iHeartMedia 2010 Annual Report Download

Download and view the complete annual report

Please find the complete 2010 iHeartMedia annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 191

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172
  • 173
  • 174
  • 175
  • 176
  • 177
  • 178
  • 179
  • 180
  • 181
  • 182
  • 183
  • 184
  • 185
  • 186
  • 187
  • 188
  • 189
  • 190
  • 191

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
For the fiscal year ended December 31, 2010,
or
For the transition period from to .
Commission File Number
001-9645
CLEAR CHANNEL COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
(210) 822-2828
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. YES NO
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange
Act. YES NO
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. YES NO
Pursuant to the terms of its bond indentures, the registrant is a voluntary filer of reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934, and has filed all such reports as required by its bond indentures during the preceding 12 months.
The registrant meets the conditions set forth in General Instructions I(1)(a) and (b) of Form 10-K as, among other things, all of the
registrant’s equity securities are owned indirectly by CC Media Holdings, Inc., which is a reporting company under the Securities
Exchange Act of 1934 and which has filed with the SEC all materials required to be filed pursuant to Section 13, 14 or 15(d) thereof,
and the registrant is therefore filing this Form 10-K with a reduced disclosure format.
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or
for such shorter period that the registrant was required to submit and post such files). YES NO
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of re
g
istrant’s knowled
g
e, in definitive
p
rox
y
or information statements incor
p
orated b
y
reference in Part III
Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Texas
74-1787539
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
200 East Basse Road
San Antonio, Texas
78209
(Address of principal executive offices) (Zip Code)

Table of contents

  • Page 1
    ... period from to . Commission File Number 001-9645 CLEAR CHANNEL COMMUNICATIONS, INC. (Exact name of registrant as specified in its charter) Texas (State or other jurisdiction of incorporation or organization) 74-1787539 (I.R.S. Employer Identification No.) 200 East Basse Road San Antonio, Texas...

  • Page 2
    .... Large accelerated filer Non-accelerated filer ⌧ Accelerated filer Smaller reporting company NO Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2). YES The registrant has no voting or nonvoting equity held by non-affiliates. On February 11...

  • Page 3
    ...10-K) Principal Accounting Fees and Services 127 127 127 127 127 Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Selected Financial Data Management's Discussion and Analysis of Financial Condition and Results of Operations Quantitative and...

  • Page 4
    ... principal executive offices are located at 200 East Basse Road, San Antonio, Texas 78209 (telephone: 210-822-2828). Our Business Segments We are a diversified media company with three reportable business segments: Radio Broadcasting, or Radio; Americas Outdoor Advertising, or Americas outdoor; and...

  • Page 5
    ... new and better solutions for large national advertisers and agencies, key relationships with advertisers and improvement of our national sales team. We seek to maximize revenue by closely managing on-air inventory of advertising time and adjusting prices to local market conditions. We operate price...

  • Page 6
    ... for Clear Channel Radio and other radio companies. National sales representatives such as Katz Media obtain advertising principally from advertising agencies located outside the station's market and receive commissions based on advertising sold (see "Media Representation"). Advertising rates are...

  • Page 7
    ... we own or operate under lease management agreements. Our Americas outdoor advertising business is focused on urban markets with dense populations. Strategy We seek to capitalize on our Americas outdoor network and diversified product mix to maximize revenue. In addition, by sharing best practices...

  • Page 8
    ...Americas Outdoor Advertising segment generates revenues from local, regional and national sales. Our advertising rates are based on a number of different factors including location, competition, size of display, illumination, market and gross ratings points. Gross ratings points are the total number...

  • Page 9
    ... street furniture and transit displays, billboards, mall displays, Smartbike schemes, wallscapes and other spectaculars, which we own or operate under lease agreements. Our International business is focused on urban markets with dense populations. Strategy Similar to our Americas outdoor advertising...

  • Page 10
    ...table shows the approximate percentage of revenue derived from each inventory category of our International Outdoor Advertising segment: Year Ended December 31, 2010 2009 2008 30% 32% 35% 42% 40% 38% 8% 8% 9% 20% 20% 18% 100% 100% 100% Billboards (1) Street furniture displays Transit displays Other...

  • Page 11
    ...and CBS, as well as numerous smaller and local companies operating a limited number of display faces in a single or a few local markets. We also compete with other advertising media in our respective markets, including broadcast and cable television, radio, print media, direct mail, the Internet and...

  • Page 12
    ... governing ownership of broadcast stations and other specified mass media entities. Under these rules, attributable interests generally include: officers and directors of a licensee or of its direct or indirect parent; general partners; limited partners and limited liability company members, unless...

  • Page 13
    ...television and radio ownership limits, respectively. • • Alien Ownership Restrictions The Communications Act restricts foreign entities or individuals from owning or voting more than 20% of the equity of a broadcast licensee directly and more than 25% indirectly (i.e. through a parent company...

  • Page 14
    ... free air time to candidates; restrictions on the advertising of certain products, such as beer and wine; frequency allocation, spectrum reallocations and changes in technical rules; and the adoption of significant new programming and operational requirements designed to increase local community...

  • Page 15
    ... non-conforming billboards. While these regulations set certain limits on the construction of new outdoor advertising displays, they also benefit established companies, including us, by creating barriers to entry and by protecting the outdoor advertising industry against an oversupply of inventory...

  • Page 16
    ... decreases in overall revenues, the numbers of advertising customers, advertising fees, or profit margins include: • unfavorable economic conditions, both general and relative to the radio broadcasting, outdoor advertising and all related media industries, which may cause companies to reduce their...

  • Page 17
    ...other radio stations and outdoor advertising companies, as well as with other media, such as newspapers, magazines, television, direct mail, iPods, smart mobile phones, satellite radio and Internet-based media, within their respective markets. Audience ratings and market shares are subject to change...

  • Page 18
    ... of billboards and the use of new technologies for changing displays, such as digital displays, are regulated by federal, state and local governments. From time to time, states and municipalities have prohibited or significantly limited the construction of new outdoor advertising structures. Changes...

  • Page 19
    ...a reduction in our direct revenues from such advertisements and an increase in the available space on the existing inventory of billboards in the outdoor advertising industry. Environmental, health, safety and land use laws and regulations may limit or restrict some of our operations As the owner or...

  • Page 20
    ... other payments by subsidiaries; changes in tax structure and level; and changes in laws or regulations or the interpretation or application of laws or regulations. In addition, because we own assets in foreign countries and derive revenues from our International operations, we may incur currency...

