iHeartMedia
Annual Report 2014

Plain-text annual report

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549 FORM 10-K [X] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 2014, or[ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ________ to _________. Commission File Number 000-53354 IHEARTMEDIA, INC.(Exact name of registrant as specified in its charter) Delaware26-0241222(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.) 200 East Basse RoadSan Antonio, Texas78209(Address of principal executive offices)(Zip code) (210) 822-2828(Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: NoneSecurities registered pursuant to Section 12(g) of the Act: None CC Media Holdings, Inc.(former name, former address and former fiscal year, if changed since last report) Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES [ ] NO [X]Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. YES [ ] NO [X]Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO [ ]Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted andposted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).YES [X]NO [ ]Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’sknowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “largeaccelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [X]Smaller reporting company [ ]Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2). YES [ ] NO [X]As of June 30, 2014, the aggregate market value of the common stock beneficially held by non-affiliates of the registrant was approximately $60.8 million based on the closing salesprice of the Class A common stock as reported on the Over-the-Counter Bulletin Board.On February 11, 2014, there were 29,307,583 outstanding shares of Class A common stock (including 111,291 shares owned by a subsidiary and excluding 117,246 shares held intreasury), 555,556 outstanding shares of Class B common stock and 58,967,502 outstanding shares of Class C common stock. DOCUMENTS INCORPORATED BY REFERENCEPortions of our Definitive Proxy Statement for the 2015 Annual Meeting, expected to be filed within 120 days of our fiscal year end, are incorporated by reference into Part III.  IHEARTMEDIA, INC.INDEX TO FORM 10-KPageNumberPART I Item 1. Business....................................................................................................................................................................................................... 1 Item 1A. Risk Factors.............................................................................................................................................................................................. 16 Item 1B. Unresolved Staff Comments................................................................................................................................................................. 26 Item 2. Properties................................................................................................................................................................................................... 26 Item 3. Legal Proceedings.................................................................................................................................................................................... 26 Item 4. Mine Safety Disclosures......................................................................................................................................................................... 27 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities................................................................................................................................................................................. 29 Item 6. Selected Financial Data.......................................................................................................................................................................... 31 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations................................................... 33 Item 7A. Quantitative and Qualitative Disclosures About Market Risk ....................................................................................................... 74 Item 8. Financial Statements and Supplementary Data ............................................................................................................................... 75 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.................................................. 117 Item 9A. Controls and Procedures...................................................................................................................................................................... 117 Item 9B. Other Information................................................................................................................................................................................. 119 PART III Item 10. Directors, Executive Officers and Corporate Governance............................................................................................................ 120 Item 11. Executive Compensation......................................................................................................................................................... ##11Item Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters............................................................................................................................................................................. 120 Item 13. Certain Relationships and Related Transactions, and Director Independence.............................................................. ##13Item Item 14. Principal Accounting Fees and Services............................................................................................................................................ 121 PART IV Item 15. Exhibits and Financial Statement Schedules................................................................................................................................... 122  PART IITEM 1. BUSINESSThe CompanyWe were incorporated in May 2007 by private equity funds sponsored by Bain Capital Partners, LLC (“Bain Capital”) and Thomas H. LeePartners, L.P. (“THL,” and together, the “Sponsors”) for the purpose of acquiring the business of iHeartCommunications, Inc., a Texas corporation(“iHeartCommunications”). The acquisition was completed on July 30, 2008 pursuant to the Agreement and Plan of Merger, dated November 16, 2006, asamended on April 18, 2007, May 17, 2007 and May 13, 2008 (the “Merger Agreement”). As a result of the merger, each issued and outstanding share ofiHeartCommunications, other than shares held by certain of our principals that were rolled over and exchanged for shares of our Class A common stock, waseither exchanged for (i) $36.00 in cash consideration or (ii) one share of our Class A common stock. Prior to the consummation of our acquisition ofiHeartCommunications, we had not conducted any activities, other than activities incident to our formation and in connection with the acquisition, and didnot have any assets or liabilities, other than those related to the acquisition. You can find more information about us at our Internet website located at www.iheartmedia.com. Our Annual Report on Form 10-K, our QuarterlyReports on Form 10-Q, our Current Reports on Form 8-K and any amendments to those reports are available free of charge through our Internet website assoon as reasonably practicable after we electronically file such material with, or furnish such material to, the Securities and Exchange Commission (“SEC”).The contents of our website are not deemed to be part of this Annual Report on Form 10-K or any of our other filings with the SEC. Our corporate headquarters are in San Antonio, Texas and we have executive offices in New York, New York. Our headquarters are located at200 East Basse Road, San Antonio, Texas 78209 (telephone: 210-822-2828). On September 16, 2014, we issued a press release that announced a change of our name to “iHeartMedia, Inc.” and changed the names of certainof its affiliates, including as follows: Old Name: New Name:Clear Channel Capital I, LLC iHeartMedia Capital I, LLCClear Channel Capital II, LLC iHeartMedia Capital II, LLCClear Channel Communications, Inc. iHeartCommunications, Inc.Clear Channel Management Services, Inc. iHeartMedia Management Services, Inc.Clear Channel Broadcasting, Inc. iHeartMedia + Entertainment, Inc.Clear Channel Identity, Inc. iHM Identity, Inc.Clear Channel Satellite Services Inc. iHeartMedia Satellite Services, Inc. Clear Channel Outdoor Holdings, Inc. (“CCOH”), an indirect subsidiary of the Company, retained its existing name. Our Business SegmentsWe are a diversified media and entertainment company with three reportable business segments: iHeartMedia (“iHM”); Americas outdooradvertising (“Americas outdoor”); and International outdoor advertising (“International outdoor”). Our iHM segment provides media and entertainmentservices via broadcast and digital delivery and also includes our national syndication business. Our Americas outdoor and International outdoor segmentsprovide outdoor advertising services in their respective geographic regions using various digital and traditional display types. Our Americas outdoorsegment consists of operations primarily in the United States and Canada. Our International outdoor segment consists of operations primarily in Asia,Australia, Europe and Latin America. Our “Other” category includes our full-service media representation business, Katz Media Group (“Katz Media”), aswell as other general support services and initiatives which are ancillary to our other businesses. Approximately half of our revenue is generated from ouriHM segment. The remaining half is comprised of our Americas outdoor and our International outdoor advertising segments, as well as Katz Media and othergeneral support services and initiatives. We are a leading global media and entertainment company specializing in radio, digital, out-of-home, mobile and on-demand entertainment andinformation services for national audiences and local communities while providing premiere opportunities for advertisers. Through our strong capabilitiesand unique collection of assets, we have the ability to deliver compelling content as well as innovative, effective marketing campaigns for advertisers andmarketing, creative and strategic partners in the United States and internationally. We focus on building the leadership position of our diverse global assets and maximizing our financial performance while serving our localcommunities. We continue to invest strategically in our digital platforms, including the development of continued1 enhancements to iHeartRadio, our integrated digital radio platform, and the ongoing deployment of digital outdoor displays. We intend to continue toexecute our strategies while closely managing expenses and focusing on achieving operating efficiencies across our businesses. We share best practicesacross our businesses and markets to replicate our successes throughout the markets in which we operate. For more information about our revenue, gross profit and assets by segment and our revenue and long-lived assets by geographic area, see Note 13 toour Consolidated Financial Statements located in Item 8 of Part II of this Annual Report on Form 10-K. iHMOur iHM operations include radio broadcasting, online and mobile services and products, program syndication, entertainment, traffic and weatherdata distribution and music research services. Our radio stations and content can be heard on AM/FM stations, HD digital radio stations, satellite radio, atiHeartRadio.com and our radio stations’ websites, and through our iHeartRadio mobile application on smart phones and tablets, on gaming consoles, via in-home entertainment, in enhanced automotive platforms, as well as in-vehicle entertainment and navigation systems. As of December 31, 2014, we owned 858 domestic radio stations servicing more than 150 U.S. markets, including 44 of the top 50 markets and 84 ofthe top 100 markets. In addition, we provide programming and sell air time on one radio station owned by a third-party under a local marketing agreement. We are also the beneficiary of Aloha Station Trust, LLC, which owns and operates 16 radio stations, and the Brunswick Trust, which owns and operates 1radio station, all of which we were required to divest in order to comply with Federal Communication Commission (“FCC”) media ownership rules, andwhich are being marketed for sale. In addition to our local radio programming, we also operate Premiere Networks (“Premiere”), a national radio network that produces, distributes orrepresents more than 90 syndicated radio programs and serves more than 5,500 radio station affiliates, reaching approximately 245 million listeners monthly. We also deliver real-time traffic information via navigation systems, radio and television broadcast media and wireless and Internet-based services throughour traffic business, Total Traffic & Weather Network. We also promote, produce and curate special nationally-recognized events for our listeners, including the iHeartRadio Music Festival, theiHeartRadio Ultimate Pool Party, the iHeartRadio Jingle Ball Concert Tour, the iHeartRadio Country Festival, the iHeartRadio Ultimate Valentine’s Escapeand the iHeartRadio Fiesta Latina. StrategyOur iHM strategy centers on delivering entertaining and informative content across multiple platforms, including broadcast, mobile and digital aswell as events. We strive to serve our listeners by providing the content they desire on the platform they prefer, while supporting advertisers, strategicpartners, music labels and artists with a diverse platform of creative marketing opportunities designed to effectively reach and engage target audiences. OuriHM strategy also focuses on continuing to improve the operations of our stations by providing valuable programming and promotions, as well as sharingbest practices across our stations in marketing, distribution, sales and cost management. Promote Broadcast Radio Media Spending. Given the attractive reach and metrics of both the broadcast radio industry in general and iHM inparticular, as well as our depth and breadth of relationships with both media agencies and national and local advertisers, we believe we can drive broadcastradio’s share of total media spending by using our dedicated national sales team to highlight the value of broadcast radio relative to other media. We havemade and continue to make significant investments in research to enable our clients to better understand how our assets can successfully reach their targetaudiences and promote their advertising campaigns; broadened our national sales teams and initiatives to better develop, create and promote theiradvertising campaigns; invested in technology to enhance our platform and capabilities; and continue to seek opportunities to deploy our iHeartRadiodigital radio service across both existing and emerging devices and platforms. We are also working closely with advertisers, marketers and agencies to meettheir needs through new products, events and services developed through optimization of our current portfolio of assets, as well as to develop tools todetermine how effective broadcast radio is in reaching their desired audiences. Promote Local and National Advertising. We intend to grow our iHM businesses by continuing to develop effective programming, creating newsolutions for our advertisers and agencies, fostering key relationships with advertisers and improving our local and national sales teams. We intend toleverage our diverse collection of assets, our programming and creative strengths, and our consumer relationships to create events, such as one-of-a-kind localand national promotions for our listeners, and develop new, innovative technologies and products to promote our advertisers. We seek to maximize revenueby closely managing our advertising opportunities and pricing to compete effectively in local markets. We operate price and yield information systems,which provide detailed inventory information. These systems enable our station managers and sales directors to adjust commercial inventory and pricingbased on local market demand, as well as to manage and monitor different commercial durations (60 second, 30 second,2 15 second and five second) in order to provide more effective advertising for our customers at what we believe are optimal prices given market conditions. Continue to Enhance the Listener Experience. We intend to continue enhancing the listener experience by offering a wide variety of compellingcontent and methods of delivery. We will continue to provide the content our listeners desire on their preferred platforms. Our investments have created acollection of leading on-air talent. For example, Premiere offers more than 90 syndicated radio programs and services for more than 5,500 radio stationaffiliates across the United States, including popular programs such as Rush Limbaugh, Sean Hannity, Glenn Beck, Ryan Seacrest, Steve Harvey, Elvis Duran,Bobby Bones and Delilah. Our distribution capabilities allow us to attract top talent and more effectively utilize programming, sharing our best and mostcompelling content across many stations. Continue to Deliver Nationally-Recognized Live Events. We intend to continue to deliver nationally-recognized live events to our listeners, such asthe iHeartRadio Music Festival, the iHeartRadio Ultimate Pool Party, the iHeartRadio Jingle Ball Concert Tour, the iHeartRadio Country Festival, theiHeartRadio Ultimate Valentine’s Escape and the iHeartRadio Fiesta Latina, featuring some of the biggest names in the music industry. Deliver Content via Multiple Distribution Technologies. We continue to expand the choices for our listeners. We deliver music, news, talk, sports,traffic and other content using an array of distribution technologies, including broadcast radio and HD radio channels, satellite radio, digitally viaiHeartRadio.com and our stations’ websites, and through our iHeartRadio mobile application on smart phones and tablets, on gaming consoles, via in-homeentertainment, in enhanced automotive platforms, as well as in-vehicle entertainment and navigation systems. Some examples of our recent initiatives are asfollows: · Streaming. We provide streaming content via the Internet, mobile and other digital platforms. We rank among the top streaming networks inthe U.S. with regards to Average Active Sessions (“AAS”), Session Starts (“SS”) and Average Time Spent Listening (“ATSL”). AAS and SSmeasure the level of activity while ATSL measures the ability to keep the audience engaged. · Websites and Mobile Applications. We have developed mobile and Internet applications such as the iHeartRadio smart phone application andwebsite and websites for our stations and personalities. These mobile and Internet applications allow listeners to use their smart phones, tabletsor other digital devices to interact directly with stations, find titles/artists, request songs and create custom and personalized stations whileproviding an additional method for advertisers to reach consumers. As of December 31, 2014, our iHeartRadio mobile application has beendownloaded approximately 500 million times (including updates). iHeartRadio provides a unique digital music experience by offering accessto more than 1,900 live broadcast and digital-only radio stations, plus user-created custom stations with broad social media integration and ouron demand content from our premium talk partnerships and user generated talk shows. Through our digital platforms, we estimate that we hadmore than 81 million unique digital visitors for the month of December 2014. Sources of RevenueOur iHM segment generated 50%, 50%, and 49% of our revenue for the years ended December 31, 2014, 2013 and 2012, respectively. The primarysource of revenue in our iHM segment is the sale of commercials on our radio stations for local and national advertising. Our iHeartRadio mobile applicationand website, our station websites, national live events and Total Traffic & Weather Network also provide additional means for our advertisers to reachconsumers. Our advertisers cover a wide range of categories, including consumer services, retailers, entertainment, health and beauty products,telecommunications, automotive, media and political. Our contracts with our advertisers range from less than a one-year to multi-year terms. We alsogenerate revenues from network compensation, our online services, our traffic business, events and other miscellaneous transactions. These other sources ofrevenue supplement our traditional advertising revenue without increasing on-air commercial time. Each radio station’s local sales staff solicits advertising directly from local advertisers or indirectly through advertising agencies. Our ability toproduce commercials that respond to the specific needs of our advertisers helps to build local direct advertising relationships. To generate nationaladvertising sales, we leverage national sales teams and engage our Katz Media unit, which specializes in soliciting radio advertising sales on a national levelfor us and other radio and television companies. National sales representatives such as Katz Media obtain advertising principally from advertising agencieslocated outside the station’s market and receive commissions based on advertising sold. 3 Advertising rates are principally based on the length of the spot and how many people in a targeted audience listen to our stations, as measured byindependent ratings services. A station’s format can be important in determining the size and characteristics of its listening audience, and advertising ratesare influenced by the station’s ability to attract and target audiences that advertisers aim to reach. The size of the market influences rates as well, with largermarkets typically receiving higher rates than smaller markets. Rates are generally highest during morning and evening commuting periods. 