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                    CERTIFICATE OF DESIGNATION OF THE POWERS,
                    PREFERENCES AND RELATIVE, PARTICIPATING,
          OPTIONAL AND OTHER SPECIAL RIGHTS OF 12 1/4% SERIES A SENIOR
                   CUMULATIVE EXCHANGEABLE PREFERRED STOCK AND
              QUALIFICATIONS, LIMITATIONS AND RESTRICTIONS THEREOF


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                         Pursuant to Section 151 of the
                General Corporation Law of the State of Delaware
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          Chancellor Radio Broadcasting Company (the "Corporation"), a 
corporation organized and existing under the General Corporation Law of the 
State of Delaware, does hereby certify that, pursuant to authority conferred 
upon the board of directors of the Corporation (the "Board of Directors") by 
its Certificate of Incorporation, as amended (hereinafter referred to as the 
"Certificate of Incorporation"), and pursuant to the provisions of Section 
151 of the General Corporation Law of the State of Delaware, said Board of 
Directors, by unanimous written consent dated March 26, 1996, duly approved 
and adopted the following resolution (the "Resolution"):

          RESOLVED, that, pursuant to the authority vested in the Board of
     Directors by its Certificate of Incorporation, the Board of Directors
     does hereby create, authorize and provide for the issuance of 12 1/4%
     Series A Senior Cumulative Exchangeable Preferred Stock, par value
     $.01 per share, with a stated value initially of $105.797951 per
     share, consisting initially of 1,000,000 shares, having the
     designations, preferences, relative, participating, optional and other
     special rights and the qualifications, limitations and restrictions
     thereof that are set forth in the Certificate of Incorporation and in
     this Resolution as follows:

          (a)  DESIGNATION.  There is hereby created out of the authorized 
and unissued shares of Preferred Stock of the Corporation a class of 
Preferred Stock designated as the "12 1/4% Series A Senior Cumulative 
Exchangeable Preferred Stock".  The number of shares constituting such class 
shall be 1,000,000 and are referred to as the "Series A Senior Exchangeable 
Preferred Stock."  The initial liquidation preference of the Series A

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Senior Exchangeable Preferred Stock shall be $105.797951 per share; such 
amount shall be subject to increase as provided in paragraph (c)(i).

          (b)  RANK.  The Series A Senior Exchangeable Preferred Stock shall, 
with respect to dividends and distributions upon liquidation, winding-up and 
dissolution of the Corporation, rank (i) senior to all classes of common 
stock of the Corporation (including, without limitation, the Common Stock) 
and to each other class of Capital Stock of the Corporation or series of 
Preferred Stock of the Corporation hereafter created the terms of which do 
not expressly provide that it ranks senior to, or on a parity with, the 
Series A Senior Exchangeable Preferred Stock as to dividends and 
distributions upon liquidation, winding-up and dissolution of the Corporation 
(collectively referred to, together with all classes of common stock of the 
Corporation, as "Junior Stock"); (ii) on a parity with the Existing Preferred 
Stock and any class of Capital Stock of the Corporation or series of 
Preferred Stock of the Corporation hereafter created the terms of which 
expressly provide that such class or series will rank on a parity with the 
Series A Senior Exchangeable Preferred Stock as to dividends and 
distributions upon liquidation, winding-up and dissolution (collectively 
referred to as "Parity Stock"); provided that any such Parity Stock (other 
than Existing Preferred Stock) that was not approved by the Holders in 
accordance with paragraph (f)(ii)(A) hereof (to the extent such approval is 
required) shall be deemed to be Junior Stock and not Parity Stock; and (iii) 
junior to each class of Capital Stock of the Corporation or series of 
Preferred Stock of the Corporation hereafter created that has been approved 
by the Holders in accordance with paragraph (f)(ii)(B) hereof and the terms 
of which expressly provide that such class or series will rank senior to the 
Series A Senior Exchangeable Preferred Stock as to dividends and 
distributions upon liquidation, winding-up and dissolution of the Company 
(collectively referred to as "Senior Stock").

          (c)  DIVIDENDS.

          (i)  Beginning on the Issue Date, the Holders of the outstanding
     shares of Series A Senior Exchangeable Preferred Stock shall be entitled to
     receive, when, as and if declared by the Board of Directors, out of funds
     legally available therefor, distributions in the form of cash dividends on
     each share of Series A Senior Exchangeable Preferred Stock, at a rate PER
     ANNUM equal to 12 1/4% of the then effective liquidation preference per
     share of the Series A Senior Exchangeable Preferred Stock, payable
     quarterly.  No interest shall be payable in respect of any dividends that

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     may be in arrears.  All dividends shall be cumulative, whether or not
     earned or declared, on a daily basis from August 15, 1996 and shall be
     payable quarterly in arrears on each Dividend Payment Date, commencing on
     the first Dividend Payment Date after the Issue Date, PROVIDED that if any
     dividend payable on any Dividend Payment Date on or before February 15,
     2001 is not declared and paid in full in cash on such Dividend Payment
     Date, the amount payable as dividends on such Dividend Payment Date that is
     not paid in cash on such Dividend Payment Date shall be added to the
     liquidation preference of the Series A Senior Exchangeable Preferred Stock
     on such Dividend Payment Date and the amount so added to the liquidation
     preference shall be deemed paid in full and shall not accumulate.  Each
     dividend shall be payable to, or added to the liquidation preference of as
     herein provided, the Series A Senior Exchangeable Preferred Stock held by
     Holders of record as they appear on the stock books of the Corporation on
     the Dividend Record Date immediately preceding the related Dividend Payment
     Date.  Dividends shall cease to accumulate in respect of the Series A
     Senior Exchangeable Preferred Stock on the Exchange Date or on the date of
     their earlier redemption unless the Corporation shall have failed to issue
     the appropriate aggregate principal amount of Exchange Debentures in
     respect of the Series A Senior Exchangeable Preferred Stock on such
     Exchange Date or shall have failed to pay the relevant redemption price on
     the date fixed for redemption.

         (ii)  All dividends paid with respect to shares of the Series A Senior
     Exchangeable Preferred Stock pursuant to paragraph (c)(i) shall be paid PRO
     RATA to the Holders entitled thereto.

        (iii)  Nothing herein contained shall in any way or under any
     circumstances be construed or deemed to require the Board of Directors to
     declare, or the Corporation to pay or set apart for payment, any dividends
     on shares of the Series A Senior Exchangeable Preferred Stock at any time.

         (iv)  Dividends on account of arrears for any past Dividend Period and
     dividends in connection with any optional redemption pursuant to paragraph
     (e)(i) may be declared and paid at any time, without reference to any
     regular Dividend Payment Date, to Holders of record on such date, not more
     than forty-five (45) days prior to the payment thereof, as may be fixed by
     the Board of Directors of the Corporation.

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          (v)  No full dividends shall be declared by the Board of Directors or
     paid or set apart for payment by the Corporation on any Parity Stock for
     any period unless full cumulative dividends have been or contemporaneously
     are declared and paid (or are deemed declared and paid) in full, or
     declared and, if payable in cash, a sum in cash set apart sufficient for
     such payment, on the Series A Senior Exchangeable Preferred Stock for all
     Dividend Periods terminating on or prior to the date of payment of such
     full dividends on such Parity Stock.  If any dividends are not so paid, all
     dividends declared upon shares of the Series A Senior Exchangeable
     Preferred Stock and any other Parity Stock shall be declared PRO RATA so
     that the amount of dividends declared per share on the Series A Senior
     Exchangeable Preferred Stock and such Parity Stock shall in all cases bear
     to each other the same ratio that accrued dividends per share on the Series
     A Senior Exchangeable Preferred Stock and such Parity Stock bear to each
     other.

         (vi)  (A)  Holders of shares of the Series A Senior Exchangeable
     Preferred Stock shall be entitled to receive the dividends provided for in
     paragraph (c)(i) hereof in preference to and in priority over any dividends
     upon any of the Junior Stock.

          (B)  So long as any share of the Series A Senior Exchangeable
     Preferred Stock is outstanding, the Corporation shall not declare, pay or
     set apart for payment any dividend on any of the Junior Stock or make any
     payment on account of, or set apart for payment money for a sinking or
     other similar fund for, the purchase, redemption or other retirement of,
     any of the Junior Stock or any warrants, rights, calls or options
     exercisable for or convertible into any of the Junior Stock whether in
     cash, obligations or shares of the Corporation or other property (other
     than dividends in Junior Stock to the holders of Junior Stock), and shall
     not permit any corporation or other entity directly or indirectly
     controlled by the Corporation to purchase or redeem any of the Junior Stock
     or any such warrants, rights, calls or options unless full cumulative
     dividends determined in accordance herewith on the Series A Senior
     Exchangeable Preferred Stock have been paid (or are deemed paid) in full.

          (C)  So long as any share of the Series A Senior Exchangeable
     Preferred Stock is outstanding, the Corporation shall not make any payment
     on account of, or set apart for payment money for a sinking or other
     similar fund for, the purchase, redemption or other retirement of, any of
     the

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     Parity Stock or any warrants, rights, calls or options exercisable for
     or convertible into any of the Parity Stock, and shall not permit any
     corporation or other entity directly or indirectly controlled by the
     Corporation to purchase or redeem any of the Parity Stock or any such
     warrants, rights, calls or options unless full cumulative dividends
     determined in accordance herewith on the Series A Senior Exchangeable
     Preferred Stock have been paid (or are deemed paid) in full.

        (vii)  Dividends payable on the Series A Senior Exchangeable Preferred
     Stock for any period less than a year shall be computed on the basis of a
     360-day year of twelve 30-day months and the actual number of days elapsed
     in the period for which payable.

               (d)  LIQUIDATION PREFERENCE.

