<PAGE>

                                                                    Exhibit 10.3


                           SPANISH BROADCASTING SYSTEM
                             1999 STOCK OPTION PLAN



1.       PURPOSES.

         The purposes of the Plan are to further the growth, development and
financial success of Spanish Broadcasting System, Inc. (the "Company") and its
Subsidiaries by providing incentives to those officers and employees who have
the capacity to contribute in substantial measure toward the growth and
profitability of the Company and to assist the Company in attracting and
retaining employees with the ability to make such contributions. To accomplish
such purposes, the Plan provides that the Company may grant such employees
either Nonqualified Stock and Incentive Stock Options, or both.

2.       DEFINITIONS.

         Wherever the masculine gender is used in the Plan, it shall include the
feminine and neuter and wherever a singular pronoun is used, it shall include
the plural, unless the context clearly indicates otherwise. Whenever the
following terms are used in the Plan, they shall have the meaning specified
below, unless the context clearly indicates to the contrary.

         "Board" shall mean the Board of Directors of the Company.

         "Cause" shall mean an Employee's willful failure to perform his duties
with the Company or a Subsidiary or the willful engaging in conduct which is
injurious to the Company or a Subsidiary, monetarily or otherwise, as determined
by the Committee in its sole discretion, provided that, if an Employee has
entered into an employment agreement with the Company or a Subsidiary, the
definition, if any, set forth in such agreement shall be substituted for the
above.

         "Change in Control" shall mean:

         (a) any "person," as such term is defined in Section 13(d) and 14(d) of
the Exchange Act, other than the Company, any Subsidiary, Raul Alarcon, Jr. (or
his spouse, heirs, assigns, legatees or trust for Mr. Alarcon's or any of the
foregoing's benefit) or any trustee or other fiduciary holding securities under
an employee benefit plan of the Company or any Subsidiary, becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing fifty percent (50%) or
more of the combined voting power of the Company's then outstanding securities;

         (b) during any two consecutive years, individuals who at the beginning
of such period constitute the Board, and any new director, whose election by the
Board or nomination for election by the Company's shareholders was approved by a
vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any reason to
constitute at least a majority of the Board;

<PAGE>

         (c) the stockholders of the Company approve a merger or consolidation
of the Company with any other company other than (i) a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than eighty percent (80%) of the combined voting power of the
voting securities of the Company (or such surviving entity) outstanding
immediately after such merger or consolidation, or (ii) a merger or
consolidation effected to implement a recapitalization of the Company (or
similar transaction) in which no "person" (as hereinabove defined) acquires more
than fifty percent (50%) of the combined voting power of the Company's then
outstanding securities; or

         (d) the stockholders of the Company adopt a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company's assets.

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

         "Committee" shall mean (i) the Compensation Committee of the Board,
appointed as provided in Section 5.1, (ii) the Stock Option Committee, if the
Compensation Committee determines to delegate the administration of the Plan to
a subcommittee, or, (iii) if no Compensation Committee or Stock Option Committee
has been appointed, or if the Compensation Committee or Stock Option Committee
ceases to consist of two or more members, the Board.

         "Company" shall mean Spanish Broadcasting System, Inc., a Delaware
corporation, and any successor corporation.

         "Designated Beneficiary" shall mean any individual designated by an
Optionee, in a manner determined by the Committee, to receive amounts due the
Optionee in the event of the Optionee's death. In the absence of an effective
designation by the Optionee, Designated Beneficiary shall mean the Optionee's
estate.

         "Director" shall mean a member of the Board.

         "Employee" shall mean any employee (including any officer whether or
not a Director) or leased employee of the Company, or of any corporation which
is then a Subsidiary, who has been designated by the Committee to participate in
the Plan.

         "Early Retirement" shall mean an Employee's retirement from active
employment with the Company or a Subsidiary in accordance with the early
retirement provisions of a pension plan maintained by the Company or a
Subsidiary, provided that, if no such plan is in existence, it shall mean the
attainment of age fifty-five (55) and the completion of fifteen (15) years of
service.

         "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.