4 Radio StationsAs of December 31, 2014, we owned 858 radio stations, including 246 AM and 612 FM domestic radio stations, of which 148 stations were in thetop 25 markets. Therefore, no one property is material to our overall operations. We believe that our properties are in good condition and suitable for ouroperations. Radio broadcasting is subject to the jurisdiction of the FCC under the Communications Act of 1934, as amended (the “Communications Act”). Asdescribed in “Regulation of Our iHeartMedia Business” below, the FCC grants us licenses in order to operate our radio stations. The following table providesthe number of owned radio stations in the top 25 Nielsen-ranked markets within our iHM segment. Nielsen NumberMarket ofRank(1) Market Stations1 New York, NY 62 Los Angeles, CA 83 Chicago, IL 74 San Francisco, CA 75 Dallas-Ft. Worth, TX 66 Houston-Galveston, TX 67 Washington, DC 58 Philadelphia, PA 69 Atlanta, GA 710 Boston, MA 511 Miami-Ft. Lauderdale-Hollywood, FL 712 Detroit, MI 613 Seattle-Tacoma, WA 714 Phoenix, AZ 815 Puerto Rico -16 Minneapolis-St. Paul, MN 617 San Diego, CA 718 Denver-Boulder, CO 819 Tampa-St. Petersburg-Clearwater, FL 820 Nassau-Suffolk (Long Island), NY -21 Baltimore, MD 422 St. Louis, MO 623 Portland, OR 724 Charlotte-Gastonia-Rock Hill, NC-SC 525 Riverside-San Bernardino 6 Total Top 25 Markets(2) 148 (1) Source: Fall 2014 Arbitron Radio Market Rankings.(2) Included in the total are stations that were placed in a trust in order to bring the merger into compliance with the FCC’s media ownership rules. We have divested certain of these stations in the past and will continue to divest these stations as required. Premiere NetworksWe operate Premiere, a national radio network that produces, distributes or represents more than 90 syndicated radio programs and services for morethan 5,500 radio station affiliates, reaching approximately 245 million listeners monthly. Our broad distribution capabilities enable us to attract and retaintop programming talent. Some of our more popular syndicated programs include Rush Limbaugh, Sean Hannity, Glenn Beck, Ryan Seacrest, Steve Harvey,Elvis Duran, Bobby Bones and Delilah. We believe recruiting and retaining top talent is an important component of the success of our radio networks. 5 Total Traffic & Weather NetworkTotal Traffic & Weather Network delivers real-time local traffic flow and incident information along with weather updates to more than 1,900 radioand approximately 180 television affiliates, as well as through Internet and mobile partnerships, reaching nearly 200 million consumers each month. TotalTraffic & Weather Network services more than 200 markets in the United States, Canada and Mexico. It operates the largest broadcast traffic navigationnetwork in North America and has expanded its offerings to include news and sports content. CompetitionOur broadcast radio stations, as well as our mobile and digital applications and our traffic business, compete for listeners and advertising revenuesdirectly with other radio stations within their respective markets, as well as with other advertising media, including broadcast and cable television, online,print media, outdoor advertising, satellite radio, direct mail and other forms of advertisement. In addition, the radio broadcasting industry is subject tocompetition from services that use media technologies such as Internet-based media, mobile applications and satellite-based digital radio services. Suchservices reach national and local audiences with multi-channel, multi-format, digital radio services. Our broadcast radio stations compete for listeners primarily on the basis of program content that appeals to a particular demographic group. Ourtargeted listener base of specific demographic groups in each of our markets allows us to attract advertisers seeking to reach those listeners. Americas Outdoor AdvertisingWe are one of the largest outdoor advertising companies in North America (based on revenues), which includes the United States and Canada. Approximately 95% of our revenue in our Americas outdoor advertising segment was derived from the United States in each of the years ended December 31,2014, 2013 and 2012. We own or operate approximately 103,000 display structures in our Americas outdoor segment with operations in 45 of the 50 largestmarkets in the United States, including all of the 20 largest markets. Our Americas outdoor assets consist of traditional and digital billboards, street furniture and transit displays, airport displays and wallscapes andother spectaculars, which we own or operate under lease management agreements. Our Americas outdoor advertising business is focused on metropolitanareas with dense populations. StrategyWe seek to capitalize on our Americas outdoor network and diversified product mix to maximize revenue. In addition, by sharing best practicesamong our business segments, we believe we can quickly and effectively replicate our successes in our other markets. Our outdoor strategy focuses onleveraging our diversified product mix and long-standing presence in many of our existing markets, which provides us with the ability to launch newproducts and test new initiatives in a reliable and cost-effective manner. Promote Outdoor Media Spending. Given the attractive industry fundamentals of outdoor media and our depth and breadth of relationships withboth local and national advertisers, we believe we can drive outdoor advertising's share of total media spending by using our dedicated national sales team tohighlight the value of outdoor advertising relative to other media. Outdoor advertising only represented 4% of total dollars spent on advertising in theUnited States in 2014. We have made and continue to make significant investments in research tools that enable our clients to better understand how ourdisplays can successfully reach their target audiences and promote their advertising campaigns. Also, we are working closely with clients, advertisingagencies and other diversified media companies to develop more sophisticated systems that will provide improved audience metrics for outdoor advertising. For example, we have implemented the TAB Out of Home Ratings audience measurement system which: (1) separately reports audiences for billboards,posters, junior posters, transit shelters and phone kiosks, (2) reports for geographically sensitive reach and frequency, (3) provides granular detail, reportingindividual out of home units in over 200 designated market areas, (4) provides detailed demographic data comparable to other media, and (5) provides truecommercial ratings based on people who see the advertising. Continue to Deploy Digital Displays. Digital outdoor advertising provides significant advantages over traditional outdoor media. Our electronicdisplays are linked through centralized computer systems to instantaneously and simultaneously change advertising copy on a large number of displays,allowing us to sell more advertising opportunities to advertisers. The ability to change copy by time of day and quickly change messaging based onadvertisers’ needs creates additional flexibility for our customers. Although digital displays require more capital to construct compared to traditionalbulletins, the advantages of digital allow us to penetrate new accounts and categories of advertisers, as well as serve a broader set of needs for existingadvertisers. Digital displays allow for high-frequency, 24-hour advertising changes in high-traffic locations and allow us to offer our clients optimalflexibility,6 distribution, circulation and visibility. We expect this trend to continue as we increase our quantity of digital inventory. As of December 31, 2014, we havedeployed more than 1,100 digital billboards in 37 markets in the United States. Sources of RevenueAmericas outdoor generated 20%, 21% and 20% of our revenue in 2014, 2013 and 2012, respectively. Americas outdoor revenue is derived fromthe sale of advertising copy placed on our traditional and digital displays. Our display inventory consists primarily of billboards, street furniture displaysand transit displays. The margins on our billboard contracts, including those related to digital billboards, tend to be higher than those on contracts for otherdisplays, due to their greater size, impact and location along major roadways that are highly trafficked. Billboards comprise approximately two-thirds of ourdisplay revenues. The following table shows the approximate percentage of revenue derived from each category for our Americas outdoor inventory: Year Ended December 31, 2014 2013 2012 Billboards: Bulletins58% 57% 56% Posters13% 13% 13% Street furniture displays4% 4% 4% Transit displays17% 17% 17% Other displays (1)8% 9% 10% Total100% 100% 100% (1) Includes spectaculars and wallscapes. Our Americas outdoor segment generates revenues from local and national sales. Our advertising rates are based on a number of different factorsincluding location, competition, size of display, illumination, market and gross ratings points. Gross ratings points are the total number of impressionsdelivered, expressed as a percentage of a market population, of a display or group of displays. The number of impressions delivered by a display is measuredby the number of people passing the site during a defined period of time. For all of our billboards in the United States, we use independent, third-partyauditing companies to verify the number of impressions delivered by a display. “Reach” is the percent of a target audience exposed to an advertisingmessage at least once during a specified period of time, typically during a period of four weeks. “Frequency” is the average number of exposures anindividual has to an advertising message during a specified period of time. Out-of-home frequency is typically measured over a four-week period. While location, price and availability of displays are important competitive factors, we believe that providing quality customer service andestablishing strong client relationships are also critical components of sales. In addition, we have long-standing relationships with a diversified group ofadvertising brands and agencies that allow us to diversify client accounts and establish continuing revenue streams. BillboardsOur billboard inventory primarily includes bulletins and posters. · Bulletins. Bulletins vary in size, with the most common size being 14 feet high by 48 feet wide. Digital bulletins display static messages thatresemble standard printed bulletins when viewed, but also allow advertisers to change messages throughout the course of a day, and maydisplay advertisements for multiple customers. Our electronic displays are linked through centralized computer systems to instantaneously andsimultaneously change advertising copy as needed. Because of their greater size, impact, high-frequency and 24-hour advertising changes, wetypically receive our highest rates for digital bulletins. Almost all of the advertising copy displayed on traditional bulletins is computer printedon vinyl and transported to the bulletin where it is secured to the display surface. Bulletins generally are located along major expressways,primary commuting routes and main intersections that are highly visible and heavily trafficked. Our clients may contract for individualbulletins or a network of bulletins, meaning the clients’ advertisements are rotated among bulletins to increase the reach of the campaign. Ourclient contracts for bulletins, either traditional or digital, generally have terms ranging from four weeks to one year.· Posters. Digital posters are available in addition to the traditional poster-size and junior poster-size. Similar to digital bulletins, digital postersdisplay static messages that resemble standard printed posters when viewed, and are linked7 through centralized computer systems to instantaneously and simultaneously change messages throughout the course of a day. Traditionalposters are approximately 11 feet high by 23 feet wide, and the traditional junior posters are approximately 5 feet high by 11 feet wide. Advertising copy for traditional posters is digitally printed on a single piece of polyethylene material that is then transported and secured to theposter surfaces. Advertising copy for traditional junior posters is printed using silk screen, lithographic or digital process to transfer the designsonto paper that is then transported and secured to the poster surfaces. Posters generally are located in commercial areas on primary andsecondary routes near point-of-purchase locations, facilitating advertising campaigns with greater demographic targeting than those displayedon bulletins. Our poster rates typically are less than our bulletin rates, and our client contracts for posters generally have terms ranging fromfour weeks to one year. Premiere displays, which consist of premiere panels and squares, are innovative hybrids between bulletins and postersthat we developed to provide our clients with an alternative for their targeted marketing campaigns. The premiere displays use one or moreposter panels, but with vinyl advertising stretched over the panels similar to bulletins. Our intent is to combine the creative impact of bulletinswith the additional reach and frequency of posters. Street Furniture DisplaysOur street furniture displays include advertising surfaces on bus shelters, information kiosks, freestanding units and other public structures, areavailable in both traditional and digital formats, and are primarily located in major metropolitan areas and along major commuting routes. Generally, we ownthe street furniture structures and are responsible for their construction and maintenance. Contracts for the right to place our street furniture displays in thepublic domain and sell advertising space on them are awarded by municipal and transit authorities in competitive bidding processes governed by local law. Generally, these contracts have terms ranging from 10 to 20 years. As compensation for the right to sell advertising space on our street furniture structures, wepay the municipality or transit authority a fee or revenue share that is either a fixed amount or a percentage of the revenue derived from the street furnituredisplays. Typically, these revenue sharing arrangements include payments by us of minimum guaranteed amounts. Client contracts for street furnituredisplays typically have terms ranging from four weeks to one year, and are typically for network packages of multiple street furniture displays. Transit DisplaysOur transit displays are advertising surfaces on various types of vehicles or within transit systems, including on the interior and exterior sides ofbuses, trains, trams, and within the common areas of rail stations and airports, and are available in both traditional and digital formats. Similar to streetfurniture, contracts for the right to place our displays on such vehicles or within such transit systems and to sell advertising space on them generally areawarded by public transit authorities in competitive bidding processes or are negotiated with private transit operators. Generally, these contracts have termsranging from five to ten years. Our client contracts for transit displays generally have terms ranging from four weeks to one year. Other DisplaysThe balance of our display inventory consists of spectaculars and wallscapes. Spectaculars are customized display structures that often incorporatevideo, multidimensional lettering and figures, mechanical devices and moving parts and other embellishments to create special effects. The majority of ourspectaculars are located in Times Square in New York City, the Gardiner Expressway in Toronto, and the Fashion Show Mall and Miracle Mile Shops in LasVegas. Client contracts for spectaculars typically have terms of one year or longer. A wallscape is a display that drapes over or is suspended from the sides ofbuildings or other structures. Generally, wallscapes are located in high-profile areas where other types of outdoor advertising displays are limited orunavailable. Clients typically contract for individual wallscapes for extended terms. Advertising Inventory and MarketsAs of December 31, 2014, we owned or operated approximately 103,000 display structures in our Americas outdoor advertising segment withoperations in 45 of the 50 largest markets in the United States, including all of the 20 largest markets. Therefore, no one property is material to our overalloperations. We believe that our properties are in good condition and suitable for our operations. Our displays are located on owned land, leased land or land for which we have acquired permanent easements. The majority of the advertisingstructures on which our displays are mounted require permits. Permits are granted for the right to operate an advertising structure as long the structure is usedin compliance with the laws and regulations of the applicable jurisdiction. CompetitionThe outdoor advertising industry in the Americas is fragmented, consisting of several large companies involved in outdoor advertising, such asOUTFRONT Media Inc. and Lamar Advertising Company, as well as numerous smaller and local companies8 operating a limited number of displays in a single market or a few local markets. We also compete with other advertising media in our respective markets,including broadcast and cable television, radio, print media, direct mail, online and other forms of advertisement. Outdoor advertising companies competeprimarily based on ability to reach consumers, which is driven by location of the display. International Outdoor AdvertisingOur International outdoor business segment includes our operations in Asia, Australia, Europe and Latin America, with approximately 33% of ourrevenue in this segment derived from France and the United Kingdom for the years ended December 31, 2014, 2013 and 2012. As of December 31, 2014, weowned or operated more than 540,000 displays across 26 countries. Our International outdoor assets consist of street furniture and transit displays, billboards, mall displays, Smartbike programs, wallscapes and otherspectaculars, which we own or operate under lease agreements. Our International business is focused on metropolitan areas with dense populations. StrategySimilar to our Americas outdoor advertising business, we believe our International outdoor advertising business has attractive industry fundamentalsincluding a broad audience reach and a highly cost effective media for advertisers as measured by cost per thousand persons reached compared to othertraditional media. Our International business focuses on the following strategies: Promote Overall Outdoor Media Spending. Our strategy is to promote growth in outdoor advertising’s share of total media spending by leveragingour international scale and local reach. We are focusing on developing and implementing better and improved outdoor audience delivery measurementsystems to provide advertisers with tools to determine how effectively their message is reaching the desired audience. Capitalize on Product and Geographic Opportunities. We are also focused on growing our business internationally by working closely with ouradvertising customers and agencies in meeting their needs, and through new product offerings, optimization of our current display portfolio and selectiveinvestments targeting promising growth markets. We have continued to innovate and introduce new products in international markets based on localdemands. Our core business is our street furniture business and that is where we plan to focus much of our investment. We plan to continue to evaluatemunicipal contracts that may come up for bid and will make prudent investments where we believe we can receive attractive returns. We will also continue toinvest in markets such as China and Latin America where we believe there is high growth potential. Continue to Deploy Digital Display Networks. Internationally, digital out-of-home displays are a dynamic medium which enables our customers toengage in real-time, tactical, topical and flexible advertising. We will continue our focused and dedicated digital strategy as we remain committed to thedigital development of out-of-home communication solutions internationally. Through our international digital brand, Clear Channel Play, we are able tooffer networks of digital displays in multiple formats and multiple environments including bus shelters, airports, transit, malls and flagship locations. Weseek to achieve greater consumer engagement and flexibility by delivering powerful, flexible and interactive campaigns that open up new possibilities foradvertisers to engage with their target audiences. We had more than 4,700 digital displays in 20 countries across Europe, Asia and Latin America as ofDecember 31, 2014. 