  • Page 21
    ... management's attention may be diverted from other business concerns; and we may lose key employees of acquired companies or stations. Additional acquisitions by us of radio stations and outdoor advertising properties may require antitrust review by federal antitrust agencies and may require review...

  • Page 22
    ... and operational flexibility and limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; limiting our ability to adjust to changing economic, business and competitive conditions...

  • Page 23
    ... litigation; changes in interest rates; taxes; shifts in population and other demographics; access to capital markets and borrowed indebtedness; the risk that we may not be able to integrate the operations of recently acquired companies successfully; the risk that our cost savings initiatives may...

  • Page 24
    intended to be exhaustive. Accordingly, all forward-looking statements should be evaluated with the understanding of their inherent uncertainty. ITEM 1B. Unresolved Staff Comments None. 20

  • Page 25
    ... service center. Radio Broadcasting Our radio executive operations are located in our corporate headquarters in San Antonio, Texas. The types of properties required to support each of our radio stations include offices, studios, transmitter sites and antenna sites. We either own or lease...

  • Page 26
    ...3,890 151-200 101 151-200 2,119 201-300 114 201+ 63 unranked 76 N/A N/A N/A N/A N/A 27,897 892 188,124 Represents markets where outdoor advertising is not operated. Represents radio markets whose Arbitron ranking is above 51. The San Jose market is combined with the San Francisco market for outdoor...

  • Page 27
    ... outdoor advertising inventory, which are listed in descending order according to 2010 revenue contribution: International Markets France United Kingdom China Italy Australia/New Zealand Spain Sweden Switzerland Belgium Denmark Norway Turkey Ireland ITEM 3. Legal Proceedings We currently...

  • Page 28
    ... assumed by Live Nation, including those pertaining to the claims discussed above. On or about July 12, 2006 and April 12, 2007, two of our operating businesses (L&C Outdoor Ltda. ("L&C") and Publicidad Klimes Sao Paulo Ltda. ("Klimes"), respectively) in the Sao Paulo, Brazil market received notices...

  • Page 29
    ... equity interests of Clear Channel Capital II, LLC are owned by CCMH. All equity interests in CCMH are owned, directly or indirectly, by the Sponsors and their co-investors, public investors and certain employees of CCMH and its subsidiaries, including certain executive officers and directors...

  • Page 30
    ... in Item 6 and Item 8 of Part II of this Annual Report on Form 10-K are those of Clear Channel Capital I, LLC ("Clear Channel Capital I"), the direct parent of Clear Channel Communications, Inc., a Texas corporation ("Clear Channel" or "Subsidiary Issuer"), and contain certain footnote disclosures...

  • Page 31
    ... Company Dividends declared per share (In thousands) Balance Sheet Data: Current assets Property, plant and equipment - net, including discontinued operations Total assets Current liabilities Long-term debt, net of current maturities Member's interest (deficit)/ shareholders' equity 2010 Post-Merger...

  • Page 32
    ... 2010 compared to 2009, driven by revenue growth across our advertising inventory, particularly digital. International outdoor revenue increased $48.1 million for the year ended December 31, 2010 compared to 2009, primarily as a result of increased revenue from street furniture across most countries...

  • Page 33
    ..."International outdoor advertising"). Included in the "other" segment are our media representation business, Katz Media, as well as other general support services and initiatives. We manage our operating segments primarily focusing on their operating income, while Corporate expenses, Merger expenses...

  • Page 34
    ..., including ratings, sales levels, pricing and overall profitability. Americas and International Outdoor Advertising Our revenue is derived from selling advertising space on the displays we own or operate in key markets worldwide, consisting primarily of billboards, street furniture and transit...

  • Page 35
    ...from street furniture across most countries, partially offset by a $10.3 million decrease from movements in foreign exchange. Other revenue increased $61.0 million compared to the same period of 2009, primarily from stronger national advertising in our media representation business. Direct Operating...

  • Page 36
    ... and exchange of radio stations and a $20.9 million loss on the sale of our taxi advertising business. The losses were partially offset by a $10.1 million gain on the sale of Americas and International outdoor assets. Interest Expense Interest expense increased $32.5 million during 2010 compared to...

  • Page 37
    ... of purchase price allocations to the acquired intangible assets. Americas Outdoor Advertising Results of Operations Disposition of Taxi Business On December 31, 2009, our subsidiary CCOI disposed of Clear Channel Taxi Media, LLC ("Taxis"), our taxi advertising business. For the year ended December...

  • Page 38
    ...,367 $ 56,259 $ (68,727) % Change 3% (4%) (2%) (11%) International outdoor revenue increased $48.1 million during 2010 compared to 2009, primarily as a result of revenue growth from street furniture across most countries, partially offset by the exit from the businesses in Greece and India. Foreign...

  • Page 39
    ... TO YEAR ENDED DECEMBER 31, 2008 IS AS FOLLOWS: CCMH was formed in May 2007 by private equity funds sponsored by Bain Capital Partners, LLC and Thomas H. Lee Partners, L.P. (together, the "Sponsors") for the purpose of acquiring the business of Clear Channel. The acquisition was completed on July 30...

  • Page 40
    ... 2008 as a result of cost-cutting measures and the impact of lower revenues. Our radio broadcasting direct operating expenses decreased $77.5 million primarily related to decreased compensation expense associated with cost savings from the restructuring program. Our Americas outdoor direct operating...

  • Page 41
    .... A rollforward of our goodwill balance from July 30, 2008 through December 31, 2009 by reporting unit is as follows: Balances as of July 30, 2008 Acquisitions Dispositions United States Radio Markets $ 6,691,260 $ 3,486 $ - United States Outdoor Markets 3,121,645 - - France 122,865 - - Switzerland...

  • Page 42
    ....0 million loss on the sale and exchange of radio stations and a $20.9 million loss on the sale of our taxi advertising business. The losses were partially offset by a $10.1 million gain on the sale of Americas and International outdoor assets. The $28.0 million income in 2008 consists of a gain of...

  • Page 43
    ...as an equity method investment and began accounting for it at cost in accordance with ASC 323. Included in equity in earnings of nonconsolidated affiliates in 2008 is a $75.6 million gain on the sale of our 50% interest in Clear Channel Independent, a South African outdoor advertising company. Other...

  • Page 44
    ... accounting adjustments to intangible assets acquired in the merger. Americas Outdoor Advertising Results of Operations Our Americas outdoor operating results were as follows: (In thousands) Revenue Direct operating expenses SG&A expenses Depreciation and amortization Operating income Years Ended...