          (i)  In the event of any voluntary or involuntary liquidation,
     dissolution or winding up of the affairs of the Corporation, the Holders of
     shares of Series A Senior Exchangeable Preferred Stock then outstanding
     shall be entitled to be paid out of the assets of the Corporation available
     for distribution to its stockholders an amount in cash equal to the then
     effective liquidation preference for each share outstanding, plus, without
     duplication, an amount in cash equal to accumulated and unpaid dividends
     thereon to the date fixed for liquidation, dissolution or winding up
     (including an amount equal to a prorated dividend for the period from the
     last Dividend Payment Date to the date fixed for liquidation, dissolution
     or winding up) before any payment shall be made or any assets distributed
     to the holders of any of the Junior Stock including, without limitation,
     common stock of the Corporation.  Except as provided in the preceding
     sentence, Holders of Series A Senior Exchangeable Preferred Stock shall not
     be entitled to any distribution in the event of any liquidation,
     dissolution or winding up of the affairs of the Corporation.  If the assets
     of the Corporation are not sufficient to pay in full the liquidation
     payments payable to the Holders of outstanding shares of the Series A
     Senior Exchangeable Preferred Stock and all Parity Stock, then the holders
     of all such shares shall share equally and ratably in such distribution of
     assets in proportion to the full liquidation preference, including, without
     duplication, all accrued and unpaid dividends to which each is entitled.

         (ii)  For the purposes of this paragraph (d), neither the sale,
     conveyance, exchange or transfer (for cash, shares

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<PAGE>

     of stock, securities or other consideration) of all or substantially all
     of the property or assets of the Corporation nor the consolidation or
     merger of the Corporation with or into one or more entities shall be
     deemed to be a liquidation, dissolution or winding up of the affairs of
     the Corporation.

          (e)  REDEMPTION.

          (i)  OPTIONAL REDEMPTION.  (A) The Corporation may, at the option of
     the Board of Directors, redeem at any time on or after February 15, 2001,
     subject to contractual and other restrictions with respect thereto and from
     any source of funds legally available therefor, in whole or in part, in the
     manner provided for in paragraph (e)(iii) hereof, any or all of the shares
     of the Series A Senior Exchangeable Preferred Stock, at the redemption
     prices (expressed as a percentage of the then effective liquidation
     preference) set forth below plus, without duplication, an amount in cash
     equal to all accumulated and unpaid dividends per share (including an
     amount in cash equal to a prorated dividend for the period from the
     Dividend Payment Date immediately prior to the Redemption Date to the
     Redemption Date) (the "Optional Redemption Price") if redeemed during the
     12-month period beginning February 15 of each of the years set forth below:

          2001 . . . . . . . . . . . . . . . . . . . . . . . . . . .    106.125%
          2002 . . . . . . . . . . . . . . . . . . . . . . . . . . .    104.900%
          2003 . . . . . . . . . . . . . . . . . . . . . . . . . . .    103.675%
          2004 . . . . . . . . . . . . . . . . . . . . . . . . . . .    102.450%
          2005 . . . . . . . . . . . . . . . . . . . . . . . . . . .    101.225%
          2006 and thereafter. . . . . . . . . . . . . . . . . . . .    100.000%

     ; provided that no redemption pursuant to this paragraph (e)(i)(A) shall be
     authorized or made unless prior thereto full accumulated and unpaid
     dividends are declared and paid in full, or declared and a sum in cash set
     apart sufficient for such payment, on the Series A Senior Exchangeable
     Preferred Stock for all Dividend Periods terminating on or prior to the
     Redemption Date.

          (B)  In addition to the foregoing paragraph (e)(i)(A), on or prior to
     February 15, 1999, the Corporation may, at its option, use the net cash
     proceeds of one or more Public Equity Offerings to redeem from any source
     of funds legally available therefor, in the manner provided for in
     paragraph (e)(iii) hereof, the Series A Senior Exchangeable Preferred
     Stock, in part, at a redemption price of 112.250%

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     of the then effective liquidation preference thereof if redeemed during 
     the 12-month period commencing on February 15, 1996, 111.025% of the 
     then effective liquidation preference thereof if redeemed during the 
     12-month period commencing on February 15, 1997 and 109.800% of the then 
     effective liquidation preference thereof if redeemed during the 12-month 
     period commencing on February 15, 1998, plus, in each case, without 
     duplication, an amount in cash equal to all accumulated and unpaid 
     dividends to the redemption date (including an amount in cash equal to a 
     prorated dividend for the period from the Dividend Payment Date 
     immediately prior to the redemption date to the redemption date) (the 
     "Cash Proceeds Redemption Price"); PROVIDED, HOWEVER, that after any 
     such redemption, the number of shares of Series A Senior Exchangeable 
     Preferred Stock outstanding must equal at least 75% of the shares of 
     Series A Senior Exchangeable Preferred Stock originally issued on the 
     Issue Date.  Any such redemption pursuant to this paragraph (e)(i)(B) 
     must occur on or prior to 60 days after the receipt by the Corporation 
     of the proceeds of each Public Equity Offering.  

          (C)  In the event of a redemption pursuant to paragraph (e)(i)(A) or
     (e)(i)(B) hereof of only a portion of the then outstanding shares of the
     Series A Senior Exchangeable Preferred Stock, the Corporation shall effect
     such redemption on a PRO RATA basis according to the number of shares held
     by each Holder of the Series A Senior Exchangeable Preferred Stock, except
     that the Corporation may redeem such shares held by Holders of fewer than
     100 shares (or shares held by Holders who would hold less than 100 shares
     as a result of such redemption), as may be determined by the Corporation.

         (ii)  MANDATORY REDEMPTION.  On February 15, 2008, the Corporation
     shall redeem, to the extent of funds legally available therefor, in the
     manner provided for in paragraph (e)(iii) hereof, all of the shares of the
     Series A Senior Exchangeable Preferred Stock then outstanding at a
     redemption price equal to 100% of the then effective liquidation preference
     per share, plus, without duplication, an amount in cash equal to all
     accumulated and unpaid dividends per share (including an amount equal to a
     prorated dividend for the period from the Dividend Payment Date immediately
     prior to the Redemption Date to the Redemption Date) (the "Mandatory
     Redemption Price"). 

        (iii)  PROCEDURES FOR REDEMPTION.  (A) At least thirty (30) days and not
     more than sixty (60) days prior to the

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     date fixed for any redemption of the Series A Senior Exchangeable 
     Preferred Stock, written notice (the "Redemption Notice") shall be given 
     by first class mail, postage prepaid, to each Holder of record on the 
     record date fixed for such redemption of the Series A Senior 
     Exchangeable Preferred Stock at such Holder's address as it appears on 
     the stock books of the Corporation, PROVIDED that no failure to give 
     such notice nor any deficiency therein shall affect the validity of the 
     procedure for the redemption of any shares of Series A Senior 
     Exchangeable Preferred Stock to be redeemed except as to the Holder or 
     Holders to whom the Corporation has failed to give said notice or except 
     as to the Holder or Holders whose notice was defective.  The Redemption 
     Notice shall state:

               (1)  whether the redemption is pursuant to paragraph (e)(i)(A),
          (e)(i)(B) or (e)(ii) hereof;

               (2)  the Optional Redemption Price, the Mandatory Redemption
          Price or the Cash Proceeds Redemption Price, as the case may be;

               (3)  whether all or less than all the outstanding shares of the
          Series A Senior Exchangeable Preferred Stock are to be redeemed and
          the total number of shares of the Series A Senior Exchangeable
          Preferred Stock being redeemed;

               (4)  the date fixed for redemption;

               (5)  that the Holder is to surrender to the Corporation, in the
          manner, at the place or places and at the price designated, his
          certificate or certificates representing the shares of Series A Senior
          Exchangeable Preferred Stock to be redeemed; and

               (6)  that dividends on the shares of the Series A Senior
          Exchangeable Preferred Stock to be redeemed shall cease to accumulate
          on such Redemption Date unless the Corporation defaults in the payment
          of the Optional Redemption Price, the Mandatory Redemption Price or
          the Cash Proceeds Redemption Price, as the case may be.

          (B)  Each Holder of Redeemable Preferred stock shall surrender the
     certificate or certificates representing such shares of Series A Senior
     Exchangeable Preferred Stock to the Corporation, duly endorsed (or
     otherwise in proper form for transfer, as determined by the Corporation),
     in the 

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     manner and at the place designated in the Redemption Notice, and on
     the Redemption Date the full Optional Redemption Price, Mandatory
     Redemption Price or Cash Proceeds Redemption Price, as the case may be, for
     such shares shall be payable in cash to the Person whose name appears on
     such certificate or certificates as the owner thereof, and each surrendered
     certificate shall be canceled and retired.  In the event that less than all
     of the shares represented by any such certificate are redeemed, a new
     certificate shall be issued representing the unredeemed shares.

          (C)  On and after the Redemption Date, unless the Corporation defaults
     in the payment in full of the applicable redemption price, dividends on the
     Series A Senior Exchangeable Preferred Stock called for redemption shall
     cease to accumulate on the Redemption Date, and all rights of the Holders
     of redeemed shares shall terminate with respect thereto on the Redemption
     Date, other than the right to receive the Optional Redemption Price, the
     Mandatory Redemption Price or the Cash Proceeds Redemption Price, as the
     case may be, without interest; PROVIDED, HOWEVER, that if a notice of
     redemption shall have been given as provided in paragraph (iii)(A) above
     and the funds necessary for redemption (including an amount in respect of
     all dividends that will accrue to the Redemption Date) shall have been
     irrevocably deposited in trust for the equal and ratable benefit for the
     Holders of the shares to be redeemed, then, at the close of business on the
     day on which such funds are segregated and set aside, the Holders of the
     shares to be redeemed shall cease to be stockholders of the Corporation and
     shall be entitled only to receive the Optional Redemption Price, the
     Mandatory Redemption Price or the Cash Redemption Price, as the case may
     be, without interest.

          (f)  VOTING RIGHTS.

          (i)  The Holders of Series A Senior Exchangeable Preferred Stock,
     except as otherwise required under Delaware law or as set forth in
     paragraphs (ii), (iii) and (iv) below, shall not be entitled or permitted
     to vote on any matter required or permitted to be voted upon by the
     stockholders of the Corporation.

         (ii)  (A) So long as any shares of the Series A Senior Exchangeable
     Preferred Stock are outstanding, the Corporation shall not authorize any
     class of Parity Stock without the affirmative vote or consent of Holders of
     at least a majority of the then outstanding shares of Series A


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     Senior Exchangeable Preferred Stock, voting or consenting, as the case 
     may be, as one class, given in person or by proxy, either in writing or 
     by resolution adopted at an annual or special meeting.

