Clear Channel begins exchange offer for 10¾% notes, toggle notes

By Angela McDaniels

Tacoma, Wash., May 21 - Clear Channel Communications, Inc. began a private exchange offer for its 10¾% senior cash pay notes due 2016 and 11%/11¾% senior toggle notes due 2016, according to a company news release.

The company is offering newly issued senior notes due Feb. 1, 2021 in exchange for the old notes. The interest rate will be 12% in cash and 2% in kind.

The early tender date is 5 p.m. ET on June 4, and the offer will end at 11:59 p.m. ET on June 18.

The payouts are as follows:

• $1,000 principal amount of new notes for each $1,000 principal amount of 10¾% notes tendered by the early tender date;

• $950 principal amount of new notes for each $1,000 principal amount of 10¾% notes tendered after the early tender but prior to the offer expiration;

• $930 principal amount of new notes and $70 cash for each $1,000 principal amount of toggle notes tendered by the early tender date; and

• $880 principal amount of new notes and $70 cash for each $1,000 principal amount of toggle notes tendered after the early tender but prior to the offer expiration.

Holders will also receive accrued interest.

There are $796.25 million of 10¾% notes outstanding and $1,282,493,821 of toggle notes outstanding. The figure for the toggle notes includes notes held by Clear Channel and its subsidiaries.

The exchange offer is subject to the receipt of tenders for at least $500 million principal amount of notes (excluding notes held by Clear Channel or any of its affiliates).

The company said the holders of more than $550 million principal amount of the notes (not including subsidiaries of Clear Channel that hold outstanding notes) have agreed to tender their notes in the exchange offer.

The outstanding notes are, and the new notes will be, guaranteed by Clear Channel's parent, Clear Channel Capital I, LLC, and all of Clear Channel's existing domestic wholly owned restricted subsidiaries.

The exchange offer is only available to holders that have certified their status as both a qualified institutional buyer and an institutional accredited investor or not a U.S. person as those terms are defined under the Securities Act.

The exchange agent and information agent is D.F. King & Co., Inc. (www.dfking.com/ccu, 800 829-6554 or, for banks and brokerage firms, 212 269-5550).

Clear Channel is a media and entertainment company based in San Antonio.

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