  • Page 45
    ... to radio broadcasting, Americas outdoor, International outdoor, and our other segment. Share-Based Compensation We do not have any compensation plans under which we grant stock awards to employees. Our employees receive equity awards from CCMH's equity incentive plans. Prior to the merger, we...

  • Page 46
    ... non-cash compensation costs related to share-based payments for the years ended December 31, 2010, 2009 and 2008, respectively: (In thousands) Radio broadcasting Americas outdoor advertising International outdoor advertising Corporate Other Total share-based compensation expense 2010 Post-Merger...

  • Page 47
    ... to new billboard and street furniture contracts and renewals of existing contracts. We spent $177.1 million primarily for the purchase of outdoor display faces and additional equity interest in international outdoor companies, representation contracts and two FCC licenses. In addition, we received...

  • Page 48
    ...our current and anticipated levels of operations and conditions in our markets, we believe that cash on hand (including amounts available under our senior secured credit facilities) as well as cash flow from operations will enable us to meet our working capital, capital expenditure, debt service and...

  • Page 49
    ... Secured Credit Facilities: Term Loan A Facility Term Loan B Facility Term Loan C - Asset Sale Facility Revolving Credit Facility Delayed Draw Term Loan Facilities Receivables Based Facility Secured Subsidiary Debt Total Secured Debt Senior Cash Pay Notes Senior Toggle Notes Clear Channel Senior...

  • Page 50
    ...amount of such facilities in years four and five and 1% thereafter, with the balance being payable on the final maturity date (January 2016) of such term loans. • • Collateral and Guarantees The senior secured credit facilities are guaranteed by Clear Channel Capital I and each of its existing...

  • Page 51
    ...; sell assets; pay dividends and distributions or repurchase our capital stock; make investments, loans, or advances; prepay certain junior indebtedness; engage in certain transactions with affiliates; amend material agreements governing certain junior indebtedness; and change our lines of business...

  • Page 52
    ... and letters of credit are available in U.S. dollars. Borrowings under the receivables based credit facility bear interest at a rate equal to an applicable margin plus, at our option, either (i) a base rate determined by reference to the higher of (A) the prime lending rate publicly announced by the...

  • Page 53
    ... assets or have cash available to be borrowed under committed credit facilities consisting of (i) $50.0 million at the issuer and guarantor entities (principally the Americas outdoor segment) and (ii) $50.0 million at the non-guarantor subsidiaries (principally the International outdoor segment...

  • Page 54
    ... be used to pay dividends from CCOI to CCOH. In turn, CCOH could declare a dividend to its shareholders of which we would receive our proportionate share. Payment of such dividends would not be prohibited by the terms of the subsidiary senior notes or any of the loan agreements or credit facilities...

  • Page 55
    ... in its Branded Cities operations to its joint venture partner, The Ellman Companies. We recognized a loss of $25.3 million in "Other operating income (expense) - net" related to this transfer. During 2010, our International outdoor segment sold its outdoor advertising business in India, resulting...

  • Page 56
    ...for repurchases of long-term debt Clear Channel Acquisition, LLC Principal amount of debt repurchased (3) Deferred loan costs and other Gain recorded in "Other income (expense) - net" (2) Cash paid for repurchases of long-term debt Post Merger Years Ended December 31, 2010 2009 2008 $185,185 104 (60...

  • Page 57
    ... For the post-merger period of 2008, we recognized Sponsors' management fees and reimbursable expenses of $6.3 million. 52 $ $ $ 35.5 41.9 61.5 Year Ended December 31, 2010 Americas International Outdoor Outdoor Advertising Advertising $ $ $ 96.7 84.4 175.8 $ $ $ 98.6 91.5 182.5 Corporate and Other...

  • Page 58
    ...Secured Debt Senior Cash Pay and Senior Toggle Notes (1) Clear Channel Senior Notes Subsidiary Senior Notes Other Long-term Debt Interest payments on long-term debt (2) Non-cancelable operating leases Non-cancelable contracts Employment/talent contracts Capital expenditures Unrecognized tax benefits...

  • Page 59
    ... rate swap agreement. Seasonality Typically, our Radio broadcasting, Americas outdoor and International outdoor segments experience their lowest financial performance in the first quarter of the calendar year, with International outdoor historically experiencing a loss from operations in that period...

  • Page 60
    ... rates of most of our broadcasting stations and outdoor display faces. New Accounting Pronouncements In December 2010, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2010-28, When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units...

  • Page 61
    ...-lived intangible assets. Our key assumptions using the direct valuation method are market revenue growth rates, market share, profit margin, duration and profile of the build-up period, estimated start-up capital costs and losses incurred during the build-up period, the risk-adjusted discount rate...

  • Page 62
    ...market size by year 3; and (v) Assumed discount rates of 9% for the 13 largest markets and 9.5% for all other markets. In determining the fair value of our billboard permits, the following key assumptions were used: (i) Industry revenue growth forecast at 7% was used for the initial four-year period...

  • Page 63
    ... basis point decline in our discrete and terminal period revenue growth rate and profit margin assumptions and a 100 basis point increase in our discount rate assumption: (In thousands) Reportable segment Radio Broadcasting Americas Outdoor International Outdoor Tax Accruals The IRS and other taxing...

  • Page 64
    ... receive equity awards from CCMH's equity incentive plans. Prior to the merger, we granted equity awards to our employees under our own equity incentive plan. ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk Required information is located within Item 7 of Part II of this Annual...

  • Page 65
    ...registered public accounting firm has unrestricted access to the Board, without management present, to discuss the results of their audit and the quality of financial reporting and internal accounting controls. /s/ Mark P. Mays President and Chief Executive Officer /s/ Thomas W. Casey Executive Vice...

  • Page 66
    ... audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Clear Channel Capital's internal control over financial reporting as of December 31, 2010, based on criteria established in Internal Control - Integrated Framework issued by the Committee of...

  • Page 67
    ... BALANCE SHEETS OF CLEAR CHANNEL CAPITAL I, LLC (In thousands) December 31, 2010 CURRENT ASSETS Cash and cash equivalents Accounts receivable, net of allowance of $74,660 in 2010 and $71,650 in 2009 Prepaid expenses Other current assets Total Current Assets PROPERTY, PLANT AND EQUIPMENT Structures...

  • Page 68
    ... OF OPERATIONS OF CLEAR CHANNEL CAPITAL I, LLC Post-Merger (In thousands, except per share data) Revenue Operating expenses: Direct operating expenses (excludes depreciation and amortization) Selling, general and administrative expenses (excludes depreciation and amortization) Corporate expenses...