9 Sources of RevenueOur International outdoor segment generated 27% of our revenue in 2014, 2013 and 2012. International outdoor advertising revenue is derivedfrom the sale of traditional advertising copy placed on our display inventory and electronic displays which are part of our network of digital displays. OurInternational outdoor display inventory consists primarily of street furniture displays, billboards, transit displays and other out-of-home advertising displays.The following table shows the approximate percentage of revenue derived from each inventory category of our International outdoor segment: Year Ended December 31, 2014 2013 2012 Street furniture displays49% 48% 46% Billboards22% 23% 26% Transit displays9% 9% 8% Other (1)20% 20% 20% Total100% 100% 100% (1) Includes advertising revenue from mall displays, other small displays, and non-advertising revenue from sales of street furniture equipment,cleaning and maintenance services, operation of Smartbike programs and production revenue. Our International outdoor segment generates revenues worldwide from local, regional and national sales. Similar to our Americas outdoor business,advertising rates generally are based on the gross ratings points of a display or group of displays. The number of impressions delivered by a display, in somecountries, is weighted to account for such factors as illumination, proximity to other displays and the speed and viewing angle of approaching traffic. While location, price and availability of displays are important competitive factors, we believe that providing quality customer service andestablishing strong client relationships are also critical components of sales. Our entrepreneurial culture allows local management to operate their markets asseparate profit centers, encouraging customer cultivation and service. Street Furniture DisplaysOur International street furniture displays, available in traditional and digital formats, are substantially similar to their Americas street furniturecounterparts, and include bus shelters, freestanding units, various types of kiosks, benches and other public structures. Internationally, contracts withmunicipal and transit authorities for the right to place our street furniture in the public domain and sell advertising on such street furniture typically providefor terms ranging from 10 to 15 years. The major difference between our International and Americas street furniture businesses is in the nature of themunicipal contracts. In our International outdoor business, these contracts typically require us to provide the municipality with a broader range ofmetropolitan amenities such as bus shelters with or without advertising panels, information kiosks and public wastebaskets, as well as space for themunicipality to display maps or other public information. In exchange for providing such metropolitan amenities and display space, we are authorized to selladvertising space on certain sections of the structures we erect in the public domain. Our International street furniture is typically sold to clients as networkpackages of multiple street furniture displays, with contract terms ranging from one to two weeks. Client contracts are also available with terms of up to oneyear. BillboardsThe sizes of our International billboards are not standardized. The billboards vary in both format and size across our networks, with the majority ofour International billboards being similar in size to our posters used in our Americas outdoor business. Our International billboards are sold to clients asnetwork packages with contract terms typically ranging from one to two weeks. Long-term client contracts are also available and typically have terms of upto one year. We lease the majority of our billboard sites from private landowners. Billboards include posters and are available in traditional and digitalformats. Transit DisplaysOur International transit display contracts are substantially similar to their Americas transit display counterparts, and typically require us to makeonly a minimal initial investment and few ongoing maintenance expenditures. Contracts with public transit authorities or private transit operators typicallyhave terms ranging from three to seven years. Our client contracts for transit displays, either traditional or digital, generally have terms ranging from oneweek to one year, or longer. 10 Other International Displays and ServicesThe balance of our revenue from our International outdoor segment consists primarily of advertising revenue from mall displays, other smalldisplays and non-advertising revenue from sales of street furniture equipment, cleaning and maintenance services and production revenue. Internationally,our contracts with mall operators generally have terms ranging from five to ten years and client contracts for mall displays generally have terms ranging fromone to two weeks, but are available for periods up to six months. Our International inventory includes other small displays that are counted as separatedisplays since they form a substantial part of our network and International outdoor advertising revenue. We also have a Smartbike bicycle rental programwhich provides bicycles for rent to the general public in several municipalities. In exchange for providing the bike rental program, we generally deriverevenue from advertising rights to the bikes, bike stations, additional street furniture displays, or fees from the local municipalities. In several of ourInternational markets, we sell equipment or provide cleaning and maintenance services as part of a billboard or street furniture contract with a municipality. Advertising Inventory and MarketsAs of December 31, 2014, we owned or operated more than 540,000 displays in our International outdoor segment, with operations across 26countries. Our International outdoor display count includes display faces, which may include multiple faces on a single structure, as well as small, individualdisplays. As a result, our International outdoor display count is not comparable to our Americas outdoor display count, which includes only uniquedisplays. No one property is material to our overall operations. We believe that our properties are in good condition and suitable for our operations. CompetitionThe international outdoor advertising industry is fragmented, consisting of several large companies involved in outdoor advertising, such asJCDecaux and ExterionMedia, as well as numerous smaller and local companies operating a limited number of displays in a single market or a few localmarkets. We also compete with other advertising media in our respective markets, including broadcast and cable television, radio, print media, direct mail,online and other forms of advertisement. Outdoor companies compete primarily based on ability to reach consumers, which is driven by location of thedisplay. OtherOur Other category includes our media representation firm, Katz Media, as well as other general support services and initiatives which are ancillaryto our other businesses. Katz Media, a leading media representation firm in the U.S. for radio and television stations, sells national spot advertising time for clients in theradio and television industries throughout the United States. As of December 31, 2014, Katz Media represented more than 4,000 radio stations,approximately one-fifth of which are owned by us. Katz Media also represents more than 700 television and digital multicast stations. Katz Media generates revenue primarily through contractual commissions realized from the sale of national spot and online advertising. Nationalspot advertising is commercial airtime sold to advertisers on behalf of radio and television stations. Katz Media represents its media clients pursuant tomedia representation contracts, which typically have terms of up to ten years in length. EmployeesAs of December 31, 2014, we had approximately 14,500 domestic employees and approximately 4,700 international employees, of whichapproximately 17,700 were in direct operations and 1,500 were in administrative or corporate related activities. Approximately 800 of our employees aresubject to collective bargaining agreements in their respective countries. We are a party to numerous collective bargaining agreements, none of whichrepresent a significant number of employees. We believe that our relationship with our employees is good. SeasonalityRequired information is located within Item 7 of Part II of this Annual Report on Form 10-K. Regulation of our iHeartMedia Business GeneralThe following is a brief summary of certain statutes, regulations, policies and proposals affecting our iHeartMedia business. For example, radiobroadcasting is subject to the jurisdiction of the FCC under the Communications Act. The Communications Act permits the operation of a radio broadcaststation only under a license issued by the FCC upon a finding that grant of the license would11 serve the public interest, convenience and necessity. Among other things, the Communications Act empowers the FCC to: issue, renew, revoke and modifybroadcasting licenses; assign frequency bands for broadcasting; determine stations’ frequencies, locations, power and other technical parameters; imposepenalties for violation of its regulations, including monetary forfeitures and, in extreme cases, license revocation; impose annual regulatory and applicationprocessing fees; and adopt and implement regulations and policies affecting the ownership, program content, employment practices and many other aspectsof the operation of broadcast stations. This summary does not comprehensively cover all current and proposed statutes, regulations and policies affecting our iHeartMedia business. Reference should be made to the Communications Act and other relevant statutes, regulations, policies and proceedings for further information concerningthe nature and extent of regulation of our iHeartMedia business. Finally, several of the following matters are now, or may become, the subject of courtlitigation, and we cannot predict the outcome of any such litigation or its impact on our iHeartMedia business. License AssignmentsThe Communications Act prohibits the assignment of a license or the transfer of control of an FCC licensee without prior FCC approval. Applications for license assignments or transfers involving a substantial change in ownership are subject to a 30-day period for public comment, duringwhich petitions to deny the application may be filed and considered by the FCC. License RenewalThe FCC grants broadcast licenses for a term of up to eight years. The FCC will renew a license for an additional eight-year term if, afterconsideration of the renewal application and any objections thereto, it finds that the station has served the public interest, convenience and necessity andthat, with respect to the station seeking renewal, there have been no serious violations of either the Communications Act or the FCC’s rules and regulationsby the licensee and no other such violations which, taken together, constitute a pattern of abuse. The FCC may grant the license renewal application with orwithout conditions, including renewal for a term less than eight years. The vast majority of radio licenses are renewed by the FCC for the full eight-yearterm. While we cannot guarantee the grant of any future renewal application, our stations’ licenses historically have been renewed for the full eight-yearterm. Ownership RegulationFCC rules and policies define the interests of individuals and entities, known as “attributable” interests, which implicate FCC rules governingownership of broadcast stations and other specified mass media entities. Under these rules, attributable interests generally include: (1) officers and directorsof a licensee or of its direct or indirect parent; (2) general partners; (3) limited partners and limited liability company members, unless properly “insulated”from management activities; (4) a 5% or more direct or indirect voting stock interest in a corporate licensee or parent, except that, for a narrowly defined classof passive investors, the attribution threshold is a 20% or more voting stock interest; and (5) combined equity and debt interests in excess of 33% of alicensee’s total asset value, if the interest holder provides over 15% of the licensee station’s total weekly programming, or has an attributable broadcast ornewspaper interest in the same market (the “EDP Rule”). An entity that owns one or more radio stations in a market and programs more than 15% of thebroadcast time, or sells more than 15% per week of the advertising time, on a radio station in the same market is generally deemed to have an attributableinterest in that station. Debt instruments, non-voting corporate stock, minority voting stock interests in corporations having a single majority stockholder, and properlyinsulated limited partnership and limited liability company interests generally are not subject to attribution unless such interests implicate the EDP Rule. Tothe best of our knowledge at present, none of our officers, directors or 5% or greater shareholders holds an interest in another television station, radio stationor daily newspaper that is inconsistent with the FCC’s ownership rules. The FCC is required to conduct periodic reviews of its media ownership rules. In 2003, the FCC, among other actions, modified the radio ownershiprules and adopted new cross-media ownership limits. The U.S. Court of Appeals for the Third Circuit initially stayed implementation of the new rules. Later,it lifted the stay as to the radio ownership rules, allowing the modified rules to go into effect. It retained the stay on the cross-media ownership limits andremanded them to the FCC for further justification (leaving in effect separate pre-existing FCC rules governing newspaper-broadcast and radio-televisioncross-ownership). In 2007, the FCC adopted a decision that revised the newspaper-broadcast cross-ownership rule but made no changes to the radioownership or radio-television cross-ownership rules. In 2011, the U.S. Court of Appeals for the Third Circuit vacated the FCC’s revisions to the newspaper-broadcast cross-ownership rule and otherwise upheld the FCC’s decision to retain the current radio ownership and radio-television cross-ownership rules. The U.S. Supreme Court denied review of the Third Circuit’s decision. The FCC began a periodic review of its media ownership rules in 2010 and issued anotice of proposed rulemaking, but did not complete the proceeding. The FCC has commenced its 2014 periodic review and has incorporated the record ofthe 2010 review proceeding with a further notice of proposed rulemaking. We cannot predict the outcome of the FCC’s media ownership proceedings or theireffects on our business in the future.12 Irrespective of the FCC’s radio ownership rules, the Antitrust Division of the U.S. Department of Justice (“DOJ”) and the U.S. Federal TradeCommission (“FTC”) have the authority to determine that a particular transaction presents antitrust concerns. In particular, where the proposed purchaseralready owns one or more radio stations in a particular market and seeks to acquire additional radio stations in that market, the DOJ has, in some cases,obtained consent decrees requiring radio station divestitures. The current FCC ownership rules relevant to our business are summarized below. · Local Radio Ownership Rule. The maximum allowable number of radio stations that may be commonly owned in a market is based on the sizeof the market. In markets with 45 or more stations, one entity may have an attributable interest in up to eight stations, of which no more thanfive are in the same service (AM or FM). In markets with 30-44 stations, one entity may have an attributable interest in up to seven stations, ofwhich no more than four are in the same service. In markets with 15-29 stations, one entity may have an attributable interest in up to sixstations, of which no more than four are in the same service. In markets with 14 or fewer stations, one entity may have an attributable interest inup to five stations, of which no more than three are in the same service, so long as the entity does not have an interest in more than 50% of allstations in the market. To apply these ownership tiers, the FCC relies on Arbitron Metro Survey Areas, where they exist, and a signal contour-overlap methodology where they do not exist. An FCC rulemaking is pending to determine how to define radio markets for stations locatedoutside Arbitron Metro Survey Areas. · Newspaper-Broadcast Cross-Ownership Rule. FCC rules generally prohibit an individual or entity from having an attributable interest in eithera radio or television station and a daily newspaper located in the same market. · Radio-Television Cross-Ownership Rule. FCC rules permit the common ownership of one television and up to seven same-market radiostations, or up to two television and six same-market radio stations, depending on the number of independent media voices in the market and onwhether the television and radio components of the combination comply with the television and radio ownership limits, respectively. Alien Ownership RestrictionsThe Communications Act restricts foreign entities or individuals from owning or voting more than 20% of the equity of a broadcast licenseedirectly. It also restricts foreign entities or individuals from owning or voting more than 25% of a licensee’s equity indirectly (i.e., through a parentcompany), unless the FCC has made a finding that greater indirect foreign ownership is in the public interest. Since we serve as a holding company for FCClicensee subsidiaries, we are effectively restricted from having more than one-fourth of our stock owned or voted directly or indirectly by foreign entities orindividuals. In November 2013, the FCC clarified that it would entertain and authorize, on a case-by-case basis and upon a sufficient public interestshowing, proposals to exceed the 25% foreign ownership limit in broadcasting holding companies. Indecency RegulationFederal law regulates the broadcast of obscene, indecent or profane material. Legislation enacted by Congress provides the FCC with authority toimpose fines of up to $325,000 per utterance with a cap of $3.0 million for any violation arising from a single act. In June 2012, the U.S. Supreme Courtruled on the appeals of several FCC indecency enforcement actions. While setting aside the particular FCC actions under review on narrow due processgrounds, the Supreme Court declined to rule on the constitutionality of the FCC’s indecency policies, and the FCC has since solicited public comment onthose policies. We have received, and may receive in the future, letters of inquiry and other notifications from the FCC concerning complaints thatprogramming aired on our stations contains indecent or profane language. We cannot predict the outcome of our outstanding letters of inquiry andnotifications from the FCC or the nature or extent of future FCC indecency enforcement actions. Equal Employment OpportunityThe FCC’s rules require broadcasters to engage in broad equal employment opportunity recruitment efforts, retain data concerning such efforts andreport much of this data to the FCC and to the public via periodic reports filed with the FCC or placed in stations’ public files and websites. Broadcasterscould be sanctioned for noncompliance. Technical RulesNumerous FCC rules govern the technical operating parameters of radio stations, including permissible operating frequency, power and antennaheight and interference protections between stations. Changes to these rules could negatively affect the operation of our stations. For example, in January2011 a law that eliminates certain minimum distance separation requirements between full-power and low-power FM radio stations was enacted, which couldlead to increased interference between our stations and low-power13 FM stations. In March 2011, the FCC adopted policies which, in certain circumstances, could make it more difficult for radio stations to relocate to increasetheir population coverage. Content, Licenses and RoyaltiesWe must pay royalties to copyright owners of musical compositions (typically, songwriters and publishers) whenever we broadcast or stream musicalcompositions. Copyright owners of musical compositions most often rely on intermediaries known as performing rights organizations (“PROs”) to negotiatelicenses with copyright users for the public performance of their compositions, collect royalties under such licenses and distribute them to copyright owners.We have obtained public performance licenses from, and pay license fees to, the three major PROs in the United States, which are the American Society ofComposers, Authors and Publishers (“ASCAP”), Broadcast Music, Inc. (“BMI”), and SESAC, Inc. (“SESAC”). There is no guarantee that a given songwriter orpublisher will remain associated with ASCAP, BMI or SESAC or that additional PROs will not emerge. For example, a new PRO has reportedly been formedto seek premium royalty rates for certain high-value copyright owners, and a major music publisher has announced that it is considering withdrawing all of itsrights from ASCAP and BMI. The withdrawal of a significant number of musical composition copyright owners from the three established PROs, and/or theemergence of one or more additional PROs, could increase our royalty rates and negotiation costs. To secure the rights to stream music content over the Internet, we also must obtain performance rights licenses and pay public performance royaltiesto copyright owners of sound recordings (typically, performing artists and record companies). Under Federal statutory licenses, we are permitted to streamany lawfully released sound recordings and to make ephemeral reproductions of these recordings on our computer servers without having to separatelynegotiate and obtain direct licenses with each individual copyright owner as long as we operate in compliance with the rules of those statutory licenses andpay the applicable royalty rates to SoundExchange, the organization designated by the Copyright Royalty Board to collect and distribute