          (B)  So long as any shares of the Series A Senior Exchangeable
     Preferred Stock are outstanding, the Corporation shall not authorize any
     class of Senior Stock without the affirmative vote or consent of Holders of
     at least a majority of the outstanding shares of Series A Senior
     Exchangeable Preferred Stock, voting or consenting, as the case may be, as
     one class, given in person or by proxy, either in writing or by resolution
     adopted at an annual or special meeting.

          (C)  So long as any shares of the Series A Senior Exchangeable
     Preferred Stock are outstanding, the Corporation shall not amend this
     Certificate of Designation so as to affect adversely the specified rights,
     preferences, privileges or voting rights of holders of shares of Series A
     Senior Exchangeable Preferred Stock or to authorize the issuance of any
     additional shares of Series A Senior Exchangeable Preferred Stock without
     the affirmative vote or consent of Holders of at least a majority of the
     issued and outstanding shares of Series A Senior Exchangeable Preferred
     Stock, voting or consenting, as the case may be, as one class, given in
     person or by proxy, either in writing or by resolution adopted at an annual
     or special meeting.

          (D)  Prior to the exchange of Series A Senior Exchangeable Preferred
     Stock for Exchange Debentures, the Corporation shall not amend or modify
     the Indenture for the Exchange Debentures in the form executed on February
     26, 1996 (the "Indenture") (except as expressly provided therein in respect
     of amendments without the consent of Holders of Exchange Debentures)
     without the affirmative vote or consent of Holders of at least a majority
     of the shares of Series A Senior Exchangeable Preferred Stock then
     outstanding, voting or consenting, as the case may be, as one class, given
     in person or by proxy, either in writing or by resolution adopted at an
     annual or special meeting. 

          (E)  Except as set forth in paragraphs (f)(ii)(A), (f)(ii)(B) and
     (f)(ii)(C) above, (x) the creation, authorization or issuance of any shares
     of any Junior Stock, Parity Stock or Senior Stock or (y) the increase or
     decrease in the amount of authorized Capital Stock of any class, including
     Preferred Stock, shall not require the consent of Holders of Series A
     Senior Exchangeable Preferred Stock and 


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     shall not be deemed to affect adversely the rights, preferences, privileges
     or voting rights of Holders of Series A Senior Exchangeable Preferred 
     Stock.

        (iii)  Without the affirmative vote or consent of Holders of a majority
     of the issued and outstanding shares of Series A Senior Exchangeable
     Preferred Stock, voting or consenting, as the case may be, as one class,
     given in person or by proxy, either in writing or by resolution adopted at
     an annual or special meeting, the Corporation shall not, in a single
     transaction or series of related transactions, consolidate or merge with or
     into, or sell, assign, transfer, lease, convey or otherwise dispose of all
     or substantially all of its assets to, another Person or adopt a plan of
     liquidation unless:  (A) either (1) the Corporation is the surviving or
     continuing Person or (2) the Person (if other than the Corporation) formed
     by such consolidation or into which the Corporation is merged or the Person
     that acquires by conveyance, transfer or lease the properties and assets of
     the Corporation substantially as an entirety or in the case of a plan of
     liquidation, the Person to which assets of the Corporation have been
     transferred, shall be a corporation, partnership or trust organized and
     existing under the laws of the United States or any State thereof or the
     District of Columbia; (B) the Series A Senior Exchangeable Preferred Stock
     shall be converted into or exchanged for and shall become shares of such
     successor, transferee or resulting Person, having in respect of such
     successor, transferee or resulting Person the same powers, preferences and
     relative, participating, optional or other special rights and the
     qualifications, limitations or restrictions thereon, that the Series A
     Senior Exchangeable Preferred Stock had immediately prior to such
     transaction; (C) immediately after giving effect to such transaction and
     the use of the proceeds therefrom (on a pro forma basis, including giving
     effect to any Indebtedness incurred or anticipated to be incurred in
     connection with such transaction), the Corporation (in the case of
     clause (1) of the foregoing clause (A)) or such Person (in the case of
     clause (2) of the foregoing clause (A)) shall be able to incur at least
     $1.00 of additional Indebtedness (other than Permitted Indebtedness) under
     paragraph (l)(i) hereof; (D) immediately after giving effect to such
     transactions, no Voting Rights Triggering Event shall have occurred or be
     continuing; and (E) the Corporation has delivered to the transfer agent for
     the Series A Senior Exchangeable Preferred Stock prior to the consummation
     of the proposed transaction an Officers' Certificate and an Opinion of
     Counsel, each stating that such consolidation, merger or 


                                      11

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     transfer complies with the terms hereof and that all conditions precedent 
     herein relating to such transaction have been satisfied.

          For purposes of the foregoing, the transfer (by lease, assignment,
     sale or otherwise, in a single transaction or series of related
     transactions) of all or substantially all of the properties or assets of
     one or more Subsidiaries of the Corporation, the Capital Stock of which
     constitutes all or substantially all of the properties and assets of the
     Corporation shall be deemed to be the transfer of all or substantially all
     of the properties and assets of the Corporation.

         (iv)  (A) If (1) after February 15, 2001 cash dividends on the Series A
     Senior Exchangeable Preferred Stock are in arrears and unpaid for six or
     more Dividend Periods (whether or not consecutive) (a "Dividend Default");
     (2) the Corporation fails to redeem all of the then outstanding shares of
     Series A Senior Exchangeable Preferred Stock on February 15, 2008 or
     otherwise fails to discharge any redemption obligation with respect to the
     Series A Senior Exchangeable Preferred Stock; (3) the Corporation fails to
     make a Change of Control Offer (whether pursuant to the terms of
     paragraph (h)(v) or otherwise) following a Change of Control if such Change
     of Control Offer is required by paragraph (h) hereof or fails to purchase
     shares of Series A Senior Exchangeable Preferred Stock from Holders who
     elect to have such shares purchased pursuant to the Change of Control
     Offer; (4) the Corporation breaches or violates one of the provisions set
     forth in any of paragraphs (l)(i), (l)(ii) or (l)(iii) hereof and the
     breach or violation continues for a period of 30 days or more after the
     Corporation receives notice thereof specifying the default from the holders
     of at least 25% of the shares of Series A Senior Exchangeable Preferred
     Stock then outstanding or (5) the Corporation fails to pay at the final
     stated maturity (giving effect to any extensions thereof) the principal
     amount of any Indebtedness of the Corporation or any Subsidiary of the
     Corporation, or the final stated maturity of any such Indebtedness is
     accelerated, if the aggregate principal amount of such Indebtedness,
     together with the aggregate principal amount of any other such Indebtedness
     in default for failure to pay principal at the final stated maturity
     (giving effect to any extensions thereof) or that has been accelerated,
     aggregates $5,000,000 or more at one time, in each case, after a 10-day
     period during which such default shall not have been cured or such
     acceleration rescinded, then in the case of any of clauses (1)-(5) the


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     number of directors constituting the Board of Directors shall be adjusted
     by the number, if any, necessary to permit the Holders of Series A Senior
     Exchangeable Preferred Stock, voting separately and as one class, to elect
     the lesser of two directors or 25% of the members of the Board of
     Directors.  Each such event described in clauses (1), (2), (3), (4) and (5)
     is a "Voting Rights Triggering Event."  Holders of a majority of the issued
     and outstanding shares of Series A Senior Exchangeable Preferred Stock,
     voting separately and as one class, shall have the exclusive right to elect
     the lesser of two directors or 25% of the members of the Board of Directors
     at a meeting therefor called upon occurrence of such Voting Rights
     Triggering Event, and at every subsequent meeting at which the terms of
     office of the directors so elected by the Holders of the Series A Senior
     Exchangeable Preferred Stock expire (other than as described in (f)(iv)(B)
     below).  The voting rights provided herein shall be the exclusive remedy at
     law or in equity of the holders of the Series A Senior Exchangeable
     Preferred Stock for any Voting Rights Triggering Event.

          (B)  The right of the Holders of Series A Senior Exchangeable
     Preferred Stock voting together as a separate class to elect members of the
     Board of Directors as set forth in subparagraph (f)(iv)(A) above shall
     continue until such time as (x) in the event such right arises due to a
     Dividend Default, all accumulated dividends that are in arrears on the
     Series A Senior Exchangeable Preferred Stock are paid in full in cash; and
     (y) in all other cases, the failure, breach or default giving rise to such
     Voting Rights Triggering Event is remedied or waived by the holders of at
     least a majority of the shares of Series A Senior Exchangeable Preferred
     Stock then outstanding and entitled to vote thereon, at which time (1) the
     special right of the Holders of Series A Senior Exchangeable Preferred
     Stock so to vote as a class for the election of directors and (2) the term
     of office of the directors elected by the Holders of the Series A Senior
     Exchangeable Preferred Stock shall each terminate and the directors elected
     by the holders of Common Stock shall constitute the entire Board of
     Directors.  At any time after voting power to elect directors shall have
     become vested and be continuing in the Holders of Series A Senior
     Exchangeable Preferred Stock pursuant to paragraph (f)(iv) hereof, or if
     vacancies shall exist in the offices of directors elected by the Holders of
     Series A Senior Exchangeable Preferred Stock, a proper officer of the
     Corporation may, and upon the written request of the Holders of record of
     at least twenty-five percent (25%) of the shares of Series A Senior
     Exchangeable Preferred Stock then 


                                      13

<PAGE>

     outstanding addressed to the secretary of the Corporation shall, call a 
     special meeting of the Holders of Series A Senior Exchangeable Preferred 
     Stock, for the purpose of electing the directors which such Holders are 
     entitled to elect.  If such meeting shall not be called by a proper 
     officer of the Corporation within twenty (20) days after personal 
     service of said written request upon the secretary of the Corporation, 
     or within twenty (20) days after mailing the same within the United 
     States by certified mail, addressed to the secretary of the Corporation 
     at its principal executive offices, then the Holders of record of at 
     least twenty-five percent (25%) of the outstanding shares of Series A 
     Senior Exchangeable Preferred Stock may designate in writing one of 
     their number to call such meeting at the expense of the Corporation, and 
     such meeting may be called by the Person so designated upon the notice 
     required for the annual meetings of stockholders of the Corporation and 
     shall be held at the place for holding the annual meetings of 
     stockholders.  Any Holder of Series A Senior Exchangeable Preferred 
     Stock so designated shall have, and the Corporation shall provide, 
     access to the lists of stockholders to be called pursuant to the 
     provisions hereof.