  • Page 69
    outstanding Diluted: Income (loss) attributable to the Company before discontinued operations Discontinued operations Net income (loss) attributable to the Company Weighted average common shares outstanding See Notes to Consolidated Financial Statements 63 495,044 $ 0.80 1.29 2.09 496,519 $

  • Page 70
    CONSOLIDATED STATEMENTS OF CHANGES IN MEMBER'S (DEFICIT)/SHAREHOLDERS' EQUITY (In thousands, except share data) Controlling Interest Additional Paid-in Accumulated Capital/ Other Member's Comprehensive Treasury Noncontrolling Common Retained Interest Income (Loss) Interest Stock Stock Deficit Total ...

  • Page 71
    Comprehensive income: Currency translation adjustment Unrealized gain on cash flow derivatives Unrealized gain (loss) on investments Reclassification adjustments Post-merger Balances at December 31, 2010 7,360 (896) 2,393 $ 490,920 $ - $ 2,128,383 $ (9,555,173) $ 18,941 15,112 18,083 12,357 (268,...

  • Page 72
    ...-term debt Deferred financing charges Debt proceeds used to finance the merger Equity contribution used to finance the merger Dividends paid Year Ended December 31, 2010 $ (462,853) - (462,853) Year Ended December 31, 2009 $ (4,049,036) - (4,049,036) Pre-Merger Period from Period from January 1 July...

  • Page 73
    ... by (used for) operating activities Net cash provided by investing activities Net cash provided by financing activities Net cash provided by discontinued operations Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period...

  • Page 74
    ... Media Holdings, Inc. ("CCMH"). CCMH was formed in May 2007 by private equity funds sponsored by Bain Capital Partners, LLC and Thomas H. Lee Partners, L.P. (together, the "Sponsors") for the purpose of acquiring the business of Clear Channel. The acquisition was completed on July 30, 2008 pursuant...

  • Page 75
    ... changes in current economic conditions. The Company believes its concentration of credit risk is limited due to the large number and the geographic diversification of its customers. Land Leases and Other Structure Licenses Most of the Company's outdoor advertising structures are located on leased...

  • Page 76
    ... and street furniture contracts, talent and representation contracts, customer and advertiser relationships, and site-leases, all of which are amortized over the respective lives of the agreements, or over the period of time the assets are expected to contribute directly or indirectly to the Company...

  • Page 77
    recoverable. The Company performs its annual impairment test for its FCC licenses and permits using a direct valuation technique as prescribed in ASC 805-20-S99. The Company engages Mesirow Financial Consulting LLC ("Mesirow Financial"), a third party valuation firm, to assist the Company in the ...

  • Page 78
    ...each country in its International outdoor segment constitutes a separate reporting unit. The Company performed its annual goodwill impairment test on October 1, 2010, and recognized a non-cash impairment charge of $2.1 million related to a specific reporting unit in its International outdoor segment...

  • Page 79
    ...is recognized ratably over the term of the contract. Advertising revenue is reported net of agency commissions. Agency commissions are calculated based on a stated percentage applied to gross billing revenue for the Company's broadcasting and outdoor operations. Payments received in advance of being...

  • Page 80
    ... plans. Prior to the merger, Clear Channel granted equity awards to its employees under its own equity incentive plans. Derivative Instruments and Hedging Activities The provisions of ASC 815-10 require the Company to recognize its interest rate swap agreements as either assets or liabilities in the...

  • Page 81
    ... equity interests in international outdoor companies for $96.5 million in cash during 2008. The Company's national representation business acquired representation contracts for $68.9 million in cash during 2008. NOTE 3 - DISCONTINUED OPERATIONS Sale of non-core radio stations and television business...

  • Page 82
    ...through July 30, 2008 is income tax expense of $62.4 million and a gain of $695.8 million related to the sale of Clear Channel's television business and certain radio stations. NOTE 4 - PROPERTY, PLANT AND EQUIPMENT, INTANGIBLE ASSETS AND GOODWILL Property, Plant and Equipment The Company's property...

  • Page 83
    ...-lived intangible assets. The key assumptions using the direct valuation method are market revenue growth rates, market share, profit margin, duration and profile of the build-up period, estimated start-up capital costs and losses incurred during the build-up period, the risk-adjusted discount rate...

  • Page 84
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Annual Impairment Test to FCC Licenses and Billboard permits The Company performs its annual impairment test on October 1 of each year. The aggregate fair value of the Company's FCC licenses on ...

  • Page 85
    ... over the discount rate used to value the permits in the preliminary purchase price allocation as of July 30, 2008. Industry revenue forecasts declined 10% through 2013 compared to the forecasts used in the preliminary purchase price allocation as of July 30, 2008. These market driven changes were...

  • Page 86
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) (In thousands) Radio Broadcasting Post-Merger Balance as of December 31, 2008 Impairment Acquisitions Dispositions Foreign currency Purchase price adjustments - net Other Balance as of December 31, ...

  • Page 87
    ... 21% and 29% for Radio, Americas outdoor and International outdoor, respectively, compared to the forecasts used in the July 30, 2008 preliminary purchase price allocation primarily as a result of the revenues realized for the year ended December 31, 2008. These market driven changes were primarily...

  • Page 88
    ... cost for an extended period of time in 2008. After considering ASC 320-10-S99 guidance, the Company concluded that the impairment was other than temporary and recorded a non-cash impairment charge of $56.7 million in "Gain (loss) on marketable securities" for the year ended December 31, 2008. Clear...

  • Page 89
    ... cost is capitalized as part of the related long-lived assets' carrying value. Due to the high rate of lease renewals over a long period of time, the calculation assumes that all related assets will be removed at some period over the next 50 years. An estimate of third-party cost information is used...

  • Page 90
    ... C - Asset Sale Facility Due 2016 (1) Revolving Credit Facility Due 2014 Delayed Draw Facilities Due 2016 Receivables Based Facility Due 2014 Other Secured Long-term Debt Total Consolidated Secured Debt Senior Cash Pay Notes Senior Toggle Notes Clear Channel Senior Notes: 7.65% Senior Notes Due 2010...

  • Page 91
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) otherwise. The Company or its subsidiaries may also sell certain assets or properties and use the proceeds to reduce its indebtedness. These purchases or sales, if any, could have a material positive...

