iHeartMedia 2012 Annual Report Download - page 89

CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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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 Clear Channel 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.
The foregoing prepayments with the net cash proceeds of any incurrence of certain debt, other than debt permitted under Clear
Channel’s senior secured credit facilities, certain securitization financing, issuances of Permitted Additional Notes and annual excess
cash flow will be applied, at Clear Channel’s option, to the term loans (on a pro rata basis, other than that non-extended classes of
term loans may be prepaid prior to any corresponding extended class), in each case (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 net cash proceeds of issuances of
Permitted Unsecured Notes and Permitted Senior Secured Notes and Net Cash Proceeds received by Clear Channel as a distribution
from indebtedness incurred by CCOH will be applied (i) to the term loan A in a manner determined by Clear Channel, and (ii) to the
term loans (on a pro rata basis), 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.
Clear Channel may voluntarily repay outstanding loans under the senior secured credit facilities at any time without premium or
penalty, other than customary “breakage” costs with respect to Eurocurrency rate loans.
Amendments
During the fourth quarter of 2012, Clear Channel amended the terms of its senior secured credit facilities (the “Amendments”). The
Amendments, among other things: (i) permit exchange offers of term loans for new debt securities in an aggregate principal amount of
up to $5.0 billion (including the $2.0 billion issued as described under “Refinancing Transactions” below); (ii) provide Clear Channel
with greater flexibility to prepay tranche A term loans; (iii) following the repayment or extension of all tranche A term loans, permit
below par non-pro rata purchases of term loans pursuant to customary Dutch auction procedures whereby all lenders of the class of
term loans offered to be purchased will be offered an opportunity to participate; (iv) following the repayment or extension of all
tranche A term loans, permit the repurchase of junior debt maturing before January 2016 with cash on hand in an amount not to
exceed $200.0 million; (v) combine the term loan B, the delayed draw term loan 1 and the delayed draw term loan 2 under the senior
secured credit facilities; (vi) preserve revolving credit facility capacity in the event Clear Channel repays all amounts outstanding
under the revolving credit facility; and (vii) eliminate certain restrictions on the ability of CCOH and its subsidiaries to incur debt. On
October 31, 2012, Clear Channel repaid and permanently cancelled the commitments under its revolving credit facility, which was set
to mature July 2014.
Collateral and Guarantees
The senior secured credit facilities are guaranteed by Clear Channel and each of Clear Channel’s existing and future material wholly-
owned domestic restricted subsidiaries, subject to certain exceptions.
All obligations under the senior secured credit facilities, and the guarantees of those obligations, are secured, subject to permitted
liens, including prior liens permitted by the indenture governing the Clear Channel senior notes, and other exceptions, by:
• a lien on the capital stock of Clear Channel;
• 100% of the capital stock of any future material wholly-owned domestic license subsidiary that is not a “Restricted
Subsidiary” under the indenture governing the Clear Channel senior notes;
• certain assets that do not constitute “principal property” (as defined in the indenture governing the Clear Channel senior
notes);
• certain specified assets of Clear Channel and the guarantors that constitute “principal property” (as defined in the
indenture governing the Clear Channel senior notes) securing obligations under the senior secured credit facilities up to
the maximum amount permitted to be secured by such assets without requiring equal and ratable security under the
indenture governing the Clear Channel senior notes; and
• a lien on the accounts receivable and related assets securing Clear Channel’s receivables based credit facility that is
junior to the lien securing Clear Channel’s obligations under such credit facility.