          (C)  At any meeting held for the purpose of electing directors at
     which the Holders of Series A Senior Exchangeable Preferred Stock shall
     have the right, voting together as a separate class, to elect directors as
     aforesaid, the presence in person or by proxy of the Holders of at least a
     majority of the outstanding shares of Series A Senior Exchangeable
     Preferred Stock shall be required to constitute a quorum of such Series A
     Senior Exchangeable Preferred Stock.

          (D)  Any vacancy occurring in the office of a director elected by the
     Holders of Series A Senior Exchangeable Preferred Stock may be filled by
     the remaining directors elected by the Holders of Series A Senior
     Exchangeable Preferred Stock unless and until such vacancy shall be filled
     by the Holders of Series A Senior Exchangeable Preferred Stock.

          (v)  In any case in which the Holders of Series A Senior Exchangeable
     Preferred Stock shall be entitled to vote pursuant to this paragraph (f) or
     pursuant to Delaware law, each Holder of Series A Senior Exchangeable
     Preferred Stock entitled to vote with respect to such matter shall be
     entitled to one vote for each share of Series A Senior Exchangeable
     Preferred Stock held.


                                      14

<PAGE>

          (g)  EXCHANGE.

          (i)  REQUIREMENTS.  The outstanding shares of Series A Senior
     Exchangeable Preferred Stock are exchangeable as a whole but not in part,
     at the option of the Corporation and subject to the terms and conditions of
     the Credit Agreement, the Note Indenture and the Existing Note Indenture,
     at any time on any Dividend Payment Date for the Corporation's 12 1/4%
     Subordinated Exchange Debentures due 2008 (the "Exchange Debentures") to be
     substantially in the form of Exhibit A to the Indenture, a copy of which is
     on file with the secretary of the Corporation, PROVIDED that any such
     exchange may only be made if on or prior to the date of such exchange (i)
     the Corporation has paid (or is deemed to have paid) all accumulated
     dividends on the Series A Senior Exchangeable Preferred Stock (including
     the dividends payable on the date of exchange) and there shall be no
     contractual impediment to such exchange; (ii) there shall be funds legally
     available sufficient therefor; and (iii) immediately after giving effect to
     such exchange, no Default or Event of Default (as defined in the Indenture)
     would exist under the Indenture and no default or event of default would
     exist under the Credit Agreement, the Note Indenture or the Existing Note
     Indenture.  The exchange rate shall be $1.00 principal amount of Exchange
     Debentures for each $1.00 of liquidation preference of Series A Senior
     Exchangeable Preferred Stock, including, to the extent necessary, Exchange
     Debentures in principal amounts less than $1,000, PROVIDED that the
     Corporation shall have the right, at its option, to pay cash in an amount
     equal to the principal amount of that portion of any Exchange Debenture
     that is not an integral multiple of $1,000 instead of delivering an
     Exchange Debenture in a denomination of less than $1,000.

         (ii)  PROCEDURE FOR EXCHANGE.  (A) At least thirty (30) days and not
     more than sixty (60) days prior to the date fixed for exchange, written
     notice (the "Exchange Notice") shall be given by first-class mail, postage
     prepaid, to each Holder of record on the record date fixed for such
     exchange of the Series A Senior Exchangeable Preferred Stock at such
     Holder's address as the same appears on the stock books of the Corporation,
     PROVIDED that no failure to give such notice nor any deficiency therein
     shall affect the validity of the procedure for the exchange of any shares
     of Series A Senior Exchangeable Preferred Stock to be exchanged except as
     to the Holder or Holders to whom the Corporation has failed to give said
     notice or except as to the Holder or Holders whose notice was defective. 
     The Exchange Notice shall state:


                                      15

<PAGE>

               (1)  the date fixed for exchange;

               (2)  that the Holder is to surrender to the Corporation, in the
          manner and at the place or places designated, his certificate or
          certificates representing the shares of Series A Senior Exchangeable
          Preferred Stock to be exchanged;

               (3)  that dividends on the shares of Series A Senior Exchangeable
          Preferred Stock to be exchanged shall cease to accrue on such Exchange
          Date whether or not certificates for shares of Series A Senior
          Exchangeable Preferred Stock are surrendered for exchange on such
          Exchange Date unless the corporation shall default in the delivery of
          Exchange Debentures; and

               (4)  that interest on the Exchange Debentures shall accrue from
          the Exchange Date whether or not certificates for shares of Series A
          Senior Exchangeable Preferred Stock are surrendered for exchange on
          such Exchange Date.

          (B)  On or before the Exchange Date, each Holder of Series A Senior
     Exchangeable Preferred Stock shall surrender the certificate or
     certificates representing such shares of Series A Senior Exchangeable
     Preferred Stock, in the manner and at the place designated in the Exchange
     Notice.  The Corporation shall cause the Exchange Debentures to be executed
     on the Exchange Date and, upon surrender in accordance with the Exchange
     Notice of the certificates for any shares of Series A Senior Exchangeable
     Preferred Stock so exchanged, duly endorsed (or otherwise in proper form
     for transfer, as determined by the Corporation), such shares shall be
     exchanged by the Corporation into Exchange Debentures.  The Corporation
     shall pay interest on the Exchange Debentures at the rate and on the dates
     specified therein from the Exchange Date.

          (C)  If notice has been mailed as aforesaid, and if before the
     Exchange Date specified in such notice (1) the Indenture shall have been
     duly executed and delivered by the Corporation and the trustee thereunder
     and (2) all Exchange Debentures necessary for such exchange shall have been
     duly executed by the Corporation and delivered to the trustee under the
     Indenture with irrevocable instructions to authenticate the Exchange
     Debentures necessary for such exchange, then the rights of the Holders of
     Series A Senior Exchangeable Preferred Stock so exchanged as stockholders
     of 


                                      16

<PAGE>

     the Corporation shall cease (except the right to receive Exchange
     Debentures, an amount in cash equal to the amount of accrued and unpaid
     dividends to the Exchange Date and, if the Corporation so elects, cash in
     lieu of any Exchange Debenture not an integral multiple of $1,000), and the
     Person or Persons entitled to receive the Exchange Debentures issuable upon
     exchange shall be treated for all purposes as the registered Holder or
     Holders of such Exchange Debentures as of the Exchange Date.

        (iii)  NO EXCHANGE IN CERTAIN CASES.  Notwithstanding the foregoing
     provisions of this paragraph (g), the Corporation shall not be entitled to
     exchange the Series A Senior Exchangeable Preferred Stock for Exchange
     Debentures if such exchange, or any term or provision of the Indenture or
     the Exchange Debentures, or the performance of the Corporation's
     obligations under the Indenture or the Exchange Debentures, shall
     materially violate or conflict with any applicable law or agreement or
     instrument then binding on the Corporation or if, at the time of such
     exchange, the Corporation is insolvent or if it would be rendered insolvent
     by such exchange.

          (h)  CHANGE OF CONTROL.

          (i)  In the event of a Change of Control (the date of such occurrence
     being the "Change of Control Date"), the Corporation shall notify the
     Holders of the Series A Senior Exchangeable Preferred Stock in writing of
     such occurrence and shall make an offer to purchase (the "Change of Control
     Offer") all then outstanding shares of Series A Senior Exchangeable
     Preferred Stock at a purchase price of 101% of the then effective
     liquidation preference thereof plus, without duplication, an amount in cash
     equal to all accumulated and unpaid dividends per share (including an
     amount in cash equal to a prorated dividend for the period from the
     Dividend Payment Date immediately prior to the Change of Control Payment
     Date to the Change of Control Payment Date).  

         (ii)  Within 30 days following the Change of Control Date, the
     Corporation shall send, by first class mail, postage prepaid, a notice to
     each Holder of Series A Senior Exchangeable Preferred Stock at such
     Holder's address as it appears on the stock books of the Corporation, which
     notice shall govern the terms of the Change of Control Offer.  The notice
     to the Holders shall contain all instructions and materials necessary to
     enable such Holders to tender Series


                                      17


<PAGE>

    A Senior Exchangeable Preferred Stock pursuant to the Change of Control 
    Offer.  Such notice shall state:

               (A)  that a Change of Control has occurred, that the Change of
          Control Offer is being made pursuant to this paragraph (h) and that
          all Series A Senior Exchangeable Preferred Stock validly tendered and
          not withdrawn will be accepted for payment;

               (B)  the purchase price (including the amount of accrued
          dividends, if any) and the purchase date (which shall be no earlier
          than 30 days nor later than 45 days from the date such notice is
          mailed, other than as may be required by law) (the "Change of Control
          Payment Date");

               (C)  that any shares of Series A Senior Exchangeable Preferred
          Stock not tendered will continue to accrue dividends;

               (D)  that, unless the Corporation defaults in making payment
          therefor, any share of Series A Senior Exchangeable Preferred Stock
          accepted for payment pursuant to the Change of Control Offer shall
          cease to accrue dividends after the Change of Control Payment Date;

               (E)  that Holders electing to have any shares of Series A Senior
          Exchangeable Preferred Stock purchased pursuant to a Change of Control
          Offer will be required to surrender the certificate or certificates
          representing such shares, properly endorsed for transfer together with
          such customary documents as the Corporation and the transfer agent may
          reasonably require, in the manner and at the place specified in the
          notice prior to the close of business on the Business Day prior to the
          Change of Control Payment Date;

               (F)  that Holders will be entitled to withdraw their election if
          the Corporation receives, not later than five Business Days prior to
          the Change of Control Payment Date, a telegram, telex, facsimile
          transmission or letter setting forth the name of the Holder, the
          number of shares of Series A Senior Exchangeable Preferred Stock the
          Holder delivered for purchase and a statement that such Holder is
          withdrawing his election to have such shares of Series A Senior
          Exchangeable Preferred Stock purchased;



                                     18

<PAGE>

               (G)  that Holders whose shares of Series A Senior Exchangeable
          Preferred Stock are purchased only in part will be issued a new
          certificate representing the unpurchased shares of Series A Senior
          Exchangeable Preferred Stock; and

               (H)  the circumstances and relevant facts regarding such Change
          of Control.

        (iii)  The Corporation will comply with any securities laws and
     regulations, to the extent such laws and regulations are applicable to the
     repurchase of the Series A Senior Exchangeable Preferred Stock in
     connection with a Change of Control Offer.