  • Page 92
    ... of the closing date of the merger, in annual amounts equal to 4.7% of the original funded principal amount of such facility in year five, 10% thereafter, with the balance being payable on the final maturity date (July 2014) of such term loans; The term loan B facility and the delayed draw...

  • Page 93
    ...assets; pay dividends and distributions or repurchase Clear Channel's capital stock; make investments, loans, or advances; prepay certain junior indebtedness; engage in certain transactions with affiliates; amend material agreements governing certain junior indebtedness; and change lines of business...

  • Page 94
    ... with the net cash proceeds raised in one or more equity offerings. If Clear Channel undergoes a change of control, sells certain of the Company's assets, or issues certain debt, it may be required to offer to purchase the senior cash pay notes and senior toggle notes from holders. The senior cash...

  • Page 95
    ..., Clear Channel Outdoor, Inc. ("CCOI") and certain of CCOH's direct and indirect subsidiaries. The subsidiary senior notes bear interest on a daily basis and contain customary provisions, including covenants requiring the Company to maintain certain levels of credit availability and limitations on...

  • Page 96
    ... and sell certain assets, including capital stock of its subsidiaries, to persons other than Clear Channel and its subsidiaries (other than CCOH). The indenture governing the Series A Notes does not include limitations on dividends, distributions, investments or asset sales. The indenture governing...

  • Page 97
    ... be used to pay dividends from CCOI to CCOH. In turn, CCOH could declare a dividend to its shareholders of which Clear Channel would receive its proportionate share. Payment of such dividends would not be prohibited by the terms of the subsidiary senior notes or any of the loan agreements or credit...

  • Page 98
    ... for repurchases of long-term debt Clear Channel Acquisition, LLC Principal amount of debt repurchased (3) Deferred loan costs and other Gain recorded in "Other income (expense) - net" (2) Cash paid for repurchases of long-term debt Post-Merger Periods Ended December 31, 2010 2009 2008 $ 185,185 104...

  • Page 99
    ... proceeds from its bank credit facility. On June 15, 2008, Clear Channel repaid its 6.625% Senior Notes at their maturity for $125.0 million with available cash on hand. Future maturities of long-term debt at December 31, 2010 are as follows: (In thousands) 2011 2012 2013 2014 2015 Thereafter Total...

  • Page 100
    ... that takes into account the present value of the future cash flows under the terms of the agreements by using market information available as of the reporting date, including prevailing interest rates and credit spread. Due to the fact that the inputs are either directly or indirectly observable...

  • Page 101
    ... under long-term operating leases. The Company accounts for these leases in accordance with the policies described above. The Company's contracts with municipal bodies or private companies relating to street furniture, billboards, transit and malls generally require the Company to build bus stops...

  • Page 102
    ...it can proceed. Based on the Company's review of the law in similar cases in other Brazilian states, the Company has not accrued any costs related to these claims and believes the occurrence of loss is not probable. In various areas in which the Company operates, outdoor advertising is the object of...

  • Page 103
    ... Internal Revenue Code to allow net operating losses realized in a tax year ended after December 31, 2007 and beginning before January 1, 2010 to be carried back for up to five years (such losses were previously limited to a two-year carryback). This change allowed the Company to recognize current...

  • Page 104
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Significant components of the Company's deferred tax liabilities and assets as of December 31, 2010 and 2009 are as follows: (In thousands) Deferred tax liabilities: Intangibles and fixed assets Long...

  • Page 105
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The reconciliation of income tax computed at the U.S. Federal statutory tax rates to income tax benefit (expense) is: Post-Merger Year Ended December 31, 2010 Amount Percent 35% 0% (5%) (0%) Year ...

  • Page 106
    ...on a market price of $36.00 per share. Holders of restricted stock awards received $36.00 per share in cash or a share of CCMH Class A common stock per share of Clear Channel restricted stock. Approximately $39.2 million of share-based compensation was recognized in the pre-merger period as a result...

  • Page 107
    ..., 2008. Share-Based Compensation Stock Options The Company does not have any compensation plans under which it grants stock awards to employees. Prior to the merger, Clear Channel granted options to purchase its common stock to its employees and directors and its affiliates under its various equity...

  • Page 108
    ... 31, 2010 Restricted Stock Awards Prior to the merger, Clear Channel granted restricted stock awards to its employees and directors and its affiliates under its various equity incentive plans. These common shares held a legend which restricted their transferability for a term of up to five years and...

  • Page 109
    ... amended employment agreement. CCOH Share-Based Awards CCOH Stock Options The Company's subsidiary, CCOH, grants options to purchase shares of its Class A common stock to its employees and directors and its affiliates under its equity incentive plan typically at no less than the fair market value of...

  • Page 110
    ... the post-merger period from July 31 through December 31, 2008 was $2.3 million. Restricted Stock Awards CCOH has also granted both restricted stock awards and restricted stock units to employees and directors of CCOH and its affiliates. The restricted stock awards represent shares of Class A common...

  • Page 111
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The following table presents a summary of CCOH's restricted stock and restricted stock units outstanding at and activity during the year ended December 31, 2010 ("Price" reflects the weighted average...

  • Page 112
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Reconciliation of Earnings per Share (In thousands, except per share data) Pre-Merger Period from January 1 through July 30, 2008 $ 1,036,525 - 640,236 396,289 2,333 $ 393,956 495,044 1,475 496,519 ...

  • Page 113
    ... service to Clear Channel. Contributions from continuing operations to these plans of $29.8 million and $23.0 million for the years ended December 31, 2010 and 2009, respectively, $12.4 million for the post-merger period ended December 31, 2008 and $17.9 million for the pre-merger period ended July...

  • Page 114
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) (In thousands) Year ended December 31, 2010 Deferred income tax (assets) liabilities on items of other comprehensive income (loss) include: Foreign currency translation adjustments Unrealized gain (...

  • Page 115
    ... from the United States. The international outdoor segment primarily includes operations in Europe, Asia and Australia. The Americas and international display inventory consists primarily of billboards, street furniture displays and transit displays. The other category includes the Company's media...

  • Page 116
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Americas Outdoor Advertising International Outdoor Advertising Corporate and other reconciling items Radio Broadcasting Other Eliminations Consolidated Post-Merger Year Ended December 31, 2009 ...

  • Page 117
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) (In thousands) Americas International Outdoor Outdoor Radio Broadcasting Advertising Advertising Pre-Merger Period from January 1, 2008 through July 30, 2008 Revenue $ 1,937,980 $ 842,831 $ 1,119,232...