royalties underthese statutory licenses. Federal law governs copyrights for sound recordings fixed on or after February 15, 1972. Sound recording copyright owners haveasserted that state law requires payments for digital audio transmissions services for unauthorized public performances and reproductions of recordings fixedbefore that date (“pre-72 recordings”). Sound recording copyright owners have sued digital audio transmission services for unauthorized publicperformances and reproductions of pre-72 recordings under various state laws, and courts in two states have issued decisions favorable to the copyrightowners. If one or more of these decisions is upheld on appeal and held to apply to radio broadcasting or Internet simulcasting, it could impede our ability tobroadcast or stream pre-72 recordings and/or increase our licensing and negotiating costs of doing so. The rates at which we pay royalties to copyright owners are privately negotiated or set pursuant to a regulatory process. In addition, we havebusiness arrangements directly with some copyright owners to receive deliveries of and, in some cases, to directly license their sound recordings for use in ourInternet operations. There is no guarantee that the licenses and associated royalty rates that currently are available to us will be available to us in the future. Congress may consider and adopt legislation that would require us to pay royalties to sound recording copyright owners for the broadcast of those recordingson our terrestrial radio stations. In addition, proceedings before the Copyright Royalty Board have commenced to establish copyright royalty rates for thepublic performance and ephemeral reproduction of sound recordings by various noninteractive webcasters, including radio broadcasters that simulcast theirterrestrial programming online, to apply to the period January 1, 2016-December 31, 2020. Increased royalty rates could significantly increase our expenses,which could adversely affect our business. Privacy and Data ProtectionWe collect certain types of information from users of our technology platforms, including, without limitation, our websites, web pages, interactivefeatures, applications, Twitter and Facebook pages, and mobile application (“Platforms”), in accordance with the privacy policies and terms of use posted onthe applicable Platform. We collect personally identifiable information directly from Platform users in several ways, including when a user purchases ourproducts or services, registers to use our services, fills out a listener profile, posts comments, uses our social networking features, participates in polls andcontests and signs up to receive email newsletters. We also may obtain information about our listeners from other listeners and third parties. We use theinformation we collect about and from Platform users for a variety of business purposes. As a company conducting business on the Internet, we are subject to a number of laws and regulations relating to consumer protection, informationsecurity, data protection and privacy, among other things. Many of these laws and regulations are still evolving and could be interpreted in ways that couldharm our business. In the area of information security and data protection, the laws in several states require companies to implement specific informationsecurity controls to protect certain types of personally identifiable information. Likewise, all but a few states have laws in place requiring companies tonotify users if there is a security breach that compromises certain categories of their personally identifiable information. Any failure on our part to complywith these laws may subject us to significant liabilities. 14 We have implemented commercially reasonable physical and electronic security measures to protect our proprietary business information and toprotect against the loss, misuse, and alteration of our listeners’ personally identifiable information. However, no security measures are perfect orimpenetrable, and we may be unable to anticipate or prevent unauthorized access to such information. Any failure or perceived failure by us to protect ourinformation or information about our listeners or to comply with our policies or applicable regulatory requirements could result in damage to our businessand loss of confidence in us, damage to our brands, the loss of listeners, consumers, business partners and advertisers, as well as proceedings against us bygovernmental authorities or others, which could harm our business. OtherCongress, the FCC and other government agencies and regulatory bodies may in the future adopt new laws, regulations and policies that couldaffect, directly or indirectly, the operation, profitability and ownership of our broadcast stations and Internet-based audio music services. In addition to theregulations and other arrangements noted above, such matters may include, for example: proposals to impose spectrum use or other fees on FCC licensees;changes to the political broadcasting rules, including the adoption of proposals to provide free air time to candidates; restrictions on the advertising ofcertain products, such as beer and wine; frequency allocation, spectrum reallocations and changes in technical rules; and the adoption of significant newprogramming and operational requirements designed to increase local community-responsive programming and enhance public interest reportingrequirements. Regulation of our Americas and International Outdoor Advertising Businesses The outdoor advertising industry in the United States is subject to governmental regulation at the federal, state and local levels. These regulationsmay include, among others, restrictions on the construction, repair, maintenance, lighting, upgrading, height, size, spacing and location and permitting ofand, in some instances, content of advertising copy being displayed on outdoor advertising structures. In addition, international regulations have asignificant impact on the outdoor advertising industry. International regulation of the outdoor advertising industry can vary by municipality, region andcountry, but generally limits the size, placement, nature and density of out-of-home displays. Other regulations may limit the subject matter and language ofout-of-home displays. From time to time, legislation has been introduced in both the United States and foreign jurisdictions attempting to impose taxes on revenue fromoutdoor advertising or for the right to use outdoor advertising assets. Several jurisdictions have imposed such taxes as a percentage of our outdooradvertising revenue generated in that jurisdiction. In addition, some jurisdictions have taxed our personal property and leasehold interests in advertisinglocations using various valuation methodologies. We expect U.S. and foreign jurisdictions to continue to try to impose such taxes as a way of increasingrevenue. In recent years, outdoor advertising also has become the subject of targeted taxes and fees. These laws may affect prevailing competitive conditionsin our markets in a variety of ways. Such laws may reduce our expansion opportunities or may increase or reduce competitive pressure from other members ofthe outdoor advertising industry. No assurance can be given that existing or future laws or regulations, and the enforcement thereof, will not materially andadversely affect the outdoor advertising industry. However, we contest laws and regulations that we believe unlawfully restrict our constitutional or otherlegal rights and may adversely impact the growth of our outdoor advertising business. In the United States, federal law, principally the Highway Beautification Act (“HBA”), regulates outdoor advertising on Federal-Aid Primary,Interstate and National Highway Systems roads within the United States (“controlled roads”). The HBA regulates the size and placement of billboards,requires the development of state standards, mandates a state’s compliance program, promotes the expeditious removal of illegal signs and requires justcompensation for takings. To satisfy the HBA’s requirements, all states have passed billboard control statutes and regulations that regulate, among other things, construction,repair, maintenance, lighting, height, size, spacing and the placement and permitting of outdoor advertising structures. We are not aware of any state that haspassed control statutes and regulations less restrictive than the prevailing federal requirements on the federal highway system, including the requirement thatan owner remove any non-grandfathered, non-compliant signs along the controlled roads, at the owner’s expense and without compensation. Localgovernments generally also include billboard control as part of their zoning laws and building codes regulating those items described above and includesimilar provisions regarding the removal of non-grandfathered structures that do not comply with certain of the local requirements. Some local governmentshave initiated code enforcement and permit reviews of billboards within their jurisdiction. In some instances we have had to remove billboards as a result ofsuch reviews. As part of their billboard control laws, state and local governments regulate the construction of new signs. Some jurisdictions prohibit newconstruction, some jurisdictions allow new construction only to replace or relocate existing structures and some jurisdictions allow new construction subjectto the various restrictions discussed above. In certain jurisdictions, restrictive regulations also limit our ability to relocate, rebuild, repair, maintain, upgrade,modify or replace existing legal non-conforming billboards. 15 U.S. federal law neither requires nor prohibits the removal of existing lawful billboards, but it does mandate the payment of compensation if a stateor political subdivision compels the removal of a lawful billboard along the controlled roads. In the past, state governments have purchased and removedexisting lawful billboards for beautification purposes using federal funding for transportation enhancement programs, and these jurisdictions may continue todo so in the future. From time to time, state and local government authorities use the power of eminent domain and amortization to remove billboards. Thusfar, we have been able to obtain satisfactory compensation for, or relocation of, our billboards purchased or removed as a result of these types ofgovernmental action, although there is no assurance that this will continue to be the case in the future. We have introduced and intend to expand the deployment of digital billboards that display static digital advertising copy from various advertisersthat change up to several times per minute. We have encountered some existing regulations in the U.S. and across some international jurisdictions that restrictor prohibit these types of digital displays. However, since digital technology for changing static copy has only recently been developed and introduced intothe market on a large scale, and is in the process of being introduced more broadly in our international markets, existing regulations that currently do notapply to digital technology by their terms could be revised to impose greater restrictions. These regulations, or actions by third parties, may impose greaterrestrictions on digital billboards due to alleged concerns over aesthetics or driver safety. ITEM 1A. RISK FACTORSRisks Related to Our BusinessOur results have been in the past, and could be in the future, adversely affected by economic uncertainty or deteriorations in economic conditionsWe derive revenues from the sale of advertising. Expenditures by advertisers tend to be cyclical, reflecting economic conditions and budgeting andbuying patterns. Periods of a slowing economy or recession, or periods of economic uncertainty, may be accompanied by a decrease in advertising. Forexample, the global economic downturn that began in 2008 resulted in a decline in advertising and marketing by our customers, which resulted in a declinein advertising revenues across our businesses. This reduction in advertising revenues had an adverse effect on our revenue, profit margins, cash flow andliquidity. Global economic conditions have been slow to recover and remain uncertain. If economic conditions do not continue to improve, economicuncertainty increases or economic conditions deteriorate again, global economic conditions may once again adversely impact our revenue, profit margins,cash flow and liquidity. Furthermore, because a significant portion of our revenue is derived from local advertisers, our ability to generate revenues inspecific markets is directly affected by local and regional conditions, and unfavorable regional economic conditions also may adversely impact our results. In addition, even in the absence of a downturn in general economic conditions, an individual business sector or market may experience a downturn, causingit to reduce its advertising expenditures, which also may adversely impact our results. We performed impairment tests on our goodwill and other intangible assets during the fourth quarter of 2014, 2013 and 2012 and recorded non-cashimpairment charges of $19.2 million, $17.0 million and $37.7 million, respectively. Although we believe we have made reasonable estimates and usedappropriate assumptions to calculate the fair value of our licenses, billboard permits and reporting units, it is possible a material change could occur. If actualmarket conditions and operational performance for the respective reporting units underlying the intangible assets were to deteriorate, or if facts andcircumstances change that would more likely than not reduce the estimated fair value of the indefinite-lived assets or goodwill for these reporting units belowtheir adjusted carrying amounts, we may also be required to recognize additional impairment charges in future periods, which could have a material impacton our financial condition and results of operations. To service our debt obligations and to fund capital expenditures, we will require a significant amount of cash to meet our needs, which depends on manyfactors beyond our controlOur ability to service our debt obligations and to fund capital expenditures will require a significant amount of cash. Our primary source of liquidityis cash on hand, cash flow from operations and borrowing capacity under iHeartCommunications’ receivables based credit facility, subject to certainlimitations contained in iHeartCommunications’ material financing agreements. Based on our current and anticipated levels of operations and conditions inour markets, we believe that cash on hand, cash flow from operations, borrowing capacity under iHeartCommunications’ receivables based credit facility andcash flow from other liquidity-generating transactions will enable us to meet our working capital, capital expenditure, debt service and other fundingrequirements for at least the next twelve months. However, our ability to fund our working capital, capital expenditures, debt service and other obligations,and to comply with the financial covenant under iHeartCommunications’ financing agreements, depends on our future operating performance and cash fromoperations and other liquidity-generating transactions, which are in turn subject to prevailing economic conditions and other factors, many of which arebeyond our control. If our future operating performance does not meet our expectation or our plans materially change in an adverse manner or prove to bematerially inaccurate, we may need additional financing. In addition, the purchase price of possible acquisitions, capital expenditures for deployment ofdigital billboards and/or16 other strategic initiatives could require additional indebtedness or equity financing on our part. Adverse securities and credit market conditions couldsignificantly affect the availability of equity or debt financing. In connection with iHeartCommunications’ financing transactions completed during 2014,the average interest rate on our outstanding debt has increased. We anticipate paying cash interest of approximately $1.6 billion during 2015. Futurefinancing transactions may further increase interest expense, which could in turn reduce our financial flexibility and our ability to fund other activities andmake us more vulnerable to changes in operating performance or economic downturns generally. There can be no assurance that additional financing, ifpermitted under the terms of iHeartCommunications’ financing agreements, will be available on terms acceptable to us or at all. The inability to generatesufficient cash or obtain additional financing could have a material adverse effect on our financial condition and on our ability to meetiHeartCommunications’ obligations or pursue strategic initiatives. Our financial performance may be adversely affected by many factors beyond our controlCertain factors that could adversely affect our financial performance by, among other things, decreasing overall revenues, the numbers of advertisingcustomers, advertising fees or profit margins include: · unfavorable economic conditions, which may cause companies to reduce their expenditures on advertising;· an increased level of competition for advertising dollars, which may lead to lower advertising rates as we attempt to retain customers or whichmay cause us to lose customers to our competitors who offer lower rates that we are unable or unwilling to match;· unfavorable fluctuations in operating costs, which we may be unwilling or unable to pass through to our customers;· technological changes and innovations that we are unable to successfully adopt or are late in adopting that offer more attractive advertising orlistening alternatives than what we offer, which may lead to a loss of advertising customers or to lower advertising rates;· the impact of potential new royalties charged for terrestrial radio broadcasting, which could materially increase our expenses;· other changes in governmental regulations and policies and actions of regulatory bodies, which could increase our taxes or other costs, reduceour outdoor advertising inventory, restrict the advertising media that we employ or restrict some or all of our customers that operate in regulatedareas from using certain advertising media or from advertising at all;· unfavorable shifts in population and other demographics, which may cause us to lose advertising customers as people migrate to markets wherewe have a smaller presence or which may cause advertisers to be willing to pay less in advertising fees if the general population shifts into a lessdesirable age or geographical demographic from an advertising perspective; and· unfavorable changes in labor conditions, which may impair our ability to operate or require us to spend more to retain and attract keyemployees. We face intense competition in our iHeartMedia and our outdoor advertising businessesWe operate in a highly competitive industry, and we may not be able to maintain or increase our current audience ratings and advertising and salesrevenues. Our iHeartMedia and our outdoor advertising businesses compete for audiences and advertising revenues with other iHeartMedia businesses andoutdoor advertising businesses, as well as with other media, such as newspapers, magazines, television, direct mail, portable digital audio players, mobiledevices, satellite radio, Internet-based services and live entertainment, within their respective markets. Audience ratings and market shares are subject tochange, which could have the effect of reducing our revenues in that market. Our competitors may develop technology, services or advertising media that areequal or superior to those we provide or that achieve greater market acceptance and brand recognition than we achieve. It also is possible that newcompetitors may emerge and rapidly acquire significant market share in any of our business segments. An increased level of competition for advertisingdollars may lead to lower advertising rates as we attempt to retain customers or may cause us to lose customers to our competitors who offer lower rates thatwe are unable or unwilling to match. Alternative media platforms and technologies may continue to increase competition with our broadcasting operationsOur terrestrial radio broadcasting operations face increasing competition from alternative media platforms and technologies, such as broadbandwireless, satellite radio, audio broadcasting by cable television systems and Internet-based audio music services, as well as consumer products, such asportable digital audio players and other mobile devices. These technologies and alternative media platforms, including those used by us, compete with ourradio stations for audience share and advertising revenues. We are unable to predict the effect that such technologies and related services and products willhave on our broadcasting operations. The capital expenditures necessary to implement these or other technologies could be substantial and we cannot assureyou that we will continue to have the resources to acquire new technologies or to introduce new services to compete with other new technologies or services,or that our investments in new technologies or services will provide the desired returns. Other companies employing new technologies17 or services could more successfully implement such new technologies or services or otherwise increase competition with our businesses. Our iHeartMedia business is dependent upon the performance of on-air talent and program hostsWe employ or independently contract with many on-air personalities and hosts of syndicated radio programs with significant loyal audiences intheir