       
correct at such earlier time), and each of the covenants and agreements of      
each Seller to be performed as of or prior to the Closing shall have been       
duly performed, except in each case for changes after the date hereof which     
are contemplated or expressly permitted by this Agreement, except where (i)     
the failure of the representations and warranties to be true and correct,       
or (ii) the failure of the covenants and agreements to be performed, as the     
case may be, would not have a material adverse effect on the business,          
operations or financial condition of the Company and its Subsidiaries,          
taken as a whole.                                                               

        (b)  Chancellor LA shall have delivered to Purchaser and
Purchaser Parent a certificate signed by an officer of Chancellor LA, dated     
the Closing, certifying that, to the best of the knowledge and belief of        
such officer, the conditions specified in Section 7.1(b), as they relate to     
Chancellor LA, and Section 7.2(a), to the extent they relate to Chancellor      
LA, have been fulfilled.                                                        

           (c)  Chancellor Mezzanine shall have delivered to Purchaser
and Purchaser Parent a certificate signed by an officer of Chancellor           
Mezzanine, dated the Closing, certifying that, to the best of the knowledge     
and belief of such officer, the conditions precedent specified in Section       
7.2(a), to the extent they relate to Chancellor Mezzanine, have been            
fulfilled.                                                                      

     (d)  Any consent required for the consummation of the
transactions contemplated hereby under any Contract required to be listed       
on SCHEDULE 2.8 hereto or for the continued enjoyment by the Company and        
its Subsidiaries of the benefits of any such Contract after the Closing         
shall have been obtained, except where the failure to obtain such consent       
would not have a material adverse effect on the business, operations or         
financial condition of the Company and its Subsidiaries, taken as a whole.      

           (e)  Each Seller shall have duly executed and delivered the
Registration Rights Agreement.                                                  

           (f)  Each Seller shall have duly executed and delivered the
Stockholders Agreement.                                                         

      (g)  Each Seller shall have delivered, or caused to be
delivered, to Purchaser and Purchaser Parent an executed affidavit, dated       
not more than 30 days prior to the Closing Date, in accordance with Code        
Section 1445(b)(2) and Treasury Regulation Section 1.1445-2(b), which           
statement certifies that such Seller is not a foreign person and sets forth     
such Seller's name, taxpayer identification number and address.                 

       (h)  As of the Closing, Sellers shall have caused to be
eliminated all intercompany receivables and payables between any Seller,        
the Company and its Subsidiaries.                                               

Section 7.3.    CONDITIONS TO THE OBLIGATIONS OF SELLERS.  The  
obligation of each Seller to consummate the transactions contemplated by this   
Agreement is subject to the satisfaction of the following additional conditions,
any one or more of which may be waived in writing by each Seller:               

            (a)  All waiting periods under the HSR Act applicable to the
transactions contemplated hereby shall have expired or been terminated.         

            (b)  Each of the representations and warranties of Purchaser
and Purchaser Parent contained in this Agreement shall be true and correct      
in all material respects both on the date hereof and as of the Closing, as      
if made anew at and as of that time (unless to the extent that any such         
representations and warranties expressly relate to an earlier time, in          
which case they shall be true and correct at such earlier time), and each       
of the covenants and agreements of Purchaser and Purchaser Parent to be         
performed as of or prior to the Closing shall have been duly performed in       
all material respects, except in each case for changes after the date           
hereof which are contemplated or expressly permitted by this Agreement.         

    (c)  Purchaser shall have delivered to each Seller a
certificate signed by an officer of Purchaser, dated the Closing,               
certifying that, to the best of the knowledge and belief of such officer,       
the conditions specified in Section 7.3(b), to the extent they relate to        
Purchaser, have been fulfilled.                                                 

           (d)  Purchaser Parent shall have delivered to each Seller a
certificate signed by an officer of Purchaser Parent, dated the Closing         
certifying that, to the best of the knowledge and belief of such officer,       
the conditions specified in Section 7.3(b), to the extent they relate to        
Purchaser Parent, have been fulfilled.                                          

            (e)  Purchaser Parent shall have duly executed and delivered
the Registration Rights Agreement.                                              

            (f)  Purchaser Parent shall have duly executed and delivered
the Stockholders Agreement.                                                     

ARTICLE 8.    
TERMINATION     

      Section 8.1.    TERMINATION.  This Agreement may be terminated and the
transactions contemplated hereby abandoned:                                     

         (a)  By mutual written consent of the parties at any time
prior to the Closing.                                                           

            (b)  Prior to the Closing, by written notice to Sellers from
Purchaser and Purchaser Parent, if (i) there is any material breach of any      
representation, warranty, covenant or agreement on the part of either           
Seller set forth in this Agreement, or if a representation or warranty of       
either Seller shall be untrue in any material respect, in either case, such     
that the condition specified in Section 7.2(a) hereof would not be              
satisfied at the Closing (a "TERMINATING SELLER BREACH"), except that, if       
such Terminating Seller Breach is curable by any Seller through the             
exercise of commercially reasonable efforts, then, for a period of up to        
thirty (30) calendar days, but only as long as any Seller continues to use      
commercially reasonable efforts to cure such Terminating Seller Breach (the     
"SELLER CURE PERIOD"), such termination shall not be effective, and such        
termination shall become effective only if the Terminating Seller Breach is     
not cured within the Seller Cure Period, (ii) the Closing has not occurred      
on or before  December 1, 1999, other than as a result of (A) a breach of a     
representation, warranty, covenant or agreement of Purchaser or Purchaser       
Parent, or (B) a failure of all waiting periods under the HSR Act               
applicable to the transactions contemplated hereby to have expired or been      
terminated, or (iii) consummation of any of the transactions contemplated       
hereby is enjoined, prohibited or otherwise restrained by the terms of a        
final, non-appealable order or judgment of a court of competent                 
jurisdiction.                                                                   

             (c)  Prior to the Closing, by written notice to Purchaser and
Purchaser Parent from either Seller, if (i) there is any material breach of     
any representation, warranty, covenant or agreement on the part of              
Purchaser or Purchaser Parent set forth in this Agreement, or if a              
representation or warranty of Purchaser or Purchaser Parent shall be untrue     
in any material respect, in either case, such that the condition specified      
in Section 7.3(a) hereof would not be satisfied at the Closing, except as       
expressly provided in Sections 5.1 and 5.6 hereof (a "TERMINATING PURCHASER     
BREACH"), except that, if such Terminating Purchaser Breach is curable by       
Purchaser or Purchaser Parent through the exercise of commercially              
reasonable efforts, then, for a period of up to thirty (30) calendar days,      
but only as long as Purchaser or Purchaser Parent continues to exercise         
such commercially reasonable efforts to cure such Terminating Purchaser         
Breach (the "PURCHASER CURE PERIOD"), such termination shall not be             
effective, and such termination shall become effective only if the              
Terminating Purchaser Breach is not cured within the Purchaser Cure Period,     
(ii) the Closing has not occurred on or before December 1, 1999, other than     
as a result of a breach of a representation, warranty, covenant or              
agreement of either Seller, or (iii) consummation of any of the                 
transactions contemplated hereby is enjoined, prohibited or otherwise           
restrained by the terms of a final, non-appealable order or judgment of a       
court of competent jurisdiction.                                                

      Section 8.2.    EFFECT OF TERMINATION.  In the event of termination of
this Agreement pursuant to Section 8.1, this Agreement shall forthwith become   
void and have no effect, without any liability on the part of any party         
hereto or their respective Affiliates, officers, directors or stockholders,     
other than liability of either Seller or of Purchaser or Purchaser Parent,      
as the case may be, for such party's breaches of this Agreement occurring       
prior to such termination.  The provisions of Sections 6.1, 11.7, 11.11 and     
11.12 hereof shall survive any termination of this Agreement.                   

Section 8.3.    OTHER TERMINATION.  This Agreement may also be  
terminated pursuant to Sections 5.6(d) or 4.9(b) hereof.  The effect of a       
termination of this Agreement pursuant to either Section 5.6(d) or 4.9(b) shall 
have the effect set forth in Section 5.6(d) or 4.9(b), as the case may be.      

ARTICLE 9.    
INDEMNIFICATION     

     Section 9.1.    SURVIVAL OF REPRESENTATIONS.  The representations and
warranties of each Seller contained herein shall survive the Closing for a      
period of twelve (12) months following the Closing Date; provided that, the     
representations and warranties of Sellers set forth in Sections 2.4 and 2.6     
shall survive without limitation; provided further that the representations     
and warranties of Sellers set forth in Section 2.16 shall survive for a         
period equal to the applicable statute of limitations for all Taxes imposed     
as a result of any breach of Section 2.16.  None of the representations and     
warranties of Purchaser or Purchaser Parent contained herein shall survive      
the Closing.                                                                    

  Section 9.2.    INDEMNIFICATION OF PURCHASER AND PURCHASER PARENT.

           (a)  Each Seller shall indemnify and hold each of Purchaser
and Purchaser Parent and its officers, directors, employees and Affiliates      
harmless from any damage, claim, liability or expense, including, without       
limitation, reasonable attorneys' fees (collectively "DAMAGES"), arising        
out of or relating to the breach of any warranty, representation, covenant      
or agreement of such Seller contained in this Agreement.                        

             (b)  Notwithstanding the foregoing, (i) neither Purchaser nor
Purchaser Parent shall be entitled to indemnification for any Damages           
unless and until the amount of all Damages for which Purchaser or Purchaser     
Parent is entitled to indemnification exceeds Two Million Five Hundred          
Thousand Dollars ($2,500,000) (the "THRESHOLD AMOUNT"), at which time           
Purchaser and Purchaser Parent shall be entitled to indemnification only        
for all such Damages sustained by Purchaser and Purchaser Parent to the         
extent that the amount of such Damages exceeds the Threshold Amount, (ii)       
in no event shall the aggregate amount of Damages for which Purchaser and       
Purchaser Parent shall be entitled to indemnification exceed Twenty-Five        
Million Dollars ($25,000,000), and (iii) the amount of Damages for which        
Purchaser and Purchaser Parent are entitled to indemnification shall be         
reduced by (A) any tax benefit or deduction allowable as a result of the        
incurrence of such Damages or the facts or circumstances giving rise            
thereto, and (B) any insurance recoveries or other indemnities,                 
contributions or similar payments recoverable from any third party as a         
result of the incurrence of such Damages or the facts or circumstances          
giving rise thereto.                                                            

            (c)  Each of Purchaser and Purchaser Parent hereby agrees to
take, and to cause its Affiliates to take, all reasonable steps to mitigate     
any Damages incurred or to be incurred by Purchaser, Purchaser Parent or        
their respective Affiliates upon and after becoming aware of any event          
which could reasonably be expected to give rise to any Damages.                 

  Section 9.3.    INDEMNIFICATION OF SELLERS.  Each of Purchaser and
Purchaser Parent shall indemnify and hold each of Chancellor LA and Chancellor  
Mezzanine and its officers, directors, employees and Affiliates (the "Seller    
Indemnitees") harmless from any damage, claim, liability or expense,            
including, without limitation, reasonable attorney's fees, arising out of       
or relating to the Pre-Closing Terminations, including without limitation,      
under the Worker Adjustment and Retraining Notification Act ("WARN") or any     
state law similar to WARN, that would not have been a damage, claim,            
liability or expense of any Seller Indemnitee if such Pre-Closing               
Terminations had actually occurred after the Closing.                           

      Section 9.4.    CONDUCT OF PROCEEDINGS.  If any claim, action, suit or
proceeding covered by the foregoing agreements to indemnify and hold harmless (a
"PROCEEDING") shall arise, the party seeking indemnification (the               
"INDEMNIFIED PARTY") shall give written notice thereof to the party from        
whom indemnification is being sought (the "INDEMNIFYING PARTY") promptly        
after the Indemnified Party, learns of the existence of such Proceeding;        
provided, however, that failure of the Indemnified Party to give any such       
Indemnifying Party prompt notice shall not bar the right of the Indemnified     
Party to indemnification unless such failure has materially prejudiced the      
Indemnifying Party's ability to defend the Proceeding.  The Indemnifying        
Party shall have the right to employ counsel reasonably acceptable to the       
Indemnified Party to defend against any such Proceeding, or to compromise,      
settle or otherwise dispose of the same, if such Indemnifying Party deems       
it advisable to do so (in its reasonable judgment), all at the expense of       
such Indemnifying Party; provided that, such Indemnifying Party shall not       
settle, or consent to entry of any judgment in any Proceeding, without          
obtaining a release of the Indemnified Party from, or agreeing to indemnify     
the Indemnified Party for, all damages in respect of the claims underlying      
such Proceeding.  The parties will fully cooperate in any such action, and      
shall make available to each other any books or records useful for the          
defense of any such Proceeding.  If any Indemnifying Party against whom an      
indemnification claim is made fails to acknowledge in writing its               
obligation to defend against or settle such Proceeding within thirty (30)       
days after receiving notice thereof from an Indemnified Party (or such          
shorter time specified in the notice as the circumstances of the matter may     
dictate), such Indemnified Party shall have the right to undertake the          
defense and settlement of any such Proceeding, at such Indemnifying Party's     
expense; provided that, if such Indemnified Party assumes the defense of        
any such Proceeding, such Indemnified Party shall not settle such               
Proceeding prior to final judgment thereon or forego any appeal with            
respect thereto without the prior written consent of such Indemnifying          
Party (which consent may not be unreasonably withheld).                         

    Section 9.5.    SOLE REMEDY; TIME LIMITATION.  After the Closing has
occurred, the right to indemnification under this Article 9 shall be the        
exclusive remedy of Purchaser and Purchaser Parent hereto in connection with    
any breach by either Seller of its representations, warranties, covenants or    
agreements contained herein.  Notwithstanding the foregoing provisions of this  
Article 9, neither Seller shall have any responsibility or obligation with      
respect to any claim for indemnification asserted pursuant to this Article      
9 unless such claim is asserted in writing by Purchaser and Purchaser           
Parent to such Seller within the survival period provided in Section 9.1.       

ARTICLE 10.     
CERTAIN DEFINITIONS     

  As used herein, the following terms shall have the
following meanings:                                                             

     "ACTION" means any action, suit, arbitration or other
proceeding by or before any Governmental Authority.                             

        "ADJUSTMENT AMOUNT" has the meaning specified in Section
1.5.                                                                            

     "ADVERTISING CONTRACTS" means Chancellor LA's and its
Subsidiaries' interest in Contracts for outdoor advertising displays by         
customers and clients of Chancellor LA and its Subsidiaries.                    

        "AFFILIATE" means, with respect to any specified Person,
any Person that, directly or indirectly, controls, is controlled by, or is      
under common control with, such specified Person, through one or more           
intermediaries or otherwise.                                                    

        "AFFILIATED GROUP" means any affiliated group within the
meaning of Code Section 1504(a).                                                

     "AGREEMENT" has the meaning specified in the Preamble
hereto.                                                                         

         "ANCILLARY AGREEMENTS" shall mean the Registration Rights
Agreement, the Stockholders Agreement, and the Voting Agreement.                

       "ANTITRUST AUTHORITIES" means the Antitrust Division of
the United Stated Department of Justice, the United States Federal Trade        
Commission or the antitrust or competition law authorities of any other         
jurisdiction (whether United States, foreign or multinational).                 

"APPLICABLE RATE" has the meaning specified in  
Section 1.5.                                                                    

    "APPROVALS CERTIFICATE" has the meaning specified in
Section 4.9(a).                                                                 

   "AUDITOR" has the meaning specified in Section 1.5.

     "BURKETT ASSETS" has the meaning specified in Section
4.1.                                                                            

 "BUSINESS" means the outdoor advertising business
conducted by the Company and its Subsidiaries.                                  