                                       2
<PAGE>

         "Fair Market Value" per Share as of a particular date shall mean,
unless otherwise determined by the Committee:

         (a) the closing sales price per Share on a national securities exchange
on the most recent date on which there was a sale of Shares on such exchange; or

         (b) if clause (a) does not apply and the Shares are quoted on the
National Association of Securities Dealers Automated Quotation system
("NASDAQ"), either (i) the closing price per Share as reported on NASDAQ for the
date of grant, provided, a sale was reported on such day, (ii) if the date of
grant is a holiday, Saturday or Sunday, the closing price per share as reported
on NASDAQ on the preceding day to the date of grant on which a sale was
reported; or (iii) as otherwise determined by the Committee in good faith; or

         (c) if neither clause (a) or (b) applies and the Shares are then traded
on an over-the-counter market, the average of the closing bid and asked prices
for the Shares in such over-the-counter market for the preceding ten (10) days
on which such bid and asked prices were quoted; or

         (d) if the Shares are not then listed on a national securities exchange
or traded in an over-the-counter market, such value as the Committee, in its
sole discretion, may determine.

         "Incentive Stock Option" shall mean an Option intended to be and
designated as an "incentive stock option" within the meaning of Section 422 of
the Code.

         "Nonqualified Stock Option" shall mean an Option that is not an
Incentive Stock Option.

         "Normal Retirement" shall mean an Employee's retirement from active
employment with the Company or a Subsidiary in accordance with the normal
retirement provisions of a pension plan maintained by the Company or a
Subsidiary, provided that, if no such plan exists, it shall mean retirement on
or after attainment of age sixty-five (65).

         "Option" shall mean an option to purchase Shares granted pursuant to
Section 4.1.

         "Option Agreement" shall mean an Option Agreement, substantially in the
form attached hereto as Exhibit A-1 and A-2, to be entered into between the
Company and an Optionee, which shall set forth the material terms of the Options
granted to such Optionee.

         "Optionee" shall mean an Employee to whom an Option has been granted
pursuant to the Plan.

         "Permanent Disability" shall mean a physical or mental incapacity that
renders an Optionee incapable of engaging in any substantial gainful employment,
or that has lasted for a continuous period of no less than six consecutive
months, or six months in any twelve-month period, as determined by the Committee
in good faith in its sole discretion, provided that, if an Employee





                                       3
<PAGE>


has entered into an employment agreement with the Company or a Subsidiary, the
definition set forth in such agreement shall be substituted for the above
definition. All determinations as to the date and extent of disability of any
Optionee shall be made by the Committee upon the basis of such evidence as it
deems necessary or desirable.

         "Plan" shall mean the Spanish Broadcasting System 1999 Stock Option
Plan, as amended from time to time.

         "Retirement" shall mean an Optionee's (a) Early Retirement which the
Committee, in its sole discretion, has determined should be treated as a
Retirement for purposes of the Plan, or (b) Normal Retirement.

         "Securities Act" shall mean the Securities Act of 1933, as amended.

         "Share" shall mean a share of the Company's Class A Common Stock,
$.0001 par value per share.

         "Subsidiary" shall mean any corporation in an unbroken chain of
corporations beginning with the Company, if each such corporation (other than
the last corporation in the unbroken chain), or if each group of commonly
controlled corporations, then owns fifty percent (50%) or more of the total
combined voting power in one of the other corporations in such chain.

         "Ten-Percent Stockholder" shall mean an Employee, who, at the time an
Incentive Stock Option is to be granted to him, owns (within the meaning of
Section 422(b)(6) of the Code) stock possessing more than ten percent (10%) of
the total combined voting power of all classes of stock of the Company or a
Subsidiary (or, if applicable, a parent corporation within the meaning of
Section 424(e) of the Code).

         "Termination of Employment" shall mean the Employee's termination of
employment for any reason whatsoever, excluding any termination where there is a
simultaneous reemployment by either the Company or a Subsidiary, provided that,
if a corporation that is a Subsidiary ceases to be a Subsidiary as a result of a
sale of stock, such sale shall be deemed to be a Termination of Employment of
the Optionees who were employed by such corporation immediately prior to such
sale.

3. ELIGIBILITY.

         Any Employee (whether or not a Director) who is an officer or who is
designated by the Committee shall be eligible to be granted Options under the
Plan.





                                       4
<PAGE>


4. TERMS OF OPTIONS.

     4.1 TERMS OF OPTIONS.

         (a) Price. The exercise price for the Shares subject to an Option, or
the manner in which such exercise price is to be determined, shall be determined
by the Committee, provided that, the exercise price per Share of any Incentive
Stock Option shall not be less than 100% of the Fair Market Value of a Share as
of the date the Option is granted by the Committee (110% in the case of an
Incentive Stock Option granted to a Ten-Percent Stockholder).

         (b) Term. Options shall be for such term as the Committee shall
determine, provided that no Option shall be exercisable after the expiration of
ten years from the date it is granted (five years in the case of an Incentive
Stock Option granted to a Ten-Percent Stockholder).