  • Page 118
    ... such services at a rate not greater than $15.0 million per year, plus reimbursable expenses. For the years ended December 31, 2010 and 2009, the Company recognized management fees and reimbursable expenses of $17.1 million and $20.5 million, respectively. For the post-merger period ended December...

  • Page 119
    ... basis certain of Clear Channel's outstanding indebtedness. The following consolidating schedules present financial information on a combined basis in conformity with the SEC's Regulation SX Rule 3-10(d): Post-merger (In thousands) Cash and cash equivalents Accounts receivable, net of allowance...

  • Page 120
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Post-merger (In thousands) Cash and cash equivalents Accounts receivable, net of allowance Intercompany receivables Prepaid expenses Other current assets Total Current Assets Property, plant and ...

  • Page 121
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Post-merger (In thousands) Revenue Operating expenses: Direct operating expenses Selling, general and administrative expenses Corporate expenses Depreciation and amortization Impairment charges Other...

  • Page 122
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Post-merger (In thousands) Revenue Operating expenses: Direct operating expenses Selling, general and administrative expenses Corporate expenses Depreciation and amortization Merger expenses ...

  • Page 123
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Post-merger (In thousands) Parent Company Period from July 31 through December 31, 2008 Subsidiary Guarantor Non-Guarantor Issuer Subsidiaries Subsidiaries Eliminations 1,338,014 760,175 274,332 31,...

  • Page 124
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Pre-merger (In thousands) Revenue Operating expenses: Direct operating expenses Selling, general and administrative expenses Corporate expenses Depreciation and amortization Merger expenses Other ...

  • Page 125
    ... discounts, net Share-based compensation (Gain) loss on sale of operating assets Loss on securities Equity in (earnings) loss of nonconsolidated affiliates Gain on debt extinguishment Other reconciling items - net Changes in operating assets and liabilities: Increase in accounts receivable (Decrease...

  • Page 126
    CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Post-merger (In thousands) Cash flows provided by (used for) financing activities: Draws on credit facilities Payments on credit facilities Proceeds from long-term debt Payments on long-term debt ...

  • Page 127
    ... discounts, net Share-based compensation Loss on sale of operating assets Loss on securities Equity in (earnings) loss of nonconsolidated affiliates (Gain) loss on debt extinguishment Other reconciling items - net Changes in operating assets and liabilities: Decrease in accounts receivable (Decrease...

  • Page 128
    ... Change in other - net Net cash provided by (used for) financing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period Parent Company Subsidiary Issuer Year Ended December 31, 2009 Guarantor Non-Guarantor...

  • Page 129
    ...and note discounts, net Share-based compensation Gain on sale of operating assets Loss on securities Equity in (earnings) loss of nonconsolidated affiliates Gain on debt extinguishment Other reconciling items - net Changes in operating assets and liabilities: Decrease in accounts receivable Increase...

  • Page 130
    ... provided by discontinued operations Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period Parent Company Subsidiary Issuer Period from July 31 through December 31, 2008 Guarantor Non-Guarantor Subsidiaries Subsidiaries...

  • Page 131
    ... note discounts, net Share-based compensation Gain on disposal of assets Gain on trading securities Equity in (earnings) loss of nonconsolidated affiliates Loss on debt extinguishment Other reconciling items - net Changes in operating assets and liabilities: Decrease in accounts receivable Increase...

  • Page 132
    ... by discontinued operations Net (decrease) increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period Parent Company Subsidiary Issuer Period from January 1 through July 30, 2008 Guarantor Non-Guarantor Subsidiaries Subsidiaries...

  • Page 133
    ...accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. Management's Report on Internal Control Over Financial Reporting The management of the Company is responsible...

  • Page 134
    ... Company Accounting Oversight Board (United States), the consolidated balance sheets of Clear Channel Capital as of December 31, 2010 and 2009, the related consolidated statements of operations, member's (deficit)/shareholders' equity, and cash flows of Clear Channel Capital for the years ended...

  • Page 135
    ITEM 9B. Other Information Not Applicable 126

  • Page 136
    ... Accounting Fees and Services Fees are incurred by CCMH for both the CCMH and Clear Channel audit services and are not allocated between the two companies. The following fees for services provided by Ernst & Young LLP were incurred by CCMH with respect to the years ended December 31, 2010 and...

  • Page 137
    ... statement schedule for the years ended December 31, 2010, 2009 and 2008 and related report of independent auditors is filed as part of this report and should be read in conjunction with the consolidated financial statements. Schedule II Valuation and Qualifying Accounts All other schedules for...

  • Page 138
    ...period $ 59,169 Charges to Costs, Expenses and other $ 23,216 Write-off of Accounts Receivable $ 19,679 Balance at end of Period $ 64,863 Description Period from January 1, through July 30, 2008 Period from July 31, through December 31, 2008 Year ended December 31, 2009 Year ended December 31, 2010...

  • Page 139
    ... ACCOUNTS Deferred Tax Asset Valuation Allowance (In thousands) Balance at Beginning of period $ 516,922 Charges to Costs, Expenses and other (1) $ - Balance at end of Period $252,679 Description Period from January 1, through July 30, 2008 Period from July 31, through December 31, 2008 Year ended...

  • Page 140
    ..., LLC, CC Media Holdings, Inc. and Clear Channel Communications, Inc. (Incorporated by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K filed May 14, 2008). Asset Purchase Agreement dated April 20, 2007, between Clear Channel Broadcasting, Inc., ABO Broadcasting Operations, LLC...

  • Page 141
    ... to Exhibit 4.2 to the Company's Current Report on Form 8-K filed January 4, 2008). Indenture, dated July 30, 2008, by and among BT Triple Crown Merger Co., Inc., Law Debenture Trust Company of New York, Deutsche Bank Trust Company Americas and Clear Channel Communications, Inc. (as the successor...

  • Page 142
    ... Clear Channel Outdoor Holdings, Inc., Clear Channel Outdoor, Inc., U.S. Bank National Association and the guarantors party thereto (Incorporated by reference to Exhibit 4.18 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009). Credit Agreement, dated as of May 13, 2008...

  • Page 143
    ... Clear Channel Worldwide Holdings, Inc. and Clear Channel Outdoor, Inc. (Incorporated by reference to Exhibit 10.43 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009). First Amended and Restated Management Agreement, dated as of July 28, 2008, by and among CC Media...

  • Page 144
    ... by reference to Exhibit 10.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009). Affiliate Transactions Agreement, dated as of July 30, 2008, by and among CC Media Holdings, Inc., Bain Capital Fund IX, L.P., Thomas H. Lee Equity Fund VI, L.P. and BT Triple Crown...