    "BUSINESS DAY" means any day that is not a Saturday,
Sunday or other day on which banks are required or authorized by law to be      
closed in New York, New York.                                                   

         "CASH CONSIDERATION" has the meaning specified in Section
1.3.                                                                            

         "CHANCELLOR LA" has the meaning specified in the Preamble
hereto.                                                                         

       "CHANCELLOR MEZZANINE" has the meaning specified in the
Preamble hereto.                                                                

    "CHANCELLOR SHARES" has the meaning specified in the
Preamble hereto.                                                                

   "CLOSING" has the meaning specified in Section 1.4.

    "CLOSING BALANCE SHEET" has the meaning specified in
Section 1.5.                                                                    

        "CLOSING DATE" has the meaning specified in Section 1.4.

  "CLOSING DATE NET WORKING CAPITAL" has the meaning
specified in Section 1.5.                                                       

       "COBRA CONTINUATION COVERAGE" has the meaning specified
in Section 6.5.                                                                 

           "CODE" means the Internal Revenue Code of 1986, as amended.

             "COMMITMENT LETTER" has the meaning specified in Section 5.6.

           "COMPANY" has the meaning specified in the Recitals hereof.

         "COMPANY CASH CONSIDERATION" has the meaning specified in
Section 1.3.                                                                    

          "COMPANY SHARES" has the meaning specified in the Recitals
hereof.                                                                         

                "CONFIDENTIALITY AGREEMENT" has the meaning specified in Section
11.8.                                                                           

            "CONTRACTS" means any contracts, agreements, subcontracts or
leases.                                                                         

            "CONVEYANCE TAXES" has the meaning specified in Section 6.4.

   "DAMAGES" has the meaning specified in Section 9.2.

               "DEFINITIVE DOCUMENTATION" has the meaning specified in Section
5.6.                                                                            

              "DETERMINATION DATE" has the meaning specified in Section 1.5.

              "DIVESTITURE ASSETS" has the meaning specified in Section 4.1.

    "DIVIDEND" has the meaning specified in Section 1.1.

     "EMPLOYEES" has the meaning specified in Section 6.5.

           "EMPLOYEE PLANS" has the meaning specified in Section 2.12.

        "ENVIRONMENTAL LAWS" means, collectively, all applicable
U.S. federal, state or local laws, statutes, ordinances, rules,                 
regulations, codes or common law relating to health, safety, pollution or       
protection of the environment, as in effect as of the date hereof.              

  "ERISA" has the meaning specified in Section 2.12.

        "EXCHANGE ACT" has the meaning specified in Section 3.7.

      "FINAL JUDGMENTS" means (i) the Final Judgments of the
United States District Court for the District of Columbia in the case of        
U.S. V. CHANCELLOR MEDIA AND CANS & COMPANY, filed November 12, 1998, and       
(ii) the Final Judgment of the United States District Court for the             
District of Columbia in the case of U.S. V. CHANCELLOR MEDIA AND WHITECO        
INDUSTRIES, ET AL., filed November 25, 1998.                                    

"GAAP" has the meaning specified in Section 1.5.

  "GOVERNMENTAL AUTHORITY" means any Federal, state,
municipal or local government, governmental authority, regulatory or            
administrative agency.                                                          

"HSR ACT" means the Hart-Scott-Rodino Antitrust 
Improvements Act of 1976, as amended, and the rules and regulations             
promulgated thereunder.                                                         

             "INDEMNIFIED PARTY" has the meaning specified in Section 9.4.

              "INDEMNIFYING PARTY" has the meaning specified in Section 9.4.

            "INTELLECTUAL PROPERTY" has the meaning specified in Section
2.9.                                                                            

       "IRS" means the United States Internal Revenue Service.

           "LAMAR LA SHARES" has the meaning specified in Section 1.3.

             "LAMAR MEZZANINE SHARES" has the meaning specified in Section
1.3.                                                                            

        "LAMAR SHARES" has the meaning specified in Section 1.3.

        "LEASED REAL PROPERTY" means all real property leases to
which the Company or any of its Subsidiaries are a party.                       

 "LIEN" means any mortgage, deed of trust, pledge,
hypothecation, encumbrance, security interest or other lien of any kind.        

       "MINIMUM NET WORKING CAPITAL" has the meaning specified
in Section 1.5.                                                                 

               "MULTIEMPLOYER PLAN" has the meaning specified in Section 2.12.

               "NET WORKING CAPITAL" has the meaning specified in Section 1.5.

              "ORIGINAL AGREEMENT" has the meaning specified in the Recitals
hereof.                                                                         

      "OWNED REAL PROPERTY" means all real property owned by
the Company or any of its Subsidiaries.                                         

 "PBGC" has the meaning specified in Section 2.12.

         "PENSION PLAN" has the meaning specified in Section 2.12.

 "PERMITS" means all licenses, permits, approvals,
authorizations or consents of any Governmental Authority, whether federal,      
foreign, state, municipal or local, pertaining to the Business.                 

        "PERMITTED LIENS" means (i) mechanics, materialmen's and
similar Liens with respect to any amounts not yet due and payable or which      
are being contested in good faith through appropriate proceedings, (ii)         
Liens for Taxes not yet due and payable or which are being contested in         
good faith through appropriate proceedings, (iii) Liens arising in              
connection with the sale of foreign receivables, (iv) Liens on goods in         
transit incurred pursuant to documentary letters of credit, (v) Liens           
securing rental payments under capital lease agreements, (vi) Liens arising     
in favor of the United States Government as a result of progress payment        
clauses contained in any Contract, (vii) encumbrances and restrictions on       
real property that do not materially interfere with the present uses of         
such real property, and (viii) other Liens arising in the ordinary course       
of business and not incurred in connection with the borrowing of money.         

 "PERSON" means any individual, firm, corporation,
partnership, limited liability company, incorporated or unincorporated          
association, joint venture, joint stock company, governmental agency or         
instrumentality or other entity of any kind.                                    

         "PRE-CLOSING PARTIAL PERIOD" has the meaning specified in
Section 6.4.                                                                    

      "PRE-CLOSING TERMINATION" has the meaning specified in
Section 6.5.                                                                    

       "PRELIMINARY TRANSACTIONS" has the meaning specified in
Section 4.1.                                                                    

      "PROCEEDING" has the meaning specified in Section 9.4.

      "PRO FORMA BALANCE SHEET" has the meaning specified in
Section 2.7.                                                                    

   "PRO FORMA STATEMENT OF OPERATIONS" has the meaning
specified in Section 2.7.                                                       

     "PURCHASER" has the meaning specified in the Preamble
hereto.                                                                         

    "PURCHASER CURE PERIOD" has the meaning specified in
Section 8.1.                                                                    

   "PURCHASER PARENT" has the meaning specified in the
Preamble hereto.                                                                

       "PURCHASER PARENT CLASS A COMMON STOCK" has the meaning
specified in Section 1.3.                                                       

  "PURCHASER PARENT CLASS A PREFERRED STOCK" has the
meaning specified in Section 3.6.                                               

       "PURCHASER PARENT CLASS B COMMON STOCK" has the meaning
specified in Section 3.6.                                                       

               "PURCHASER PARENT PREFERRED STOCK" has the meaning specified in
Section 3.6.                                                                    

"PURCHASER PARENT SEC DOCUMENTS" has the meaning
specified in Section 3.7.                                                       

"PURCHASER PARENT STOCK OPTIONS" has the meaning
specified in Section 3.6.                                                       

     "PURCHASER SAVINGS PLAN" has the meaning specified in
Section 6.5.                                                                    

      "PURCHASER SAVINGS TRUST" has the meaning specified in
Section 6.5.                                                                    

      "PURCHASER SEC DOCUMENTS" has the meaning specified in
Section 3.7.                                                                    

"PWC" has the meaning specified in Section 1.5. 

      "REGISTRATION RIGHTS AGREEMENT" means the Registration
Rights Agreement among Purchaser Parent and each Seller, dated the Closing      
Date, in the form attached as ANNEX D.                                          

             "RESTRUCTURING" means the corporate restructuring effected by
Purchaser on July 20, 1999 pursuant to which Purchaser became the wholly-owned  
subsidiary of Purchaser Parent.                                                 

"RFLP" has the meaning specified in Section 5.8.

"SEC" has the meaning specified in Section 3.4. 

          "SECURITIES ACT" has the meaning specified in Section 3.7.

              "SELLER INDEMNITEES" has the meaning specified in Section 9.3.

           "SELLERS" has the meaning specified in the Preamble hereto.

              "SELLER CURE PERIOD" has the meaning specified in Section 8.1.

               "SELLER SAVINGS PLAN" has the meaning specified in Section 6.5.

                "SELLER SAVINGS TRUST" has the meaning specified in Section 6.5.

"STOCKHOLDERS AGREEMENT" means that Stockholders
Agreement among Purchaser Parent, each Seller and the other signatories         
listed therein, dated as of the Closing Date, in the form attached as           
ANNEX E.                                                                        

       "STRADDLE PERIOD" means any taxable period which begins
before and ends after the Closing Date.                                         

 "SUBSIDIARY" means, with respect to any Person, a
corporation or other entity of which 50% of more of the voting power of the     
equity securities or equity interests is owned, directly or indirectly, by      
such Person.  Except as otherwise expressly provided herein, references to      
Subsidiaries of the Company shall be deemed to include Whiteco.                 

         "TAX" or "TAXES" means all income, gross receipts, sales,
use, employment, franchise, profits, property or other fees, stamp duties,      
assessments or similar charges (whether payable directly or by                  
withholding), together with any interest and any penalties or additions to      
tax imposed by any tax authority with respect thereto.                          

     "TAX ASSET" means any net operating loss, net capital
loss, investment tax credit, foreign tax credit, charitable deduction or        
any other credit or tax attribute which could reduce Taxes (including,          
without limitation, deductions and credits related to alternative minimum       
taxes).                                                                         

      "TAX RETURNS" means all returns and reports (including
elections, declarations, disclosure schedules, estimates and information        
returns, claims for refund, or statements of any kind or nature relating to     
Taxes, in any schedule or amendment thereto and any amendment thereof)          
required to be supplied to a Tax authority relating to Taxes.                   

        "TERMINATING PURCHASER BREACH" has the meaning specified
in Section 8.1.                                                                 

        "TERMINATING SELLER BREACH" has the meaning specified in
Section 8.1.                                                                    

            "THRESHOLD AMOUNT" has the meaning specified in Section 9.2.

               "TOTAL CONSIDERATION" has the meaning specified in Section 1.3.

            "TRANSFERRED EMPLOYEES" has the meaning specified in Section
6.5.                                                                            

   "TREASURY REGULATIONS" means the regulations issued
pursuant to the Code.                                                           

        "VOTING AGREEMENT" means the Amended and Restated Voting
Agreement among Purchaser, each Seller and RFLP, dated the date hereof, in      
the form attached as ANNEX G.                                                   

"WARN" has the meaning specified in Section 9.3.

         "WELFARE PLAN" has the meaning specified in Section 2.12.

           "WHITECO" has the meaning specified in the Recitals hereof.

         "WHITECO CASH CONSIDERATION" has the meaning specified in
Section 1.3.                                                                    

          "WHITECO SHARES" has the meaning specified in the Recitals
hereof.                                                                         

ARTICLE 11.     
MISCELLANEOUS     

     Section 11.1.   WAIVER.  Any party to this Agreement may, at any time
prior to the Closing, waive any of the terms or conditions of this Agreement or 
agree to an amendment or modification to this Agreement by an agreement in      
writing executed in the same manner as this Agreement.                          

        Section 11.2.   NOTICES.  All notices and other communications among the
parties shall be in writing and shall be deemed to have been duly given when (i)
delivered in person, or (ii) five (5) calendar days after posting in the        
United States mail having been sent registered or certified mail return         
receipt requested, or (iii) delivered by telecopy and promptly confirmed by     
delivery in person or post as aforesaid in each case, with postage prepaid,     
addressed as follows:                                                           

(a) If to Purchaser or Purchaser Parent, to:    

Lamar Advertising Company               
5551 Corporate Boulevard                
Baton Rouge, Louisiana  70808           
Attention:  Keith Istre                 
Telecopy No.:  (225) 923-0658           

with copies to:                         

Jones, Walker, Waechter, Poitevent,     
Carrere & Denegre, L.L.P.               
5th Floor                               
Four United Plaza                       
8555 United Plaza Boulevard             
Baton Rouge, Louisiana  70809           
Attention:  Brad J. Axelrod             
Telecopy No.:  (225) 231-3336           

(b) IF TO CHANCELLOR LA, TO:                    

   Chancellor Media Corporation of Los Angeles
1845 Woodall Rogers Freeway             
Suite 1300                              
Dallas, Texas  75201                    
Attention:  General Counsel             
Telecopy No.:  (512) 340-7890           

with copies to:                         

Latham & Watkins                        
1001 Pennsylvania Avenue, N.W.          
Suite 1300                              
Washington, D.C. 20004-2502             
Attention:  Eric L. Bernthal            
Telecopy No.:  (202) 637-2201           

and                                     

Weil, Gotshal & Manges LLP              
100 Crescent Court, Suite 1300          
Dallas, Texas  75201-6950               
Attention:  Michael A. Saslaw           
Telecopy No.:  (214) 746-7777           

(c) IF TO CHANCELLOR MEZZANINE, TO:             

 Chancellor Mezzanine Holdings Corporation
1845 Woodall Rogers Freeway             
Suite 1300                              
Dallas, Texas  75201                    
Attention:  General Counsel             
Telecopy No.:  (512) 340-7890           

with copies to:                         

Latham & Watkins                        
1001 Pennsylvania Avenue, N.W.          
Suite 1300                              
Washington, D.C. 20004-2502             
Attention:  Eric L. Bernthal            
Telecopy No.:  (202) 637-2201           

and                                     

Weil, Gotshal & Manges LLP              
100 Crescent Court, Suite 1300          
Dallas, Texas  75201-6950               
Attention:  Michael A. Saslaw           
Telecopy No.:  (214) 746-7777           

(or to such other address or addresses as the parties may from time to time     
designate in writing.                                                           

     Section 11.3.   TERMINATION OF SUBSCRIPTION AGREEMENT.  Chancellor LA
and Purchaser have terminated that certain Subscription Agreement, dated as of  
June 1, 1999, by and between Chancellor LA and Purchaser.  Such termination was 
effective as of July 12, 1999 and such Subscription Agreement was thereby       
deemed to be void and of no further force and effect, without any liability     
on the part of Chancellor LA or Purchaser or any of their respective            
Affiliates.                                                                     

        Section 11.4.   ASSIGNMENT.  No party hereto shall assign this Agreement
or any part hereof without the prior written consent of the other parties.      
Subject to the foregoing, this Agreement shall be binding upon and inure to     
the benefit of the parties hereto and their respective permitted successors     
and assigns.                                                                    

      Section 11.5.   RIGHTS OF THIRD PARTIES.  Nothing expressed or implied
in this Agreement is intended or shall be construed to confer upon or give any  
Person, other than the parties hereto, any right or remedies under or by        
reason of this Agreement.                                                       

        Section 11.6.   EXPENSES.  Each party hereto shall bear its own expenses
incurred in connection with this Agreement and the transactions herein          
contemplated whether or not such transactions shall be consummated, including,  
without limitation, all fees of its legal counsel, financial advisers and       
accountants; provided, however, that (i) the fees and expenses of the           
Auditors, if any, shall be paid one-half by Purchaser and one-half by           
Chancellor LA, (ii) all Conveyance Taxes imposed as a result of the sale of     
the Chancellor Shares and the Lamar Shares shall be paid by Sellers,            
Purchaser and Purchaser Parent as set forth in Section 6.4(i), and (iii)        
all fees paid to Antitrust Authorities in connection with compliance with       
the notification and reporting requirements of the HSR Act for the              
transactions contemplated hereby, shall be paid by Purchaser.                   