respective markets. Although we have entered into long-term agreements with some of our key on-air talent and program hosts to protect our interests inthose relationships, we can give no assurance that all or any of these persons will remain with us or will retain their audiences. Competition for theseindividuals is intense and many of these individuals are under no legal obligation to remain with us. Our competitors may choose to extend offers to any ofthese individuals on terms which we may be unwilling to meet. Furthermore, the popularity and audience loyalty of our key on-air talent and program hosts ishighly sensitive to rapidly changing public tastes. A loss of such popularity or audience loyalty is beyond our control and could have a material adverseeffect on our ability to attract local and/or national advertisers and on our revenue and/or ratings, and could result in increased expenses. Our business is dependent on our management team and other key individualsOur business is dependent upon the performance of our management team and other key individuals. A number of key individuals have joined us orassumed increased responsibilities over the past several years, including Robert W. Pittman, who became our Chief Executive Officer on October 2, 2011,C. William Eccleshare, who was promoted to be our Chief Executive Officer—Outdoor on January 24, 2012, and Richard J. Bressler, who became ourPresident and Chief Financial Officer on July 29, 2013. Effective January 2014, Mr. Pittman and Mr. Bressler assumed direct management responsibility forour iHeartMedia division in addition to their existing roles. Although we have entered into agreements with some members of our management team andcertain other key individuals, we can give no assurance that all or any of our management team and other key individuals will remain with us, or that wewon’t continue to make changes to the composition of, and the roles and responsibilities of, our management team. Competition for these individuals isintense and many of our key employees are at-will employees who are under no legal obligation to remain with us, and may decide to leave for a variety ofpersonal or other reasons beyond our control. We are currently contemplating modifying certain roles and responsibilities of specified members of ourmanagement team to more align with their operational focus. If members of our management or key individuals decide to leave us in the future, if we decideto make further changes to the composition of, or the roles and responsibilities of, these individuals, or if we are not successful in attracting, motivating andretaining other key employees, our business could be adversely affected. Extensive current government regulation, and future regulation, may limit our radio broadcasting and other iHeartMedia operations or adversely affectour business and financial resultsCongress and several federal agencies, including the FCC, extensively regulate the domestic radio industry. For example, the FCC could impact ourprofitability by imposing large fines on us if, in response to pending complaints, it finds that we broadcast indecent programming or committed otherviolations of FCC regulations. We could face significant fines, for instance, as a result of pending FCC investigations into the allegedly inappropriatebroadcast of emergency alert signals by several of our stations. Additionally, we cannot be sure that the FCC will approve renewal of the licenses we musthave in order to operate our stations. Nor can we be assured that our licenses will be renewed without conditions and for a full term. The non-renewal, orconditioned renewal, of a substantial number of our FCC licenses, could have a materially adverse impact on our operations. Furthermore, possible changesin interference protections, spectrum allocations and other technical rules may negatively affect the operation of our stations. For example, in January 2011,a law that eliminates certain minimum distance separation requirements between full-power and low-power FM radio stations was enacted, which could leadto increased interference between our stations and low-power FM stations. In March 2011, the FCC adopted policies which, in certain circumstances, couldmake it more difficult for radio stations to relocate to increase their population coverage. In addition, Congress, the FCC and other regulatory agencies haveconsidered, and may in the future consider and adopt, new laws, regulations and policies that could, directly or indirectly, have an adverse effect on ourbusiness operations and financial performance. For example, Congress may consider and adopt legislation that would impose an obligation upon all U.S.broadcasters to pay performing artists a royalty for the on-air broadcast of their sound recordings (this would be in addition to payments already made bybroadcasters to owners of musical work rights, such as songwriters, composers and publishers). Moreover, it is possible that our license fees and negotiatingcosts associated with obtaining rights to use musical compositions and sound recordings in our programming content could sharply increase as a result ofprivate negotiations, one or more regulatory rate-setting processes, or administrative and court decisions. We cannot predict whether such increases willoccur. Such legislation and/or increased royalty rates and negotiating costs could have a material impact on our operations and financial results. Finally,various regulatory matters relating to our iHeartMedia business are now, or may become, the subject of court litigation, and we cannot predict the outcome ofany such litigation or its impact on our business. 18 Regulations and consumer concerns regarding privacy and data protection, or any failure to comply with these regulations, could hinder our operationsWe collect and utilize demographic and other information, including personally identifiable information, from and about our listeners, consumers,business partners and advertisers as they interact with us. For example: (1) our broadcast radio station websites and our iHeartRadio digital platform collectpersonal information as users register for our services, fill out their listener profiles, post comments, use our social networking features, participate in pollsand contests and sign-up to receive email newsletters; (2) we use tracking technologies, such as “cookies,” to manage and track our listeners’ interactionswith us so that we can deliver relevant music content and advertising; and (3) we collect credit card or debit card information from consumers, businesspartners and advertisers who use our services. We are subject to numerous federal, state and foreign laws and regulations relating to consumer protection, information security, data protection andprivacy, among other things. Many of these laws are still evolving, new laws may be enacted and any of these laws could be amended or interpreted in waysthat could harm our business. In addition, changes in consumer expectations and demands regarding privacy and data protection could restrict our ability tocollect, use, disclose and derive economic value from demographic and other information related to our listeners, consumers, business partners andadvertisers. Such restrictions could limit our ability to provide customized music content to our listeners, interact directly with our listeners and consumersand offer targeted advertising opportunities to our business partners and advertisers. Although we have implemented policies and procedures designed tocomply with these laws and regulations, any failure or perceived failure by us to comply with our policies or applicable regulatory requirements related toconsumer protection, information security, data protection and privacy could result in a loss of confidence in us, damage to our brands, the loss of listeners,consumers, business partners and advertisers, as well as proceedings against us by governmental authorities or others, which could hinder our operations andadversely affect our business. If our security measures are breached, we could lose valuable information, suffer disruptions to our business, and incur expenses and liabilities includingdamages to our relationships with listeners, business partners and advertisersAlthough we have implemented physical and electronic security measures to protect against the loss, misuse and alteration of our websites, digitalassets and proprietary business information as well as listener, consumer, business partner and advertiser personally identifiable information, no securitymeasures are perfect and impenetrable and we may be unable to anticipate or prevent unauthorized access. A security breach could occur due to the actionsof outside parties, employee error, malfeasance or a combination of these or other actions. If an actual or perceived breach of our security occurs, we couldlose competitively sensitive business information or suffer disruptions to our business operations, information processes or internal controls. In addition, thepublic perception of the effectiveness of our security measures or services could be harmed, we could lose listeners, consumers, business partners andadvertisers. In the event of a security breach, we could suffer financial exposure in connection with remediation efforts, investigations and legal proceedingsand changes in our security and system protection measures. Government regulation of outdoor advertising may restrict our outdoor advertising operationsU.S. federal, state and local regulations have a significant impact on the outdoor advertising industry and our business. One of the seminal laws isthe HBA, which regulates outdoor advertising on controlled roads in the United States. The HBA regulates the size and location of billboards, mandates astate compliance program, requires the development of state standards, promotes the expeditious removal of illegal signs and requires just compensation fortakings. Construction, repair, maintenance, lighting, upgrading, height, size, spacing, the location and permitting of billboards and the use of newtechnologies for changing displays, such as digital displays, are regulated by federal, state and local governments. From time to time, states andmunicipalities have prohibited or significantly limited the construction of new outdoor advertising structures. Changes in laws and regulations affectingoutdoor advertising, or changes in the interpretation of those laws and regulations, at any level of government, including the foreign jurisdictions in whichwe operate, could have a significant financial impact on us by requiring us to make significant expenditures or otherwise limiting or restricting some of ouroperations. Due to such regulations, it has become increasingly difficult to develop new outdoor advertising locations. From time to time, certain state and local governments and third parties have attempted to force the removal of our displays under various state andlocal laws, including zoning ordinances, permit enforcement, condemnation and amortization. Similar risks also arise in certain of our internationaljurisdictions. Amortization is the attempted forced removal of legal non-conforming billboards (billboards which conformed with applicable laws andregulations when built, but which do not conform to current laws and regulations) or the commercial advertising placed on such billboards after a period ofyears. Pursuant to this concept, the governmental body asserts that just compensation is earned by continued operation of the billboard over time. Althoughamortization is prohibited along all controlled roads and generally prohibited along non-controlled roads, amortization has been upheld along non-controlled roads in limited instances where provided by state and local law. Other regulations limit our ability to rebuild, replace, repair, maintain andupgrade non-conforming displays. In addition, from time to time third parties or local governments assert that we own or operate displays that either are notproperly permitted or otherwise are not in strict compliance with applicable law. If we are19 increasingly unable to resolve such allegations or obtain acceptable arrangements in circumstances in which our displays are subject to removal,modification or amortization, or if there occurs an increase in such regulations or their enforcement, our operating results could suffer. A number of state and local governments have implemented or initiated taxes, fees and registration requirements in an effort to decrease or restrictthe number of outdoor signs and/or to raise revenue. From time to time, legislation also has been introduced in international jurisdictions attempting toimpose taxes on revenue from outdoor advertising or for the right to use outdoor advertising assets. In addition, a number of jurisdictions have implementedlegislation or interpreted existing legislation to restrict or prohibit the installation of digital billboards, and we expect these efforts to continue. Theincreased imposition of these measures, and our inability to overcome any such measures, could reduce our operating income if those outcomes requireremoval or restrictions on the use of preexisting displays or limit growth of digital displays. In addition, if we are unable to pass on the cost of these items toour clients, our operating income could be adversely affected. International regulation of the outdoor advertising industry can vary by municipality, region and country, but generally limits the size, placement,nature and density of out-of-home displays. Other regulations limit the subject matter and language of out-of-home displays. Our failure to comply withthese or any future international regulations could have an adverse impact on the effectiveness of our displays or their attractiveness to clients as anadvertising medium and may require us to make significant expenditures to ensure compliance. As a result, we may experience a significant impact on ouroperations, revenue, international client base and overall financial condition. Additional restrictions on outdoor advertising of tobacco, alcohol and other products may further restrict the categories of clients that can advertise usingour productsOut-of-court settlements between the major U.S. tobacco companies and all 50 states, the District of Columbia, the Commonwealth of Puerto Ricoand other U.S. territories include a ban on the outdoor advertising of tobacco products. Other products and services may be targeted in the U.S. in the future,including alcohol products. Most European Union countries, among other nations, also have banned outdoor advertisements for tobacco products andregulate alcohol advertising. Regulations vary across the countries in which we conduct business. Any significant reduction in alcohol-related advertisingor advertising of other products due to content-related restrictions could cause a reduction in our direct revenues from such advertisements and an increase inthe available space on the existing inventory of billboards in the outdoor advertising industry. Environmental, health, safety and land use laws and regulations may limit or restrict some of our operationsAs the owner or operator of various real properties and facilities, especially in our outdoor advertising operations, we must comply with variousforeign, federal, state and local environmental, health, safety and land use laws and regulations. We and our properties are subject to such laws andregulations relating to the use, storage, disposal, emission and release of hazardous and non-hazardous substances and employee health and safety as well aszoning restrictions. Historically, we have not incurred significant expenditures to comply with these laws. However, additional laws which may be passed inthe future, or a finding of a violation of or liability under existing laws, could require us to make significant expenditures and otherwise limit or restrict someof our operations. Doing business in foreign countries exposes us to certain risks not found when doing business in the United StatesDoing business in foreign countries carries with it certain risks that are not found when doing business in the United States. These risks could resultin losses against which we are not insured. Examples of these risks include: · potential adverse changes in the diplomatic relations of foreign countries with the United States;· hostility from local populations;· the adverse effect of foreign exchange controls;· government policies against businesses owned by foreigners;· investment restrictions or requirements;· expropriations of property without adequate compensation;· the potential instability of foreign governments;· the risk of insurrections;· risks of renegotiation or modification of existing agreements with governmental authorities;· difficulties collecting receivables and otherwise enforcing contracts with governmental agencies and others in some foreign legal systems;· withholding and other taxes on remittances and other payments by subsidiaries;· changes in tax structure and level; and· changes in laws or regulations or the interpretation or application of laws or regulations.20 In addition, because we own assets in foreign countries and derive revenues from our International operations, we may incur currency translationlosses due to changes in the values of foreign currencies and in the value of the U.S. dollar. We cannot predict the effect of exchange rate fluctuations uponfuture operating results. Our International operations involve contracts with, and regulation by, foreign governments. We operate in many parts of the world that experiencecorruption to some degree. Although we have policies and procedures in place that are designed to promote legal and regulatory compliance (including withrespect to the U.S. Foreign Corrupt Practices Act and the United Kingdom Bribery Act), our employees, subcontractors and agents could take actions thatviolate applicable anticorruption laws or regulations. Violations of these laws, or allegations of such violations, could have a material adverse effect on ourbusiness, financial position and results of operations. The success of our street furniture and transit products businesses is dependent on our obtaining key municipal concessions, which we may not be able toobtain on favorable termsOur street furniture and transit products businesses require us to obtain and renew contracts with municipalities and other governmental entities.Many of these contracts, which require us to participate in competitive bidding processes at each renewal, typically have terms ranging from three to 20 yearsand have revenue share and/or fixed payment components. Our inability to successfully negotiate, renew or complete these contracts due to governmentaldemands and delay and the highly competitive bidding processes for these contracts could affect our ability to offer these products to our clients, or to offerthem to our clients at rates that are competitive to other forms of advertising, without adversely affecting our financial results. Future acquisitions and other strategic transactions could pose risksWe frequently evaluate strategic opportunities both within and outside our existing lines of business. We expect from time to time to pursueadditional acquisitions and may decide to dispose of certain businesses. These acquisitions or dispositions could be material. Our acquisition strategyinvolves numerous risks, including: · our acquisitions may prove unprofitable and fail to generate anticipated cash flows;· to successfully manage our large portfolio of iHeartMedia, outdoor advertising and other businesses, we may need to:· recruit additional senior management as we cannot be assured that senior management of acquired businesses will continue to work for usand we cannot be certain that our recruiting efforts will succeed, and· expand corporate infrastructure to facilitate the integration of our operations with those of acquired businesses, because failure to do somay cause us to lose the benefits of any expansion that we decide to undertake by leading to disruptions in our ongoing businesses or bydistracting our management;· we may enter into markets and geographic areas where we have limited or no experience;· we may encounter difficulties in the integration of operations and systems; and· our management’s attention may be diverted from other business concerns. Additional acquisitions by us of media and entertainment businesses and outdoor advertising businesses may require antitrust review by U.S. federalantitrust agencies and may require review by foreign antitrust agencies under the antitrust laws of foreign jurisdictions. We can give no assurances that theDOJ, the FTC or foreign antitrust agencies will not seek to bar us from acquiring additional media and entertainment businesses or outdoor advertisingbusinesses in any market where we already have a significant position. Further, radio acquisitions by us are subject to FCC approval. Such acquisitions mustcomply with the Communications Act and FCC regulatory requirements and policies, including with respect to the number of broadcast facilities in which aperson or entity may have an ownership or attributable interest in a given local market and the level of interest that may be held by a foreign individual orentity. The FCC's media ownership rules remain subject to ongoing agency and court proceedings. Future changes could restrict our ability to acquire newradio assets or businesses. Risks Related to Ownership of Our Class A Common StockThe market price and trading volume of our Class A common stock may be volatileThe market price of our Class