         (iv)  On the Change of Control Payment Date the Corporation shall (A)
     accept for payment the shares of Series A Senior Exchangeable Preferred
     Stock validly tendered pursuant to the Change of Control Offer, (B) pay to
     the Holders of shares so accepted the purchase price therefor in cash and
     (C) cancel and retire each surrendered certificate.  Unless the Corporation
     defaults in the payment for the shares of Series A Senior Exchangeable
     Preferred Stock tendered pursuant to the Change of Control Offer, dividends
     will cease to accrue with respect to the shares of Series A Senior
     Exchangeable Preferred Stock tendered and all rights of Holders of such
     tendered shares will terminate, except for the right to receive payment
     therefor, on the Change of Control Payment Date.

          (v)  If the purchase of the Series A Senior Exchangeable Preferred
     Stock would violate or constitute a default under the Credit Agreement, the
     Note Indenture, the Existing Note Indenture or other Indebtedness of the
     Corporation, then, notwithstanding anything to the contrary contained
     above, prior to complying with the foregoing provisions, but in any event
     within 30 days following the Change of Control Date, the Corporation shall
     either (A) repay in full all such Indebtedness and terminate all
     commitments outstanding under the Credit Agreement or (B) obtain the
     requisite consents, if any, under the Credit Agreement, the Note Indenture,
     the Existing Note Indenture or such Indebtedness required to permit the
     repurchase of Series A Senior Exchangeable Preferred Stock required by this
     paragraph (h).  Until the requirements of the immediately preceding
     sentence are satisfied, the Corporation shall not make, and shall not be
     obligated to make, any Change of Control Offer; PROVIDED that the
     Corporation's failure to comply with the provisions of this 



                                     19

<PAGE>

     paragraph (h)(v) shall constitute a Voting Rights Triggering Event.

          (i)  CONVERSION OR EXCHANGE.  The Holders of shares of Series A Senior
Exchangeable Preferred Stock shall not have any rights hereunder to convert such
shares into or exchange such shares for shares of any other class or classes or
of any other series of any class or classes of Capital Stock of the Corporation.

          (j)  REISSUANCE OF SERIES A SENIOR EXCHANGEABLE PREFERRED STOCK. 
Shares of Series A Senior Exchangeable Preferred Stock that have been issued and
reacquired in any manner, including shares purchased or redeemed or exchanged,
shall (upon compliance with any applicable provisions of the laws of Delaware)
have the status of authorized and unissued shares of Preferred stock
undesignated as to series and may be redesignated and reissued as part of any
series of Preferred Stock, PROVIDED that any issuance of such shares as Series A
Senior Exchangeable Preferred Stock must be in compliance with the terms hereof.

          (k)  BUSINESS DAY.  If any payment, redemption or exchange shall be
required by the terms hereof to be made on a day that is not a Business Day,
such payment, redemption or exchange shall be made on the immediately succeeding
Business Day.

          (l)  CERTAIN ADDITIONAL PROVISIONS.

          (i)  LIMITATION ON INCURRENCE OF ADDITIONAL INDEBTEDNESS.  Neither the
     Corporation nor any of its Subsidiaries shall, directly or indirectly,
     create, incur, assume, guarantee, acquire or become liable for,
     contingently or otherwise (collectively, "incur"), any Indebtedness other
     than Permitted Indebtedness.  Notwithstanding the foregoing limitation, the
     Corporation or any Subsidiary may incur Indebtedness if, on the date of the
     incurrence of such Indebtedness, after giving effect to the incurrence of
     such Indebtedness and the receipt and application of the proceeds thereof,
     the Corporation's Leverage Ratio is less than 7.0 to 1.

         (ii)  LIMITATION ON RESTRICTED PAYMENTS.  (A) Neither the Corporation
     nor any of its Subsidiaries shall, directly or indirectly, make any
     Restricted Payment if immediately after giving effect thereto:

               (1)  any Voting Rights Triggering Event shall have occurred and
          be continuing; or



                                     20

<PAGE>

               (2)  the Corporation is not able to incur $1.00 of additional
          Indebtedness (other than Permitted Indebtedness) in compliance with
          paragraph (l)(i) above; or

               (3)  the aggregate amount of Restricted Payments made subsequent
          to the Issue Date (the amount expended for such purposes, if other
          than in cash, being the fair market value of such property as
          determined by the Board of Directors in good faith) exceeds the sum of
          (I) (x) 100% of the aggregate Consolidated EBITDA of the Corporation
          (or, in the event such Consolidated EBITDA shall be a deficit, minus
          100% of such deficit) accrued subsequent to the Issue Date to the most
          recent date for which financial information is available to the
          Corporation, taken as one accounting period, less (y) 1.4 times
          Consolidated Interest Expense for the same period, plus (II) 100% of
          the aggregate net proceeds, including the fair market value of
          property other than cash as determined by the Board of Directors in
          good faith, received by the Corporation from any Person (other than a
          Subsidiary of the Corporation) from the issuance and sale on or
          subsequent to February 14, 1996 of Qualified Capital Stock of the
          Corporation (excluding any net proceeds from issuances and sales
          financed directly or indirectly using funds borrowed from the
          Corporation or any Subsidiary of the Corporation, until and to the
          extent such borrowing is repaid, but including the proceeds from the
          issuance and sale of any securities convertible into or exchangeable
          for Qualified Capital Stock to the extent such securities are so
          converted or exchanged and including any additional proceeds received
          by the Corporation upon such conversion or exchange), plus (III)
          without duplication of any amount included in clause (3)(II) above,
          100% of the aggregate net proceeds, including the fair market value of
          property other than cash (valued as provided in clause (3)(II) above),
          received by the Corporation as a capital contribution on or subsequent
          to February 14, 1996 (excluding the net proceeds from a Public Equity
          Offering by Chancellor to the extent used to redeem the Series A
          Senior Exchangeable Preferred Stock); plus (IV) $2,500,000.

          (B)  Notwithstanding the foregoing, these provisions will not
     prohibit:  (1) the payment of any dividend or the making of any
     distribution within 60 days after the date of its declaration if such
     dividend or distribution would have 



                                     21

<PAGE>

     been permitted on the date of declaration; (2) the acquisition of any 
     Capital Stock of the Corporation or any warrants, options or other rights 
     to acquire shares of any class of such Capital Stock either (I) solely 
     in exchange for shares of Qualified Capital Stock or other rights to 
     acquire Qualified Capital Stock or (II) through the application of the 
     net proceeds of a substantially concurrent sale for cash (other than to 
     a Subsidiary of the Corporation) of shares of Qualified Capital Stock or 
     warrants, options or other rights to acquire Qualified Capital Stock; 
     (3) payments by the Corporation to fund the operating expenses of 
     Chancellor in an amount not to exceed $500,000 per annum; (4) payments by 
     the Corporation to Chancellor to enable Chancellor to make payments 
     pursuant to (x) the Financial Monitoring and Oversight Agreement or (y) the
     Tax Sharing Agreement; (5) payments by the Corporation to repurchase, or 
     enable Chancellor to repurchase, Capital Stock or other securities of 
     Chancellor from employees of Chancellor or the Corporation in
     an aggregate amount not to exceed $5,000,000; (6) payments to enable
     Chancellor to redeem or repurchase stock purchase or similar rights in an
     aggregate amount not to exceed $500,000; (7) payments, not to exceed
     $100,000 in the aggregate, to enable the Corporation to make cash payments
     to holders of its Capital Stock in lieu of the issuance of fractional
     shares of its Capital Stock; and (8) payments made pursuant to any merger,
     consolidation or sale of assets effected in accordance with paragraph
     (f)(iii) above; PROVIDED, HOWEVER, that no such payment may be made
     pursuant to this clause (8) unless, after giving effect to such transaction
     (and the incurrence of any Indebtedness in connection therewith and the use
     of the proceeds thereof), the Corporation would be able to incur $1.00 of
     additional Indebtedness (other than Permitted Indebtedness) in compliance
     with paragraph (l)(i) above such that after incurring that $1.00 of
     additional Indebtedness, the Leverage Ratio would be less than 6.0 to 1;
     provided, further, however, that in the case of clauses (4)(x), (5), (6),
     (7) and (8), no Voting Rights Triggering Event shall have occurred or be
     continuing at the time of such payment or as a result thereof.  In
     determining the aggregate amount of Restricted Payments made subsequent to
     the Issue Date, amounts expended pursuant to clauses (1), (2), (4)(x), (5),
     (6), (7) and (8) shall be included in such calculation.

        (iii)  LIMITATION ON PREFERRED STOCK OF SUBSIDIARIES.  The Corporation
     shall not permit any of its Subsidiaries to issue any Preferred Stock
     (other than to the Corporation or to a Wholly Owned Subsidiary of the
     Corporation) or permit any Person (other than to the Corporation or a
     Wholly Owned 



                                     22

<PAGE>

     Subsidiary of the Corporation) to own any Preferred Stock of a Subsidiary
     of the Corporation (other than Acquired Preferred Stock; provided that at
     the time the issuer of such Acquired Preferred Stock becomes a Subsidiary
     of the Corporation or merges with the Corporation or any of its 
     Subsidiaries, and after giving effect to such transaction, the Corporation
     shall be able to incur $1.00 of additional Indebtedness (other than 
     Permitted Indebtedness) in compliance with paragraph (l)(i) above).

         (iv)  REPORTS.  So long as any shares of Series A Senior Exchangeable
     Preferred Stock are outstanding, the Corporation will provide to the
     holders of Series A Senior Exchangeable Preferred Stock, within 15 days
     after it files them with the Commission, copies of the annual reports and
     of the information, documents and other reports (or copies of such portions
     of any of the foregoing as the Commission may by rules and regulations
     prescribe) which the Corporation files with the Commission pursuant to
     Section 13 or 15(d) of the Exchange Act.  In the event that the Corporation
     is no longer required to furnish such reports to its securityholders
     pursuant to the Exchange Act, the Corporation will cause its consolidated
     financial statements, comparable to those which would have been required to
     appear in annual or quarterly reports, to be delivered to the Holders of
     Series A Senior Exchangeable Preferred Stock.