  • Page 145
    ... and among Mark P. Mays, CC Media Holdings, Inc., and Clear Channel Communications, Inc., as successor to BT Triple Crown Merger Co., Inc. (Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed June 24, 2010). Employment Agreement, dated as of December 15, 2009...

  • Page 146
    ...Number Description 31.2* 32.1** 32.2** * ** § + Certification Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Certification of Chief Executive Officer...1934. A management contract or ...

  • Page 147
    ...of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on February 14, 2011. CLEAR CHANNEL COMMUNICATIONS, INC. By: /s/ Mark P. Mays Mark P. Mays President and Chief Executive Officer Power of Attorney Each person whose signature...

  • Page 148
    Name Title Date /s/ Richard J. Bressler Richard J. Bressler /s/ Charles A. Brizius Charles A. Brizius /s/ John P. Connaughton ...Director February 14, 2011 Director February 14, 2011 Director February 14, 2011 Director February 14, 2011 Director February 14, 2011 Director February 14, 2011 Director ...

  • Page 149
    ...Executive Option Agreement (the "Agreement"), the "Grant Date" shall mean July 30, 2008. 1. Grant of Option. The Agreement evidences the grant by the Company on the Grant Date to the Optionee of an option to purchase, in whole or in part, on the terms provided herein and in the Plan, shares of Class...

  • Page 150
    ... Company without Cause during the twelve (12) months following a Change of Control, 100%...terms and conditions of the Plan and shall be in writing, signed by the Optionee or by his or her executor or administrator or by the person or persons to whom this Option is transferred by will or the applicable...

  • Page 151
    ... as a condition thereto, the Permitted Transferee shall execute a written agreement in a form provided by the Company under which such Permitted Transferee shall become subject to all provisions of this Agreement to the extent applicable to the Received Shares, including without limitation Sections...

  • Page 152
    ... Transfers. Any Transfer of Received Shares not made in compliance with the terms of this Section 6 shall be null and void ab initio, and the Company shall not in any way give effect to any such Transfer. (vii) Period. Upon the occurrence of a Change of Control, all the Transfer restrictions...

  • Page 153
    ...of the Option or any portion thereof or any of the Received Shares for such period as the Company or such managing underwriter(s), as the case may be, may request, commencing on the effective date of the registration statement relating to such Public Offering and continuing for not more than 90 days...

  • Page 154
    ... of the terms of any non-competition, non-solicitation or non-disclosure agreement with the Company or Optionee's breach of any duty to the Company. Accordingly, Optionee acknowledges that (i) the Company may withhold delivery of Shares, (ii) the Company may place the proceeds of any sale or other...

  • Page 155
    ... assigns. "Capital V" means Clear Channel Capital V, L.P., a Delaware limited partnership formed and jointly controlled by the Sponsors, and its successors and/or assigns. "Change of Control" means (a) any consolidation or merger of the Company with or into any other corporation or other Person, or...

  • Page 156
    ... months during any period of 12 consecutive months. "Equity Shares" means Shares as such term is used in the Stockholders Agreement. "Investors" means Capital IV and Capital V and their "Permitted Transferees," as defined in the Stockholders Agreement. "Investor Shares" means Equity Shares of any...

  • Page 157
    ... Affiliates and Affiliated Funds from the sale or other disposition of such Investor Shares. "Sponsors" shall mean Bain Capital (CC) IX L.P. and Thomas H. Lee Equity Fund VI, L.P. "Stockholders Agreement" means the Stockholders Agreement, dated as of July 29, 2008, as amended from time to time...

  • Page 158
    ...to be executed under its corporate seal by its duly authorized officer. This Option shall take effect as a sealed instrument. CC MEDIA HOLDINGS, INC. By: Name: Mark P. Mays Title: CEO Dated: Acknowledged and Agreed Name: JOHN HOGAN Address of Principal Residence: 30899 VENTURER, FAIR OAKS, TX 78015...

  • Page 159
    ... of sale and other provisions as set forth below. CC MEDIA HOLDINGS, INC. NON-QUALIFIED STOCK OPTION AGREEMENT This stock option (the "Option") is granted by CC Media Holdings, Inc., a Delaware corporation (the "Company"), to the Optionee, pursuant to the Company's 2008 Executive Incentive...

  • Page 160
    ...) the period ending on the Final Exercise Date, and will thereupon terminate. 4. Withholding. No Shares will be transferred pursuant to the exercise of this Option unless and until the person exercising this Option shall have remitted to the Company an amount sufficient to satisfy any federal, state...

  • Page 161
    ... as a condition thereto, the Permitted Transferee shall execute a written agreement in a form provided by the Company under which such Permitted Transferee shall become subject to all provisions of this Agreement to the extent applicable to the Received Shares, including without limitation Sections...

  • Page 162
    ... and exercisable and Received Shares then held by the Optionee that the Company notifies the Optionee is equal to the percentage of Equity Shares held by the Sponsors and their Affiliates that the Sponsors and Affiliates are transferring in such transaction, on the same terms and conditions as the...

  • Page 163
    ...of the Option or any portion thereof or any of the Received Shares for such period as the Company or such managing underwriter(s), as the case may be, may request, commencing on the effective date of the registration statement relating to such Public Offering and continuing for not more than 90 days...

  • Page 164
    ...of this Agreement, "control" (including, with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies...

  • Page 165
    ... assigns. "Capital V" means Clear Channel Capital V, L.P., a Delaware limited partnership formed and jointly controlled by the Sponsors, and its successors and/or assigns. "Change of Control" means (a) any consolidation or merger of the Company with or into any other corporation or other Person, or...

  • Page 166
    ... Affiliates or Affiliated Funds receives sale proceeds therefrom. "Sponsors" shall mean Bain Capital (CC) IX L.P. and Thomas H. Lee Equity Fund VI, L.P. "Stockholders Agreement" means the Stockholders Agreement, dated as of July 29, 2008, as amended from time to time, by and among the Company...

  • Page 167
    IN WITNESS WHEREOF, the Company has caused this Option to be executed under its corporate seal by its duly authorized officer. This Option shall take effect as a sealed instrument. CC MEDIA HOLDINGS, INC. By: Name: Mark P. Mays Title: CEO Dated: Acknowledged and Agreed Name: Address of Principal ...

  • Page 168
    ... of sale and other provisions as set forth below. CC MEDIA HOLDINGS, INC. NON-QUALIFIED STOCK OPTION AGREEMENT This stock option (the "Option") is granted by CC Media Holdings, Inc., a Delaware corporation (the "Company"), to the Optionee, pursuant to the Company's 2008 Executive Incentive...