    Section 11.7.   CONSTRUCTION.  This Agreement shall be construed and
enforced in accordance with the internal laws, and not the law of conflicts, of 
the State of Delaware.  Unless otherwise stated, references to Sections,        
Articles, Schedules or Annexes refer to the Sections, Articles, Schedules       
and Annexes to this Agreement.  As used herein, the phrase "to the              
knowledge" of any Person shall mean the actual knowledge of such Person's       
executive officers after due inquiry.  The parties to this Agreement            
participated jointly in the negotiation and drafting of this Agreement.  If     
any ambiguity or question of intent or interpretation shall arise with          
respect to this Agreement, then this Agreement shall be construed as if         
drafted jointly by the parties and no presumption or burden of proof will       
arise favoring or disfavoring any party to this Agreement by virtue of the      
authorship of any provision of this Agreement.                                  

       Section 11.8.   CAPTIONS; COUNTERPARTS.  The captions in this Agreement
are for convenience only and shall not be considered a part of or affect the    
construction or interpretation of any provision of this Agreement.  This        
Agreement may be executed in two or more counterparts, each of which shall      
be deemed an original, but all of which together shall constitute one and       
the same instrument.                                                            

    Section 11.9.   ENTIRE AGREEMENT.  This Agreement (together with the
Ancillary Agreements, Schedules and Annexes to this Agreement, which, although  
they may be bound separately, constitute part of this Agreement) and that       
certain Confidentiality Agreement between Purchaser and Chancellor LA (the      
"CONFIDENTIALITY AGREEMENT") constitute the entire agreement among the          
parties and supersede any other agreements, whether written or oral, that       
may have been made or entered into by or among any of the parties hereto or     
any of their respective Subsidiaries relating to the transactions               
contemplated hereby.  No representations, warranties, covenants,                
understandings, agreements, oral or otherwise, relating to the transactions     
contemplated by this Agreement exist between the parties except as              
expressly set forth in this Agreement and the Confidentiality Agreement.        
This Agreement supersedes the Original Agreement and the Restated Agreement     
in their entirety, and the Original Agreement and Restated Agreement shall      
be of no further force and effect; PROVIDED, HOWEVER, that the Schedules        
and Annexes delivered with the Original Agreement (other than Schedules 2.8     
and 4.9 and Annexes D, E and G which are attached hereto) shall be deemed       
to constitute a part of this Agreement.  Except as otherwise expressly          
provided herein, (i) references to "the date hereof" or "the date of this       
Agreement" shall be deemed to refer to June 1, 1999 (the date of the            
Original Agreement) and (ii) all representations and warranties set forth       
in this Agreement shall be deemed to be made as of June 1, 1999 (the date       
of the Original Agreement), except that representations and warranties that     
relate solely to Chancellor Mezzanine, unless otherwise expressly provided      
herein, shall be deemed to be made as of July 12, 1999, and representations     
and warranties that relate solely to Purchaser Parent, unless otherwise         
provided herein, shall be deemed to be made as of the date this Agreement       
was executed and delivered.                                                     

      Section 11.10.  AMENDMENTS.  This Agreement may be amended or modified
in whole or in part, only by a duly authorized agreement in writing executed in 
the same manner as this Agreement and which makes reference to this Agreement.  

Section 11.11.  PUBLICITY.  All press releases or other public  
communications of any nature whatsoever relating to the transactions            
contemplated by this Agreement, and the method of the release for publication   
thereof, shall be subject to the prior mutual approval of Purchaser, Purchaser  
Parent and Sellers, which approval shall not be unreasonably withheld by any    
party; provided, however, that, nothing herein shall prevent any party from     
publishing such press releases or other public communications as such party     
may consider necessary in order to satisfy such party's legal or                
contractual obligations after such consultation with the other parties          
hereto as is reasonable under the circumstances.                                

        Section 11.12.  DISPUTE RESOLUTION.  Any and all disputes arising out of
or relating to this contract, or the breach, termination or validity thereof,   
shall be resolved by final and binding, confidential arbitration in             
accordance with the then current Center for Public Resources Institute for      
Dispute Resolution Rules for Non-Administered Arbitration of Business           
Disputes, by a sole arbitrator selected from among the Center for Public        
Resources Panel of Distinguished Neutrals.  The arbitration shall be            
governed by the United States Arbitration Act, 9 U.S.C. 1-16, and judgment      
upon the award rendered by the arbitrator may be entered by any court           
having jurisdiction thereof.  Neither party nor the arbitrator shall            
disclose the existence, content or results of any arbitration hereunder         
without the prior written consent of all parties.  The place of arbitration     
shall be Chicago, Illinois.  The costs of the arbitrator and all expenses       
relating to the arbitration (exclusive of legal fees) shall be borne            
equally by the parties.  The arbitrator may award reasonable attorneys'         
fees to the prevailing party at the arbitrator's sole discretion.               

[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]      

DEFM14C
72nd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 72nd
IN WITNESS WHEREOF the parties have hereunto caused this Agreement to be        
duly executed as of the date first above written.                               

     LAMAR ADVERTISING COMPANY

By:                 
Name:     
Title:    

LAMAR MEDIA CORP.   

By:                 
Name:     
Title:    

                     CHANCELLOR MEZZANINE HOLDINGS CORPORATION

             By:  /S/ WILLIAM S. BANOWSKY, JR.
                    Name: William S. Banowsky, Jr.
                     Title: Executive Vice President

                       CHANCELLOR MEDIA CORPORATION OF LOS ANGELES

             By:  /S/ WILLIAM S. BANOWSKY, JR.
                    Name: William S. Banowsky, Jr.
                     Title: Executive Vice President

DEFM14C
73rd “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 73rd
AMENDED AND RESTATED VOTING AGREEMENT       

THIS SECOND AMENDED AND RESTATED VOTING AGREEMENT (this "Agreement"), 
dated as of August 11, 1999, among LAMAR ADVERTISING COMPANY, a Delaware        
corporation (the "Company"), CHANCELLOR MEDIA CORPORATION OF LOS ANGELES,       
a Delaware corporation ("Chancellor LA"), CHANCELLOR MEZZANINE HOLDINGS         
CORPORATION, a Delaware corporation ("Chancellor Mezzanine"), and REILLY        
FAMILY LIMITED PARTNERSHIP, a Louisiana limited partnership (the                
"Stockholder").                                                                 

   WHEREAS, Lamar Media Corp. (formerly known as Lamar Advertising Company),
a Delaware corporation and a wholly-owned subsidiary of the Company ("LMC"),    
and Chancellor LA entered into (i) that certain Stock Purchase Agreement dated  
as of June 1, 1999 (the "Original Purchase Agreement") and (ii) that certain    
Subscription Agreement, dated as of June 1, 1999 (the "Subscription Agreement");

WHEREAS, LMC, Chancellor LA and Chancellor Mezzanine entered into that
certain Amended and Restated Stock Purchase Agreement, dated as of July 12,     
1999, (the "Resated Purchase Agreement") in order to (i) terminate the          
Subscription Agreement and (ii) amend and restate the Original Purchase         
Agreement in its entirety;                                                      

WHEREAS,  LMC, Chancellor LA and Chancellor Mezzanine are             
entering into that certain Second Amended and Restated Stock Purchase           
Agreement of even date herewith (the "Purchase Agreement"), in order to amend   
and restate the Restated Purchase Agreement;                                    

WHEREAS, the Purchase Agreement contemplates the issuance and sale    
of shares (collectively, the "Company Shares") of Class A Common Stock,         
par value $0.001 per share, of the Company ("Class A Common Stock"), to         
Chancellor LA and Chancellor Mezzanine upon the terms and subject to the        
conditions set forth in the Purchase Agreement;                                 

WHEREAS, all of the shares of Class A Common Stock and Class B        
Common Stock, $0.001 par value per share, of the Company ("Class B Common       
Stock"), that are held of record as of the date hereof by the Stockholder       
or over which the Stockholder has the power to direct the vote, together        
with any shares of capital stock of the Company acquired by the                 
Stockholder after the date hereof and during the term of this Agreement,        
including upon exercise of any option or warrant, are collectively              
referred to herein as the "Subject Shares;"                                     

WHEREAS, as a condition to its willingness to enter into the          
Original Purchase Agreement, Chancellor LA requested that the Stockholder       
enter into, and the Stockholder agreed to enter into, that certain Voting       
Agreement dated as of June 1, 1999 (the "Original Voting Agreement");           

WHEREAS, the Original Voting Agreement was amended and restated as    
of July 12, 1999 (the "Restated Voting Agreement"); and                         

WHEREAS, the parties are entering into this Agreement in order to     
amend and restate the Restated Voting Agreement to reflect changes that         
are appropriate as a result of the parties' execution and delivery of the       
Purchase Agreement;                                                             

NOW, THEREFORE, in consideration of Chancellor LA and Chancellor      
Mezzanine entering into the Purchase Agreement, and in consideration of         
the premises and the representations, warranties and agreements contained       
herein, the parties agree as follows:                                           

   1.   REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS.  The Stockholder
hereby represents and warrants to Chancellor LA and Chancellor Mezzanine as of  
the date hereof as follows:                                                     

             (a) AUTHORITY; NONCONTRAVENTION.  The Stockholder has all
         requisite power and authority to enter into this Agreement and to
           consummate the transactions contemplated hereby.  The execution and
           delivery of this Agreement by the Stockholder, and the consummation
          of the transactions contemplated hereby, have been duly authorized
           by all necessary partnership action on the part of the Stockholder.
          This Agreement has been duly authorized, executed and delivered by
         the Stockholder and constitutes a valid and binding obligation of
      the Stockholder enforceable in accordance with its terms.  The
execution and delivery of this Agreement do not, and the
           consummation of the transactions contemplated hereby and compliance
          with the terms hereof (including Section 3 of this Agreement) will
           not, conflict with, or result in any violation of, or default (with
           or without notice or lapse of time or both) under any provision of,
         the certificate of limited partnership, the partnership agreement
or any other partnership organizational documents of the
      Stockholder, or any trust agreement, loan or credit agreement,
  note, bond, mortgage, indenture, lease or other agreement,
     instrument, permit, concession, franchise, license, judgment,
          order, notice, decree, statute, law, ordinance, rule or regulation
         applicable to the Stockholder or to the Stockholder's property or
assets.                                                 

             (b) THE SUBJECT SHARES.  The Stockholder is the record or
      beneficial owner of, and has good and marketable title to, the
         Subject Shares, free and clear of any claims, liens, encumbrances
        and security interests whatsoever.  The Stockholder has the sole
        right to vote the Subject Shares.  None of the Subject Shares is
      subject to any voting trust or other agreement (other than the
      Stockholders Agreement, among the parties hereto, of even date
herewith (the "Stockholders Agreement")), arrangement or
       restriction with respect to the voting of the Subject Shares as
required by this Agreement.                             

2.   REPRESENTATIONS AND WARRANTIES OF CHANCELLOR LA AND CHANCELLOR   
MEZZANINE.  Each of Chancellor LA and Chancellor Mezzanine hereby represents    
and warrants to the Stockholder as of the date hereof that (i) such entity has  
all requisite corporate power and authority to enter into this Agreement and to 
consummate the transactions contemplated hereby; (ii) the execution and         
delivery of this Agreement by such entity, and the consummation of the          
transactions contemplated hereby, have been duly authorized by all necessary    
corporate action on the part of such entity; (iii) this Agreement has been duly 
executed and delivered by such entity and constitutes a valid and binding       
obligation of such entity enforceable in accordance with its terms; and (iv)    
the execution and delivery of this Agreement do not, and the consummation of    
the transactions contemplated hereby and compliance with the terms hereof will  
not, conflict with, or result in any violation of, or default (with or without  
notice or lapse of time or both) under any provision of, the certificate of     
incorporation or bylaws of such entity, any trust agreement, loan or credit     
agreement, note, bond, mortgage, indenture, lease or other agreement,           
instrument, permit, concession, franchise, license, judgment, order, notice,    
decree, statute, law, ordinance, rule or regulation applicable to such entity   
or to such entity's property or assets.                                         

3.   COVENANTS OF THE STOCKHOLDER.  Until the termination of this     
Agreement in accordance with Section 6, the Stockholder agrees as follows:      

               (a) At any meeting of stockholders of the Company called to
       vote upon the approval and authorization of the issuance of the
        Company Shares, as contemplated by the Purchase Agreement, or at
          any adjournment thereof or in any other circumstances upon which a
           vote, consent or other approval (including by written consent) with
        respect to the approval and authorization of the issuance of the
          Company Shares, is sought, the Stockholder shall vote (or cause to
          be voted) the Subject Shares in favor of such proposals and any of
           the other transactions contemplated by the Purchase Agreement.  The
        Stockholder further agrees (i) not to convert any Subject Shares
      that are shares of Class B Common Stock into shares of Class A
         Common Stock and (ii) not to waive or otherwise forfeit its right
          to have each Subject Share that is a share of Class B Common Stock
be entitled to ten (10) votes per share.                

                (b) Except as provided in the immediately following sentence
     of this Section 3(b), the Stockholder agrees not to (i) sell,
      transfer, pledge, assign or otherwise dispose of (including by
         gift) (collectively, the "Transfer"), or enter into any contract,
 option or other arrangement (including any profit sharing
        agreement) with respect to the Transfer of the Subject Shares to
         any person, or (ii) enter into any voting arrangement, whether by
        proxy, voting agreement or otherwise (other than the Amended and
        Restated Stockholders Agreement to be entered into in connection
         with the closing of the transactions contemplated by the Purchase
      Agreement (the "Stockholders Agreement")), with respect to any
          capital stock of the Company, and agrees not to commit or agree to
          take any of the foregoing actions.  Notwithstanding the foregoing,
        the Stockholder shall have the right, for tax or estate planning
         purposes, to Transfer the Subject Shares to a transferee provided
       that, as a condition to any such Transfer, each such transferee
           shall execute and deliver to Chancellor LA and Chancellor Mezzanine
       a counterpart of this Agreement and expressly agree to be bound
hereby.                                                 

              (c) Until after the earlier of (i) the consummation of the
        transactions contemplated by the Purchase Agreement and (ii) the
        termination of the Purchase Agreement, the Stockholder shall use
          all reasonable efforts to take, or cause to be taken, all actions,
        and to do, or cause to be done, and to assist and cooperate with
   Chancellor LA and Chancellor Mezzanine in doing, all things
           necessary, proper or advisable to consummate and make effective, in
 the most expeditious manner practicable, the transactions
contemplated by the Purchase Agreement.                 

      (d) Immediately prior to the closing of the transactions
contemplated by the Purchase Agreement (the "Purchase   
    Closing"), the Stockholder shall execute and deliver to each
   of the Company, Chancellor LA and Chancellor Mezzanine, the
    Stockholders Agreement, dated as of the date of the Purchase
Closing, the form of which is attached to the Purchase  
  Agreement as Annex E, as required by Section 7.3(e) of the
Purchase Agreement.                                     

    4.   FURTHER ASSURANCES.  The Stockholder will, from time to time, execute
and deliver, or cause to be executed and delivered, such additional or further  
consents, documents and other instruments as Chancellor LA and Chancellor       
Mezzanine may reasonably request for the purpose of effectively carrying out    
the transactions contemplated by this Agreement.                                

   5.   ASSIGNMENT.  Neither party hereto shall assign this Agreement or any
part hereof without the prior written consent of the other party.  Subject to   
the foregoing, this Agreement shall be binding upon and inure to the benefit of 
the parties hereto and their respective permitted successors and assigns.       

   6.   TERMINATION.  This Agreement shall terminate upon the earlier of (a)
the termination of the Purchase Agreement in accordance with the terms thereof, 
or (b) the closing of the transactions contemplated  thereby.                   

7.  GENERAL PROVISIONS.                                               

                (a) AMENDMENTS.  This Agreement may not be amended except by
      an instrument in writing signed by each of the parties hereto.

