iHeartMedia 2010 Annual Report Download - page 93

CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
In addition, the senior secured credit facilities include negative covenants that, subject to significant exceptions, limit the Company’s
ability and the ability of its restricted subsidiaries to, among other things:
The senior secured credit facilities include certain customary representations and warranties, affirmative covenants and events of
default, including payment defaults, breach of representations and warranties, covenant defaults, cross-defaults to certain
indebtedness, certain events of bankruptcy, certain events under ERISA, material judgments, the invalidity of material provisions of
the senior secured credit facilities documentation, the failure of collateral under the security documents for the senior secured credit
facilities, the failure of the senior secured credit facilities to be senior debt under the subordination provisions of certain of the
Company’s subordinated debt and a change of control. If an event of default occurs, the lenders under the senior secured credit
facilities will be entitled to take various actions, including the acceleration of all amounts due under the senior secured credit facilities
and all actions permitted to be taken by a secured creditor.
R
eceivables Based Credit Facility
As of December 31, 2010, the Company had a total of $384.2 million outstanding under Clear Channel’s receivables based credit
facility.
The receivables based credit facility provides revolving credit of $783.5 million, subject to a borrowing base. The borrowing base at
any time equals 85% of the Company’s and certain of its subsidiaries’ eligible accounts receivable. The receivables based credit
facility includes a letter of credit sub-facility and a swingline loan sub-facility. The maturity of the receivables based credit facility is
July 2014.
All borrowings under the receivables based credit facility are subject to the absence of any default, the accuracy of representations
and warranties and compliance with the borrowing base. In addition, borrowings under the receivables based credit facility, excluding
the initial borrowing, are subject to compliance with a minimum fixed charge coverage ratio of 1.0:1.0 if at any time excess
availability under the receivables based credit facility is less than $50 million, or if aggregate excess availability under the receivables
based credit facility and revolving credit facility is less than 10% of the borrowing base.
Clear Channel and certain subsidiary borrowers are the borrowers under the receivables based credit facility. Clear Channel has the
ability to designate one or more of its restricted subsidiaries as borrowers under the receivables based credit facility. The receivables
based credit facility loans 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 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 percentage applicable to the receivables based credit facility is (i) 1.40%, in the case of base rate loans and (ii) 2.40% in
the case of Eurocurrency rate loans subject to adjustment if Clear Channel’s leverage ratio of total debt to EBITDA decreases below 7
to 1.
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• incur additional indebtedness;
• create liens on assets;
• en
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e in mer
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ers, consolidations, li
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uidations and dissolutions;
• sell assets;
•
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dividends and distributions or re
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urchase Clear Channel’s ca
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ital stock;
• make investments, loans, or advances;
•
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certain
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unior indebtedness;
• en
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e in certain transactions with affiliates;
• amend material a
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reements
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certain
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unior indebtedness; and
• chan
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e lines of business.