         (c) Vesting. Options shall be exercisable in such installments (which
need not be equal) and at such times as the Committee may designate, as set
forth in an Option Agreement. To the extent not exercised, installments shall
accumulate and may be exercised, in whole or in part, at any time after becoming
exercisable, but not later than the date the Option expires. The Committee may
accelerate the exercisability of an Option at any time. Notwithstanding the
foregoing, any Options that are not exercisable prior to a Change in Control
shall become exercisable on the date of such Change in Control and shall remain
exercisable for the remainder of their term.

         (d) Exercise of Option After Termination of Employment.

         Subject to the terms of any written employment agreement and reflected
in an option agreement, an Option granted under the Plan is exercisable by an
Optionee only while he is an Employee, provided that any Options that are
exercisable preceding an Optionee's Termination of Employment for any reason
other than Cause, shall remain exercisable for the following period:

                  (i) If the Optionee dies while an Employee, or if his
         Termination of Employment is due to Permanent Disability or Retirement,
         the Optionee (or his Beneficiary or personal representative, as
         applicable) may exercise the Option no later than twelve (12) months
         after such death or determination;

                  (ii) If the Optionee's Termination of Employment is for any
         reason other than those set forth in (i) above and is not for Cause,
         the Optionee may exercise the Option within three months after such
         termination; or

                  (iii) If the Optionee dies during a period described in (i) or
         (ii) above, his Beneficiary may exercise such Option no later than the
         expiration of such extended period;

                  (iv) Notwithstanding (i) through (iii) above or anything in an
         Option Agreement or the Plan to the contrary, at any time after the
         grant of an Option, the Committee, in its sole and absolute discretion
         and subject to whatever terms and conditions





                                       5
<PAGE>

         it selects, may provide that an Option may be exercised after the
         relevant extended period set forth above, but in no event later than
         the date that it would have expired under the Option Agreement.

     4.2 NONTRANSFERABILITY.

         No Option granted hereunder shall be transferable by the Optionee to
whom granted otherwise than by will or the laws of descent and distribution, and
an Option may be exercised during the lifetime of such Optionee only by the
Optionee or his guardian or legal representative; provided, however that an
Optionee may designate a Beneficiary to exercise his Option or other rights
under the Plan after his death and, in the discretion of the Committee, Options
may be transferable pursuant to a Qualified Domestic Relations Order ("QDRO"),
as determined by the Committee or its designee.

     4.3 METHOD OF EXERCISE.

         An Option shall be exercised by delivery of a written notice (in person
or by first class mail to the Secretary of the Company at the Company's
principal executive office) which specifies the number of Shares to be purchased
and is accompanied by full payment therefor and otherwise in accordance with the
Option Agreement pursuant to which the Option was granted. The purchase price
for any Shares purchased pursuant to the exercise of an Option shall be paid in
full upon such exercise in cash, by check or, at the discretion of the Committee
and upon such terms and conditions as the Committee shall approve, by
transferring previously owned Shares to the Company, having Shares withheld or
exercising pursuant to a "cashless exercise" procedure, or any combination
thereof. Any Shares transferred to the Company as payment of the purchase price
under an Option shall be valued at their Fair Market Value on the date of
exercise of such Option. If requested by the Committee, the Optionee shall
deliver the Option Agreement evidencing the Option to the Secretary of the
Company who shall endorse thereon a notation of such exercise and return such
Option Agreement to the Optionee. Not less than one hundred (100) Shares may be
purchased at any time upon the exercise of an Option unless the number of Shares
so purchased constitutes the total number of Shares then purchasable under the
Option or the Committee determines otherwise, in its sole discretion.

5. ADMINISTRATION.

     5.1 COMPOSITION OF COMPENSATION COMMITTEE.

         The Plan shall be administered by the Committee, which shall consist of
at least two individuals appointed by and serving at the pleasure of the Board,
provided that each Committee member must qualify as an "outside director" as
such term is used in Section 162(m) of the Code, unless the Board determines
otherwise, in its sole discretion. All Committee members shall be members of the
Board. Appointment of Committee members shall be effective upon acceptance of
appointment. Committee members may resign at any time by delivering thirty (30)
days advance written notice to the Board and may be removed by the Board at any
time for any reason. Vacancies



                                       6
<PAGE>

in the Committee shall be filled by the Board. If no Committee has been
appointed or if the Committee ceases to consist of two or more members, the Plan
shall be administered by the Board acting by a majority of the Board. In such
case, the Board shall have all the powers and duties as would have been
delegated to the Committee hereunder.