          (m)  DEFINITIONS.  As used in this Certificate of Designation, the
following terms shall have the following meanings (with terms defined in the
singular having comparable meanings when used in the plural and VICE versa),
unless the context otherwise requires:

          "ACQUIRED PREFERRED STOCK" means Preferred Stock of any Person at the
     time such Person becomes a Subsidiary of the Corporation or at the time it
     merges or consolidates with the Corporation or any of its Subsidiaries and
     not issued by such Person in connection with, or in anticipation or
     contemplation of, such Person becoming a Subsidiary of the Corporation or
     such acquisition, merger or consolidation.

          "AFFILIATE" means a Person who, directly or indirectly, through one or
     more intermediaries, controls, or is controlled by, or is under common
     control with, the Corporation.  The term "control" means the possession,
     directly or indirectly, of the power to direct or cause the direction of
     the management and policies of a Person, 



                                     23

<PAGE>

     whether through the ownership of voting securities, by contract or 
     otherwise.

          "ASSET ACQUISITION" means (i) an Investment by the Corporation or any
     Subsidiary of the Corporation in any other Person pursuant to which such
     Person shall become a Subsidiary of the Corporation or shall be
     consolidated or merged with the Corporation or any Subsidiary of the
     Corporation or (ii) the acquisition by the Corporation or any Subsidiary of
     the Corporation of assets of any Person comprising a division or line of
     business of such Person.

          "ASSET SALE" means any direct or indirect sale, issuance, conveyance,
     transfer, lease (other than operating leases entered into in the ordinary
     course of business), assignment or other transfer for value by the
     Corporation or any of its Subsidiaries (excluding any Sale and Leaseback
     Transaction or any pledge of assets or stock by the Corporation or any of
     its Subsidiaries) to any Person other than the Corporation or a Wholly
     Owned Subsidiary of the Corporation of (i) any Capital Stock of any
     Subsidiary of the Corporation or (ii) any other property or assets of the
     Corporation or any Subsidiary of the Corporation other than in the ordinary
     course of business.

          "BOARD OF DIRECTORS" shall have the meaning ascribed to it in the
     first paragraph of this Resolution.

          "BUSINESS DAY" means any day except a Saturday, a Sunday, or any day
     on which banking institutions in New York, New York are required or
     authorized by law or other governmental action to be closed.

          "CAPITAL STOCK" means (i) with respect to any Person that is a
     corporation, any and all shares, interests, participations or other
     equivalents (however designated) of capital stock of such Person and
     (ii) with respect to any Person that is not a corporation. any and all
     partnership or other equity interests of such Person.

          "CAPITALIZED LEASE OBLIGATION" means, as to any Person, the obligation
     of such Person to pay rent or other amounts under a lease to which such
     Person is a party that is required to be classified and accounted for as a
     capital lease obligation under GAAP, and for purposes of this definition,
     the amount of such obligation at any date shall be the capitalized amount
     of such obligation at such date, determined in accordance with GAAP.



                                     24

<PAGE>

          "CASH EQUIVALENTS" means (i) marketable direct obligations issued by,
     or unconditionally guaranteed by, the United States Government or issued by
     any agency thereof and backed by the full faith and credit of the United
     States, in each case maturing within one year from the date of acquisition
     thereof; (ii) marketable direct obligations issued by any state of the
     United States of America or any political subdivision of any such state or
     any public instrumentality thereof maturing within one year from the date
     of acquisition thereof and, at the time of acquisition, having one of the
     two highest ratings obtainable from either Standard & Poor's Corporation or
     Moody's Investors Service, Inc.; (iii) commercial paper maturing no more
     than one year from the date of creation thereof and, at the time of
     acquisition, having a rating of at least A-1 from Standard & Poor's
     Corporation or at least P-1 from Moody's Investors Service, Inc.; (iv)
     certificates of deposit or bankers' acceptances maturing within one year
     from the date of acquisition thereof issued by any commercial bank
     organized under the laws of the United States of America or any state
     thereof or the District of Columbia or any U.S. branch of a foreign bank
     having at the date of acquisition thereof combined capital and surplus of
     not less than $200,000,000; (v) repurchase obligations with a term of not
     more than seven days for underlying securities of the types described in
     clause (i) above entered into with any bank meeting the qualifications
     specified in clause (iv) above; and (vi) investments in money market funds
     which invest substantially all their assets in securities of the types
     described in clauses (i) through (v) above.

          "CHANCELLOR" means Chancellor Broadcasting Company, a Delaware
     corporation, and its successors.

          "CHANGE OF CONTROL" means the occurrence of one or more of the
     following events: (i) any sale, lease, exchange or other transfer (in one
     transaction or a series of related transactions) of all or substantially
     all of the assets of the Corporation to any Person or group of related
     Persons for purposes of Section 13(d) of the Exchange Act (a "Group")
     (whether or not otherwise in compliance with the provisions of the Exchange
     Indenture), other than to Hicks Muse or any of its Affiliates, officers and
     directors or to Steven Dinetz (the "Permitted Holders"); or (ii) a majority
     of the Board of Directors of Chancellor or the Corporation shall consist of
     Persons who are not Continuing Directors; or (iii) the acquisition by any
     Person or Group (other than the Permitted Holders) of the power, directly
     or indirectly, to vote or direct the voting of securities having more than



                                     25

<PAGE>

     50% of the ordinary voting power for the election of directors of
     Chancellor or the Corporation.

          "CHANGE OF CONTROL DATE" shall have the meaning ascribed to it in
     paragraph (h) hereof.

          "CHANGE OF CONTROL PAYMENT DATE" shall have the meaning ascribed to it
     in paragraph (h) hereof.

          "CHANGE OF CONTROL OFFER" shall have the meaning ascribed to it in
     paragraph (h) hereof.

          "COMMISSION" means the Securities and Exchange Commission.

          "COMMODITY AGREEMENT" means any commodity futures contract, commodity
     option or other similar agreement or arrangement entered into by the
     Corporation or any of its Subsidiaries designed to protect the Corporation
     or any of its Subsidiaries against fluctuations in the price of commodities
     actually used in the ordinary course of business of the Corporation and its
     Subsidiaries.

          "CONSOLIDATED EBITDA" means, with respect to any Person, for any
     period, the sum (without duplication) of (i) Consolidated Net Income and
     (ii) to the extent Consolidated Net Income has been reduced thereby,
     (a) all income taxes of such Person and its Subsidiaries paid or accrued in
     accordance with GAAP for such period (other than income taxes attributable
     to extraordinary or nonrecurring gains or losses), (b) Consolidated
     Interest Expense and (c) Consolidated Non-Cash Charges, all as determined
     on a consolidated basis for such Person and its Subsidiaries in conformity
     with GAAP.

          "CONSOLIDATED INTEREST EXPENSE" means, with respect to any Person for
     any period, without duplication, the sum of (i) the interest expense of
     such Person and its Subsidiaries for such period as determined on a
     consolidated basis in accordance with GAAP, including, without limitation,
     (a) any amortization of debt discount, (b) the net cost under Interest Swap
     Obligations (including any amortization of discounts), (c) the interest
     portion of any deferred payment obligation, (d) all commissions, discounts
     and other fees and charges owed with respect to letters of credit, bankers'
     acceptance financing or similar facilities, and (e) all accrued interest
     and (ii) the interest component of Capitalized Lease Obligations paid or
     accrued by such Person 



                                     26

<PAGE>

     and its Subsidiaries during such period as determined on a consolidated 
     basis in accordance with GAAP.

          "CONSOLIDATED NET INCOME" of any Person means, for any period, the
     aggregate net income (or loss) of such Person and its Subsidiaries for such
     period on a consolidated basis, determined in accordance with GAAP;
     provided that there shall be excluded therefrom, without duplication,
     (i) gains and losses from Asset Sales or abandonments or reserves relating
     thereto and the related tax effects, (ii) items classified as extraordinary
     or nonrecurring gains and losses, and the related tax effects according to
     GAAP, (iii) the net income (or loss) of any Person acquired in a pooling of
     interests transaction accrued prior to the date it becomes a Subsidiary of
     such first referred to Person or is merged or consolidated with it or any
     of its Subsidiaries, (iv) the net income of any Subsidiary to the extent
     that the declaration of dividends or similar distributions by that
     Subsidiary of that income is restricted by contract, operation of law or
     otherwise and (v) the net income of any Person, other than a Subsidiary,
     except to the extent of the lesser of (a) dividends or distributions paid
     to such first referred to Person or its Subsidiary by such Person and (b)
     the net income of such Person (but in no event less than zero), and the net
     loss of such Person shall be included only to the extent of the aggregate
     Investment of the first referred to Person or a consolidated Subsidiary of
     such Person.

          "CONSOLIDATED NON-CASH CHARGES" means, with respect to any Person for
     any period, the aggregate depreciation, amortization and other non-cash
     expenses of such Person and its Subsidiaries reducing Consolidated Net
     Income of such Person and its Subsidiaries for such period, determined on a
     consolidated basis in accordance with GAAP (excluding any such charges
     constituting an extraordinary or nonrecurring item).

          "CONTINUING DIRECTOR" means, as of the date of determination, any
     Person who (i) was a member of the Board of Directors of Chancellor or the
     Corporation on the Issue Date, (ii) was nominated for election or elected
     to the Board of Directors of Chancellor or the Corporation with the
     affirmative vote of a majority of the Continuing Directors who were members
     of such Board of Directors at the time of such nomination or election, or
     (iii) is a representative of a Permitted Holder.



                                     27

<PAGE>

          "CREDIT AGREEMENT" means the Credit Agreement, dated February 14, 1996
     among Chancellor, the Corporation, the lenders from time to time party
     thereto and Bankers Trust Company as agent, together with the related
     documents thereto (including, without limitation, any guarantee agreements
     and security documents), in each case as such agreements may be amended
     (including any amendment and restatement thereof), supplemented or
     otherwise modified from time to time, including any agreement extending the
     maturity of, refinancing, replacing or otherwise restructuring (including
     by way of adding subsidiaries of the Corporation as additional borrowers or
     guarantors thereunder) all or any portion of the Indebtedness under such
     agreement or any successor or replacement agreement and whether by the same
     or any other agent, lender or group of lenders.

          "CURRENCY AGREEMENT" means any foreign exchange contract, currency
     swap agreement or other similar agreement or arrangement designed to
     protect the Corporation or any of its Subsidiaries against fluctuations in
     currency values.