A common stock could fluctuate significantly for many reasons, including, without limitation:· as a result of the risk factors listed in this Annual Report on Form 10-K;· actual or anticipated fluctuations in our operating results;· reasons unrelated to operating performance, such as reports by industry analysts, investor perceptions, or negative announcements by ourcustomers or competitors regarding their own performance;21 · regulatory changes that could impact our business; and· general economic and industry conditions.Shares of our Class A common stock are quoted on the Over-the-Counter Bulletin Board. The lack of an active market may impair the ability ofholders of our Class A common stock to sell their shares of Class A common stock at the time they wish to sell them or at a price that they considerreasonable. The lack of an active market may also reduce the fair market value of the shares of our Class A common stock.There is no assurance that holders of our Class A common stock will ever receive cash dividendsWe have never paid cash dividends on our Class A common stock, and there is no guarantee that we will ever pay cash dividends on our Class Acommon stock in the future. The terms of our credit facilities and other debt restrict our ability to pay cash dividends on our Class A common stock. Inaddition to those restrictions, under Delaware law, we are permitted to pay cash dividends on our capital stock only out of our surplus, which in general termsmeans the excess of our net assets over the original aggregate par value of our stock. In the event we have no surplus, we are permitted to pay these cashdividends out of our net profits for the year in which the dividend is declared or in the immediately preceding year. Accordingly, there is no guarantee that, ifwe wish to pay cash dividends, we would be able to do so pursuant to Delaware law. Also, even if we are not prohibited from paying cash dividends by theterms of our debt or by law, other factors such as the need to reinvest cash back into our operations may prompt our Board of Directors to elect not to pay cashdividends. Significant equity investors control us and may have conflicts of interest with us in the futurePrivate equity funds sponsored by or co-investors with Bain Capital and THL currently indirectly control us through their ownership of all of ouroutstanding shares of Class B common stock and Class C common stock, which collectively represent approximately 68% of the voting power of all of ouroutstanding capital stock. As a result, Bain Capital and THL have the power to elect all but two of our directors, appoint new management and approve anyaction requiring the approval of the holders of our capital stock, including adopting any amendments to our third amended and restated certificate ofincorporation, and approving mergers or sales of substantially all of our capital stock or assets. The directors elected by Bain Capital and THL will havesignificant authority to make decisions affecting us, including the issuance of additional capital stock, change in control transactions, the incurrence ofadditional indebtedness, the implementation of stock repurchase programs and the decision of whether or not to declare dividends.In addition, affiliates of Bain Capital and THL are lenders under iHeartCommunications’ term loan credit facilities and holders ofiHeartCommunications’ priority guarantee notes due 2019. It is possible that their interests in some circumstances may conflict with our interests and theinterests of other stockholders.Additionally, Bain Capital and THL are in the business of making investments in companies and may acquire and hold interests in businesses thatcompete directly or indirectly with us. One or more of the entities advised by or affiliated with Bain Capital and/or THL may also pursue acquisitionopportunities that may be complementary to our business and, as a result, those acquisition opportunities may not be available to us. So long as entitiesadvised by or affiliated with Bain Capital and THL directly or indirectly own a significant amount of the voting power of our capital stock, even if suchamount is less than 50%, Bain Capital and THL will continue to be able to strongly influence or effectively control our decisions.We may terminate our Exchange Act reporting, if permitted by applicable lawIf at any time our Class A common stock is held by fewer than 300 holders of record, we will be permitted to cease to be a reporting company underthe Exchange Act to the extent we are not otherwise required to continue to report pursuant to any contractual agreements, including with respect to any ofour indebtedness. If we were to cease filing reports under the Exchange Act, the information now available to our stockholders in the annual, quarterly andother reports we currently file with the SEC would not be available to them as a matter of right. Risks Related to Our IndebtednessThe substantial amount of indebtedness of our subsidiary, iHeartCommunications, and its subsidiaries, may adversely affect our cash flows and our abilityto operate our business and make us more vulnerable to changes in the economy or our industryWe have a substantial amount of indebtedness. At December 31, 2014, we had $20.3 billion of total indebtedness outstanding, including: (1) $931.2million aggregate principal amount outstanding under iHeartCommunications’ term loan credit22 facilities, which mature in January 2016, $5.0 billion aggregate principal amount outstanding under iHeartCommunications’ term loan credit facilities, whichmature in January 2019 and $1.3 billion aggregate principal amount outstanding under iHeartCommunications’ term loan credit facilities, which mature inJuly 2019; (2) $2.0 billion aggregate principal amount outstanding of iHeartCommunications’ 9.0% priority guarantee notes due 2019, which mature inDecember 2019; (3) $1.7 billion aggregate principal amount outstanding of iHeartCommunications’ 9.0% priority guarantee notes due 2021, net of$34.2 million of unamortized discounts, which mature in March 2021; (4) $575.0 million aggregate principal amount of iHeartCommunications’ outstanding11.25% priority guarantee notes due 2021, which mature in March 2021; (5) $1.0 billion aggregate principal amount outstanding of iHeartCommunications’9.0% priority guarantee notes due 2022, net of $2.4 million of unamortized premiums, which mature in September 2022; (6) $19.3 million aggregateprincipal amount of other secured debt; (7) $1.6 billion aggregate principal amount outstanding of iHeartCommunications’ 14.0% senior notes due 2021, netof $15.6 million of unamortized discounts, (net of $423.4 million held by a subsidiary of iHeartCommunications), which mature in February 2021; (8) $486.5million aggregate principal amount outstanding of iHeartCommunications’ Legacy Notes, net of unamortized purchase accounting discounts of$181.4 million (net of $57.1 million held by a subsidiary of iHeartCommunications), which mature at various dates from 2016 through 2027; (9) 730.0million aggregate principal amount outstanding of iHeartCommunications’ 10.0% senior notes due 2018 (net of $120.0 million held by a subsidiary ofiHeartCommunications), which mature in January 2018; (10) $2.7 billion aggregate principal amount outstanding of subsidiary senior notes, net ofunamortized discount of $6.2 million, which mature in November 2022; (11) $2.2 billion aggregate principal amount outstanding of subsidiary seniorsubordinated notes, which mature in March 2020; and (12) other obligations of $1.0 million. This large amount of indebtedness could have negativeconsequences for us, including, without limitation: · requiring us to dedicate a substantial portion of our cash flow to the payment of principal and interest on indebtedness, thereby reducing cashavailable for other purposes, including to fund operations and capital expenditures, invest in new technology and pursue other businessopportunities;· limiting our liquidity and operational flexibility and limiting our ability to obtain additional financing for working capital, capitalexpenditures, debt service requirements, acquisitions and general corporate or other purposes;· limiting our ability to adjust to changing economic, business and competitive conditions;· requiring us to defer planned capital expenditures, reduce discretionary spending, sell assets, restructure existing indebtedness or deferacquisitions or other strategic opportunities;· limiting our ability to refinance any of the indebtedness or increasing the cost of any such financing;· making us more vulnerable to an increase in interest rates, a downturn in our operating performance, a decline in general economic or industryconditions or a disruption in the credit markets; and· making us more susceptible to negative changes in credit ratings, which could impact our ability to obtain financing in the future and increasethe cost of such financing. If compliance with the debt obligations materially hinders our ability to operate our business and adapt to changing industry conditions, we maylose market share, our revenue may decline and our operating results may suffer. The terms of iHeartCommunications’ credit facilities and the otherindebtedness allow us, under certain conditions, to incur further indebtedness, including secured indebtedness, which heightens the foregoing risks. iHeartCommunications and its subsidiaries may not be able to generate sufficient cash to service all of their indebtedness, may not be able to refinance allof their indebtedness before it becomes due and may be forced to take other actions to satisfy their obligations under their indebtedness, which may not besuccessfuliHeartCommunications’ and its subsidiaries’ ability to make scheduled payments on their respective debt obligations depends on their financialcondition and operating performance, which is subject to prevailing economic and competitive conditions and to certain financial, business and other factorsbeyond its or our control. In addition, because iHeartCommunications derives a substantial portion of its operating income from its subsidiaries,iHeartCommunications’ ability to repay its debt depends upon the performance of its subsidiaries, their ability to dividend or distribute funds toiHeartCommunications and iHeartCommunications’ receipt of funds under its cash management arrangement with its subsidiary, CCOH. iHeartCommunications and its subsidiaries may not generate cash flow from operations in an amount sufficient to fund our liquidity needs. Weanticipate cash interest requirements of approximately $1.6 billion during 2015. At December 31, 2014, we had debt maturities totaling $3.6 million,$1,126.9 million (net of $57.1 million due to a subsidiary of iHeartCommunications), and $8.2 million in 2015, 2016, and 2017, respectively. We arecurrently exploring, and expect to continue to explore, a variety of transactions to provide us with additional liquidity. We cannot assure you that we willenter into or consummate any such liquidity-generating transactions, or that such transactions will provide sufficient cash to satisfy our liquidity needs, andwe cannot currently predict the impact that any such transaction, if consummated, would have on us. 23 If iHeartCommunications’ and its subsidiaries’ cash flows from operations, refinancing sources and other liquidity-generating transactions areinsufficient to fund their respective debt service obligations, we may be forced to reduce or delay capital expenditures, sell material assets or operations, orseek additional capital. We may not be able to take any of these actions, and these actions may not be successful or permit iHeartCommunications or itssubsidiaries to meet the scheduled debt service obligations. Furthermore, these actions may not be permitted under the terms of existing or future debtagreements. The ability to refinance the debt will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of thedebt could be at higher interest rates and increase debt service obligations and may require us, iHeartCommunications and its subsidiaries to comply withmore onerous covenants, which could further restrict our business operations. The terms of existing or future debt instruments may restrict us from adoptingsome of these alternatives. These alternative measures may not be successful and may not permit us, iHeartCommunications or its subsidiaries to meetscheduled debt service obligations. If we, iHeartCommunications or its subsidiaries cannot make scheduled payments on indebtedness,iHeartCommunications or its subsidiaries, as applicable, will be in default under one or more of the debt agreements and, as a result we could be forced intobankruptcy or liquidation. Our substantial debt service obligations have increased as a result of iHeartCommunications’ financing transactions and may continue to do so, whichcould adversely affect our liquidity and prevent us from fulfilling our obligationsIn 2014, our debt service obligations increased. Future financing transactions may further increase our interest expense. The increase in our debtservice obligations could adversely affect our liquidity and could have important consequences, including the following: · it may make it more difficult for us to satisfy our obligations under our indebtedness and our contractual and commercial commitments; and· it may otherwise further limit us in the ways summarized above under “The substantial amount of indebtedness of our subsidiary,iHeartCommunications, and its subsidiaries, may adversely affect our cash flows and our ability to operate our business and make us morevulnerable to changes in the economy or our industry,” including by reducing our cash available for operations, debt service obligations, futurebusiness opportunities, acquisitions and capital expenditures. Our ability to make payments with respect to iHeartCommunications’ debt obligations will depend on our future operating performance andiHeartCommunications’ ability to continue to refinance its indebtedness, which will be affected by prevailing economic and credit market conditions andfinancial, business and other factors, many of which are beyond our control. The documents governing our indebtedness contain restrictions that limit our flexibility in operating our businessiHeartCommunications’ material financing agreements, including its credit agreements and indentures, contain various covenants restricting, amongother things, our ability to: · make acquisitions or investments;· make loans or otherwise extend credit to others;· incur indebtedness or issue shares or guarantees;· create liens;· enter into transactions with affiliates;· sell, lease, transfer or dispose of assets;· merge or consolidate with other companies; and· make a substantial change to the general nature of our business. In addition, under iHeartCommunications’ senior secured credit facilities, iHeartCommunications is required to comply with certain affirmativecovenants and certain specified financial covenants and ratios. For instance, iHeartCommunications’ senior secured credit facilities require it to comply on aquarterly basis with a financial covenant limiting the ratio of its consolidated secured debt, net of cash and cash equivalents, to its consolidated EBITDA (asdefined under the terms of the senior secured credit facilities) for the preceding four quarters. The ratio under this financial covenant for the four quartersended December 31, 2014 is set at 8.75 to 1. The restrictions contained in iHeartCommunications’ credit agreements and indentures could affect our ability to operate our business and may limitour ability to react to market conditions or take advantage of potential business opportunities as they arise. For example, such restrictions could adverselyaffect our ability to finance our operations, make strategic acquisitions, investments or alliances, restructure our organization or finance our capital needs. Additionally, the ability to comply with these covenants and restrictions may be affected by events beyond iHeartCommunications’ or our control. Theseinclude prevailing economic, financial24 and industry conditions. If any of these covenants or restrictions is breached, iHeartCommunications could be in default under the agreements governing itsindebtedness and, as a result, we would be forced into bankruptcy or liquidation. Downgrades in our credit ratings may adversely affect our borrowing costs, limit our financing options, reduce our flexibility under future financings andadversely affect our liquidity, and also may adversely impact our business operationsThe corporate credit ratings for iHeartCommunications and its indirect subsidiary, Clear Channel Worldwide Holdings, Inc., are speculative-grade.Any reductions in their credit ratings could increase our borrowing costs, reduce the availability of financing to us or increase the cost of doing business orotherwise negatively impact our business operations. Cautionary Statement Concerning Forward-Looking StatementsThe Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by us or on our behalf. Except forthe historical information, this report contains various forward-looking statements which represent our expectations or beliefs concerning future events,including, without limitation, our future operating and financial performance, our ability to comply with the covenants in the agreements governing ourindebtedness and the availability of capital and the terms thereof. Statements expressing expectations and projections with respect to future matters areforward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We caution that these forward-looking statementsinvolve a number of risks and uncertainties and are subject to many variables which could impact our future performance. These statements are made on thebasis of management’s views and assumptions, as of the time the statements are made, regarding future events and performance. There can be no assurance,however, that management’s expectations will necessarily come to pass. Actual future events and performance may differ materially from the expectationsreflected in our forward-looking statements. We do not intend, nor do we undertake any duty, to update any forward-looking statements. A wide range of factors could materially affect future developments and performance, including but not limited to: · the impact of our substantial indebtedness, including the effect of our leverage on our financial position and earnings;· our ability to generate sufficient cash from operations or other liquidity-generating transactions and our need to allocate significant amounts ofour cash to make payments on our indebtedness, which in turn could reduce our financial flexibility and ability to fund other activities;· risks associated with weak or uncertain global economic conditions and their impact on the capital markets;· other general economic and political conditions in the United States and in other countries in which we currently do business, including thoseresulting from recessions, political events and acts or threats of terrorism or military conflicts;· industry conditions, including competition;· the level of expenditures on advertising;· legislative or regulatory requirements;· fluctuations in operating costs;· technological changes and innovations;· changes in labor conditions, including on-air talent, program hosts and management;· capital expenditure requirements;· risks of doing business in foreign countries;· fluctuations in exchange rates and currency values;· the outcome of pending and future litigation;· taxes and tax disputes;· changes in interest rates;· shifts in population and other demographics;· access to capital markets and borrowed indebtedness;· our ability to implement our business strategies;· the risk that we may not be able to integrate the operations of acquired businesses successfully;· the risk that our cost savings initiatives may not be entirely successful or that any cost savings achieved from those initiatives may not persist;and· certain other factors set forth in our other filings with the Securities and Exchange Commission. This list of factors that may affect future performance and the accuracy of forward-looking statements is illustrative and is not intended to beexhaustive. Accordingly, all forward-looking statements should be evaluated with the understanding of their inherent uncertainty. 