     5.2 DUTIES AND POWERS OF COMMITTEE.

         (a) Subject to the provisions hereof, the Committee shall have (i) the
sole and complete authority to determine which Employees shall be granted
options, the number of Shares to be covered by each Option, the exercise price
therefor and the terms and conditions applicable to the exercise of the Option,
(ii) the authority to grant Incentive Stock Options, Nonqualified Stock Options
or both. In the case of Incentive Stock Options, the terms and conditions of
such grants shall be subject to and shall comply with Section 422 of the Code
and any rules or regulations promulgated thereunder, including the requirement
that the aggregate Fair Market Value (determined as of the date of grant) of the
Shares granted under the Plan and all other option plans of the Company and any
Subsidiary (and, if applicable, any parent corporation, within the meaning of
Section 424(e) of the Code) that become exercisable by an Optionee during any
calendar year shall not exceed $100,000. To the extent that the limitation set
forth in the preceding sentence is exceeded for any reason (including the
acceleration of the time for exercise of an Option), the Options with respect to
such excess amount shall be treated as Nonqualified Stock Options.

         (b) It shall be the duty of the Committee to conduct the general
administration of the Plan in accordance with its terms and provisions. The
Committee shall have the power to interpret the Plan and to adopt such rules for
the administration, interpretation and application of the Plan as are consistent
therewith and to interpret, amend or revoke any such rules. All actions taken
and all interpretations and determinations made by the Committee shall be
binding upon all persons, including, but not limited to, the Company,
stockholders, all Subsidiaries, Employees, Directors, Optionees and Designated
Beneficiaries.

     5.3 COMMITTEE ACTIONS.

         The Committee shall act by a majority of its members in office in
attendance at a meeting at which a quorum is present or by a memorandum or other
written instrument signed by all of the members of the Committee.

     5.4 COMPENSATION; PROFESSIONAL ASSISTANCE.

         Members of the Committee shall receive such compensation for their
services as members as may be determined by the Board. All expenses and
liabilities incurred by members of the Committee in connection with the
administration of the Plan shall be borne by the Company. The Committee may,
with the approval of the Board, employ attorneys, consultants, accountants,
appraisers, or other persons. The Committee, the Company and its officers and
Directors shall be entitled to rely upon the advice, opinions or valuations of
any such persons.





                                       7
<PAGE>

     5.5 DELEGATION OF AUTHORITY.

         The Committee may, in its sole and absolute discretion, delegate to (i)
any proper officer of the Company, or more than one of them, or (ii) a
subcommittee, consisting solely of Committee members, any or all of the
administrative duties of the Committee under this Plan.

     5.6 NO LIABILITY.

         No member of the Board or the Committee, or Director, officer of the
Company or other Employee shall be liable, responsible or accountable in damages
or otherwise for any determination made or other action taken or any failure to
act by such person with respect to the Plan so long as such person is not
determined to be guilty by a final adjudication of willful misconduct with
respect to such determination, action or failure to act.

     5.7 INDEMNIFICATION.

         To the fullest extent permitted by law, each member of the Board and
the Committee and each Director, officer of the Company or Employee shall be
held harmless and be indemnified by the Company for any liability, loss
(including amounts paid in settlement), damages or expenses (including
reasonable attorneys' fees) suffered by virtue of any determinations, acts or
failures to act, or alleged acts or failures to act, in connection with the
administration of the Plan so long as such person is not determined by a final
adjudication to be guilty of willful misconduct with respect to such
determination, action or failure to act.

6. SHARES SUBJECT TO THE PLAN.

     6.1 SHARES SUBJECT TO THE PLAN.

         The maximum number of Shares that may be issued upon the exercise of
Options granted under the Plan is 3,000,000. The Company shall reserve such
number of Shares for the purposes of the Plan, out of its authorized but
unissued Shares or out of Shares held in the Company's treasury, or partly out
of each. In the event that an Option expires or is terminated unexercised as to
any Shares covered thereby, or is canceled or forfeited for any reason under the
Plan without the delivery of Shares, or any Restricted Shares are forfeited for
any reason, such Shares shall thereafter be again available for award pursuant
to the Plan. The maximum number of Shares that may be granted to an Optionee in
any year is 250,000.