               (b) NOTICE.  All notices and other communications hereunder
  shall be in writing and shall be deemed given if delivered
   personally or sent by overnight courier (providing proof of
           delivery) to the Company, Chancellor LA and Chancellor Mezzanine in
         accordance with Section 11.2 of the Purchase Agreement and to the
          Stockholder at its address set forth on the signature pages hereto
           (or at such other address for a party as shall be specified by like
written notice).                                        

         (c) INTERPRETATION.  When a reference is made in this
           Agreement to Sections, such reference shall be to a Section to this
        Agreement unless otherwise indicated.  The headings contained in
           this Agreement are for reference purposes only and shall not affect
   in any way the meaning or interpretation of this Agreement.
           Wherever the words "include," "includes" or "including" are used in
        this Agreement, they shall be deemed to be followed by the words
"without limitation."                                   

               (d) COUNTERPARTS.  This Agreement may be executed in one or
       more counterparts, all of which shall be considered one and the
          same agreement, and shall become effective when one or more of the
          counterparts have been signed by each of the parties and delivered
        to the other party, it being understood that each party need not
sign the same counterpart.                              

             (e) ENTIRE AGREEMENT; NO THIRD-PARTY BENEFICIARIES.  This
      Agreement (including the documents and instruments referred to
       herein) (i) constitutes the entire agreement and supersedes all
         prior agreements and understandings, both written and oral, among
         the parties with respect to the subject matter hereof and (ii) is
     not intended to confer upon any person other than the parties
hereto any rights or remedies hereunder.                

                (f) GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND
       CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE
           REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW THEREOF.                 

    8. ENFORCEMENT.  The parties agree that irreparable damage would  occur in
the event that any of the provisions of this A greement  were not  performed in 
accordance with their  specific  terms  or  were  otherwise  breached.   It  is 
accordingly  agreed  that the  parties  shall  be entitled to an  injunction or 
injunctions to prevent breaches of this Agreement  and to enforce  specifically 
the terms and provisions of this Agreement in any competent court of the United 
States located in  the  State  of  Delaware or  in a Delaware state court, this 
being in addition to any other remedy to which they are  entitled at law  or in 
equity.  In addition, each of the parties hereto (i)  consents to  submit  such 
party  to  the   personal  jurisdiction of any Federal  court  in the event any 
dispute  arises out of this Agreement or any of the  transactions  contemplated 
hereby, (ii) agrees that such party  will  not  attempt to deny or defeat  such 
personal jurisdiction by motion or other request for leave from any such court, 
(iii) agrees  that  such party will not  bring  any  action  relating  to  this 
Agreement or the transactions contemplated hereby in any  court  other  than  a 
Federal court sitting in the state of Delaware or  a  Delaware  state court and 
(iv) waives any right to trial by jury with respect to any claim or  proceeding 
related to or  arising  out  of  this  Agreement  or any  of  the  transactions 
contemplated hereby.                                                            

       [The remainder of this page is intentionally left blank.]

DEFM14C
74th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 74th
 IN WITNESS WHEREOF, each of the parties hereto has caused
this Agreement to be duly executed as of the date first 
written above.                                          

LAMAR ADVERTISING COMPANY                         

By: /s/ Keith A. Istre                            
-------------------------------------     
Name:   Keith A. Istre                            
Title:  Cief Financial Officer                    

CHANCELLOR MEZZANINE HOLDINGS CORPORATION         

By: /s/ William  S. Banowsky, Jr.                 
-------------------------------------     
Name:   William S. Banowsky, Jr.                  
Title:  Executive Vice President                  

CHANCELLOR MEDIA CORPORATION OF                   
LOS ANGELES                                   

By: /s/ William S. Banowsky, Jr.                  
-------------------------------------     
Name:   William S. Banowsky, Jr.                  
Title:  Executive Vice President                  

REILLY FAMILY LIMITED PARTNERSHIP                 

By: /s/ Kevin P. Reilly, Jr.                      
-------------------------------------     
Name:   Kevin P. Reilly, Jr.                      
Title:  General Partner                           

DEFM14C
75th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 75th
  STOCKHOLDERS AGREEMENT

  BY AND AMONG

   LAMAR ADVERTISING COMPANY

AND 

   SIGNATORIES LISTED HEREIN

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

    Dated as of ____, 1999

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

DEFM14C
76th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 76th
TABLE OF CONTENTS 
(continued) 
                                                                        Page

Article 1               DEFINITIONS..........................................1  

      Section 1.1     Definitions..........................................2

      Section 1.2     Rules of Construction ...............................3

Article 2               MANAGEMENT OF THE COMPANY AND CERTAIN                   

                      ACTIVITIES...........................................4

      Section 2.1     Board of Directors...................................4

              2.1.1   Board of Representation..............................4

              2.1.2   Vacancies............................................4

              2.1.3   Committee Representation.............................4

              2.1.4   Costs and Expenses...................................5

              2.1.5   Other Activities of teh Holders; Fiduciary Duties....5

Article 3               CHANCELLOR LOCK-UP...................................5  

      Section 3.1     Lock-Up Agreement....................................5

Article 4               CERTAIN LIMITATIONS..................................6  

      Section 4.1     Transactions with Affiliates.........................6

      Section 4.2     Other Significant Transactions.......................6

Article 5               LEGENDS..............................................7  

      Section 5.1     Restrictive Legends..................................7

              5.1.1   Securities Act Legend................................7

              5.1.2   Other Legends........................................7

      Section 5.2     Termination of Certain Restrictions..................7

Article 6               TERMINATION..........................................8  

      Section 6.1     Termination..........................................8

Article 7               MISCELLANEOUS........................................8  

      Section 7.1     Financial Statements.................................8

      Section 7.2     Notices..............................................8

      Section 7.3     Voting of Holders....................................9

      Section 7.4     Governing Law.......................................10

      Section 7.5     Successors and Assigns..............................10

      Section 7.6     Duplicate Originals.................................10

      Section 7.7     Severability........................................10

      Section 7.8     No Waivers; Amendments..............................10

      Section 7.9     Entire Agreement....................................10

STOCKHOLDERS AGREEMENT        

THIS STOCKHOLDERS AGREEMENT (this "Stockholders Agreement") dated as  
of ________, 1999, is entered into by and among Lamar Advertising               
Company, a Delaware corporation (including its successors, the                  
"Company"), and the securityholders of the Company listed on the                
signature pages hereof, or who may execute counterpart signature pages          
hereto following the date hereof.                                               

In consideration of the premises, mutual covenants and agreements     
hereinafter contained and for other good and valuable consideration, the        
receipt and adequacy of which are hereby acknowledged, the parties hereto       
agree as follows:                                                               

ARTICLE 1   

DEFINITION    

SECTION 1.1   DEFINITIONS.                                  

       "Affiliate" means, with respect to any Person, any Person
 who, directly or indirectly, controls, is controlled by or is
under common control with that Person.  For purposes of this
definition, "control" when used with respect to any Person  
 means the power to direct the management and policies of such
 Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise.             

"BENEFICIALLY OWN" OR "BENEFICIAL OWNERSHIP" means
 beneficial ownership determined in accordance with Rule 13d-3
promulgated under the Exchange Act.                         

       "CHANCELLOR LA" means Chancellor Media Corporation of Los
Angeles, a Delaware corporation.                            

      "CHANCELLOR DESIGNEE" shall have the meaning provided in
SECTION 2.1.1(A) hereof.                                    

      "CHANCELLOR HOLDERS" means, collectively, Chancellor LA,
Chancellor Mezzanine and any Affiliates of Chancellor LA or 
  Chancellor Mezzanine who then are parties to this Stockholders
Agreement and who own any Common Stock or Common Stock      
Equivalents or any interest therein.                        

        "CHANCELLOR MEZZANINE" means Chancellor Mezzanine Holdings
Corporation, a Delaware corporation.                        

        "CHANGE OF CONTROL" means the occurrence of one or more of
   the following events:  (i) a majority of the Board of Directors
  of the Company shall consist of Persons who are not Continuing
Directors, or (ii) the failure by Reilly and the Chancellor 
   Holders collectively to Beneficially Own securities having more
than 50% of the ordinary voting power for the election of   
directors of the Company.                                   

       "CLASS A COMMON STOCK" means shares of the Class A Common
Stock, par value $.001 per share, of the Company, and any   
capital stock into which such Class A Common Stock hereafter
may be changed.                                             

       "CLASS B COMMON STOCK" means shares of the Class B Common
Stock, par value $.001 per share, of the Company, and any   
   capital stock, other than Class A Common Stock, into which such
Class B Common Stock hereafter may be changed.              

    "COMMON STOCK" means, collectively, the Class A Common
Stock and the Class B Common Stock.                         

        "COMMON STOCK EQUIVALENTS" means, without duplication with
any other Common Stock or Common Stock Equivalents, any     
  security of the Company which is convertible into, exercisable
 for or exchangeable for, directly or indirectly, Common Stock
of the Company, whether at the time of issuance or upon the 
passage of time or the occurrence of some future event.     

"COMPANY" shall have the meaning provided in the  
introductory paragraph hereof.                              

"CONTINUING DIRECTOR " means, as of the date of   
determination, any Person who (i) is a Chancellor Designee, 
 (ii) was a member of the Board of Directors of the Company as
   of the date hereof, (iii) was nominated for election or elected
 to the Board of Directors of the Company with the affirmative
   vote of a majority of the Continuing Directors who were members
of the Board of Directors of the Company at the time of such
   nomination or election or (iv) is a representative of Reilly or
an Affiliate of Reilly.                                     

     "EBITDA" shall have the meaning provided in SECTION 7.1
hereof.                                                     

       "EXCHANGE ACT" means the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated by the
SEC thereunder.                                             

       "FULLY-DILUTED COMMON STOCK" means, at any time, the then
outstanding Common Stock of the Company plus (without       
duplication) all shares of Common Stock issuable, whether at
such time or upon the passage of time or the occurrence of  
future events, upon the conversion or exchange of all then  
outstanding Common Stock Equivalents.                       

    "GAAP" means generally accepted accounting principles.

      "GROUP" means a group of related persons for purposes of
Section 13(d) of the Exchange Act.                          

    "HOLDER" means (i) any Person (other than the Company)
listed on the signature pages hereof as of the date of this 
Stockholders Agreement and (ii) any direct or indirect      
 transferee of any such Person who elects to become a party to
this Stockholders Agreement by executing and delivering a   
counterpart signature page hereto.                          

    "MAJORITY CHANCELLOR HOLDERS" means Chancellor Holders
owning Common Stock and/or Common Stock Equivalents         
  representing a majority of the Fully-Diluted Common Stock then
owned by all Chancellor Holders.                            

     "PERSON" or "PERSON" means any individual, corporation,
partnership, limited liability company, joint venture,      
association, joint-stock company, trust, unincorporated     
organization or government or other agency or political     
subdivision thereof.                                        

              "PURCHASE AGREEMENT" means the Second Amended and Restated Stock
     Purchase Agreement, dated as of August 11, 1999, by and among the
       Company, Lamar Media Corp., a Delaware corporation and wholly-owned
  subsidiary of the Company (formerly known as Lamar Advertising
Company), Chancellor Mezzanine and Chancellor LA.           

     "REILLY" means, collectively, the Reilly Family Limited
  Partnership, a Louisiana limited partnership ("RFLP"), and any
Affiliates of RFLP (other than the Company and any of its   
Subsidiaries) who then are parties to this Stockholders     
Agreement and who own any Common Stock or Common Stock      
Equivalents or any interest therein.                        

       "SEC" means the U. S. Securities and Exchange Commission.

   "SECURITIES ACT" means the Securities Act of 1933, as
 amended, and the rules and regulations promulgated by the SEC
thereunder.                                                 

"STOCKHOLDERS AGREEMENT" means this Stockholders  
Agreement, as such from time to time may be amended.        

  "SUBSIDIARY" of any Person means (i) a corporation a
  majority of whose outstanding shares of capital stock or other
equity interests with voting power, under ordinary          
  circumstances, to elect directors, is at the time, directly or
 indirectly, owned by such Person, by one or more subsidiaries
 of such Person or by such Person and one or more subsidiaries
of such Person, and (ii) any other Person (other than a     
  corporation) in which such Person, a subsidiary of such Person
or such Person and one or more subsidiaries of such Person, 
 directly or indirectly, at the date of determination thereof,
   has (x) at least a majority ownership interest or (y) the power
to elect or direct the election of the directors or other   
governing body of such Person.                              

  SECTION 1.2   RULES OF CONSTRUCTION.  Unless the context otherwise
                    requires

(1) a term has the meaning assigned to it;        

(2)  "OR" IS NOT EXCLUSIVE;                       

        (3) words in the singular include the plural, and words in
the plural include the singular;                  

              (4)  provisions apply to successive events and transactions; and

      (5) "herein," "hereof" and other words of similar import
        refer to this Stockholders Agreement as a whole and not to
   any particular Article, Section or other subdivision.

Article 2       

MANGEMENT OF THE COMPANY AND CERTAIN ACTIVITIES       

Section 2.1   BOARD OF DIRECTORS                                        

2.1.1  BOARD OF REPRESENTATIVES                           

   (a)  From and following the date hereof, the Board of Dirctions
of the Company shall consist of ten (10) individuals.  The Majority             
Chancellor Holders will be entitled to designate two (2) directors (each        
a "Chancellor Designee").  The existence of the right, pursuant to this         
SECTION 2.1.1(A), on the part of the Majority Chancellor Holders to             
designate certain directors will in no way limit or impair the right of         
the Majority Chancellor Holders to vote their shares of capital stock of        
the Company as they see fit with respect to the election of persons to          
fill seats on the Board of Directors other than the seats filled as a           
result of the designation rights under this SECTION 2.1.1(A).                   

 (b)  The Company, from time to time at each appropriate time,
will cause each of the persons theretofore serving as Chancellor                
Designees (or other persons designated by the Majority Chancellor Holders       
as new Chancellor Designees in replacement of such persons) to be               
nominated and recommended by the Board of Directors of the Company for          
reelection to the Board of Directors of the Company by the stockholders         
of the Company upon any expiration of their respective terms of office.         

2.1.2 VACANCIES.  If, prior to his election to the Board of 
Directors of the Company pursuant to SECTION 2.1.1 hereof, any Chancellor       
Designee shall be unable or unwilling to serve as a director of the             
Company, then the Majority Chancellor Holders shall be entitled to              
designate a replacement Chancellor Designee.  If, following an election         
to the Board of Directors of the Company pursuant to SECTION 2.1.1              
hereof, any Chancellor Designee shall resign or be removed or be unable         
to serve for any reason prior to the expiration of his term as a director       
of the Company, then the Majority Chancellor Holders shall, within thirty       
(30) days of such event, notify the Board of Directors of the Company in        
writing of a replacement Chancellor Designee, and the Board of Directors        
shall appoint such replacement Chancellor Designee to fill the unexpired        
term of the director who such new Chancellor Designee is replacing.  If         
the Majority Chancellor Holders request that any Chancellor Designee be         
removed as a director (with or without cause) by written notice thereof         
to the Company, then each of the Holders shall vote all of its or his           
capital stock in favor of such removal upon such request.                       

2.1.3 COMMITTEE REPRESENTATION.  So long as the Chancellor  
Holders are entitled to designate any director under SECTION 2.1.1, at          
least one (1) of the Chancellor Designees shall be permitted to serve on        
each committee of the Board of Directors of the Company (provided that,         
if such committee has eligibility requirements that are imposed by a            
Person other than the Company, such as independence requirements for the        
independent committee of the Board of Directors of the Company, such            
designee meets those requirements).  Notwithstanding the foregoing, the         
Executive Committee of the Board of Directors of the Company shall not be       
required to have a Chancellor Designee serving on such committee so long        
as (i) the actions of such committee are restricted to the day to day           
management of the Company in the ordinary course of business and (ii)           
each of such actions of such committee is not material to the Company and       
its Subsidiaries, taken as a whole.                                             

  2.1.4 COSTS AND EXPENSES.  The Company will pay all reasonable
out-of-pocket expenses incurred by the Chancellor Designees in connection       
with the participation by directors in meetings of the Board of Directors       
(and committees thereof) of the Company.                                        

   2.1.5 OTHER ACTIVITIES OF THE HOLDERS; FIDUCIARY DUTIES.  It is
understood and accepted that the Holders and their Affiliates have              
interests in other business ventures which may be in conflict with the          
activities of the Company and its Subsidiaries and that, subject to             
applicable law, nothing in this Stockholders Agreement shall limit the          
current or future business activities of the Holders whether or not such        
activities are competitive with those of the Company and its                    
Subsidiaries.  Nothing in this Stockholders Agreement, express or               
implied, shall relieve any officer or director of the Company or any of         
its Subsidiaries, or any Holder, of any fiduciary or other duties or            
obligations they may have to the Company's stockholders.                        