25 ITEM 1B. UNRESOLVED STAFF COMMENTSNone. ITEM 2. PROPERTIESCorporateOur corporate headquarters are located in San Antonio, Texas, where we own space in an executive office building and lease a data andadministrative service center. In addition, certain of our executive and other operations are located in New York, New York, Phoenix, Arizona, and London,England. iHMThe types of properties required to support each of our radio stations include offices, studios, transmitter sites and antenna sites. We either own orlease our transmitter and antenna sites. These leases generally have expiration dates that range from five to 15 years. A radio station’s studios are generallyhoused with its offices in downtown or business districts. A radio station’s transmitter sites and antenna sites are generally located in a manner that providesmaximum market coverage. Americas Outdoor and International Outdoor AdvertisingThe types of properties required to support each of our outdoor advertising branches include offices, production facilities and structure sites. Anoutdoor branch and production facility is generally located in an industrial or warehouse district.With respect to each of the Americas outdoor and International outdoor segments, we primarily lease our outdoor display sites and own or haveacquired permanent easements for relatively few parcels of real property that serve as the sites for our outdoor displays. Our leases generally range frommonth-to-month to year-to-year and can be for terms of 10 years or longer, and many provide for renewal options. There is no significant concentration of displays under any one lease or subject to negotiation with any one landlord. We believe that an importantpart of our management activity is to negotiate suitable lease renewals and extensions. ConsolidatedThe studios and offices of our radio stations and outdoor advertising branches are located in leased or owned facilities. These leases generally haveexpiration dates that range from one to 40 years. We do not anticipate any difficulties in renewing those leases that expire within the next several years or inleasing other space, if required. We own substantially all of the equipment used in our iHM and outdoor advertising businesses. For additional informationregarding our iHM and outdoor properties, see “Item 1. Business.” ITEM 3. LEGAL PROCEEDINGSWe currently are involved in certain legal proceedings arising in the ordinary course of business and, as required, have accrued an estimate of theprobable costs for the resolution of those claims for which the occurrence of loss is probable and the amount can be reasonably estimated. These estimateshave been developed in consultation with counsel and are based upon an analysis of potential results, assuming a combination of litigation and settlementstrategies. It is possible, however, that future results of operations for any particular period could be materially affected by changes in our assumptions or theeffectiveness of our strategies related to these proceedings. Additionally, due to the inherent uncertainty of litigation, there can be no assurance that theresolution of any particular claim or proceeding would not have a material adverse effect on our financial condition or results of operations. Although we are involved in a variety of legal proceedings in the ordinary course of business, a large portion of our litigation arises in the followingcontexts: commercial disputes; defamation matters; employment and benefits related claims; governmental fines; intellectual property claims; and taxdisputes. Los Angeles LitigationIn 2008, Summit Media, LLC, one of the Company’s competitors, sued the City of Los Angeles (the “City”), Clear Channel Outdoor, Inc. and CBSOutdoor in Los Angeles Superior Court (Case No. BS116611) challenging the validity of a settlement agreement that had been entered into in November2006 among the parties and pursuant to which Clear Channel Outdoor, Inc. had taken down existing billboards and converted 83 existing signs from staticdisplays to digital displays. In 2009 the Los Angeles Superior Court ruled that the settlement agreement constituted an ultra vires act of the City, andnullified its existence. After further proceedings, on April 12, 2013 the Los Angeles Superior Court invalidated 82 digital modernization permits issued toClear Channel26 Outdoor, Inc. (77 of which displays were operating at the time of the ruling), and Clear Channel Outdoor, Inc. was required to turn off the electrical power toall affected digital displays on April 15, 2013. The digital display structures remain intact but digital displays are currently prohibited in the City. ClearChannel Outdoor, Inc. is seeking permits under the existing City sign code to either wrap the LED faces with vinyl or convert the LED faces to traditionalstatic signs, and has obtained a number of such permits. Clear Channel Outdoor, Inc. is also pursuing a new ordinance to permit digital signage in the City. ITEM 4. MINE SAFETY DISCLOSURESNot Applicable. EXECUTIVE OFFICERS OF THE REGISTRANT The following information with respect to our executive officers is presented as of February 19, 2015: Name Age PositionRobert W. Pittman 61 Chairman, Chief Executive Officer and DirectorRichard J. Bressler 57 President, Chief Financial Officer and DirectorC. William Eccleshare 59 Chief Executive Officer—OutdoorScott D. Hamilton 45 Senior Vice President, Chief Accounting Officer and Assistant SecretaryRobert H. Walls, Jr. 54 Executive Vice President, General Counsel and Secretary The officers named above serve until their respective successors are chosen and qualified, in each case unless the officer sooner dies, resigns, isremoved or becomes disqualified. Robert W. Pittman was appointed as our Chairman and as Chairman of iHeartCommunications on May 17, 2013, as Chief Executive Officer and adirector of ours and iHeartCommunications and as Executive Chairman and a director of CCOH on October 2, 2011. He also was appointed as Chairman andChief Executive Officer and a member of the board of managers of our subsidiary, iHeartMedia Capital I, LLC, on April 26, 2013. Prior to October 2, 2011,Mr. Pittman served as Chairman of Media and Entertainment Platforms for us and Clear Channel since November 2010. He has been a member of, and aninvestor in, Pilot Group, a private equity investment company, since April 2003. Mr. Pittman was formerly Chief Operating Officer of AOL Time Warner, Inc.from May 2002 to July 2002. He also served as Co-Chief Operating Officer of AOL Time Warner, Inc. from January 2001 to May 2002, and earlier, asPresident and Chief Operating Officer of America Online, Inc. from February 1998 to January 2001. Mr. Pittman serves on the boards of numerous charitableorganizations, including the Alliance for Lupus Research, the New York City Ballet, the Rock and Roll Hall of Fame Foundation and the Robin HoodFoundation, where he has served as past Chairman. Richard J. Bressler was appointed as our President and Chief Financial Officer, as President and Chief Financial Officer of iHeartCommunicationsand iHeartMedia Capital I, LLC and as Chief Financial Officer of CCOH on July 29, 2013. Prior thereto, Mr. Bressler was a Managing Director at THL. Priorto joining THL, Mr. Bressler was the Senior Executive Vice President and Chief Financial Officer of Viacom, Inc. from 2001 through 2005. He also served asChairman and Chief Executive Officer of Time Warner Digital Media and, from 1995 to 1999, was Executive Vice President and Chief Financial Officer ofTime Warner Inc. Prior to joining Time Inc. in 1988, Mr. Bressler was a partner with the accounting firm of Ernst & Young LLP since 1979. Mr. Bressler alsocurrently is a director of Clear Channel and Gartner, Inc., a member of the board of managers of Clear Channel Capital I, LLC and a board observer atUnivision Communications Inc. Mr. Bressler previously served as a member of the board of directors of American Media Operations, Inc., Nielsen HoldingsB.V. and Warner Music Group Corp. and as a member of the J.P. Morgan Chase National Advisory Board. Mr. Bressler holds a B.B.A. in Accounting fromAdelphi University. Mr. Bressler has been one of our directors since May 2007. C. William Eccleshare was appointed as our Chief Executive Officer – Outdoor, as Chief Executive Officer—Outdoor of iHeartCommunications andas Chief Executive Officer of CCOH on January 24, 2012. He also was appointed as Chief Executive Officer—Outdoor of iHeartMedia Capital I, LLC onApril 26, 2013. Prior to January 24, 2012, he served as Chief Executive Officer—Clear Channel Outdoor—International of ours and iHeartCommunicationssince February 17, 2011 and as Chief Executive Officer—International of CCOH since September 1, 2009. Previously, he was Chairman and CEO of BBDOEMEA from 2005 to 2009. Prior thereto, he was Chairman and CEO of Young & Rubicam EMEA since 2002. Scott D. Hamilton was appointed as our Senior Vice President, Chief Accounting Officer and Assistant Secretary and as27 Senior Vice President, Chief Accounting Officer and Assistant Secretary of iHeartCommunications and CCOH on April 26, 2010. He also was appointed asSenior Vice President, Chief Accounting Officer and Assistant Secretary of iHeartMedia Capital I, LLC on April 26, 2013. Prior to April 26, 2010, Mr.Hamilton served as Controller and Chief Accounting Officer of Avaya Inc. (“Avaya”), a multinational telecommunications company, from October 2008 toApril 2010. Prior thereto, Mr. Hamilton served in various accounting and finance positions at Avaya, beginning in October 2004. Prior thereto, Mr.Hamilton was employed by PricewaterhouseCoopers from September 1992 until September 2004 in various roles including audit, transaction services andtechnical accounting consulting. Robert H. Walls, Jr. was appointed as our Executive Vice President, General Counsel and Secretary and as Executive Vice President, GeneralCounsel and Secretary of iHeartCommunications and CCOH on January 1, 2010. He also was appointed as Executive Vice President, General Counsel andSecretary of iHeartMedia Capital I, LLC on April 26, 2013. On March 31, 2011, Mr. Walls was appointed to serve in the newly-created Office of the ChiefExecutive Officer for us, iHeartCommunications and CCOH, in addition to his existing offices. Mr. Walls served in the Office of the Chief Executive Officerfor us and iHeartCommunications until October 2, 2011, and served in the Office of the Chief Executive Officer for CCOH until January 24, 2012. Mr. Wallswas a founding partner of Post Oak Energy Capital, LP and served as Managing Director through December 31, 2009 and as an advisor to Post Oak EnergyCapital, LP through December 31, 2013.28 PART II ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITYSECURITIES Market InformationShares of our Class A common stock are quoted for trading on the Over-The-Counter (“OTC”) Bulletin Board under the symbol “CCMO.” Therewere 308 stockholders of record as of February 6, 2014. This figure does not include an estimate of the indeterminate number of beneficial holders whoseshares may be held of record by brokerage firms and clearing agencies. The following quotations obtained from the OTC Bulletin Board reflect the high andlow bid prices for our Class A common stock based on inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actualtransactions. Class ACommon Stock Market Price Class ACommon Stock Market Price HighLow HighLow2014 2013 First Quarter................$8.00$6.50 First Quarter..................$3.74$2.20Second Quarter...........7.406.50 Second Quarter.............6.982.40Third Quarter..............9.307.26 Third Quarter................5.503.70Fourth Quarter............9.266.80 Fourth Quarter..............7.104.80 There is no established public trading market for our Class B and Class C common stock. There were 555,556 shares of our Class B common stockand 58,967,502 shares of our Class C common stock outstanding on February 11, 2014. All outstanding shares of our Class B common stock are held byClear Channel Capital IV, LLC and all outstanding shares of our Class C common stock are held by Clear Channel Capital V, L.P. Dividend PolicyWe currently do not intend to pay regular quarterly cash dividends on the shares of our common stock. We have not declared any dividend on ourcommon stock since our incorporation. We are a holding company with no independent operations and no significant assets other than the stock of oursubsidiaries. We, therefore, are dependent on the receipt of dividends or other distributions from our subsidiaries to pay dividends. In addition,iHeartCommunications’ debt financing arrangements include restrictions on its ability to pay dividends, which in turn affects our ability to pay dividends. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Sources of Capital” andNote 5 to the Consolidated Financial Statements. Sales of Unregistered SecuritiesWe did not sell any equity securities during 2014 that were not registered under the Securities Act of 1933. Purchases of Equity SecuritiesThe following table sets forth the purchases made during the quarter ended December 31, 2014 by or on behalf of us or an affiliated purchaser ofshares of our Class A common stock registered pursuant to Section 12 of the Exchange Act: 29 Period Total Number ofShares Purchased Average PricePaid per Share Total Number of SharesPurchased as Part ofPublicly Announced Plansor Programs Maximum Number (orApproximate Dollar Value) ofShares that May Yet BePurchased Under the Plans orProgramsOctober 1 through October 31 - $ - - $ (1) November 1 through November 30 - - - (1) December 1 through December 31 5,000,000 9.75 5,000,000 34,184,424 (1) Total 5,000,000 $ 9.75 5,000,000 $ 34,184,424 (1) (1) On August 9, 2010, iHeartCommunications announced that its board of directors approved a stock purchase program under whichiHeartCommunications or its subsidiaries may purchase up to an aggregate of $100 million of our Class A common stock and/or the Class A commonstock of CCOH. No shares of our Class A common stock were purchased in 2014. During 2014, a subsidiary of iHeartCommunications purchased5,000,000 shares of CCOH Class A common stock for approximately $48.8 million. During 2011, a subsidiary of iHeartCommunications purchased1,553,971 shares of CCOH Class A common stock for approximately $16.4 million in open market purchases. During 2012, a subsidiary ofiHeartCommunications purchased 111,291 shares of our Class A common stock approximately $0.7 million under the stock purchase program. As aresult of these purchases of shares of the Class A common stock of CCOH and our Class A common stock, as of December 31, 2014, an aggregate of $34.2million was available under the stock purchase program to purchase the Class A common stock of CCOH and/or our Class A common stock. The stockpurchase program does not have a fixed expiration date and may be modified, suspended or terminated at any time at iHeartCommunications’ discretion. On January 7, 2015 a subsidiary of iHeartCommunications purchased an additional 2,000,000 shares of CCOH Class A common stock at a price of$10.20 per share, or $20.4 million total purchase price.30 ITEM 6. SELECTED FINANCIAL DATAThe following tables set forth our summary historical consolidated financial and other data as of the dates and for the periods indicated. Thesummary historical financial data are derived from our audited consolidated financial statements. Certain prior period amounts have been reclassified toconform to the 2014 presentation. Historical results are not necessarily indicative of the results to be expected for future periods. Acquisitions anddispositions impact the comparability of the historical consolidated financial data reflected in this schedule of Selected Financial Data. The summary historical consolidated financial and other data should be read in conjunction with “Management’s Discussion and Analysis ofFinancial Condition and Results of Operations” and our consolidated financial statements and the related notes thereto located within Item 8 of Part II of thisAnnual Report on Form 10-K. (In thousands)For the Years Ended December 31, 2014 2013 2012 2011 2010Results of Operations Data: Revenue$ 6,318,533 $ 6,243,044 $ 6,246,884 $ 6,161,352 $ 5,865,685 Operating expenses: Direct operating expenses (excludes depreciation and amortization) 2,534,365 2,554,087 2,498,400 2,505,946 2,368,943 Selling, general and administrative expenses (excludes depreciation and amortization) 1,687,208 1,649,861 1,666,418 1,604,524 1,566,580 Corporate expenses (excludes depreciation and amortization) 320,331 313,514 293,207 237,920 300,378 Depreciation and amortization 710,898 730,828 729,285 763,306 732,869 Impairment charges (1) 24,176 16,970 37,651 7,614 15,364 Other operating income (expense), net 40,031 22,998 48,127 12,682 (16,710) Operating income 1,081,586 1,000,782 1,070,050 1,054,724 864,841 Interest expense 1,741,596 1,649,451 1,549,023 1,466,246 1,533,341 Gain (loss) on marketable securities - 130,879 (4,580) (4,827) (6,490) Equity in earnings (loss) of nonconsolidated affiliates (9,416) (77,696) 18,557 26,958 5,702 Gain (loss) on extinguishment of debt (43,347) (87,868) (254,723) (1,447) 60,289 Other income (expense), net 9,104 (21,980) 250 (3,169) (13,834) Loss before income taxes (703,669) (705,334) (719,469) (394,007) (622,833) Income tax benefit (expense) (58,489) 121,817 308,279 125,978 159,980 Consolidated net loss (762,158) (583,517) (411,190) (268,029) (462,853) Less amount attributable to noncontrolling interest 31,603 23,366 13,289 34,065 16,236 Net loss attributable to the Company$ (793,761) $ (606,883) $ (424,479) $ (302,094) $ (479,089) For the Years Ended December 31, 2014 2013 2012 2011 2010Net loss per common share: Basic Net loss attributable to the Company$ (9.46) $ (7.31) $ (5.23) $ (3.70) $ (5.94) Diluted: Net loss attributable to the Company$ (9.46) $ (7.31) $ (5.23) $ (3.70) $ (5.94) Dividends declared per share - - - - - 31 (In thousands)As of December 31, 2014 2013 2012 2011 2010Balance Sheet Data: Current assets$ 2,180,143 $ 2,513,294 $ 2,987,753 $ 2,985,285 $ 3,603,173 Property, plant and equipment, net 2,699,064 2,897,630 3,036,854 3,063,327 3,145,554 Total assets 14,040,242 15,097,302 16,292,713 16,452,039 17,460,382 Current liabilities 1,364,285 1,763,618 1,782,142 1,428,962 2,098,579 Long-term debt, net of current maturities 20,322,414 20,030,479 20,365,369 19,938,531 19,739,617 Shareholders’ deficit (9,665,208) (8,696,635) (7,995,191) (7,471,941) (7,204,686) (1) We recorded non-cash impairment charges of $24.2 million, $17.0 million, $37.7 million, $7.6 million and $15.4 million during 2014, 2013, 2012,2011 and 2010, respectively. Our impairment charges are discussed more fully in Item 8 of Part II of this Annual Report on Form 10-K.32 ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSOVERVIEWFormat of Presentation On September 16, 2014, the Company issued a press release that announced a change of its name to “iHeartMedia, Inc.” and a change to the namesof certain of its affiliates, including as follows: Old Name: New Name:Clear Channel Capital I, LLC iHeartMedia Capital I, LLCClear Channel Capital II, LLC iHeartMedia Capital II, LLCClear Channel Communications, Inc. iHeartCommunications, Inc.Clear Channel Management Services, Inc. iHeartMedia Management Services, Inc.Clear Channel Broadcasting, Inc. iHeartMedia + Entertainment, Inc.Clear Channel Identity, Inc. iHM Identity, Inc.Clear Channel Satellite Services Inc. iHeartMedia Satellite Services, Inc. Clear Channel Outdoor Holdings, Inc., an indirect subsidiary of the Company, retains its existing name. Management’s discussion and analysis of our financial condition and results of operations (“MD&A”) should be read in conjunction with theconsolidated financial statements and related footnotes. Our discussion is presented on both a consolidated and segment basis. Our reportable segments areiHeartMedia (“iHM”), Americas outdoor advertising (“Americas outdoor” or “Americas outdoor advertising”), and International outdoor advertising(“International outdoor” or “International outdoor advertising”). Our iHM segment provides media and entertainment services via broadcast and digitaldelivery and also includes our national syndication business. Our Americas outdoor and International outdoor segments provide outdoor advertisingservices in their respective geographic regions using various digital and traditional display types. Included in the “Other” category are our mediarepresentation business, Katz Media Group, as well as other general support services and initiatives, which are ancillary to our other businesses. We manage our operating segments primarily focusing on their operating income, while Corporate expenses, Other operating income (expense), net,Interest expense, Gain on marketable securities, Equity in earnings of nonconsolidated affiliates, Gain (loss) on extinguishment of debt, Gain (loss) onextinguishment of debt, Other income (expense), net and Income tax benefit (expense) are managed on a total company basis and are, therefore, includedonly in our discussion of consolidated results. Certain prior period amounts have been reclassified to conform to the 2014 presentation. iHMOur revenue is derived primarily from selling advertising time, or spots, on our radio stations, with advertising contracts typically less than one yearin duration. The programming formats of our radio stations are designed to reach audiences with targeted demographic characteristics that appeal to ouradvertisers. We also provide streaming content via the Internet, mobile and other digital platforms which reach national, regional and local audiences andderive revenues primarily from selling advertising time with advertising contracts similar to those used by our radio stations. iHM management monitors average advertising rates, which are principally based on the length of the spot and how many people in a targetedaudience listen to our stations, as measured by an independent ratings service. Also, our advertising rates are influenced by the time of day the advertisementairs, with morning and evening drive-time hours typically priced the highest. Management monitors yield per available minute in addition to average ratesbecause yield allows management to track revenue performance across our inventory. Yield is measured by management in a variety of ways, includingrevenue earned divided by minutes of advertising sold. Management monitors macro-level indicators to assess our iHM operations’ performance. Due to the geographic diversity and autonomy of ourmarkets, we have a multitude of market-specific advertising rates and audience demographics. Therefore, management reviews average unit rates across eachof our stations. Management looks at our iHM operations’ overall revenue as well as the revenue from each type of advertising, including local advertising, which issold