iHeartMedia 2011 Annual Report Download - page 52

Senior Cash Pay Notes and Senior Toggle Notes
As of December 31, 2011, we had outstanding $796.3 million aggregate principal amount of 10.75% senior cash pay notes
due 2016 and $829.8 million aggregate principal amount of 11.00%/11.75% senior toggle notes due 2016.
The senior cash pay notes and senior toggle notes are unsecured and are guaranteed by Clear Channel Capital I, LLC and
all of our existing and future material wholly-owned domestic restricted subsidiaries, subject to certain exceptions. The senior toggle
notes mature on August 1, 2016 and may require a special redemption of up to $30.0 million on August 1, 2015. We may elect on
each interest election date to pay all or 50% of such interest on the senior toggle notes in cash or by increasing the principal amount o
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the senior toggle notes or by issuing new senior toggle notes (such increase or issuance, “PIK Interest”). Interest on the senior toggle
notes payable in cash will accrue at a rate of 11.00% per annum and PIK Interest will accrue at a rate of 11.75% per annum.
We may redeem some or all of the senior cash pay notes and senior toggle notes at any time prior to August 1, 2012, at a
price equal to 100% of the principal amount of such notes plus accrued and unpaid interest thereon to the redemption date and an
“applicable premium,” as described in the indenture governing such notes. We may redeem some or all of the senior cash pay notes
and senior toggle notes at any time on or after August 1, 2012 at the redemption prices set forth in the indenture governing such notes.
If we undergo a change of control, sell certain of our assets, or issue certain debt, we may be required to offer to purchase the senior
cash pay notes and senior toggle notes from holders.
The senior cash pay notes and senior toggle notes are senior unsecured debt and rank equal in right of payment with all of
our existing and future senior debt. Guarantors of obligations under the senior secured credit facilities, the receivables based credit
facility and the priority guarantee notes guarantee the senior cash pay notes and senior toggle notes with unconditional guarantees that
are unsecured and equal in right of payment to all existing and future senior debt of such guarantors, except that the guarantees are
subordinated in right of payment only to the guarantees of obligations under the senior secured credit facilities, the receivables based
credit facility and the priority guarantee notes to the extent of the value of the assets securing such indebtedness. In addition, the
senior cash pay notes and senior toggle notes and the guarantees are structurally senior to our senior notes and existing and future debt
to the extent that such debt is not guaranteed by the guarantors of the senior cash pay notes and senior toggle notes. The senior cash
pay notes and senior toggle notes and the guarantees are effectively subordinated to our existing and future secured debt and that of
the guarantors to the extent of the value of the assets securing such indebtedness and are structurally subordinated to all obligations of
subsidiaries that do not guarantee the senior cash pay notes and senior toggle notes.
On July 16, 2010, we made the election to pay interest on the senior toggle notes entirely in cash, effective for the interest
period commencing August 1, 2010. Assuming the cash interest election remains in effect for the remaining term of the notes, we will
be contractually obligated to make a payment to bondholders of $57.4 million on August 1, 2013. This amount is included in “Interest
payments on long-term debt” in the “Contractual Obligations” table of this MD&A.
Clear Channel Senior Notes
As of December 31, 2011, our senior notes (the “senior notes”) represented approximately $2.0 billion of aggregate
principal amount of indebtedness outstanding.
The senior notes were our obligations prior to the merger. The senior notes are senior, unsecured obligations that are
effectively subordinated to our secured indebtedness to the extent of the value of our assets securing such indebtedness and are not
guaranteed by any of our subsidiaries and, as a result, are structurally subordinated to all indebtedness and other liabilities of our
subsidiaries. The senior notes rank equally in right of payment with all of our existing and future senior indebtedness and senior in
right of payment to all existing and future subordinated indebtedness. The senior notes are not guaranteed by our subsidiaries.
Subsidiary Senior Notes
As of December 31, 2011, we had outstanding $2.5 billion aggregate principal amount of subsidiary senior notes, which
consisted of $500.0 million aggregate principal amount of Series A Senior Notes due 2017 (the “Series A Notes”) and $2.0 billion
aggregate principal amount of Series B Senior Notes due 2017 (the “Series B Notes” and, collectively with the Series A Notes, the
“subsidiary senior notes”). The subsidiary senior notes were issued by Clear Channel Worldwide Holdings, Inc. (“CCWH”) and are
guaranteed by CCOH, 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 CCWH to maintain certain levels of credit availability
and limitations on incurring additional debt.
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