Article 3       

CHANCELLOR LOCK-UP        

SECTION 3.1 LOCK-UP AGREEMENT.  Each of Chancellor LA and Chancellor  
Mezzanine agrees that, until that date that is twelve (12) months               
following the date hereof, such entity will not sell or otherwise               
transfer any of the shares of Common Stock acquired pursuant to the             
Purchase Agreement, or any interest therein; provided, however, that this       
SECTION 3.1 shall not prohibit the transfer of any such shares (or any          
interest therein) (i) to any Affiliate of Chancellor LA or Chancellor           
Mezzanine in compliance with the other provisions of this Stockholders          
Agreement, (ii) in a transaction approved by the Board of Directors of          
the Company or (iii) pursuant to a bona fide pledge of such shares to a         
lender or in connection with a foreclosure (or similar proceeding or            
remedy) effected with respect to any such pledge.                               

ARTICLE 4       

CERTAIN LIMITATIONS       

SECTION 4.1 TRANSACTIONS WITH AFFILIATES.  The Company will not, nor  
will it permit any of its Subsidiaries to, directly or indirectly, enter        
into or engage in any transaction with or for the benefit of any of its         
Affiliates (other than transactions between the Company and a wholly            
owned Subsidiary of the Company or among wholly owned Subsidiaries of the       
Company), except for any such transaction which (i) has been approved in        
advance in writing by the Majority Chancellor Holders or (ii) is on terms       
no less favorable than those that might reasonably have been obtained in        
a comparable transaction on an arm's-length basis from a person that is         
not an Affiliate.  With respect to the requirement set forth in clause          
(ii) of the immediately preceding sentence, for a transaction or series         
of related transactions involving a value of $1,000,000 or more, such           
determination will be made in good faith by a majority of the members of        
the Board of Directors of the Company and a majority of the disinterested       
members of the Board of Directors of the Company, and for a transaction         
or series of transactions involving a value of $5,000,000 or more, the          
Board of Directors of the Company must receive an opinion from a                
nationally recognized investment banking firm that such transaction is          
(or that such series of transactions are) fair, from a financial point of       
view, to the Company or such Subsidiary, as applicable.  Notwithstanding        
the foregoing, the restrictions set forth in this SECTION 4.1 shall not         
apply to reasonable and customary directors' fees, reasonable and               
customary directors' or officers' indemnification arrangements, or              
reasonable and customary compensatory arrangements with officers of the         
Company.                                                                        

Section 4.2 OTHER SIGNIFICANT TRANSACTIONS.  Subject to the           
provisions set forth in this SECTION 4.2, without the prior written             
approval of the Majority Chancellor Holders, neither the Company nor any        
of the Holders will take any action which would result in (and the              
Company will not permit any of its Subsidiaries to take any action which        
would result in) (i) a Change of Control or (ii) the acquisition or             
disposition by the Company and/or any of its Subsidiaries, in a single          
transaction or a series of related transactions, of assets (which shall         
include, without limitation, capital stock or other equity interests in         
any Person) with an aggregate fair market value of $500,000,000 or more.        
Notwithstanding the foregoing, the restrictions set forth in this SECTION       
4.2 shall not apply to (a) any transaction pursuant to which all Persons        
who owned Common Stock immediately prior to such transaction cease to own       
any equity interest in the Company or, if applicable, in the entity that        
is the successor to the Company as a result of such transaction, (b) any        
merger in which all Persons who owned Common Stock immediately prior to         
such merger are permitted to exercise statutory appraisal rights, or (c)        
any sale of substantially all of the assets of the Company to a Person          
that is not an Affiliate of the Company if the net proceeds of such sale        
are promptly distributed to the holders of Common Stock.                        

Article 5       

LEGENDS       

SECTION 5.1 RESTRICTIVE LEGENDS.                                      

   5.1.1  SECURITIES  ACT LEGEND.  Except as otherwise provided in
SECTION 5.2 hereof, each  certificate  evidencing  shares  of Common  
Stock  issued  on  or  after  the  date  hereof  to a Holder or to a  
subsequent transferee of such Holder, shall be stamped  or otherwise  
imprinted with a legend in substantially the following form:          

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN          
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR PURSUANT TO        
THE SECURITIES OR "BLUE SKY" LAWS OF ANY STATE.  SUCH SECURITIES MAY NOT        
BE OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE               
ASSIGNED, EXCEPT PURSUANT TO (i) A REGISTRATION STATEMENT WITH RESPECT TO       
SUCH SECURITIES WHICH IS EFFECTIVE UNDER SUCH ACT, (ii) RULE 144 UNDER          
SUCH ACT, OR (iii) ANY OTHER EXEMPTION FROM REGISTRATION UNDER SUCH ACT.        

5.12 OTHER LEGENDS.  Each certificate evidencing shares of  
Common Stock or Common Stock Equivalents, where applicable, issued    
on or after the date hereof to a Holder or a subsequent transferee    
of such Holder shall be stamped or otherwise imprinted with a legend  
in substantially the following form:                                  

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO         
RESTRICTIONS ON TRANSFER, VOTING AND OTHER TERMS AND CONDITIONS SET FORTH       
IN THE STOCKHOLDERS AGREEMENT DATED AS OF ______________, 1999, A COPY OF       
WHICH MAY BE OBTAINED FROM THE COMPANY AT ITS PRINCIPAL EXECUTIVE               
OFFICES.                                                                        

SECTION 5.2 TERMINATION OF CERTAIN RESTRICTIONS.  Notwithstanding     
the foregoing provisions of this ARTICLE 5, the legend requirements of          
SECTION 5.1.1 shall terminate as to any Common Stock (i) when and so long       
as such Common Stock shall have been effectively registered under the           
Securities Act and disposed of pursuant thereto or (ii) when the Company        
shall have received an opinion of counsel reasonably satisfactory to it         
that such Common Stock may be transferred without registration thereof          
under the Securities Act and that such legend may be removed.  Whenever         
the restrictions imposed by SECTION 5.1.1 shall terminate as to any             
Common Stock, the Holder thereof shall be entitled to receive from the          
Company, at the Company's expense, a new certificate evidencing such            
shares of Common Stock not bearing the restrictive legend set forth in          
SECTION 5.1.1.                                                                  

ARTICLE 6       

TERMINATION       

SECTION 6.1 TERMINATION.  The provisions of this Stockholders         
Agreement shall terminate on the earlier of (i) the date that is ten (10)       
years following the date of this Stockholders Agreement and (ii) such           
date that the Chancellor Holders collectively no longer Beneficially Own        
at least ten percent (10%) of the Fully-Diluted Common Stock.                   
Notwithstanding the foregoing, SECTION 7.1 hereof shall remain in full          
force and effect for so long as (and only for so long as) the information       
to be provided to Chancellor LA or Chancellor Mezzanine under such              
SECTION 7.1 is necessary for such entity in connection with the                 
preparation of its financial statements.                                        

ARTICLE 7         

MISCELLANEOUS         

SECTION 7.1 FINANCIAL STATEMENTS.  The Company shall deliver to       
Chancellor LA and Chancellor Mezzanine the following, together with             
management's discussion and analysis of financial condition and results         
of operations for the relevant fiscal periods, in writing:                      

   (a)  as soon as available and in any event within 80 days after
the  end  of each fiscal year of the Company, (i) an audited consolidated       
balance sheet  or  equivalent  statement  of  financial  position  of the       
Company and its Subsidiaries  and  the related consolidated statements of       
income, cash flows, and changes in stockholders'  equity  for such fiscal       
year, setting forth in each case in comparative form the figures  for the       
previous  fiscal year, and (ii) a statement of earnings before  interest,       
taxes, depreciation and amortization as per  the  consolidated  financial       
statements of the Company and its Subsidiaries prepared in accordance with      
GAAP ("EBITDA") for such fiscal year, all presented in accordance with GAAP     
and reported on as to fairness of presentation, accounting principles  and      
consistency, and otherwise by independent public accountants; and               

   (b)  as soon as available and in any event within 35 days after
the end  of each calendar quarter of each fiscal year of the Company, (i)       
an unaudited  consolidated  balance  sheet  or  equivalent  statement  of       
financial  position  of  the  Company and its Subsidiaries as of the end        
of each such calendar quarter, as applicable, and the related consolidated      
statements of income and cash flows for the portion  of the Company's           
fiscal year ended at the end of each such calendar quarter  setting  forth      
in comparative form in the case of such statements of income and cash flows     
the figures for the corresponding calendar quarter of the previous fiscal       
year,  and  (ii)  a statement   of  EBITDA  for  such  calendar  quarter,       
all  presented  in accordance with  GAAP  and  certified  as  to  fairness      
of presentation, accounting principles and consistency by an officer of the     
Company.                                                                        

SECTION 7.2 NOTICES.  Any notices or other communications required    
or permitted hereunder shall be in writing, and shall be sufficiently           
given if made by hand delivery, by telex, by telecopier, by registered or       
certified mail, postage prepaid, return receipt requested, or by                
overnight courier, addressed as follows (or at such other address as may        
be substituted by notice given as herein provided):                             

If to the Company:                                                    

Lamar Advertising Company                                   
5551 Corporate Boulevard                                    
Baton Rouge, Louisiana  70808                               
Attention:  Keith Istre                                     
Fax:  (225) 923-0658                                        

With copies to:                                                         

Jones, Walker, Waechter, Poitevent,                         
Carrere & Denegre, L.L.P.                                   
5th Floor                                                   
Four United Plaza                                           
8555 United Plaza Boulevard                                 
Baton Rouge, Louisiana  70809                               
Attention:  Brad J. Axelrod                                 
Fax:  (225) 231-3336                                        

If to any Holder, at its address listed on the signature pages        
hereof.                                                                         

Any notice or communication hereunder shall be deemed to have been    
given or made as of the date so delivered if personally delivered; when         
answered back, if telexed; when receipt is acknowledged, if telecopied;         
five (5) calendar days after mailing if sent by registered or certified         
mail (except that a notice of change of address shall not be deemed to          
have been given until actually received by the addressee); and one (1)          
business day after delivery to a reputable overnight courier service            
guaranteeing next business day delivery.                                        

Failure to mail a notice or communication to a Holder or any defect   
in it shall not affect its sufficiency with respect to other Holders.  If       
a notice or communication is mailed in the manner provided above, it is         
duly given, whether or not the addressee receives it.                           

SECTION 7.3 VOTING OF HOLDERS.  Each Holder shall vote his or its     
shares of Voting Stock at any regular or special meeting of stockholders        
of the Company or in any written consent executed in lieu of such a             
meeting of stockholders and shall take all other lawful actions                 
(including using its, his or her commercially reasonable efforts to cause       
the Board of Directors of the Company to take all such actions) necessary       
to give effect to the agreements contained in this Stockholders Agreement       
(including but not limited to the election of the Chancellor Designees)         
and to ensure that the certificate of incorporation and bylaws of the           
Company as in effect at any time hereafter do not conflict in any respect       
with the provisions of this Stockholders Agreement.  In order to                
effectuate the provisions of this Stockholders Agreement, each Holder           
hereby agrees that when any action or vote is required to be taken by           
such Holder pursuant to this Stockholders Agreement, such Holder shall          
use his commercially reasonable efforts to call, or cause the appropriate       
officers and directors of the Company to call, a special or annual              
meeting of stockholders of the Company, as the case may be, or execute or       
cause to be executed a consent in writing in lieu of any such meetings          
pursuant to the General Corporation Law of the State of Delaware, as            
amended from time to time, or any successor statutes.                           

Section 7.4 GOVERNING LAW.  THIS STOCKHOLDERS AGREEMENT SHALL BE      
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF           
DELAWARE, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.                     

SECTION 7.5 SUCCESSORS AND ASSIGNS.  This Stockholders Agreement      
shall be binding upon the Company, each Holder, and their respective            
successors and permitted assigns.                                               

Section 7.6 DUPLICATE ORIGINALS.  All parties may sign any number of  
copies of this Stockholders Agreement.  Each signed copy shall be an            
original, but all of them together shall represent the same agreement.          

SECTION 7.7 SEVERABILITY.  In case any provision in this              
Stockholders Agreement shall be held invalid, illegal or unenforceable in       
any respect for any reason, the validity, legality and enforceability of        
any such provision in every other respect and the remaining provisions          
shall not in any way be affected or impaired thereby                            

Section 7.8 NO WAIVERS; AMENDMENTS.                                   

7.8.1 NO FAILURE OR DELAY ON THE PART OF THE COMPANY OR ANY 
HOLDER IN EXERCISING ANY RIGHT, POWER OR REMEDY HEREUNDER SHALL OPERATE         
AS A WAIVER THEREOF, NOR SHALL ANY SINGLE OR PARTIAL EXERCISE OF ANY SUCH       
RIGHT, POWER OR REMEDY PRECLUDE ANY OTHER OR FURTHER EXERCISE THEREOF OR        
THE EXERCISE OF ANY OTHER RIGHT, POWER OR REMEDY.  THE REMEDIES PROVIDED        
FOR HEREIN ARE CUMULATIVE AND ARE NOT EXCLUSIVE OF ANY REMEDIES THAT MAY        
BE AVAILABLE TO THE COMPANY OR ANY HOLDER AT LAW OR IN EQUITY OR                
OTHERWISE.                                                                      

7.8.2 Any provision of this Stockholders Agreement may be   
amended or waived if, but only if, such amendment or waiver is in writing       
and is signed by the Company, the Holders holding at least a majority of        
the Fully-Diluted Common Stock held by all Holders and by the Majority          
Chancellor Holders.                                                             

SECTION 7.9 ENTIRE AGREEMENT.  This Stockholders Agreement contains   
the entire agreement among the parties with respect to the subject matter       
hereof and supersedes all prior agreements and understandings with              
respect to such subject matter.                                                 

[SIGNATURE PAGES FOLLOW]        

DEFM14C
77th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 77th
                                           LAMAR ADVERTISING COMPANY

                                                By:___________________________

                                                Name:_________________________

                                                Title:________________________

DEFM14C
78th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 78th
HOLDERS:          

          CHANCELLOR MEDIA CORPORATION
OF LOS ANGELES    

               By:______________________________

               Name:____________________________

               Title:___________________________

Address:          

         1845 Woodall Rogers Freeway
Suite 1300        
  Dallas, Texas  75201
         Attention:  General Counsel
  Fax:  (512) 340-7890

With copies to:   

        Weil, Gotshal & Manges LLP
100 Crescent Court
Suite 1300        
       Dallas, Texas  75201-6950
           Attention:  Michael A. Saslaw
  Fax:  (214) 746-7777

and               

Latham & Watkins  
            1001 Pennsylvania Avenue, N.W.
Suite 1300        
          Washington, D.C.  20004-2502
          Attention:  Eric L. Bernthal
  Fax:  (202) 637-2201

DEFM14C
79th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 79th
           CHANCELLOR MEZZANINE HOLDINGS
CORPORATION       

               By:______________________________

               Name:____________________________

               Title:___________________________

Address:          

         1845 Woodall Rogers Freeway
Suite 1300        
  Dallas, Texas  75201
         Attention:  General Counsel
  Fax:  (512) 340-7890

With copies to:   

        Weil, Gotshal & Manges LLP
100 Crescent Court
Suite 1300        
       Dallas, Texas  75201-6950
           Attention:  Michael A. Saslaw
  Fax:  (214) 746-7777

and               

Latham & Watkins  
            1001 Pennsylvania Avenue, N.W.
Suite 1300        
          Washington, D.C.  20004-2502
          Attention:  Eric L. Bernthal
  Fax:  (202) 637-2201

DEFM14C
80th “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 80th
               REILLY FAMILY LIMITED PARTNERSHIP

               By:______________________________
         Name   Kevin P. Reilly, Jr.
    Title: General Partner

Address:          

           c/o Lamar Advertising Company
      5551 Corporate Boulevard
           Baton Rouge, Louisiana  70808
              Attention:  Kevin P. Reilly, Jr.
  Fax:  (225) 923-0658

REGISTRATION RIGHTS AGREEMENT     

This REGISTRATION RIGHTS AGREEMENT dated as of _________, 1999 (this  
"Agreement"), among Lamar Advertising Company, a Delaware corporation (the      
"Issuer"), Chancellor Media Corporation of Los Angeles, a Delaware              
Corporation ("Chancellor LA"), and Chancellor Mezzanine Holdings                
Corporation, a Delaware corporation ("Chancellor Mezzanine").                   

