iHeartMedia 2012 Annual Report Download - page 51

48
indebtedness of ours or our subsidiaries or outstanding equity securities of CCMH or CCOH, in tender offers, open market purchases,
privately negotiated transactions or otherwise. We may also sell certain assets or properties and use the proceeds to reduce our
indebtedness. These purchases or sales, if any, could have a material positive or negative impact on our liquidity available to repay
outstanding debt obligations or on our consolidated results of operations. These transactions could also require or result in
amendments to the agreements governing outstanding debt obligations or changes in our leverage or other financial ratios, which
could have a material positive or negative impact on our ability to comply with the covenants contained in our debt agreements. These
transactions, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.
The amounts involved may be material.
Senior Secured Credit Facilities
As of December 31, 2012, we had a total of $9,075.5 million outstanding under our senior secured credit facilities, consisting
of:
• an $846.9 million term loan A facility which matures in July 2014;
• a $7,714.9 million term loan B facility which matures in January 2016; and
• a $513.7 million term loan C—asset sale facility, subject to reduction as described below, which matures in January 2016.
We may raise incremental term loans of up to (a) $1.5 billion, plus (b) the excess, if any, of (x) 0.65 times pro forma
consolidated EBITDA (as calculated in the manner provided in the senior secured credit facilities documentation), over
(y) $1.5 billion, plus (c) the aggregate amount of certain principal prepayments made in respect of the term loans under the senior
secured credit facilities. Availability of such incremental term loans is subject, among other things, to the absence of any default, pro
forma compliance with the financial covenant and the receipt of commitments by existing or additional financial institutions.
We are the primary borrower under the senior secured credit facilities, except that certain of our domestic restricted
subsidiaries are co-borrowers under a portion of the term loan facilities.
Interest Rate and Fees
Borrowings under our senior secured credit facilities 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 administrative
agent or (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 are the following percentages per annum:
• with respect to loans under the term loan A facility, (i) 2.40% in the case of base rate loans and (ii) 3.40% in the case of
Eurocurrency rate loans; and
• with respect to loans under the term loan B facility and term loan C - asset sale facility, (i) 2.65%, in the case of base rate
loans and (ii) 3.65%, in the case of Eurocurrency rate loans.
The margin percentages are subject to adjustment based upon our leverage ratio.
Prepayments
The senior secured credit facilities require us to prepay outstanding term loans, subject to certain exceptions, with:
• 50% (which percentage may be reduced to 25% and to 0% based upon our leverage ratio) of our annual excess cash flow
(as calculated in accordance with our senior secured credit facilities), less any voluntary prepayments of term loans and
subject to customary credits;
• 100% of the net cash proceeds of sales or other dispositions of specified assets being marketed for sale (including casualty
and condemnation events), subject to certain exceptions;
• 100% (which percentage may be reduced to 75% and 50% based upon our leverage ratio) of the net cash proceeds of sales
or other dispositions by us or our wholly owned restricted subsidiaries of assets other than specified assets being marketed
for sale, subject to reinvestment rights and certain other exceptions;
• 100% of the net cash proceeds of (i) any incurrence of certain debt, other than debt permitted under our senior secured
credit facilities, (ii) certain securitization financing, (iii) certain issuances of Permitted Additional Notes (as defined in the
senior secured credit facilities) and (iv) certain issuances of Permitted Unsecured Notes and Permitted Senior Secured
Notes (as defined in the senior secured credit facilities); and
• Net Cash Proceeds received by us as dividends or distributions from indebtedness incurred at CCOH provided that the
Consolidated Leverage Ratio of CCOH is no greater than 7.00 to 1.00.