          "DISQUALIFIED CAPITAL STOCK" means any Capital Stock which, by its
     terms (or by the terms of any security into which it is convertible or for
     which it is exchangeable), or upon the happening of any event, matures
     (excluding any maturity as the result of an optional redemption by the
     issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund
     obligation or otherwise, or is redeemable at the sole option of the holder
     thereof (except, in each case, upon the occurrence of a Change of Control),
     in whole or in part, on or prior to February 15, 2008.

          "DIVIDEND PAYMENT DATE" means February 15, May 15, August 15 and
     November 15, of each year.

          "DIVIDEND PERIOD" means the Initial Dividend Period and, thereafter,
     each Quarterly Dividend Period.

          "DIVIDEND RECORD DATE" means February 1, May 1, August 1 and
     November 1 of each year.

          "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
     and the rules and regulations promulgated thereunder.

          "EXCHANGE DATE" means a date on which shares of Series A Senior
     Exchangeable Preferred Stock are exchanged by the Corporation for Exchange
     Debentures.


                                      28

<PAGE>

          "EXCHANGE DEBENTURES" shall have the meaning ascribed to it in
     paragraph (g) hereof.

          "EXCHANGE NOTICE" shall have the meaning ascribed to it in paragraph
     (g) hereof.

          "EXISTING NOTES" means the Corporation's $60 million aggregate
     principal amount of 12 1/2% Senior Subordinated Notes due 2004 as the same
     may be modified or amended from time to time and future refinancings
     thereof.

          "EXISTING INDENTURE" means the Indenture governing the Existing Notes
     as such Indenture may be amended or supplemented from time to time in
     accordance with the terms thereof.

          "EXISTING PREFERRED STOCK" means the Corporation's
     12 1/4% Senior Cumulative Exchangeable Preferred Stock.

          "FEDERAL RESERVE BOARD" means the Board of Governors of the Federal
     Reserve System, or any successor thereto.

          "FINANCIAL MONITORING AND OVERSIGHT AGREEMENT" means, collectively,
     the Financial Monitoring and Oversight Agreement among Hicks, Muse & Co.
     Partners, L.P., the Corporation and Chancellor, as in effect on the Issue
     Date, and the Financial Advisory Agreement among HM/2 Management Partners,
     L.P., the Corporation and Chancellor, as in effect on the Issue Date.

          "GAAP" means generally accepted accounting principles as in effect in
     the United States of America as of the Issue Date.

          "HOLDER" means a holder of shares of Series A Senior Exchangeable
     Preferred Stock as reflected in the stock books of the Corporation.

          "INDEBTEDNESS" means with respect to any Person, without duplication,
     any liability of such Person (i) for borrowed money, (ii) evidenced by
     bonds, debentures, notes or other similar instruments, (iii) constituting
     Capitalized Lease Obligations, (iv) incurred or assumed as the deferred
     purchase price of property, or pursuant to conditional sale obligations and
     title retention agreements (but excluding trade accounts payable arising in
     the ordinary course of business), (v) for the reimbursement of any obligor
     on any letter of credit, banker's acceptance or similar credit transaction,
     (vi) for Indebtedness of others guaranteed by 


                                      29

<PAGE>

     such Person, (vii) for Interest Swap Obligations, Commodity Agreements 
     and Currency Agreements and (viii) for Indebtedness of any other Person 
     of the type referred to in clauses (i) through (vii) which is secured by 
     any Lien on any property or asset of such first referred to Person, the 
     amount of such Indebtedness being deemed to be the lesser of the value 
     of such property or asset or the amount of the Indebtedness so secured. 
     The amount of Indebtedness of any Person at any date shall be the 
     outstanding principal amount of all unconditional obligations described 
     above, as such amount would be reflected on a balance sheet prepared in 
     accordance with GAAP, and the maximum liability at such date of such 
     Person for any contingent obligations described above.

          "INITIAL DIVIDEND PERIOD" means the dividend period commencing on the
     Issue Date and ending on the first Dividend Payment Date to occur
     thereafter.

          "INTEREST SWAP OBLIGATIONS" means the obligations of any Person under
     any interest rate protection agreement, interest rate future, interest rate
     option, interest rate swap, interest rate cap or other interest rate hedge
     or arrangement.

          "INVESTMENT" means (i) any transfer or delivery of cash, stock or
     other property of value in exchange for Indebtedness, stock or other
     security or ownership interest in any Person by way of loan, advance,
     capital contribution, guarantee or otherwise and (ii) an investment deemed
     to have been made by the Corporation at the time any entity which was a
     Subsidiary of the Corporation ceases to be such a Subsidiary in an amount
     equal to the value of the loans and advances made, and any remaining
     ownership interest in, such entity immediately following such entity
     ceasing to be a Subsidiary of the Corporation.  The amount of any non-cash
     Investment shall be the fair market value of such Investment, as determined
     conclusively in good faith by management of the Corporation unless the fair
     market value of such Investment exceeds $1,000,000, in which case the fair
     market value shall be determined conclusively in good faith by the Board of
     Directors at the time such Investment is made.

          "ISSUE DATE" means the date of original issuance of the Series A
     Senior Exchangeable Preferred Stock.

          "JUNIOR STOCK" shall have the meaning ascribed to it in paragraph (b)
     hereof.


                                      30

<PAGE>

          "LEVERAGE RATIO" shall mean, as to any Person, the ratio of (i) the
     sum of the aggregate outstanding amount of Indebtedness of such Person and
     its Subsidiaries as of the date of calculation on a consolidated basis in
     accordance with GAAP to (ii) the Consolidated EBITDA of such Person for the
     four full fiscal quarters (the "Four Quarter Period") ending on or prior to
     the date of determination.

          For purposes of this definition, the aggregate outstanding principal
     amount of Indebtedness of the Person and its Subsidiaries for which such
     calculation is made shall be determined on a pro forma basis as if the
     Indebtedness giving rise to the need to perform such calculation had been
     incurred and the proceeds therefrom had been applied, and all other
     transactions in respect of which such Indebtedness is being incurred had
     occurred, on the last day of the Four Quarter Period. In addition to the
     foregoing, for purposes of this definition, "Consolidated EBITDA" shall be
     calculated on a pro forma basis after giving effect to (i) the incurrence
     of the Indebtedness of such Person and its Subsidiaries (and the
     application of the proceeds therefrom) giving rise to the need to make such
     calculation and any incurrence (and the application of the proceeds
     therefrom) or repayment of other Indebtedness, other than the incurrence or
     repayment of Indebtedness pursuant to working capital facilities, at any
     time subsequent to the beginning of the Four Quarter Period and on or prior
     to the date of determination, as if such incurrence (and the application of
     the proceeds thereof), or the repayment, as the case may be, occurred on
     the first day of the Four Quarter Period and (ii) any Asset Sales or Asset
     Acquisitions (including, without limitation, any Asset Acquisition giving
     rise to the need to make such calculation as a result of such Person or one
     of its Subsidiaries (including any Person that becomes a Subsidiary as a
     result of such Asset Acquisition) incurring, assuming or otherwise becoming
     liable for Indebtedness) at any time on or subsequent to the first day of
     the Four Quarter Period and on or prior to the date of determination, as if
     such Asset Sale or Asset Acquisition (including the incurrence, assumption
     or liability for any such Indebtedness and also including any Consolidated
     EBITDA associated with such Asset Acquisition) occurred on the first day of
     the Four Quarter Period. Furthermore, in calculating "Consolidated Interest
     Expense" for purposes of the calculation of "Consolidated EBITDA," (i)
     interest on Indebtedness determined on a fluctuating basis as of the date
     of determination (including Indebtedness actually incurred on the date of
     the transaction giving rise to the need to calculate the 


                                      31

<PAGE>

     Leverage Ratio) and which will continue to be so determined thereafter 
     shall be deemed to have accrued at a fixed rate per annum equal to the 
     rate of interest on such Indebtedness as in effect on the date of 
     determination and (ii) notwithstanding (i) above, interest determined on 
     a fluctuating basis, to the extent such interest is covered by Interest 
     Swap Obligations, shall be deemed to accrue at the rate per annum 
     resulting after giving effect to the operation of such agreements.

          "LIEN" means any lien, mortgage, deed of trust, pledge, security
     interest, charge or encumbrance of any kind (including any conditional sale
     or other title retention agreement, any lease in the nature thereof and any
     agreement to give any security interest).

          "MANDATORY REDEMPTION PRICE" shall have the meaning ascribed to it in
     paragraph (e) hereof.

          "NOTE INDENTURE" means the Indenture governing the Notes as such
     Indenture may be amended or supplemented from time to time in accordance
     with the terms thereof.

          "NOTES" means the Corporation's $200.0 million aggregate principal
     amount of 9 3/8% Senior Subordinated Notes due 2004 of the Corporation as
     the same may be modified or amended from time to time and future
     refinancings thereof.

          "OBLIGATIONS" means all obligations for principal, premium, interest,
     penalties, fees, indemnifications, reimbursements, damages and other
     liabilities payable under the documentation governing, or otherwise
     relating to, any Indebtedness.

          "OFFICERS' CERTIFICATE" means a certificate signed by two officers or
     by an officer and either an Assistant Treasurer or an Assistant Secretary
     of the Corporation which certificate shall include a statement that, in the
     opinion of such signers all conditions precedent to be performed by the
     Corporation prior to the taking of any proposed action have been taken.  In
     addition, such certificate shall include (i) a statement that the
     signatories have read the relevant covenant or condition, (ii) a brief
     statement of the nature and scope of such examination or investigation upon
     which the statements are based, (iii) a statement that, in the opinion of
     such signatories, they have made such examination or investigation as is
     reasonably necessary to express an informed opinion and (iv) a statement as
     to 


                                      32

<PAGE>

     whether or not, in the opinion of the signatories, such relevant conditions
     or covenants have been complied with.

          "OPINION OF COUNSEL" means an opinion of counsel that, in such
     counsel's opinion, all conditions precedent to be performed by the
     Corporation prior to the taking of any proposed action have been taken. 
     Such opinion shall also include the statements called for in the second
     sentence under "Officers' Certificate".

          "OPTIONAL REDEMPTION PRICE" shall have the meaning ascribed to it in
     paragraph (e)(i) hereof.

          "PARITY STOCK" shall have the meaning ascribed to it in paragraph (b)
     hereof.