WHEREAS, this Agreement is being entered into in connection with the  
closing of the transactions contemplated by the Purchase Agreement referred     
to below.                                                                       

NOW, THEREFORE, in consideration of the foregoing and the mutual      
promises, representations, warranties, covenants and agreements contained       
herein, the parties hereto, intending to be legally bound hereby, agree as      
follows:                                                                        

ARTICLE 1       

DEFINITIONS       

Section 1.1  DEFINITIONS.  The following terms, as used herein, shall 
have the following respective meanings:                                         

"Commission" means the Securities and Exchange Commission or any      
successor governmental body or agency.                                          

"Common Stock" means the Class A Common Stock, par value $0.001 per   
share, of the Issuer and any capital stock into which such Common Stock         
thereafter may be changed.                                                      

"Demand Registration" has the meaning ascribed thereto in Section     
2.2(a).                                                                         

"Demand Request" has the meaning ascribed thereto in Section 2.2(a).  

"Disadvantageous Condition" has the meaning ascribed thereto in       
Section 2.4.                                                                    

"Exchange Act" means the Securities Exchange Act of 1934, as amended. 

"Excluded Registration" means a registration under the Securities Act 
of (i) securities pursuant to one or more Demand Registrations pursuant to      
Section 2.2 hereof, (ii) securities registered on Form S-8 under the            
Securities Act or any similar successor form and (iii) securities               
registered to effect the acquisition of or combination with another             
business entity.                                                                

"Holder" means (i) Chancellor LA, (ii) Chancellor Mezzanine and       
(iii) any direct or indirect transferee of  Chancellor LA or Chancellor         
Mezzanine who shall agree to be bound by the terms of this Agreement.           

"Person" or "person" means any individual, corporation, partnership,  
limited liability company, joint venture, association, joint-stock company,     
trust, unincorporated organization or government or other agency or             
political subdivision thereof.                                                  

"Piggyback Registration" has the meaning ascribed thereto in          
Section 2.3(a).                                                                 

   "Purchase Agreement" means the Second Amended and Restated Stock Purchase
Agreement dated as of August 11, 1999, among the Issuer, Lamar Media Corp., a   
Delaware corporation and wholly-owned subsidiary of the Issuer (formerly known  
as Lamar Advertising Company), Chancellor LA and Chancellor Mezzanine.          

"Registrable Securities" means, at any time, any shares of Common     
Stock owned by the Holders, whether owned on the date hereof or acquired        
hereafter; PROVIDED, HOWEVER, that Registrable Securities shall not include     
any shares of Common Stock (i) the sale of which has been registered            
pursuant to the Securities Act and which shares have been sold pursuant to      
such registration or (ii) which have been sold pursuant to Rule 144 of the      
Commission under the Securities Act.                                            

"Registration Expenses" means any and all expenses incident to        
performance of or compliance with any registration of securities pursuant       
to Article 2, including, without limitation, (i) all registration and           
filing fees, (ii) all fees and expenses associated with filings required to     
be made with the NASD (including, if applicable, the fees and expenses of       
any "qualified independent underwriter" as such term is defined in              
Rule 2720(b)(15) of the NASD Conduct Rules, and of its counsel), as may be      
required by the rules and regulations of the NASD, (iii) fees and expenses      
of compliance with securities or "blue sky" laws (including reasonable fees     
and disbursements of counsel in connection with "blue sky" qualifications       
of the Registrable Shares), (iv) rating agency fees, (v) printing expenses      
(including expenses of printing certificates for the Registrable Shares in      
a form eligible for deposit with The Depository Trust Company and of            
printing prospectuses if the printing of prospectuses is requested by a         
holder of Registrable Shares), (vi) messenger and delivery expenses,            
(vii) the Issuer's internal expenses (including, without limitation, all        
salaries and expenses of its officers and employees performing legal or         
accounting duties), (viii) the fees and expenses incurred in connection         
with any listing of the Registrable Shares, (ix) fees and expenses of           
counsel for the Issuer and its independent certified public accountants         
(including the expenses of any special audit or "cold comfort" letters          
required by or incident to such performance), (x) Securities Act liability      
insurance (if the Issuer elects to obtain such insurance), (xi) the fees        
and expenses of any special experts retained by the Issuer in connection        
with such registration, (xii) the fees and expenses of other persons            
retained by the Issuer and (xiii) reasonable fees and expenses of one firm      
of counsel for the Selling Holders (which shall be selected by the Holders      
of a majority of the Registrable Securities being included in any               
particular registration statement).                                             

"Required Shelf Registration" has the meaning ascribed thereto in     
Section 2.1.                                                                    

"Rule 144" means Rule 144 (or any successor rule to similar effect)   
promulgated under the Securities Act.                                           

"Rule 145" means Rule 145 (or any successor rule to similar effect)   
promulgated under the Securities Act.                                           

"Rule 415 Offering" means an offering on a delayed or continuous      
basis pursuant to Rule 415 (or any successor rule to similar effect)            
promulgated under the Securities Act.                                           

"Securities Act" means the Securities Act of 1933, as amended.        

"Seller Affiliates" has the meaning ascribed thereto in Section 2.8.  

"Selling Holder" means any Holder who sells Registrable Securities    
pursuant to a public offering registered hereunder.                             

"Shelf Registration" means the registration under the Securities Act  
of a Rule 415 Offering.                                                         

"Shelf Registration Statement" means a registration statement         
intended to effect a Shelf Registration.                                        

"Shelf Termination Date" has the meaning ascribed thereto in          
Section 2.1(c).                                                                 

    Section 1.2  INTERNAL REFERENCES.  Unless the context indicates otherwise,
references to Articles, Sections and paragraphs shall refer to the              
corresponding articles, sections and paragraphs in this Agreement, and          
references to the parties shall mean the parties to this Agreement.             

ARTICLE 2       

REGISTRATION RIGHTS       

  Section 2.1  SHELF REGISTRATION.  At any time after the date that is ten
months from the date hereof, if requested by a Holder or Holders holding a      
majority in interest of the Registrable Securities, as soon as practicable      
(but in any event not more than 15 days) after such request, the Issuer         
shall prepare and file with the Commission a Shelf Registration Statement       
on an appropriate form that shall include all Registrable Securities, and       
which shall not include any other securities (the "Required Shelf               
Registration").  The Issuer shall use its reasonable best efforts to cause      
such Shelf Registration Statement to be declared effective as soon as           
practicable after such request; PROVIDED, HOWEVER, that the Issuer shall        
have no obligation to cause such Shelf Registration Statement to be             
declared effective on a date that is prior to the first anniversary of this     
Agreement.  Notwithstanding anything else contained in this Agreement, the      
Issuer shall only be obligated to keep such Shelf Registration Statement        
effective until the earliest of:                                                

(a)(i) 12 months after the date such Shelf Registration     
Statement has been declared effective, provided that such 12-month period       
shall be extended by (1) the length of any period during which the Issuer       
delays in maintaining the Shelf Registration Statement current pursuant to      
Section 2.4, (2) the length of any period (in which such Shelf Registration     
Statement is required to be effective hereunder) during which such Shelf        
Registration Statement is not maintained effective, and (3) such number of      
days that equals the number of days elapsing from (x) the date the written      
notice contemplated by Section 2.6(e) below is given by the Issuer to           
(y) the date on which the Issuer delivers to the Holders of Registrable         
Securities the supplement or amendment contemplated by Section 2.6(e)           
below;                                                                          

(b)such time as all Registrable Securities have been sold or
disposed of thereunder or sold, transferred or otherwise disposed of to a       
Person that is not a Holder; and                                                

(c)such time as all securities owned by the Holders have    
ceased to be Registrable Securities (the earliest of (a), (b) and (c) being     
the "Shelf Termination Date").                                                  

The Required Shelf Registration shall not be counted as a Demand                
Registration for purposes of Section 2.2 of this Agreement.                     

Section 2.2  DEMAND REGISTRATION.                                     

 (a) At any time after the date that is ten months from the date
hereof, upon written notice to the Issuer from a Holder or Holders holding      
a majority in interest of the Registrable Securities (a "Demand Request")       
requesting that the Issuer effect the registration under the Securities Act     
of any or all of the Registrable Securities held by such requesting             
Holders, which notice shall specify the intended method or methods of           
disposition of such Registrable Securities, the Issuer shall prepare as         
soon as practicable and, within 15 days after such request, file with the       
Commission a registration statement with respect to such Registrable            
Securities and thereafter use its reasonable best efforts to cause such         
registration statement to be declared effective under the Securities Act        
for purposes of dispositions in accordance with the intended method or          
methods of disposition stated in such request within 30 days after the          
filing of such registration statement; PROVIDED, HOWEVER, that the Issuer       
shall have no obligation to (i) cause such registration statement filed         
pursuant to this Section 2.2 to be declared effective on a date that is         
prior to the first anniversary of this Agreement or (ii) cause such             
registration statement filed pursuant to this Section 2.2 to be declared        
effective during any period during which a Shelf Registration Statement         
filed pursuant to Section 2.1 remains effective.  Notwithstanding any other     
provision of this Agreement to the contrary:                                    

    (i) the Holders may collectively exercise their Demand
Request rights for registration of their Registrable Securities under 
this Section 2.2(a) on not more than three occasions (any such        
registration being referred to herein as a "Demand Registration");    

  (ii) the method of disposition requested by Holders in
connection with any Demand Registration may not, without the Issuer's 
written consent, be a Rule 415 Offering;                              

   (iii) the Issuer shall not be required to effect a Demand
Registration hereunder if all securities owned by the Holders have    
ceased to be Registrable Securities; and                              

     (iv) the Issuer shall not be required to effect more than
one Demand Registration during any 12 month period.                   

  (b) Notwithstanding any other provision of this Agreement to the
contrary, a Demand Registration requested by Holders pursuant to this           
Section 2.2 shall not be deemed to have been effected, and, therefore, not      
requested and the rights of each Holder shall be deemed not to have been        
exercised for purposes of paragraph (a) above, (i) if such Demand               
Registration has not become effective under the Securities Act or (ii) if       
such Demand Registration, after it became effective under the Securities        
Act, was not maintained effective under the Securities Act (including,          
without limitation, if it was interfered with by any stop order,                
injunctions or other order or requirement the Commission or other               
governmental agency or court) for at least 30 days (or such shorter period      
ending when all the Registrable Securities covered thereby have been            
disposed of pursuant thereto) and, as a result thereof, the Registrable         
Securities requested to be registered cannot be distributed in accordance       
with the plan of distribution set forth in the related registration             
statement.  The Holders shall be deemed not to have exercised a Demand          
Request under Section 2.2 if the Demand Registration related to such Demand     
Request is delayed or not effected in the circumstances set forth in this       
clause (b).                                                                     

  (c) The Issuer shall have the right to cause the registration of
additional shares of Common Stock for sale for the account of the Issuer,       
but not for the account of any other Person, in the registration of             
Registrable Securities requested by the Holders pursuant to Section 2.2(a)      
above, PROVIDED, that if such Holders are advised by the lead or managing       
underwriter referred to in Section 2.2(e) that, in such underwriter's good      
faith view, all or a part of such Registrable Securities and additional         
shares of Common Stock cannot be sold or the inclusion of such Registrable      
Securities and additional shares of Common Stock in such registration would     
be likely to have a material adverse effect on the price, timing or             
distribution of the offering and sale of the Registrable Securities and         
additional equity securities then contemplated, then the number of              
securities that can, in the good faith view of such underwriter, be sold in     
such offering without so materially adversely affecting such offering shall     
be allocated first, pro rata among the requesting Holders on the basis of       
the relative number requested to be included therein by each such Holder        
and then second, to the Issuer.  The Holders of the Registrable Securities      
to be offered pursuant to paragraph (a) above may require that any such         
additional equity securities be included by the Issuer in the offering          
proposed by such Holders on the same conditions as the Registrable              
Securities that are included therein.  If, in the case of any registration      
pursuant to a Demand Request, the Holders making such Demand Request are        
advised by the lead or managing underwriter referred to in Section  2.2(e)      
that, in such underwriter's good faith view, all or a part of such              
Registrable Securities cannot be sold or the inclusion of such Registrable      
Securities in such registration would be likely to have a material adverse      
effect on the price, timing or distribution of the offering and sale of the     
Registrable Securities then contemplated, then such Holders will have the       
right, within 15 days following such advice from such underwriter, to elect     
to terminate such Demand Request, in which case the Holders shall be deemed     
not to have exercised a Demand Request pursuant to Section 2.2 hereof.          

    (d) Within 10 days after delivery of a Demand Request by a Holder,
the Issuer shall provide a written notice to each Holder, advising such         
Holder of its right to include any or all of the Registrable Securities         
held by such Holder for sale pursuant to the Demand Registration and            
advising such Holder of procedures to enable such Holder to elect to so         
include Registrable Securities for sale in the Demand Registration as each      
such Holder may request.  Any Holder may, within 20 days of delivery to         
such Holder of a notice pursuant to this Section 2.2(d), elect to so            
include such portion of its Registrable Securities in the Demand                
Registration by written notice to such effect to the Issuer specifying the      
number of Registrable Securities desired to be so included by such Holder.      

(e) In the event that any public offering pursuant to either  
Section 2.1 or 2.2 of this Agreement shall involve, in whole or in part, an     
underwritten offering, the Holders of a majority of the Registrable             
Securities being included in such underwritten offering shall have the          
right to designate an underwriter or underwriters as the lead or managing       
underwriters of such underwritten offering; PROVIDED, that such selection       
shall be subject to the consent of the Issuer, which consent shall not be       
unreasonably withheld or delayed.                                               

Section 2.3 PIGGYBACK REGISTRATIONS.                                  

 (a) Each time the Issuer proposes to register any of its equity
securities (other than pursuant to an Excluded Registration) under the          
Securities Act for sale to the public (whether for the account of the           
Issuer or the account of any securityholder of the Issuer ) and the form of     
registration statement to be used permits the registration of Registrable       
Securities, the Issuer shall give prompt written notice to each Holder          
(which notice shall be given not less than thirty (30) days prior to the        
effective date of the Issuer's registration statement), which notice shall      
offer each such Holder the opportunity to include any or all of its             
Registrable Securities in such registration statement (a "Piggyback             
Registration"), subject to the limitations contained in Section 2.3(b)          
below.  Each Holder who desires to have its Registrable Securities included     
in such registration statement shall so advise the Issuer in writing            
(stating the number of Registrable Securities desired to be registered)         
within 20 days after the date of such notice from the Issuer.  Any Holder       
shall have the right to withdraw such Holder's request for inclusion of         
such Holder's Registrable Securities in any registration statement pursuant     
to this Section 2.3 by giving written notice to the Issuer of such              
withdrawal.  Subject to Section 2.3(b) below, the Issuer shall include in       
such registration statement all such Registrable Securities so requested to     
be included therein; PROVIDED, HOWEVER, that the Issuer may at any time         
withdraw or cease proceeding with any such registration if it shall at the      
same time withdraw or cease proceeding with the registration of all other       
equity securities originally proposed to be registered.                         

