iHeartMedia 2007 Annual Report Download - page 52

During the year ended December 31, 2007, we made principal payments totaling $1.7 billion and drew down $886.9 million on the credit
facility. As of February 13, 2008, the credit facility’s outstanding balance was $669.6 million and, taking into account outstanding letters of
credit, $997.8 million was available for future borrowings.
Other Borrowings
Other debt includes various borrowings and capital leases utilized for general operating purposes. Included in the $106.1 million balance
at December 31, 2007 is $87.2 million that matures in less than one year, which we have historically refinanced with new twelve month notes
and anticipate these refinancings to continue.
Guarantees of Third Party Obligations
As of December 31, 2007 we did not guarantee any debt of third parties.
Disposal of Assets
We received proceeds of $26.2 million primarily related to the sale of representation contracts and outdoor assets recorded in cash flows
from investing activities during 2007. We also received proceeds of $341.9 million related to the sale of radio stations recorded as investing
cash flows from discontinued operations during 2007.
Shelf Registration
On August 30, 2006, we filed a Registration Statement on Form S-3 covering the issuance of debt securities, junior subordinated debt
securities, preferred stock, common stock, warrants, stock purchase contracts and stock purchase units. The shelf registration statement also
covers preferred securities that may be issued from time to time by our three Delaware statutory business trusts and guarantees of such
preferred securities by us. This shelf registration statement was automatically effective on August 31, 2006 for a period of three years.
Debt Covenants
The significant covenants on our $1.75 billion five-year, multi-currency revolving credit facility relate to leverage and interest coverage
contained and defined in the credit agreement. The leverage ratio covenant requires us to maintain a ratio of consolidated funded indebtedness
to operating cash flow (as defined by the credit agreement) of less than 5.25x. The interest coverage covenant requires us to maintain a
minimum ratio of operating cash flow (as defined by the credit agreement) to interest expense of 2.50x. In the event that we do not meet these
covenants, we are considered to be in default on the credit facility at which time the credit facility may become immediately due. At
December 31, 2007, our leverage and interest coverage ratios were 3.0x and 5.1x, respectively. This credit facility contains a cross default
provision that would be triggered if we were to default on any other indebtedness greater than $200.0 million.
Our other indebtedness does not contain provisions that would make it a default if we were to default on our credit facility.
The fees we pay on our $1.75 billion, five-year multi-currency revolving credit facility depend on the highest of our long-term debt
ratings, unless there is a split rating of more than one level in which case the fees depend on the long-term debt rating that is one level lower
than the highest rating. Based on our current ratings level of B-/Baa3, our fees on borrowings are a 52.5 basis point spread to LIBOR and are
22.5 basis points on the total $1.75 billion facility. In the event our ratings improve, the fee on borrowings and facility fee decline gradually to
20.0 basis points and 9.0 basis points, respectively, at ratings of A/A3 or better. In the event that our ratings decline, the fee on borrowings and
facility fee increase gradually to 120.0 basis points and 30.0 basis points, respectively, at ratings of BB/Ba2 or lower.
We believe there are no other agreements that contain provisions that trigger an event of default upon a change in long-term debt ratings
that would have a material impact to our financial statements.
Additionally, our 8% senior notes due 2008, which were originally issued by AMFM Operating Inc., a wholly-owned subsidiary of Clear
Channel, contain certain restrictive covenants that limit the ability of AMFM Operating Inc. to incur additional indebtedness, enter into certain
transactions with affiliates, pay dividends, consolidate, or effect certain asset sales.
At December 31, 2007, we were in compliance with all debt covenants.
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