iHeartMedia 2007 Annual Report Download - page 26

Federal law neither requires nor prohibits the removal of existing lawful billboards, but it does mandate the payment of compensation if a
state or political subdivision compels the removal of a lawful billboard along the controlled roads. In the past, state governments have
purchased and removed existing lawful billboards for beautification purposes using federal funding for transportation enhancement programs,
and these jurisdictions may continue to do so in the future. From time to time, state and local government authorities use the power of eminent
domain and amortization to remove billboards. Thus far, we have been able to obtain satisfactory compensation for our billboards purchased or
removed as a result of these types of governmental action, although there is no assurance that this will continue to be the case in the future.
Other important outdoor advertising regulations include the Intermodal Surface Transportation Efficiency Act of 1991 (currently known
as SAFETEA-LU), the Bonus Act/Bonus Program, the 1995 Scenic Byways Amendment and various increases or implementations of property
taxes, billboard taxes and permit fees. From time to time, legislation has been introduced in both the United States and foreign jurisdictions
attempting to impose taxes on revenue from outdoor advertising. Several state and local jurisdictions have already imposed such taxes as a
percentage of our outdoor advertising revenue in that jurisdiction. While these taxes have not had a material impact on our business and
financial results to date, we expect state and local governments to continue to try to impose such taxes as a way of increasing revenue.
We have introduced and intend to expand the deployment of digital billboards that display static digital advertising copy from various
advertisers that change up to several times per minute. We have encountered some existing regulations that restrict or prohibit these types of
digital displays, but these regulations have not yet materially impacted our digital deployment. However, since digital technology for changing
static copy has only recently been developed and introduced into the market on a large scale, existing regulations that currently do not apply to
digital technology by their terms could be revised to impose greater restrictions. These regulations may impose greater restrictions on digital
billboards due to alleged concerns over aesthetics or driver safety.
International regulation of the outdoor advertising industry varies by region and country, but generally limits the size, placement, nature
and density of out-of-home displays. The significant international regulations include the Law of December 29, 1979 in France, the Town and
Country Planning (Control of Advertisements) Regulations 1992 in the United Kingdom and Règlement Régional Urbain de l’agglomération
bruxelloise in Belgium. These laws define issues such as the extent to which advertisements can be erected in rural areas, the hours during
which illuminated signs may be lit and whether the consent of local authorities is required to place a sign in certain communities. Other
regulations may limit the subject matter and language of out-of-home displays.
NYSE Matters
The certifications of our Chief Executive Officer and Chief Financial Officer required under Section 302 of the Sarbanes-Oxley Act have
been filed as Exhibits 31.1 and 31.2 to this report. Additionally, in 2007 our Chief Executive Officer submitted a Section 303A.12(a) CEO
Certification to the New York Stock Exchange (“NYSE”) certifying that he was not aware of any violation by Clear Channel of the NYSE’s
corporate governance listing standards.
Item 1A. Risk Factors
We May Be Adversely Affected if the Proposed Merger is Not Completed
There is no assurance that the conditions to the completion of the merger will be satisfied. In the event that the merger is not completed,
we may be subject to several risks including the following: the current market price of our common stock may reflect a market assumption that
the merger will occur and a failure to complete the merger could result in a decline in the market price of our common stock; management’s
attention from our day to day business may be diverted; uncertainties with regards to the merger may adversely affect our relationships with our
employees, vendors and customers; and we may be required to pay significant transaction costs related to the merger.
We Have a Large Amount of Indebtedness
We currently use a portion of our operating income for debt service. Our leverage could make us vulnerable to an increase in interest
rates or a downturn in the operating performance of our businesses due to various factors including a decline in general economic conditions.
At December 31, 2007, we had debt outstanding of $6.6 billion and shareholders’ equity of $8.8 billion. We may continue to borrow funds to
finance capital expenditures, share
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