     6.2 EFFECT OF CHANGES IN COMPANY'S SHARES.

         In the event that the Committee determines that any stock dividend,
extraordinary cash dividend, recapitalization, reorganization, merger,
consolidation, split-up, spin-off, combination, exchange of shares, warrants or
rights offering to purchase Shares at a price substantially below fair market
value, or other similar corporate event affects the Shares such that an
adjustment is required in order to preserve the benefits or potential benefits
intended to be made





                                       8
<PAGE>


available under the Plan, the Committee shall, in its sole discretion, and in
such manner as the Committee may deem equitable, adjust any or all of (a) the
number and kind of shares subject to outstanding Options, and (b) the exercise
price with respect to any outstanding Option and/or, if deemed appropriate, make
provision for a cash payment to an Optionee, provided, however, that the number
of Shares subject to any Option shall always be a whole number.

7. MISCELLANEOUS.

     7.1 EFFECTIVE DATE; TERM OF PLAN.

         The Plan has been approved by the Board and by the Company's
stockholders, and shall be effective as of the date of Board approval (the
"Effective Date"). The Plan shall continue in effect until ten years after the
date it was approved by the Company's stockholders.

     7.2 AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN.

         The Plan may be wholly or partially amended or otherwise modified,
suspended or terminated at any time or from time to time by the Board. Neither
the amendment, suspension nor termination of the Plan shall, without the consent
of an Optionee, alter or impair any rights or obligations under any option
theretofore granted. No Options may be granted during any period of suspension
nor after termination of the Plan, and in no event may any Options be granted
under the Plan after September 30, 2009.

     7.3 AMENDMENT OF OPTION.

         The Committee may amend, modify or terminate any outstanding Option
with the Optionee's consent at any time prior to payment or exercise in any
manner not inconsistent with the terms of the Plan, including without
limitation, (a) to change the date or dates as of which an Option becomes
exercisable, or (b) to cancel and reissue an Option under such different terms
and conditions as it determines appropriate.

     7.4 NO RIGHTS AS STOCKHOLDER.

         No holder of an Option shall be deemed to be or to have the rights and
privileges of an owner of Shares unless and until certificates representing such
Shares have been issued to such holder.

     7.5 EFFECT OF PLAN UPON OTHER COMPENSATION AND INCENTIVE PLANS.

         The adoption of the Plan shall not affect any other compensation or
incentive plans in effect for the Company or any Subsidiary. Nothing in the Plan
shall be construed to limit the right of the Company or any Subsidiary to
establish any other forms of incentives or compensation for Employees.





                                       9
<PAGE>

     7.6 REGULATIONS AND OTHER APPROVALS.

         (a) The obligation of the Company to sell or deliver Shares with
respect to Options shall be subject to all applicable laws, rules and
regulations, including all applicable federal and state securities laws, and the
obtaining of all such approvals by governmental agencies as may be deemed
necessary or appropriate by the Committee.

         (b) The Board may make such changes as may be necessary or appropriate
to comply with the rules and regulations of any government authority or to
obtain the tax benefits under the applicable provisions of the Code and
regulations promulgated thereunder for Employees granted Incentive Stock
Options.

         (c) Each Option is subject to the requirement that, if at any time the
Committee determines, in its sole discretion, that the listing, registration or
qualification of Shares issuable pursuant to the Plan is required by any
securities exchange or under any state or federal law, or the consent or
approval of any governmental regulatory body is necessary or desirable as a
condition of, or in connection with, the grant of an Option or the issuance of
Shares, no Options shall be granted or Shares issued, in whole or in part,
unless listing, registration, qualification, consent or approval has been
effected or obtained free of any conditions as acceptable to the Committee.

         (d) In the event that the disposition of Shares acquired pursuant to
the Plan is not covered by a then current registration statement under the
Securities Act, and is not otherwise exempt from such registration, such Shares
shall be restricted against transfer to the extent required by the Securities
Act or regulations thereunder, and the Committee may require any individual
receiving Shares pursuant to the Plan, as a condition precedent to receipt of
such Shares, to represent to the Company in writing that the Shares acquired by
such individual are acquired for investment only and not with a view to
distribution. The certificate for any Shares acquired pursuant to the Plan shall
include any legend that the Committee deems appropriate to reflect any
restrictions on transfer.

     7.7 GOVERNING LAW.

         The Plan and the rights of all persons claiming hereunder shall be
construed and determined in accordance with the laws of the State of New York
without giving effect to the choice of law principles thereof.