  • Page 169
    ...) the period ending on the Final Exercise Date, and will thereupon terminate. 4. Withholding. No Shares will be transferred pursuant to the exercise of this Option unless and until the person exercising this Option shall have remitted to the Company an amount sufficient to satisfy any federal, state...

  • Page 170
    ... as a condition thereto, the Permitted Transferee shall execute a written agreement in a form provided by the Company under which such Permitted Transferee shall become subject to all provisions of this Agreement to the extent applicable to the Received Shares, including without limitation Sections...

  • Page 171
    ... and exercisable and Received Shares then held by the Optionee that the Company notifies the Optionee is equal to the percentage of Equity Shares held by the Sponsors and their Affiliates that the Sponsors and Affiliates are transferring in such transaction, on the same terms and conditions as the...

  • Page 172
    ...of the Option or any portion thereof or any of the Received Shares for such period as the Company or such managing underwriter(s), as the case may be, may request, commencing on the effective date of the registration statement relating to such Public Offering and continuing for not more than 90 days...

  • Page 173
    ...of this Agreement, "control" (including, with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies...

  • Page 174
    ... assigns. "Capital V" means Clear Channel Capital V, L.P., a Delaware limited partnership formed and jointly controlled by the Sponsors, and its successors and/or assigns. "Change of Control" means (a) any consolidation or merger of the Company with or into any other corporation or other Person, or...

  • Page 175
    ... Affiliates or Affiliated Funds receives sale proceeds therefrom. "Sponsors" shall mean Bain Capital (CC) IX L.P. and Thomas H. Lee Equity Fund VI, L.P. "Stockholders Agreement" means the Stockholders Agreement, dated as of July 29, 2008, as amended from time to time, by and among the Company...

  • Page 176
    IN WITNESS WHEREOF, the Company has caused this Option to be executed under its corporate seal by its duly authorized officer. This Option shall take effect as a sealed instrument. CC MEDIA HOLDINGS, INC. By: Name: Mark P. Mays Title: CEO Dated: Acknowledged and Agreed Name: Address of Principal ...

  • Page 177
    ... of sale and other provisions as set forth below. CC MEDIA HOLDINGS, INC. NON-QUALIFIED STOCK OPTION AGREEMENT This stock option (the "Option") is granted by CC Media Holdings, Inc., a Delaware corporation (the "Company"), to the Optionee, pursuant to the Company's 2008 Executive Incentive...

  • Page 178
    ... as a condition thereto, the Permitted Transferee shall execute a written agreement in a form provided by the Company under which such Permitted Transferee shall become subject to all provisions of this Agreement to the extent applicable to the Received Shares, including without limitation Sections...

  • Page 179
    ...(iv) Release of Received Shares. If prior to the third anniversary of the closing of a Qualified Public Offering, any Investor makes a Transfer of its Equity Shares to any Person (other than a Transfer to any other Investor or Sponsor or to any of the respective Affiliates or Affiliated Funds of any...

  • Page 180
    ...of the Option or any portion thereof or any of the Received Shares for such period as the Company or such managing underwriter(s), as the case may be, may request, commencing on the effective date of the registration statement relating to such Public Offering and continuing for not more than 90 days...

  • Page 181
    ... of the terms of any non-competition, non-solicitation or non-disclosure agreement with the Company or Optionee's breach of any duty to the Company. Accordingly, Optionee acknowledges that (i) the Company may withhold delivery of Shares, (ii) the Company may place the proceeds of any sale or other...

  • Page 182
    ... by a single Sponsor and/or its Affiliates, in each case (i) and (ii) that is formed to invest directly or indirectly in the Company. "Capital IV" means Clear Channel Capital IV, LLC, a Delaware limited liability company formed and jointly controlled by the Sponsors, and its successors and...

  • Page 183
    ... Funds and Affiliates do not directly or indirectly control capital stock representing more than 25% of the economic interests in and 25% of the voting power of the Company or other surviving entity immediately after such consolidation, merger, reorganization or transaction; (b) any stock sale or...

  • Page 184
    ... Affiliates or Affiliated Funds receives sale proceeds therefrom. "Sponsors" shall mean Bain Capital (CC) IX L.P. and Thomas H. Lee Equity Fund VI, L.P. "Stockholders Agreement" means the Stockholders Agreement, dated as of July 29, 2008, as amended from time to time, by and among the Company...

  • Page 185
    IN WITNESS WHEREOF, the Company has caused this Option to be executed under its corporate seal by its duly authorized officer. This Option shall take effect as a sealed instrument. CC MEDIA HOLDINGS, INC. By: Name: Mark P. Mays Title: CEO Dated: Acknowledged and Agreed Name: Address of Principal ...

  • Page 186
    ... Earnings (Loss) (In thousands, except per share data) Pre-Merger Period from January 1 through July 30, 2008 $ 1,036,525 - 640,236 396,289 2,333 $ 393,956 495,044 1,475 496,519 NUMERATOR: Net income attributable to the Company - common shares Less: Participating securities dividends Less: Income...

  • Page 187
    ...financial statements and schedule of Clear Channel Capital I, LLC, and the effectiveness of internal control over financial reporting of Clear Channel Capital I, LLC, included in this Annual Report (Form 10-K) for the year ended December 31, 2010. /s/ ERNST & YOUNG LLP San Antonio, Texas February 14...

  • Page 188
    ... OF 2002 I, Mark P. Mays, certify that: 1. I have reviewed this Annual Report on Form 10-K of Clear Channel Communications, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in...

  • Page 189
    ...SARBANES-OXLEY ACT OF 2002 I, Thomas W. Casey, certify that: 1. I have reviewed this Annual Report on Form 10-K of Clear Channel Communications, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the...

  • Page 190
    ...and accompanies the Annual Report on Form 10-K (the "Form 10-K") for the year ended December 31, 2010 of Clear Channel Communications, Inc. ...condition and results of operations of the Issuer. Dated: February 14, 2011 By: /s/ Mark P. Mays Name: Mark P. Mays Title: President and Chief Executive Officer

  • Page 191
    ...the Annual Report on Form 10-K (the "Form 10-K") for the year ended December 31, 2010 of Clear Channel Communications, ...condition and results of operations of the Issuer. Dated: February 14, 2011 By: /s/ Thomas W. Casey Name: Thomas W. Casey Title: Executive Vice President and Chief Financial Officer