    (b) If the managing underwriter of an offering involving a request
for Piggyback Registration advises the Issuer in writing (with a copy to        
the Holders requesting inclusion of their Registrable Securities) that, in      
such underwriter's good faith view, the inclusion of any Registrable            
Securities pursuant to Section 2.3(a) above would be likely to have a           
material adverse effect on the price, timing or distribution of such            
offering, then (i) the number of such Holder's or Holders' Registrable          
Securities to be included in the registration statement for such offering       
may, subject to the provisions of the immediately following sentence, be        
reduced to an amount which, in the judgment of the managing underwriter,        
would no longer be likely to have a material adverse effect on the price,       
timing or distribution of such offering or (ii) if no such reduction would,     
in the judgment of the managing underwriter, eliminate such likelihood of a     
material adverse effect on the price, timing or distribution of such            
offering, then the Issuer may, subject to the provisions of the immediately     
following sentence, exclude all such Registrable Securities from such           
registration statement.  Any reduction in the number of Registrable             
Securities to be included in the registration statement for such offering       
pursuant to the immediately preceding sentence shall be effected by the         
inclusion in such registration statement of (A) first, (p) if such              
registration was initiated by the Issuer for the sale of securities for its     
own account, any and all securities for sale by the Issuer or (q) if such       
registration was initiated by any other Person pursuant to the exercise of      
demand registration rights, any and all securities for sale by such Person      
pursuant to such exercise of demand registration rights, (B) second, any        
Registrable Shares requested to be included in such registration, pro rata      
based on the ratio which such Holder's requested Registrable Securities         
bears to the total number of Registrable Securities requested to be             
included in such registration statement by all Holders who have requested       
that their Registrable Securities be included in such registration              
statement, and (C) third, pro rata among any other securities requested to      
be included in such registration by other Persons pursuant to the exercise      
of  contractual registration rights granted by the Issuer.  If as a result      
of the provisions of this Section 2.3(b) any Holder shall not be entitled       
to include all Registrable Securities in a registration that such Holder        
has requested to be so included, such Holder may withdraw such Holder's         
request to include any Registrable Securities in such registration              
statement.  No Holder may participate in any registration statement             
hereunder unless such Holder (x) agrees to sell such Holder's Registrable       
Securities on the basis provided in any underwriting arrangements approved      
by the Issuer relating to such registration statement and (y) completes and     
executes all questionnaires, powers of attorney, indemnities, underwriting      
agreements, and other documents reasonably required under the terms of such     
underwriting arrangements; PROVIDED, HOWEVER, that no such Holder shall be      
required to make any representations or warranties in connection with any       
such registration other than representations and warranties as to (1) such      
Holder's ownership of its Registrable Securities to be transferred free and     
clear of all liens, claims, and encumbrances, (2) such Holder's power and       
authority to effect such transfer, and (3) such matters pertaining to           
compliance with securities laws as may be reasonably requested; PROVIDED        
FURTHER, HOWEVER, that the obligation of such Holder to indemnify pursuant      
to any such underwriting arrangements shall be several, not joint and           
several, among such Holders selling Registrable Securities, and the             
liability of each such Holder will be in proportion thereto, and PROVIDED       
FURTHER that such liability will be limited to the net amount received by       
such Holder from the sale of its Registrable Securities pursuant to such        
registration statement.                                                         

   Section 2.4 CERTAIN DELAY RIGHTS.  Notwithstanding any other provision of
this Agreement to the contrary, if at any time while the Required Shelf         
Registration is effective the Issuer provides written notice to each Holder     
that in the good faith and reasonable judgment of the Board of Directors of     
the Issuer it would be materially disadvantageous to the Issuer (because        
the sale of Registrable Securities covered by such registration statement       
or the disclosure of information therein or in any related prospectus or        
prospectus supplement would materially interfere with any acquisition,          
financing or other material event or transaction in connection with which a     
registration of securities under the Securities Act for the account of the      
Issuer is then intended or the public disclosure of which at the time would     
be materially prejudicial to the Issuer (a "Disadvantageous Condition"))        
for sales of Registrable Securities thereunder to then be permitted, and        
setting forth the general reasons for such judgment, the Issuer may refrain     
from maintaining current the prospectus contained in the Shelf Registration     
Statement until such Disadvantageous Condition no longer exists (notice of      
which the Issuer shall promptly deliver in writing to each Holder).             
Furthermore, notwithstanding anything else contained in this Agreement,         
with respect to any registration statement filed, or to be filed, pursuant      
to Section 2.2 of this Agreement, if the Issuer provides written notice to      
each Holder that in the good faith and reasonable judgment of the Board of      
Directors of the Issuer it would be materially disadvantageous to the           
Issuer (because of a Disadvantageous Condition) for such a registration         
statement to be maintained effective, or to be filed and become effective,      
and setting forth the general reasons for such judgment, the Issuer shall       
be entitled to cause such registration statement to be withdrawn or the         
effectiveness of such registration statement terminated, or, in the event       
no registration statement has yet been filed, shall be entitled not to file     
any such registration statement, until such Disadvantageous Condition no        
longer exists (notice of which the Issuer shall promptly deliver in writing     
to each Holder).  With respect to each Holder, upon the receipt by such         
Holder of any such notice of a Disadvantageous Condition (i) in connection      
with the Required Shelf Registration, such Holder shall forthwith               
discontinue use of the prospectus and any prospectus supplement under such      
registration statement and shall suspend sales of Registrable Securities        
until such Disadvantageous Condition no longer exists and (ii) in               
connection with the Required Shelf Registration or the Demand Registration,     
as applicable, if so directed by the Issuer by notice as aforesaid, such        
Holder will deliver to the Issuer all copies, other than permanent filed        
copies then in such Holder's possession, of the prospectus and prospectus       
supplements then covering such Registrable Securities at the time of            
receipt of such notice as aforesaid.  Notwithstanding anything else             
contained in this Agreement, (x) neither the filing nor the effectiveness       
of any registration statement under Section 2.2 of this Agreement may be        
delayed for more than a total of 60 days pursuant to this Section 2.4 and       
(y) the maintaining current of a prospectus (and the suspension of sales of     
Registrable Securities) in connection with the Required Shelf Registration      
may not be delayed under this Section 2.4 for more than a total of 60 days      
in any six-month period.  If, in the case of any registration pursuant to a     
Demand Request, the Issuer provides notice to the applicable Holders of a       
Disadvantageous Condition, then such Holders will have the right, within 15     
days following such notice from the Issuer, to elect to terminate such          
Demand Request, in which case the Holders shall be deemed not to have           
exercised a Demand Request pursuant to Section 2.2 hereof.                      

   Section 2.5 EXPENSES. Except as provided herein, the Issuer shall pay all
Registration Expenses with respect to each registration hereunder, whether      
or not any registration statement becomes effective.  Notwithstanding the       
foregoing, (i) each Holder and the Issuer shall be responsible for its own      
internal administrative and similar costs, which shall not constitute           
Registration Expenses, (ii) each Holder shall be responsible for the legal      
fees and expenses of its own counsel (except as provided in the definition      
of Registration Expenses) and (iii) each Holder shall be responsible for        
all underwriting discounts and commissions, selling or placement agent or       
broker fees and commissions, and transfer taxes, if any, in connection with     
the sale of securities by such Holder.                                          

 Section 2.6 REGISTRATION AND QUALIFICATION.  If and whenever the Issuer
is required to effect the registration of any Registrable Securities under the  
Securities Act as provided in this Agreement, the Issuer shall as promptly      
as practicable:                                                                 

 (a)prepare, file and cause to become effective a registration
statement under the Securities Act relating to the Registrable Securities       
to be offered in accordance with the intended method of disposition             
thereof;                                                                        

(b)prepare and file with the Commission such amendments and 
supplements to such registration statement and the prospectus used in           
connection therewith as may be necessary to keep such registration              
statement effective and to comply with the provisions of the Securities Act     
with respect to the disposition of all Registrable Securities (i) in the        
case of the Required Shelf Registration, until the Shelf Termination Date,      
(ii) in the case of a Demand Registration or Piggyback Registration, for a      
period of not less than 180 days (or such shorter period as is necessary        
for underwriters in an underwritten offering to sell unsold allotments),        
provided, that such 180-day period shall be extended for such number of         
days that equals the number of days elapsing from (x) the date the written      
notice contemplated by paragraph (e) below is given by the Issuer to (y)        
the date on which the Issuer delivers to the Holders of Registrable             
Securities the supplement or amendment contemplated by paragraph (e) below;     

  (c)furnish to the Holders of Registrable Securities and to any
underwriter of such Registrable Securities (i) such number of conformed         
copies of such registration statement and of each such amendment and            
supplement thereto (in each case including all exhibits), (ii) such number      
of copies of the prospectus included in such registration statement             
(including each preliminary prospectus), in conformity with the                 
requirements of the Securities Act, and (iii) such documents incorporated       
by reference in such registration statement or prospectus, as the Holders       
of Registrable Securities or such underwriter may reasonably request in         
order to facilitate the disposition of the Registrable Shares owned by such     
Holder or the sale of such securities by such underwriter (it being             
understood that, subject to Section 2.4 of this Agreement and the               
requirements of the Securities Act and applicable state securities laws,        
the Issuer consents to the use of the prospectus and any amendment or           
supplement thereto by each Holder of Registrable Securities and any             
underwriter of such Registrable Securities in connection with the offering      
and sale of the Registrable Shares covered by the registration statement of     
which such prospectus, amendment or supplement is a part);                      

(d)in the case of any underwritten offering, furnish to each
Selling Holder and any underwriter of Registrable Securities an opinion of      
counsel for the Issuer and a "cold comfort" letter signed by the                
independent public accountants who have audited the financial statements of     
the Issuer included in the applicable registration statement, in each such      
case covering substantially such matters with respect to such registration      
statement (and the prospectus included therein) and the related offering as     
are customarily covered in opinions of issuer's counsel with respect            
thereto and in accountants' letters delivered to underwriters in                
underwritten public offerings of securities and such other matters as any       
such Selling Holder or underwriter may reasonably request;                      

  (e)promptly notify each Selling Holder and each underwriter of
Registrable Securities in writing (i) at any time when a prospectus             
relating to a registration pursuant to this Agreement is required to be         
delivered under the Securities Act, of the happening of any event as a          
result of which the prospectus included in such registration statement, as      
then in effect, includes an untrue statement of a material fact or omits to     
state any material fact required to be stated therein or necessary to make      
the statements therein, in light of the circumstances under which they were     
made, not misleading, and (ii) of any request by the Commission or any          
other regulatory body having jurisdiction for any additional information or     
amendment or supplement to any registration statement or other document         
relating to such offering, and in either such case, at the request of any       
Selling Holder or underwriter, promptly prepare and furnish to each Selling     
Holder and underwriter a reasonable number of copies of a supplement to or      
an amendment of such prospectus as may be necessary so that, as thereafter      
delivered to the purchasers of such Registrable Securities, such prospectus     
shall not include an untrue statement of a material fact or omit to state a     
material fact required to be stated therein or necessary to make the            
statements therein, in light of the circumstances under which they are          
made, not misleading;                                                           

(f)cause all such Registrable Securities covered by such    
registration to be listed on each securities exchange and included for          
quotation on each automated interdealer quotation system on which the           
Common Stock is then listed or included for quotation;                          

 (g)provide a CUSIP number for the Registrable Shares included
in any registration statement not later than the effective date of such         
registration statement;                                                         

(h)cooperate with each Selling Holder and each underwriter  
participating in the disposition of Registrable Securities and their            
respective counsel in connection with any filings required to be made with      
the NASD;                                                                       

(i)during the period when a prospectus is required to be    
delivered under the Securities Act, promptly file all documents required to     
be filed with the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d)     
of the Exchange Act;                                                            

   (j)prepare and file with the Commission promptly any amendments
or supplements to such registration statement or prospectus which, in the       
opinion of counsel for the Issuer or the managing underwriter, are required     
in connection with the distribution of the Registrable Securities;              

  (k)advise each Selling Holder, promptly after it shall receive
notice or obtain knowledge thereof, of the issuance of any stop order by        
the Commission suspending the effectiveness of any registration statement       
or the initiation or threatening of any proceeding for such purpose and         
promptly use its commercially reasonable efforts to prevent the issuance of     
any stop order or to obtain its withdrawal at the earliest possible moment      
if such stop order should be issued;                                            

(l)use reasonable efforts to assist the Holders in the      
marketing of Common Stock in connection with underwritten offerings             
hereunder (including using reasonable efforts to have officers of the           
Issuer attend "road shows" and analyst or investor presentations scheduled      
in connection with such registration); and                                      

 (m)furnish for delivery in connection with the closing of any
offering of Registrable Securities pursuant to a registration effected          
pursuant to this Agreement unlegended certificates representing ownership       
of the Registrable Securities being sold in such denominations as shall be      
requested by the Selling Holders or the underwriters.                           

Section 2.7 Underwriting; Due Diligence                               

    (a) If requested by the underwriters for any underwritten offering
of Registrable Securities pursuant to a registration requested under this       
Article 2, the Issuer shall enter into an underwriting agreement with such      
underwriters for such offering, which agreement will contain such               
representations and warranties by the Issuer and such other terms and           
provisions as are customarily contained in underwriting agreements with         
respect to secondary distributions.                                             

(b) In connection with the preparation and filing of each     
registration statement registering Registrable Securities under the             
Securities Act pursuant to this Article 2, the Issuer shall give the            
Holders of such Registrable Securities and the underwriters, if any, and        
their respective counsel and accountants, such reasonable and customary         
access to its books, records and properties and such opportunities to           
discuss the business and affairs of the Issuer with its officers and the        
independent public accounts who have certified the financial statements of      
the Issuer as shall be necessary, in the opinion of such Holders and such       
underwriters or their respective counsel, to conduct a reasonable               
investigation within the meaning of the Securities Act;  PROVIDED that (i)      
each Holder and the underwriters and their respective counsel and               
accountants shall have entered into a confidentiality agreement reasonably      
acceptable to the Issuer and (ii) the Holders of such Registrable               
Securities and the underwriters and their respective counsel and                
accountants shall use their reasonable best efforts to minimize the             
disruption to the Issuer's business and coordinate any such investigation       
of the books, records and properties of the Issuer and any such discussions     
with the Issuer's officers and accountants so that all such investigations      
occur at the same time and all such discussions occur at the same time.         