     7.8 WITHHOLDING OF TAXES.

         As a condition to the exercise of an Option and the continued holding
of shares received upon exercise of an Option, to the extent required by law, no
later than the date as to which an amount first becomes includible in the gross
income of an Optionee for federal income tax purposes with respect to any award
granted under the Plan, the Optionee shall pay to the Company, or make
arrangements satisfactory to the Company regarding the payment of, any federal,
state, or local taxes of any kind required by law or the Company to be withheld
with respect to such amount. The obligations of the Company under the Plan shall
be conditional on such payment or





                                       10
<PAGE>


arrangements and the Company and its Subsidiaries shall, to the extent permitted
by law, have the right to deduct any such taxes from any payment of any kind
otherwise due to the Optionee. In its discretion, the Committee may permit an
Optionee to satisfy withholding obligations by delivering previously owned
Shares or by electing to have Shares withheld.

     7.9 NO RIGHT TO CONTINUED EMPLOYMENT.

         Nothing in the Plan or in any award agreement shall confer upon any
Employee any right to continue in the employ of the Company or any Subsidiary or
shall interfere with or restrict in any way the right of the Company and its
Subsidiaries, which are hereby expressly reserved, to remove, terminate or
discharge any Employee at any time for any reason whatsoever, with or without
Cause.

     7.10 TITLES; CONSTRUCTION.

         Titles are provided herein for convenience only and are not to serve as
a basis for interpretation or construction of the Plan. The masculine pronoun
shall include the feminine and neuter and the singular shall include the plural,
when the context so indicates.




                                       11
<PAGE>

                                  EXHIBIT A-1

                            FORM OF OPTION AGREEMENT

                        (INCENTIVE STOCK OPTION GRANTS)

[SBS LOGO]



Date:
     -------------------


(Optionee's Name)
------------------------
(Address)
------------------------
(Address)
------------------------

Dear (Optionee's Name) :
     -------------------


Pursuant to the terms and conditions of the Spanish Broadcasting System, Inc.
1999 Stock Option Plan (the "Plan"), you have been granted an Incentive Stock
Option, subject to limitations set forth by the Internal Revenue Code of
1986, as amended from time to time, to purchase _______ shares (the "Option") of
Class A common stock as outlined below.

<TABLE>
<S>                            <C>
            Granted To:        ________________________

            Grant Date:        ________________________

       Options Granted:        ________________________

Option Price per Share:        ________________________  Total Cost to Exercise: $________

       Expiration Date:        _________ _________ _______, unless terminated earlier.

      Vesting Schedule:        ___% immediately, ___ % each year as follows:

                               _________________________________________________

                               _________________________________________________


       Transferability:        Not transferable except in accordance with the Plan.

                                       Spanish Broadcasting System, Inc.


                                       By:________________________________

</TABLE>


By my signature below, I hereby acknowledge receipt of this Option granted on
the date shown above, which has been issued to me under the terms and conditions
of the Plan. I further acknowledge receipt of a copy of the Plan and agree to
conform to all of the terms and conditions of the Option and the Plan.


Signature:_____________________________________         Date:___________________
                  (Name of Optionee)

<PAGE>


                                  EXHIBIT A-2

                            FORM OF OPTION AGREEMENT

                       (NONQUALIFIED STOCK OPTION GRANTS)

[SBS LOGO]




Date:
     -------------------


(Optionee's Name)
------------------------
(Address)
------------------------
(Address)
------------------------

Dear (Optionee's Name) :
     -------------------



Pursuant to the terms and conditions of the Spanish Broadcasting System, Inc.
1999 Stock Option Plan (the "Plan"), you have been granted an Nonqualified
Stock Option, to purchase _______ shares (the "Option") of Class A common stock
as outlined below.

<TABLE>
<S>                            <C>
            Granted To:        ________________________

            Grant Date:        ________________________

       Options Granted:        ________________________

Option Price per Share:        ________________________  Total Cost to Exercise: $________

       Expiration Date:        _________ _________ _______, unless terminated earlier.

      Vesting Schedule:        ___% immediately, ___ % each year as follows:

                               _________________________________________________

                               _________________________________________________


       Transferability:        Not transferable except in accordance with the Plan.

                                       Spanish Broadcasting System, Inc.


                                       By:________________________________

</TABLE>

By my signature below, I hereby acknowledge receipt of this Option granted on
the date shown above, which has been issued to me under the terms and conditions
of the Plan. I further acknowledge receipt of a copy of the Plan and agree to
conform to all of the terms and conditions of the Option and the Plan.


Signature:_____________________________________         Date:___________________
                  (Name of Optionee)

                                       2