iHeartMedia 2010 Annual Report Download - 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 or negative impact on the Company’s liquidity available to repay
outstanding debt obligations or on the Company’s consolidated results of operations. These transactions could also require or result in
amendments to the agreements governing outstanding debt obligations or changes in the Company’s leverage or other financial ratios,
which could have a material positive or negative impact on the Company’s ability to comply with the covenants contained in its debt
agreements. These transactions, if any, will depend on prevailing market conditions, the Company’s liquidity requirements,
contractual restrictions and other factors. The amounts involved may be material.
Senior Secured Credit Facilities
Borrowings under Clear Channel’s senior secured credit facilities bear interest at a rate equal to an applicable margin plus, at Clear
Channel’s option, either (i) a base rate determined by reference to the higher of (A) the prime lending rate publicly announced by the
administrative agent and (B) the Federal funds effective rate from time to time plus 0.50%, or (ii) a Eurocurrency rate determined by
reference to the costs of funds for deposits for the interest period relevant to such borrowing adjusted for certain additional costs.
The margin percentages applicable to the term loan facilities and revolving credit facility are the following percentages per annum:
The margin percentages are subject to adjustment based upon Clear Channel’s leverage ratio.
Clear Channel is required to pay each revolving credit lender a commitment fee in respect of any unused commitments under the
revolving credit facility, which is currently 0.50% per annum, but subject to adjustment based on Clear Channel’s leverage ratio. The
delayed draw term facilities are fully drawn, therefore there are currently no commitment fees associated with any unused
commitments thereunder.
Prepayments
The senior secured credit facilities require Clear Channel to prepay outstanding term loans, subject to certain exceptions, with:
The foregoing prepayments with the net cash proceeds of certain incurrences of debt and annual excess cash flow will be applied
(i) first to the term loans other than the term loan C - asset sale facility loans (on a pro rata basis) and (ii) second to the term loan C -
asset sale facility loans, in each case to the remaining installments thereof in direct order of maturity. The foregoing prepayments with
the net cash proceeds of the sale of assets (including casualty and condemnation events) will be applied (i) first to the term loan C -
asset sale facility loans and (ii) second to the other term loans (on a pro rata basis), in each case to the remaining installments thereof
in direct order of maturity.
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• with respect to loans under the term loan A facility and the revolving credit facility, (i) 2.40% in the case of base rate loans
and (ii) 3.40% in the case of Eurocurrenc
y
rate loans; and
• with respect to loans under the term loan B facility, term loan C - asset sale facility and delayed draw term loan facilities,
(i) 2.65%, in the case of base rate loans and (ii) 3.65%, in the case of Eurocurrenc
y
rate loans.
• 50% (which percentage may be reduced to 25% and to 0% based upon Clear Channel’s leverage ratio) of Clear Channel’s
annual excess cash flow (as calculated in accordance with the senior secured credit facilities), less any voluntary
prepayments of term loans and revolving credit loans (to the extent accompanied by a permanent reduction of the
commitment) and sub
j
ect to customar
y
credits;
• 100% of the net cash proceeds of sales or other dispositions of specified assets being marketed for sale (including casualty
and condemnation events), sub
j
ect to certain exce
p
tions;
• 100% (which percentage may be reduced to 75% and 50% based upon Clear Channel’s leverage ratio) of the net cash
proceeds of sales or other dispositions by Clear Channel or its wholly-owned restricted subsidiaries of assets other than
s
p
ecified assets bein
g
marketed for sale, sub
j
ect to reinvestment ri
g
hts and certain other exce
p
tions; and
• 100% of the net cash proceeds of (i) any incurrence of certain debt, other than debt permitted under Clear Channel’s senior
secured credit facilities, (ii) certain securitization financing and (iii) certain issuances of Permitted Additional Notes (as
defined in the senior secured credit facilities).