Section 2.8 INDEMNIFICATION.                                          

    (a) The Issuer agrees to indemnify and reimburse, to the fullest
extent permitted by law, each Selling Holder, and each of its employees,        
advisors, agents, representatives, partners, officers, and directors and        
each Person who controls such seller of Registrable Securities (within the      
meaning of the Securities Act or the Exchange Act) and any agent or             
investment advisor thereof (collectively, the "Seller Affiliates") against      
any and all losses, claims, damages, liabilities, and expenses, joint or        
several (including, without limitation, reasonable attorneys' fees and          
disbursements except as limited by Section 2.8(c) below) based upon,            
arising out of, related to or resulting from any untrue or alleged untrue       
statement of a material fact contained in any registration statement,           
prospectus, or preliminary prospectus or any amendment thereof or               
supplement thereto, or any omission or alleged omission of a material fact      
required to be stated therein or necessary to make the statements therein       
not misleading, except insofar as the same are made in reliance upon and in     
strict conformity with information furnished in writing to the Issuer by        
such Selling Holder or any Seller Affiliate for use therein or arise from       
such Selling Holder's or any Seller Affiliate's failure to deliver a copy       
of the registration statement or prospectus or any amendments or                
supplements thereto after the Issuer has furnished such Selling Holder or       
Seller Affiliate with a sufficient number of copies of the same.  The           
reimbursements required by this Section 2.8(a) will be made by periodic         
payments during the course of the investigation or defense, as and when         
bills are received or expenses incurred.                                        

(b) In connection with any registration statement in which a
Selling Holder is participating, each such Selling Holder will furnish to       
the Issuer in writing such information and affidavits as the Issuer             
reasonably requests for use in connection with any such registration            
statement or prospectus and, to the fullest extent permitted by law, each       
such Selling Holder will indemnify the Issuer and its directors and             
officers and each Person who controls the Issuer (within the meaning of the     
Securities Act or the Exchange Act) against any and all losses, claims,         
damages, liabilities, and expenses (including, without limitation,              
reasonable attorneys' fees and disbursements except as limited by Section       
2.8(c) below) resulting from:  (i) any untrue statement or alleged untrue       
statement of a material fact contained in the registration statement,           
prospectus, or any preliminary prospectus or any amendment thereof or           
supplement thereto, or any omission or alleged omission of a material fact      
required to be stated therein or necessary to make the statements therein       
not misleading, but only to the extent that such untrue statement or            
alleged untrue statement or omission or alleged omission is contained in        
any information or affidavit so furnished in writing by such Selling Holder     
or any of its Seller Affiliates specifically for inclusion in the               
registration statement; or (ii) such Selling Holder's or any Seller             
Affiliate's failure to deliver a copy of the registration statement or          
prospectus or any amendments or supplements thereto after the Issuer has        
furnished such Selling Holder or Seller Affiliate with a sufficient number      
of copies of the same; PROVIDED, that the obligation to indemnify will be       
several, not joint and several, among such Selling Holders, and the             
liability of each such Selling Holder will be in proportion to, and             
PROVIDED FURTHER that such liability will be limited to, the net amount         
received by such Selling Holder from the sale of Registrable Securities         
pursuant to such registration statement; PROVIDED, HOWEVER, that such           
Selling Holder shall not be liable in any such case to the extent that,         
prior to the filing of any such registration statement or prospectus or         
amendment thereof or supplement thereto, such Selling Holder has furnished      
in writing to the Issuer information expressly for use in such registration     
statement or prospectus or any amendment thereof or supplement thereto          
which corrected or made not misleading information previously furnished to      
the Issuer.                                                                     

(c) Any Person entitled to indemnification hereunder will give
prompt written notice to the indemnifying party of any claim with respect       
to which it seeks indemnification (provided that the failure to give such       
notice shall not limit the rights of such Person except to the extent such      
failure prejudiced the indemnifying party) and permit such indemnifying         
party to assume the defense of such claim; PROVIDED, HOWEVER, that any          
Person entitled to indemnification hereunder shall have the right to employ     
separate counsel and to participate in the defense of such claim, but the       
fees and expenses of such counsel shall be at the expense of such Person        
unless (i) the indemnifying party has agreed to pay such fees or expenses,      
(ii) the indemnifying party shall have failed to assume the defense of such     
claim or (iii) in the reasonable opinion of counsel to such indemnified         
party, a conflict of interest between such indemnified and indemnifying         
parties may exist with respect to such claim.  If such defense is not           
assumed by the indemnifying party as permitted hereunder, the indemnifying      
party will not be subject to any liability for any settlement made by the       
indemnified party without its consent (but such consent will not be             
unreasonably withheld or delayed).  If such defense is assumed by the           
indemnifying party pursuant to the provisions hereof, such indemnifying         
party shall not settle or otherwise compromise the applicable claim unless      
(A) such settlement or compromise contains a full and unconditional release     
of the indemnified party or (B) the indemnified party otherwise consents in     
writing.  An indemnifying party who is not entitled to, or elects not to,       
assume the defense of a claim will not be obligated to pay the fees and         
expenses of more than one counsel for all parties indemnified by such           
indemnifying party with respect to such claim, unless in the reasonable         
judgment of any indemnified party, a conflict of interest may exist between     
such indemnified party and any other of such indemnified parties with           
respect to such claim, in which event the indemnifying party shall be           
obligated to pay the reasonable fees and disbursements of such additional       
counsel or counsels.                                                            

(d) Each party hereto agrees that, if for any reason the      
indemnification provisions contemplated by Section 2.8(a) or Section 2.8(b)     
are unavailable to or insufficient to hold harmless an indemnified party in     
respect of any losses, claims, damages, liabilities, or expenses (or            
actions in respect thereof) referred to therein, then each indemnifying         
party shall contribute to the amount paid or payable by such indemnified        
party as a result of such losses, claims, liabilities, or expenses (or          
actions in respect thereof) in such proportion as is appropriate to reflect     
the relative fault of the indemnifying party and the indemnified party in       
connection with the actions which resulted in the losses, claims, damages,      
liabilities or expenses as well as any other relevant equitable                 
considerations.  The relative fault of such indemnifying party and              
indemnified party shall be determined by reference to, among other things,      
whether the untrue or alleged untrue statement of a material fact or            
omission or alleged omission to state a material fact relates to                
information supplied by such indemnifying party or indemnified party, and       
the parties' relative intent, knowledge, access to information and              
opportunity to correct or prevent such statement or omission.  The parties      
hereto agree that it would not be just and equitable if contribution            
pursuant to this Section 2.8(d) were determined by pro rata allocation          
(even if the Holders or any underwriters or all of them were treated as one     
entity for such purpose) or by any other method of allocation which does        
not take account of the equitable considerations referred to in this            
Section 2.8(d). The amount paid or payable by an indemnified party as a         
result of the losses, claims, damages, liabilities, or expenses (or actions     
in respect thereof) referred to above shall be deemed to include any legal      
or other fees or expenses reasonably incurred by such indemnified party in      
connection with investigating or, except as provided in Section 2.8(c)          
above, defending any such action or claim.  Notwithstanding the provisions      
of this Section 2.8(d), no Holder shall be required to contribute an amount     
greater than the dollar amount by which the net proceeds received by such       
Holder with respect to the sale of any Registrable Securities exceeds the       
amount of damages which such Holder has otherwise been required to pay by       
reason of such statement or omission.  No person guilty of fraudulent           
misrepresentation (within the meaning of Section 11(f) of the Securities        
Act) shall be entitled to contribution from any Person who was not guilty       
of such fraudulent misrepresentation.  The Holders' obligations in this         
Section 2.8(d) to contribute shall be several in proportion to the amount       
of Registrable Securities registered by them and not joint.                     

If indemnification is available under this Section 2.8, the         
indemnifying parties shall indemnify each indemnified party to the full         
extent provided in Section 2.8(a) and Section 2.8(b) without regard to the      
relative fault of said indemnifying party or indemnified party or any other     
equitable consideration provided for in this Section 2.8(d) subject, in the     
case of the Holders, to the limited dollar amounts set forth in                 
Section 2.8(b).                                                                 

The indemnification and contribution provided for under this        
Agreement shall be in addition to any liability which any party may             
otherwise have to any other party and shall remain in full force and effect     
regardless of any investigation made by or on behalf of the indemnified         
party or any officer, director, or controlling Person of such indemnified       
party and will survive the transfer of the Common Stock and the termination     
of this Agreement.                                                              

 Section 2.9 ISSUER'S EXISTING SHELF REGISTRATION.  The Issuer shall use
its reasonable best efforts to cause the Issuer's Shelf Registration Statement  
which was filed by the Issuer prior to the date hereof (the "Existing Shelf     
Registration Statement") to be amended to contain a provision for the           
inclusion in such Shelf Registration Statement of shares for sale for the       
account of stockholders of the Issuer.  In the event that the Issuer, after     
the expiration of the twelve month period immediately following the date        
hereof, proposes to effect any offering under the Existing Shelf                
Registration Statement (other than to effect the acquisition of or              
combination with another business entity), it shall permit each Holder to       
include its Registrable Securities on substantially the same terms and          
subject to substantially the same conditions and limitations (including,        
but not limited to, indemnification provisions) as would be the case in         
connection with a registration that is the subject of Section 2.3 hereof.       
The Issuer will promptly file any prospectus supplements as are necessary       
to reflect the inclusion in any such registration of any Registrable            
Securities included in such registration by any Holder pursuant to this         
Section 2.9.                                                                    

ARTICLE 3         

MISCELLANEOUS         

Section 3.1 ENTIRE AGREEMENT.  This Agreement constitutes the entire  
agreement between the parties with respect to the subject matter hereof and     
supersedes all other prior agreements and understandings, both written and      
oral, between the parties with respect to the subject matter hereof.            

   Section 3.2 SUCCESSORS AND ASSIGNS.  Whether or not an express assignment
has been made pursuant to the provisions of this Agreement, provisions of this  
Agreement that are for the Holders' benefit as the holders of any Common        
Stock are, except as otherwise expressly provided herein, also for the          
benefit of, and enforceable by, all subsequent holders of such Common           
Stock, except as otherwise expressly provided herein.  This Agreement shall     
be binding upon the Issuer, each Holder, and, except as otherwise expressly     
provided herein, their respective heirs, devisees, successors and assigns.      

Section 3.3 DUPLICATE ORIGINALS.  All parties may sign any number of  
copies of this Agreement.  Each signed copy shall be an original, but all of    
them together shall represent the same agreement.                               

   Section 3.4 AMENDMENTS, WAIVERS, ETC.  This Agreement may not be amended,
changed, supplemented, waived or otherwise modified or terminated, except       
upon the execution and delivery of a written agreement executed by the          
Issuer and Holders representing a majority of the Registrable Securities        
then held by all Holders.                                                       

Section 3.5 NOTICES.  All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall      
be deemed to have been duly received if given) by hand delivery or              
telecopy, or by any courier service, such as Federal Express, providing         
proof of delivery.  All communications hereunder shall be delivered to the      
respective parties at the address or telecopy number set forth on the           
signature pages hereto (unless such contact information in the case of the      
Holders is updated by written notice from the affected Holder to the            
Issuer.                                                                         

 Section 3.6 SEVERABILITY.  Whenever possible, each provision or portion
of any provision of this Agreement will be interpreted in such manner as to be  
effective and valid under applicable law, but if any provision or portion       
of any provision of this Agreement is held to be invalid, illegal or            
unenforceable in any respect under any applicable law or rule in any            
jurisdiction, such invalidity, illegality or unenforceability will not          
affect any other provision or portion of any provision in such                  
jurisdiction, and this Agreement will be reformed, construed and enforced       
in such jurisdiction as if such invalid, illegal or unenforceable provision     
or portion of any provision had never been contained herein.                    

 Section 3.7 NO WAIVER.  The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in  
respect hereof at law or in equity, or to insist upon compliance by any         
other party hereto with its obligations hereunder, and any custom or            
practice of the parties at variance with the terms hereof, shall not            
constitute a waiver by such party of its right to exercise any such or          
other right, power or remedy or to demand such compliance.                      

 Section 3.8 NO THIRD PARTY BENEFICIARIES.  Except as expressly provided
in Section 2.8; this Agreement is not intended to be for the benefit of, and    
shall not be enforceable by, any Person who or which is not a party hereto;     
provided, that, this Agreement is also intended to be for the benefit of        
and is enforceable by each Holder.                                              

Section 3.9 GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY AND   
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD  
TO PRINCIPLES OF CONFLICT OF LAWS.                                              

  Section 3.10 DESCRIPTIVE HEADINGS.  The descriptive headings used herein
are inserted for convenience of reference only and are not intended to be part  
of or to affect the meaning or interpretation of this Agreement.                

    Section 3.11 COUNTERPARTS.  This Agreement may be executed in counterpart,
each of which shall be deemed to be an original, but all of which, taken        
together, shall constitute one and the same Agreement.                          

DEFM14C
81st “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 81st
IN WITNESS WHEREOF, the Issuer and the Holders have caused this Agreement       
to be duly executed as of the day and year first above written.                 

LAMAR ADVERTISING COMPANY     

By:___________________________
  Name:___________________________
   Title:___________________________

Address:                      

Lamar Advertising Company     
5551 Corporate Boulevard      
Baton Rouge, Louisiana  70808 
Attention:  Keith Istre       
Fax:  (225) 923-0658          

DEFM14C
Last “Page” of 82
TOC
1st
Previous
Next
↓Bottom
Just 82nd
HOLDERS:                      

 CHANCELLOR MEDIA CORPORATION OF
LOS ANGELES                   

By:___________________________
  Name:___________________________
   Title:___________________________

Address:                      

1845 Woodall Rodgers Freeway  
Suite 1300                    
Dallas, Texas  75201          
Attention:  General Counsel   
Fax:  (512) 340-7890          

CHANCELLOR MEZZANINE HOLDINGS 
CORPORATION                   

By:___________________________
  Name:___________________________
   Title:___________________________

Address:                      

1845 Woodall Rodgers Freeway  
Suite 1300                    
Dallas, Texas  75201          
Attention:  General Counsel   
Fax:  (512) 340-7890          

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘DEFM14C’ Filing		Date		First		Last			Other Filings
		5/1/11		67
		4/8/11		67
		10/1/09		67
		12/23/06		42		49
		12/15/03		67					4
		7/8/02		67
		6/1/02		67
		5/13/02		67
		12/28/01		49
		11/10/01		61
		9/27/01		49
		9/18/00		61
		1/1/00		67
		12/31/99		6		26			10-K
		12/1/99		8		71
		11/30/99		4		71
		11/15/99		67
		8/15/99		67
		8/14/99		4		71
Filed on:		8/13/99		2		21
		8/11/99		4		80
		8/10/99		3					8-K
		8/9/99		4		8
		8/6/99		3					424B5,  8-K
		8/5/99		3					10-K/A,  8-K
		8/4/99		2		71
		8/3/99		3					424B3,  8-K
		7/31/99		8		9
		7/28/99		3					8-K
		7/26/99		3					8-K/A
		7/22/99		3					8-K
		7/20/99		4		71			8-K,  8-K/A,  8-K12G3
		7/19/99		8					POS AM
		7/12/99		4		73
		7/7/99		3
		6/30/99		4		9			10-Q
		6/16/99		4		8
		6/15/99		4		15
		6/10/99		3		8
		6/9/99		4		50
		6/8/99		3		16
		6/1/99		4		73
		5/31/99		8
		5/28/99		6		8
		5/27/99		8		27
		5/10/99		8
		5/7/99		3
		5/5/99		8		71
		5/3/99		8
		3/31/99		1		71
		2/9/99		27
		1/21/99		27
		12/31/98		3		27			10-K/A
		12/10/98		67
		12/1/98		15		32
		11/30/98		12		71
		11/25/98		71
		11/13/98		15		27
		11/12/98		71
		10/19/98		3
		10/15/98		3
		10/1/98		49		61
		9/23/98		42		49
		9/17/98		33
		8/31/98		32		37
		8/1/98		27
		7/31/98		13		55
		7/22/98		11		27
		7/9/98		42
		4/1/98		71
		3/31/98		11
		3/30/98		67
		2/26/98		6
		2/13/98		43		56
		1/2/98		15		55
		1/1/98		16		61
		12/31/97		6		61
		12/23/97		15		49
		11/27/97		49
		10/1/97		67
		8/15/97		67
		7/31/97		15		61
		7/3/97		15
		1/1/97		49		61
		12/31/96		12		61
		10/31/96		11
		7/15/96		49
		6/1/96		61
		4/15/96		67
		4/3/96		67
		2/1/96		49		61
		1/1/96		8		9
		12/31/95		12		61
		10/31/95		11
		8/25/95		62
		8/1/95		61
		7/7/95		67
		7/1/95		55		67
		6/30/95		14		67
		6/1/95		67
		12/31/94		13
		11/11/94		61		67
		10/31/94		11
		6/30/94		14
		7/1/93		67
		8/15/92		67
									List all Filings