iHeartMedia 2006 Annual Report Download - page 27

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27
The studios and offices of our radio stations and outdoor advertising branches are located in leased or owned
facilities. These leases generally have expiration dates that range from one to forty years. We either own or lease our
transmitter and antenna sites. These leases generally have expiration dates that range from five to fifteen years. We do
not anticipate any difficulties in renewing those leases that expire within the next several years or in leasing other space,
if required. We own substantially all of the equipment used in our radio broadcasting and outdoor advertising
businesses.
Outdoor Advertising
The headquarters of our Americas outdoor advertising operations is in Phoenix, Arizona and the headquarters
of our international outdoor advertising operations is in London, England. The types of properties required to support
each of our outdoor advertising branches include offices, production facilities and structure sites. An outdoor branch
and production facility is generally located in an industrial or warehouse district.
In both our Americas and international outdoor advertising segments, we own or have permanent easements on
relatively few parcels of real property that serve as the sites for our outdoor displays. Our remaining outdoor display
sites are leased. Our leases are for varying terms ranging from month-to-month to year-to-year and can be for terms of
ten years or longer, and many provide for renewal options. There is no significant concentration of displays under any
one lease or subject to negotiation with any one landlord. We believe that an important part of our management activity
is to negotiate suitable lease renewals and extensions.
As noted in Item 1 above, as of December 31, 2006, we owned more than 1,100 radio stations and owned or
leased over 910,000 outdoor advertising display faces in various markets throughout the world. See “Business --
Operating Segments.” Therefore, no one property is material to our overall operations. We believe that our properties
are in good condition and suitable for our operations.
ITEM 3. Legal Proceedings
On September 9, 2003, the Assistant United States Attorney for the Eastern District of Missouri caused a
Subpoena to Testify before Grand Jury to be issued to us. The Subpoena requires us to produce certain information
regarding commercial advertising run by us on behalf of offshore and/or online (Internet) gambling businesses,
including sports bookmaking and casino-style gambling. On October 5, 2006, the Company received a subpoena from
the Assistant United States Attorney for the Southern District of New York requiring it to produce certain information
regarding substantially the same matters as covered in the subpoena from the Eastern District of Missouri. We are
cooperating with such requirements.
On February 7, 2005, the Company received a subpoena from the State of New York Attorney General’s office,
requesting information on policies and practices regarding record promotion on radio stations in the state of New York.
We are cooperating with this subpoena.
On April 19, 2006, we received a letter of inquiry from the Federal Communications Commission (the “FCC”)
requesting information about whether consideration was provided by record labels to us in exchange for the broadcast of
music without disclosure of such consideration to the public. We are cooperating with the FCC in responding to this
request for information.
Seven putative class actions and one shareholder derivative action challenging the merger are pending in the
408th District Court of Bexar County, Texas. The class actions, Teitelbaum v. Clear Channel Communications, Inc., et
al., No. 2006CI17492 (filed November 14, 2006), Manson v. Clear Channel Communications, Inc., et al., No.
2006CI17656 (filed November 16, 2006), City of St. Clair Shores Police and Fire Retirement System v. Clear Channel
Communications, Inc., et al., No. 2006CI17660 (filed November 16, 2006), Levy Investments, Ltd. v. Clear Channel
Communications, Inc., et al., No. 2006CI17669 (filed November 16, 2006), DD Equity Partners LLC v. Clear Channel
Communications, Inc., et al., No. 2006CI7914 (filed November 22, 2006), and Pioneer Investments
Kapitalanlagegesellschaft MBH v. L. Lowry Mays, et al. (filed December 7, 2006), all raise substantially similar
allegations on behalf of a purported class of our shareholders against the defendants for breaches of fiduciary duty in
connection with the approval of the merger. The above complaints have been consolidated for pretrial and discovery
purposes with the derivative action Rauch v. Clear Channel Communications, Inc., et. al., No. 2006CI17436 (filed
November 22, 2006), which challenges the merger, as well as the terms of employment agreements between Clear
Channel and L. Lowry Mays, Randall T. Mays, and Mark P. Mays.