USA Digital Radio Secures $41 Million in Additional Equity Financing

Columbia, MD (May 1, 2000) - The broadcast industry and major members of the investment community demonstrated their continued confidence in USA Digital Radio, the leading developer of digital audio broadcast technology or iDAB™, by investing $41 million in the company during the private equity financing round that closed in April. New investors include: Allbritton New Media; Beasley Broadcast Group, Inc.; Bonneville International; ComVentures; DB Capital Partners; Flatiron Partners; Grotech Capital Group; Harris Corporation; H & Q Venture Associates; J. & W. Seligman & Co. Incorporated; Regent Communications, Inc.; Riggs Capital Partners, LLC; Saga Communications; TI Ventures; Waller-Sutton Media Partners; Whitney & Co; and Williams, Jones & Associates. Existing owners that invested additional funds include: Chase Capital Partners, Gannett Company, Inc. and Radio One, Inc. USA Digital Radio is now owned by fifteen of the nation's largest radio broadcasters, and fifteen other prominent investment, technology, and media companies. USA Digital Radio's broadcast owners operate 2,064 stations reaching 110 million listeners, and account for 49 percent of radio industry revenue in the United States. BT Alex Brown Incorporated served as the placement agent for the offering.

USA Digital Radio is developing an In-Band On-Channel digital audio broadcast technology, called iDAB, that uses the current radio spectrum to transmit existing AM and FM analog simultaneously with new high-quality digital signals. iDAB is designed to give consumers superior sound quality and crystal clear reception while listening to their favorite AM and FM stations, and to display new data services on a radio screen, such as song and artist identification, local traffic, weather, news, and more. The iDAB system is currently operating under experimental licenses at eight stations across the country, including WNEW-FM in New York City and WHFS-FM in Washington, DC.

"USA Digital Radio has set aggressive goals for commercialization of our technology. This new capital and the support of these high quality investors will help us meet those goals," said Robert J. Struble, president and chief executive officer, USA Digital Radio, Inc. "These new investors also bring additional strength to the broad coalition of broadcasters, technology developers, and transmitter equipment, semiconductor and receiver manufacturers that we have assembled to further the implementation of iDAB."

"USA Digital Radio's IBOC system will revolutionize AM and FM radio and keep today's broadcasters competitive," said Jim Woods, Vice President - Radio Systems, Broadcast Communications Division of Harris Corporation, the world's leading manufacturer of radio broadcast transmission equipment. "Harris chose to invest in USA Digital Radio to further validate our support for an IBOC system. We believe the opportunity for this technology is enormous and have been working closely with USADR and our customers to ensure IBOC works in the real world."

"With 600 million radios in the US, an average of 6.5 per household, the potential market for digital radio is huge," said Storm Boswick, managing director, J. & W. Seligman & Co. Incorporated. "This market potential, combined with the progress USA Digital Radio has made toward making its technology a reality and the coalition it has built, persuaded us to invest in the company."

"Digital is the wave of the future and radio can't be left behind," said Ed Christian, president and chief executive officer, Saga Communications. "We choose to invest in USA Digital Radio because they are the AM and FM radio industry's preferred choice for going digital. They have the technology and the coalition to move radio into the digital world."

"Digital radio is one of many exciting new applications for TI, as the performance and programmability of our DSPs brings more clear, CD-like sound quality and new data services to consumers," said Doug Rasor, vice president of strategic marketing, Texas Instruments. "Our investment in USA Digital Radio validates the tremendous growth potential we see in this emerging market."

About USA Digital Radio

USA Digital Radio (www.usadr.com) is developing and marketing an IBOC DAB technology, called iDAB, for AM and FM radio. Owners of USA Digital Radio include fifteen of the nation's largest radio broadcasters, and other prominent media and investment companies: ABC, Inc., New York (NYSE:DIS); Allbritton New Media, Washington, DC; AMFM, Inc., Dallas, Texas (NYSE:AFM); Beasley Broadcast Group, Inc., Naples, Florida (NASDAQ:BBGI); Bonneville International, Salt Lake City; CBS Corporation, New York (NYSE:CBS); Chase Capital Partners, New York, an affiliate of Chase Manhattan Corporation (NYSE:CMB); Citadel Communications Corporation, Las Vegas (NASDAQ:CITC); Clear Channel Communications, San Antonio (NYSE:CCU); ComVentures, Geneva, Switzerland; Cox Radio, Inc., Atlanta, Georgia (NYSE:CXR); Cumulus Media, Inc., Milwaukee (NASDAQ:CMLS); DB Capital Partners, New York; Emmis Communications, Indianapolis (NASDAQ:EMMS); Entercom Communications Corporation, Bala Cynwyd, Pennsylvania (NYSE:ETM); Flatiron Partners, New York; Gannett Company, Inc., Arlington, Virginia (NYSE:GCI); Grotech Capital Group, Timonium, Maryland; Harris Corporation, Melbourne, Florida (NYSE:HRS); Hispanic Broadcasting Corporation, Dallas (NASDAQ:HBCCA); H & Q Venture Associates, San Francisco; J. & W. Seligman & Co. Incorporated, New York; Radio One, Inc., Lanham, Maryland (NASDAQ:ROIA); Regent Communications, Inc., Covington, Kentucky (NASDAQ:RGCI); Riggs Capital Partners, LLC, Washington, DC; Saga Communications, Grosse Pointe, Michigan (AMEX: SGA); TI Ventures, Dallas; Waller-Sutton Media Partners, New York; Whitney & Co., Stamford, Connecticut; and Williams, Jones & Associates, New York.

USA Digital Radio's efforts include development agreements with outside parties, including Xetron, Cincinnati, Ohio; Fraunhofer Institute for Integrated Circuits (IIS), Erlangen, Germany; BittWare Research Systems, Concord, New Hampshire; Nautel Limited, Nova Scotia, Canada; QEI Corporation, Williamstown, New Jersey; Broadcast Electronics, Quincy, Illinois; Kenwood, Tokyo, Japan; Texas Instruments, Dallas, Texas; Continental Electronics Corporation, Dallas, Texas; Andrew Passive Power Products, Gray, Maine; Energy-Onix, Valatie, New York; Orban, San Leandro, California; Shively Labs, Bridgton, Maine; Telos Systems/Cutting Edge, Cleveland, Ohio; Digital Radio Express, Milpitas, California; Analog Devices, Inc. (ADI), Norwood, Massachusetts, Armstrong Transmitter, Marcellus, NY; Dielectric, Raymond, ME; Jampro RF Systems, Sacramento; and Moseley, Santa Barbara, CA.; SANYO Electric Co., Ltd., Osaka, Japan; and Lowpass Prototype, Raymond, Maine.

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