          "PERMITTED INDEBTEDNESS" means, without duplication, (i) Indebtedness
     outstanding on the Issue Date, including, without limitation, the Notes,
     the Existing Notes, and guarantees thereof; (ii) Indebtedness of the
     Corporation incurred pursuant to the Credit Agreement in an aggregate
     principal amount at any time outstanding not to exceed the sum of the
     aggregate commitments pursuant to the Credit Agreement as initially in
     effect reduced by the aggregate principal amount permanently repaid with
     the proceeds of Asset Sales; (iii) Indebtedness evidenced by the Exchange
     Debentures, including any Exchange Debentures issued in accordance with the
     Exchange Indenture as the payment of interest on the Exchange Debentures;
     (iv) Interest Swap Obligations; provided that such Interest Swap
     Obligations are entered into to protect the Corporation from fluctuations
     in interest rates of its Indebtedness; (v) additional Indebtedness of the
     Corporation or any of its Subsidiaries not to exceed $10,000,000 in
     principal amount outstanding at any time (which amount may, but need not,
     be incurred under the Credit Agreement); (vi) Refinancing Indebtedness;
     (vii) Indebtedness owed by the Corporation to any Wholly Owned Subsidiary
     or by any Subsidiary to the Corporation or any Wholly Owned Subsidiary of
     the Corporation; and (viii) guarantees by Subsidiaries of any Indebtedness
     permitted to be incurred pursuant to the terms of paragraph (1)(i) hereof.

          "PERMITTED INVESTMENTS" means (i) Investments by the Corporation or
     any Subsidiary to acquire the stock or assets of any Person (or
     Indebtedness of such Person acquired in connection with a transaction in
     which such Person becomes a Subsidiary of the Corporation) engaged in the
     broadcast business or businesses reasonably related thereto; provided 


                                      33

<PAGE>

     that if any such Investment or series of related Investments involves an
     Investment by the Corporation in excess of $5,000,000, the Corporation is
     able, at the time of such investment and immediately after giving effect
     thereto, to incur at least $1.00 of additional Indebtedness (other than
     Permitted Indebtedness) in compliance with paragraph (l)(i) hereof, (ii)
     Investments received by the Corporation or its Subsidiaries as
     consideration for a sale of assets, (iii) Investments by the Corporation or
     any Wholly Owned Subsidiary of the Corporation in any Wholly Owned
     Subsidiary of the Corporation (whether existing on the Issue Date or
     created thereafter) or any Person that after such Investments, and as a
     result thereof, becomes a Wholly Owned Subsidiary of the Corporation and
     Investments in the Corporation by any Wholly Owned Subsidiary of the
     Corporation, (iv) cash and Cash Equivalents, (v) Investments in securities
     of trade creditors, wholesalers or customers received pursuant to any plan
     of reorganization or similar arrangement and (vi) additional Investments in
     an aggregate amount not to exceed $2,500,000 at any time outstanding.

          "PERSON" means an individual, partnership, corporation, limited
     liability company, unincorporated organization, trust or joint venture, or
     a governmental agency or political subdivision thereof.

          "PREFERRED STOCK" of any Person means any Capital Stock of such Person
     that has preferential rights to any other Capital Stock of such Person with
     respect to dividends or redemptions or upon liquidation.

          "PRO FORMA" means, unless otherwise provided herein, with respect to
     any calculation made or required to be made pursuant hereto, a calculation
     in accordance with Article II of Regulation S-X under the Securities Act.

          "PUBLIC EQUITY OFFERING" means an underwritten public offering of
     Capital Stock (other than Disqualified Capital Stock) of the Corporation or
     Chancellor, pursuant to an effective registration statement filed with the
     Commission in accordance with the Securities Act; provided, however, that,
     in the case of a Public Equity Offering by Chancellor, Chancellor
     contributes to the capital of the Corporation net cash proceeds in an
     amount sufficient to redeem the Series A Senior Exchangeable Preferred
     Stock called for redemption in accordance with the terms hereof.

          "QUALIFIED CAPITAL STOCK" means any Capital Stock that is not
     Disqualified Capital Stock.


                                      34

<PAGE>

          "QUARTERLY DIVIDEND PERIOD" shall mean the quarterly period commencing
     on each February 16, May 16, August 16 and November 16 and ending on the
     next succeeding Dividend Payment Date, respectively.

          "SERIES A SENIOR EXCHANGEABLE PREFERRED STOCK" shall have the meaning
     ascribed to it in paragraph (a) hereof.

          "REDEMPTION DATE", with respect to any shares of Series A Senior
     Exchangeable Preferred Stock, means the date on which such shares of Series
     A Senior Exchangeable Preferred Stock are redeemed by the Corporation.

          "REDEMPTION NOTICE" shall have the meaning ascribed to it in paragraph
     (e) hereof.

          "REFINANCING INDEBTEDNESS" means any refinancing by the Corporation of
     Indebtedness of the Corporation or any of its Subsidiaries incurred in
     accordance with paragraph (l)(i) hereof (other than pursuant to clause (ii)
     or (iv) of the definition of Permitted Indebtedness) that does not (i)
     result in an increase in the aggregate principal amount of Indebtedness
     (such principal amount to include, for purposes of this definition, any
     premiums, penalties or accrued interest paid with the proceeds of the
     Refinancing Indebtedness) of such Person or (ii) create Indebtedness with
     (a) a Weighted Average Life to Maturity that is less than the Weighted
     Average Life to Maturity of the Indebtedness being refinanced or (b) a
     final maturity earlier than the final maturity of the Indebtedness being
     refinanced.

          "RESTRICTED PAYMENT" means (i) the declaration or payment of any
     dividend or the making of any other distribution (other than dividends or
     distributions payable in Qualified Capital Stock) on shares of Junior
     Stock, (ii) any purchase, redemption, retirement or other acquisition for
     value of any Junior Stock, or any warrants, rights or options to acquire
     shares of Junior Stock, other than through the exchange of such Junior
     Stock or any warrants, rights or options to acquire shares of any class of
     such Junior Stock for Qualified Capital Stock or warrants, rights or
     options to acquire Qualified Capital Stock or (iii) the making of any
     Investment (other than a Permitted Investment).

          "SALE AND LEASEBACK TRANSACTION" means any direct or indirect
     arrangement with any Person or to which any such Person is a party,
     providing for the leasing to the 


                                      35

<PAGE>

     Corporation or a Subsidiary of any property, whether owned by the 
     Corporation or any Subsidiary at the Issue Date or later acquired, which 
     has been or is to be sold or transferred by the Corporation or such 
     Subsidiary to such Person or to any other Person from whom funds have 
     been or are to be advanced by such Person on the security of such 
     property.

          "SECURITIES ACT" means the Securities Act of 1933, as amended, and the
     rules and regulations promulgated thereunder.

          "SENIOR STOCK" shall have the meaning ascribed to it in paragraph (b)
     hereof.

          "SUBSIDIARY," with respect to any Person, means (i) any corporation of
     which the outstanding Capital Stock having at least a majority of the votes
     entitled to be cast in the election of directors under ordinary
     circumstances shall at the time be owned, directly or indirectly, by such
     Person or (ii) any other Person of which at least a majority of the voting
     interest under ordinary circumstances is at the time, directly or
     indirectly, owned by such Person.  Notwithstanding anything contained
     herein to the contrary, all references to the Corporation and its
     consolidated Subsidiaries or to financial information prepared on a
     consolidated basis in accordance with GAAP shall be deemed to include the
     Corporation and its Subsidiaries as to which financial statements are
     prepared on a combined basis in accordance with GAAP and to financial
     information prepared on such a combined basis.  Notwithstanding anything
     herein to the contrary, an Unrestricted Subsidiary shall not be deemed to
     be a Subsidiary for purposes hereof.

          "TAX SHARING AGREEMENT" means the Tax Sharing Agreement between the
     Corporation and Chancellor, as in effect on the Issue Date.

          "UNRESTRICTED SUBSIDIARY" means a Subsidiary of the Corporation
     created after the Issue Date and so designated by a resolution adopted by
     the Board of Directors, provided that (i) neither the Corporation nor any
     of its other Subsidiaries (other than Unrestricted Subsidiaries) (a)
     provides any credit support for any Indebtedness of such Subsidiary
     (including any undertaking, agreement or instrument evidencing such
     Indebtedness) or (b) is directly or indirectly liable for any Indebtedness
     of such Subsidiary, (ii) the creditors with respect to Indebtedness for
     borrowed money of such Subsidiary, having a principal 


                                      36

<PAGE>

     amount in excess of $5,000,000, have agreed in writing that they have no 
     recourse, direct or indirect, to the Corporation or any other Subsidiary 
     of the Corporation (other than Unrestricted Subsidiaries), including, 
     without limitation, recourse with respect to the payment of principal of 
     or interest on any Indebtedness of such Subsidiary and (iii) at the time 
     of designation of such Subsidiary such Subsidiary has no property or 
     assets (other than de minimis assets resulting from the initial 
     capitalization of such Subsidiary).  Any such designation by the Board 
     of Directors shall be evidenced by a resolution of the Board of 
     Directors giving effect to such designation.

          "VOTING RIGHTS TRIGGERING EVENT" shall have the meaning ascribed to it
     in paragraph f(iv) hereof.

          "WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
     Indebtedness at any date, the number of years obtained by dividing (a) the
     then outstanding aggregate principal amount of such Indebtedness into (b)
     the total of the product obtained by multiplying (i) the amount of each
     then remaining installment, sinking fund, serial maturity or other required
     payment of principal, including payment at final maturity, in respect
     thereof, by (ii) the number of years (calculated to the nearest one-
     twelfth) which will elapse between such date and the making of such
     payment.

          "WHOLLY OWNED SUBSIDIARY" of any Person means any Subsidiary of such
     Person of which all the outstanding voting securities (other than
     directors' qualifying shares) which normally have the right to vote m the
     election of directors are owned by such Person.






                                      37

<PAGE>


          IN WITNESS WHEREOF, said Chancellor Radio Broadcasting Company, has
caused this Certificate to be signed by Jacques Kerrest, its Senior Vice
President, this 19th day of August 1996.


                         CHANCELLOR RADIO BROADCASTING COMPANY


                         By:  /s/ JACQUES KERREST
                            ----------------------------------------
                              Name:  Jacques Kerrest
                              Title: Senior Vice President












                                      38