predominately in a station’s local market, and national advertising, which is sold across multiple markets. Local advertising is sold by each radiostation’s sales staff while national advertising is sold by our national sales team and33 through our national representation firm. Local advertising, which is our largest source of advertising revenue, and national advertising revenues are trackedseparately because these revenue streams have different sales forces and respond differently to changes in the economic environment. We periodically reviewand refine our selling structures in all markets in an effort to maximize the value of our offering to advertisers and, therefore, our revenue. Management also looks at iHM revenue by market size. Typically, larger markets can reach larger audiences with wider demographics than smallermarkets. Additionally, management reviews our share of iHM advertising revenues in markets where such information is available, as well as our share oftarget demographics listening in an average quarter hour. This metric gauges how well our formats are attracting and retaining listeners. A portion of our iHM segment’s expenses vary in connection with changes in revenue. These variable expenses primarily relate to costs in our salesdepartment, such as commissions, and bad debt. Our programming and general and administrative departments incur most of our fixed costs, such as utilitiesand office salaries. We incur discretionary costs in our marketing and promotions, which we primarily use in an effort to maintain and/or increase ouraudience share. Lastly, we have incentive systems in each of our departments which provide for bonus payments based on specific performance metrics,including ratings, sales levels, pricing and overall profitability. Outdoor AdvertisingOur outdoor advertising revenue is derived from selling advertising space on the displays we own or operate in key markets worldwide, consistingprimarily of billboards, street furniture and transit displays. Part of our long-term strategy for our outdoor advertising businesses is to pursue the technologyof digital displays, including flat screens, LCDs and LEDs, as additions to traditional methods of displaying our clients’ advertisements. We are currentlyinstalling these technologies in certain markets, both domestically and internationally. Management typically monitors our outdoor advertising business by reviewing the average rates, average revenue per display, occupancy, andinventory levels of each of our display types by market. We own the majority of our advertising displays, which typically are located on sites that we either lease or own or for which we have acquiredpermanent easements. Our advertising contracts with clients typically outline the number of displays reserved, the duration of the advertising campaign andthe unit price per display. The significant expenses associated with our operations include direct production, maintenance and installation expenses as well as site leaseexpenses for land under our displays including revenue-sharing or minimum guaranteed amounts payable under our billboard, street furniture and transitdisplay contracts. Our direct production, maintenance and installation expenses include costs for printing, transporting and changing the advertising copyon our displays, the related labor costs, the vinyl and paper costs, electricity costs and the costs for cleaning and maintaining our displays. Vinyl and papercosts vary according to the complexity of the advertising copy and the quantity of displays. Our site lease expenses include lease payments for use of theland under our displays, as well as any revenue-sharing arrangements or minimum guaranteed amounts payable that we may have with the landlords. Theterms of our site leases and revenue-sharing or minimum guaranteed contracts generally range from one to 20 years. Americas Outdoor AdvertisingOur advertising rates are based on a number of different factors including location, competition, type and size of display, illumination, market andgross ratings points. Gross ratings points are the total number of impressions delivered by a display or group of displays, expressed as a percentage of amarket population. The number of impressions delivered by a display is measured by the number of people passing the site during a defined period of time. For all of our billboards in the United States, we use independent, third-party auditing companies to verify the number of impressions delivered by a display. Client contract terms typically range from four weeks to one year for the majority of our display inventory in the United States. Generally, we ownthe street furniture structures and are responsible for their construction and maintenance. Contracts for the right to place our street furniture and transitdisplays and sell advertising space on them are awarded by municipal and transit authorities in competitive bidding processes governed by local law or arenegotiated with private transit operators. Generally, these contracts have terms ranging from 10 to 20 years. International Outdoor AdvertisingSimilar to our Americas outdoor business, advertising rates generally are based on the gross ratings points of a display or group of displays. Thenumber of impressions delivered by a display, in some countries, is weighted to account for such factors as34 illumination, proximity to other displays and the speed and viewing angle of approaching traffic. In addition, because our International outdoor advertisingoperations are conducted in foreign markets, including Europe, Asia, Australia and Latin America, management reviews the operating results from our foreignoperations on a constant dollar basis. A constant dollar basis allows for comparison of operations independent of foreign exchange movements. Our International display inventory is typically sold to clients through network packages, with client contract terms typically ranging from one totwo weeks with terms of up to one year available as well. Internationally, contracts with municipal and transit authorities for the right to place our streetfurniture and transit displays typically provide for terms ranging from three to 15 years. The major difference between our International and Americas streetfurniture businesses is in the nature of the municipal contracts. In our International outdoor business, these contracts typically require us to provide themunicipality with a broader range of metropolitan amenities in exchange for which we are authorized to sell advertising space on certain sections of thestructures we erect in the public domain. A different regulatory environment for billboards and competitive bidding for street furniture and transit displaycontracts, which constitute a larger portion of our business internationally, may result in higher site lease costs in our International business. As a result, ourmargins are typically lower in our International business than in our Americas outdoor business. Macroeconomic IndicatorsOur advertising revenue for all of our segments is highly correlated to changes in gross domestic product (“GDP”) as advertising spending hashistorically trended in line with GDP, both domestically and internationally. According to the U.S. Department of Commerce, estimated U.S. GDP growth for2014 was 2.4%. Internationally, our results are impacted by fluctuations in foreign currency exchange rates as well as the economic conditions in the foreignmarkets in which we have operations. Executive SummaryThe key developments in our business for the year ended December 31, 2014 are summarized below:· Consolidated revenue increased $75.5 million including a decrease of $22.7 million from movements in foreign exchange during 2014compared to 2013. Excluding foreign exchange impacts, consolidated revenue increased $98.2 million over 2013.· iHM revenue increased $29.9 million during 2014 compared to 2013 primarily driven by increased revenues from political advertising, ourtraffic and weather business, and core national broadcast radio.· Americas outdoor revenue decreased $37.3 million compared to 2013, including a decrease of $3.4 million from movements in foreignexchange. Excluding foreign exchange impacts, revenue decreased $33.9 million over 2013 primarily driven by lower national advertisingrevenues.· International outdoor revenue increased $52.3 million compared to 2013, including a decrease of $19.3 million from movements in foreignexchange. Excluding foreign exchange impacts, revenue increased $71.6 million compared to 2013 primarily driven by growth in both Europeand emerging markets.· Revenues in our Other category increased $33.1 million compared to 2013 primarily as a result of higher political revenues and a contracttermination fee of $15 million earned by our media representation business.· We spent $70.6 million on strategic revenue and cost-saving initiatives during 2014 to realign and improve our on-going business operations—an increase of $12.7 million compared to 2013.· During 2014, iHeartCommunications completed several refinancing transactions, including a $1,000.0 million issuance of 9.0% PriorityGuarantee Notes due 2022, an $850.0 million issuance of 10.0% Senior Notes due 2018, and a new issuance and sale to a subsidiary of $222.2million of 14.0% Senior Notes due 2021. The proceeds from these transactions were used to repay or redeem existing indebtedness ofiHeartCommunications, as well as pay associated fees and expenses.· Throughout 2014, CC Finco, LLC (“CC Finco”), an indirect wholly-owned subsidiary of ours, repurchased $239.0 million principal amount ofnotes, for a total purchase price of $222.4 million, including accrued interest. Of these notes repurchased, $177.1 million principal amount werenot cancelled and remain outstanding.· On December 11, 2014, we announced that one of our subsidiaries had entered into an agreement with Vertical Bridge Acquisitions, LLC(“Buyer”), for the sale of 411 of our broadcast communications tower sites and related assets for up to $400.0 million (the “Tower Portfolio”).The acquisition of the Tower Portfolio may occur in one or more closings, and the transaction is subject to due diligence and other customaryclosing conditions. The Buyer is required to acquire at least 85% of the Tower Portfolio. Simultaneous with each closing of the sale of thetowers, we will enter into lease agreements for the continued use of the subject towers. The initial term of each lease will be fifteen yearsfollowed by three option periods of five years each, subject to exclusions and limitations. If Buyer acquires the entire Tower Portfolio, we willhave annual lease payments of approximately $22.7 million, a loss of annual tenant revenues of approximately $11.6 million and a reduction ofdirect operating expenses of approximately $3.8 million annually. 35 Consolidated Results of OperationsThe comparison of our historical results of operations for the year ended December 31, 2014 to the year ended December 31, 2013 is as follows: (In thousands)Years Ended December 31, % 2014 2013 ChangeRevenue$ 6,318,533 $ 6,243,044 1% Operating expenses: Direct operating expenses (excludes depreciation and amortization) 2,534,365 2,554,087 (1%) Selling, general and administrative expenses (excludes depreciation and amortization) 1,687,208 1,649,861 2% Corporate expenses (excludes depreciation and amortization) 320,331 313,514 2% Depreciation and amortization 710,898 730,828 (3%) Impairment charges 24,176 16,970 42% Other operating income, net 40,031 22,998 74% Operating income 1,081,586 1,000,782 8% Interest expense 1,741,596 1,649,451 6% Gain on marketable securities - 130,879 Equity in loss of nonconsolidated affiliates (9,416) (77,696) Loss on extinguishment of debt (43,347) (87,868) Other income (expense), net 9,104 (21,980) Loss before income taxes (703,669) (705,334) Income tax benefit (expense) (58,489) 121,817 Consolidated net loss (762,158) (583,517) Less amount attributable to noncontrolling interest 31,603 23,366 Net loss attributable to the Company$ (793,761) $ (606,883) Consolidated RevenueOur consolidated revenue during 2014 increased $75.5 million including a decrease of $22.7 million from movements in foreign exchangecompared to 2013. Excluding the impact of foreign exchange movements, consolidated revenue increased $98.2 million. Our iHM revenue increased $29.9million driven by increased revenues from political advertising, our traffic and weather business, core national broadcast radio and digital revenues. Americas outdoor revenue decreased $37.3 million compared to 2013, including negative movements in foreign exchange of $3.4 million. Excluding theimpact of foreign exchange movements, Americas outdoor revenue decreased $33.9 million primarily driven by lower revenues generated by nationalaccounts and the nonrenewal of certain airport contracts, and lower revenues in our Los Angeles market as a result of the impact of litigation. OurInternational outdoor revenue increased $52.3 million compared to 2013, including negative movements in foreign exchange of $19.3 million. Excludingthe impact of foreign exchange movements, International outdoor revenue increased $71.6 million primarily driven by new contracts and from growth inEurope and emerging markets. Other revenues increased $33.1 million primarily as a result of higher political revenues and a contract termination fee of $15million earned by our media representation business. Consolidated Direct Operating ExpensesConsolidated direct operating expenses during 2014 decreased $19.7 million including a decrease of $11.9 million from movements in foreignexchange compared to 2013. Excluding the impact of foreign exchange movements, consolidated direct operating expenses decreased $7.8 million. Our iHMdirect operating expenses decreased $21.6 million compared to 2013, primarily resulting from lower costs in our national syndication business partiallyoffset by higher programming and content costs. Direct operating expenses in our Americas outdoor segment decreased $11.1 million compared to 2013,including a decrease of $2.5 million from movements in foreign exchange. Excluding the impact of foreign exchange movements, direct operating expensesin our Americas outdoor segment decreased $8.6 million, primarily due to lower site lease expenses related to the decrease in revenues and from thenonrenewal of certain airport contracts. Direct operating expenses in our International outdoor segment increased $13.2 million compared to 2013, includinga decrease of $9.4 million from movements in foreign exchange. Excluding the impact of foreign exchange movements, direct operating expenses in ourInternational outdoor segment increased $22.6 million primarily as a result of higher variable costs associated with new contracts. 36 Consolidated Selling, General and Administrative (“SG&A”) ExpensesConsolidated SG&A expenses during 2014 increased $37.3 million including a decrease of $4.5 million from movements in foreign exchangecompared to 2013. Excluding the impact of foreign exchange movements, consolidated SG&A expenses increased $41.8 million. Our iHM SG&A expensesincreased $32.5 million primarily due to higher compensation expense, including commissions. SG&A expenses decreased $8.8 million in our Americasoutdoor segment including a decrease of $0.4 million from movements in foreign exchange compared to 2013. Excluding the impact of foreign exchangemovements, SG&A expenses in our Americas outdoor segment decreased $8.4 million primarily due to lower commission expense in connection with lowerrevenues and property tax refunds. Our International outdoor SG&A expenses increased $13.7 million compared to 2013, including a $4.1 million decreasedue to the effects of movements in foreign exchange. Excluding the impact of foreign exchange movements, SG&A expenses in our International outdoorsegment increased $17.8 million primarily due to higher compensation expense, including commissions, in connection with higher revenues, as well ashigher litigation expenses. Corporate ExpensesCorporate expenses increased $6.8 million compared to 2013 primarily due to increased employee benefits costs, higher strategic revenue andefficiency costs and higher compensation expenses related to our variable compensation plans, partially offset by an $8.5 million credit for the realization ofan insurance recovery related to litigation filed by stockholders of Clear Channel Outdoor Holdings, Inc. (“CCOH”), an indirect non-wholly ownedsubsidiary of iHeartCommunications, which is, in turn, an indirect wholly owned subsidiary of ours, and lower legal costs related to this litigation. Revenue and Efficiency InitiativesIncluded in the amounts for direct operating expenses, SG&A and corporate expenses discussed above are expenses of $70.6 million incurred inconnection with our strategic revenue and efficiency initiatives. The costs were incurred to improve revenue growth, enhance yield, reduce costs, andorganize each business to maximize performance and profitability. These costs consist primarily of consolidation of locations and positions, severancerelated to workforce initiatives, consulting expenses, and other costs incurred in connection with streamlining our businesses. Of the strategic revenue and efficiency costs, $13.0 million are reported within direct operating expenses, $23.6 million are reported within SG&Aand $34.0 million are reported within corporate expense. In 2013, such costs totaled $15.1 million, $22.3 million, and $20.5 million, respectively. Depreciation and AmortizationDepreciation and amortization decreased $19.9 million during 2014 compared to 2013, primarily due to intangible assets becoming fully amortized. Impairment ChargesWe performed our annual impairment tests as of October 1, 2014 and 2013 on our goodwill, FCC licenses, billboard permits, and other intangibleassets. In addition, we test for impairment of property, plant and equipment whenever events and circumstances indicate that depreciable assets might beimpaired. As a result of these impairment tests, we recorded impairment charges of $24.2 million and $17.0 million during 2014 and 2013, respectively. During 2014, we recognized a $15.7 impairment charge related to FCC licenses in eight markets due to changes in the discount rates and weight-average costof capital for those markets. During 2013, we recognized a $10.7 million goodwill impairment charge in our International outdoor segment related to adecline in the estimated fair value of one market. Please see Note 2 to the consolidated financial statements included in Item 8 of Part II of this AnnualReport on Form 10-K for a further description of the impairment charges. Other Operating Income, NetOther operating income of $40.0 million in 2014 primarily related to a non-cash gain of $43.5 million recognized on the sale of non-core radiostations in exchange for a portfolio of 29 stations in five markets. Other operating income of $23.0 million in 2013 primarily related to the gain on the sale of certain outdoor assets in our Americas outdoor segment. 37 Interest ExpenseInterest expense increased $92.1 million during 2014 compared to 2013 primarily due to the weighted average cost of debt increasing as a result ofdebt refinancings that occurred since 2013. Please refer to “Sources of Capital” for additional discussion of debt issuances and exchanges. Our weightedaverage cost of debt during 2014 and 2013 was 8.1% and 7.6%, respectively. Gain On Marketable SecuritiesThe gain on marketable securities of $130.9 million during 2013 resulted from the sale of the shares we held in Sirius XM Radio, Inc. Equity In Loss Of Nonconsolidated AffiliatesEquity in loss of nonconsolidated affiliates of $9.4 million for 2014 primarily related to the $4.5 million gain on the sale of our 50% interest inBuspak in the third quarter, offset by the first quarter 2014 sale of our 50% interest in Australian Radio Network Pty Ltd (“ARN”), which included a loss onthe sale of $2.4 million and $11.5 million of foreign exchange losses that were reclassified from accumulated other comprehensive income at the date of thesale. Equity in loss of nonconsolidated affiliates of $77.7 million for 2013 primarily included the loss from our investments in Australia Radio Networkand New Zealand Radio Network. On February 18, 2014, a subsidiary of ours sold its 50% interest in ARN. As of December 31, 2013 the book value of ourinvestment in ARN exceeded the estimated selling price. Accordingly, we recorded an impairment charge of $95.4 million during the fourth quarter of 2013to write down the investment to its estimated fair value. Loss On Extinguishment Of DebtDuring the fourth quarter of 2014, CC Finco repurchased $57.1 million aggregate principal amount of iHeartCommunications’ 5.5% Senior Notesdue 2016 and $120.0 million aggregate principal amount of iHeartCommunications’ 10.0% Senior Notes due 2018 for a total of $159.3 million, includingaccrued interest, through open market purchases. In connection with these transactions, we recognized a net gain of $12.9 million.In September of 2014, iHeartCommunications prepaid $974.9 million of the loans outstanding under its Term Loan B facility and $16.1 million ofthe loans outstanding under its Term Loan C-asset sale facility. In connection with these transactions, we recognized a loss of $4.8 million.During June 2014, iHeartCommunications redeemed $567.1 million aggregate principal amount of its outstanding 5.5% Senior Notes due 2014 and$241.0 million aggregate principal amount of its outstanding 4.9% Senior Notes due 2015. In connection with these transactions, we recognized a loss of$47.5 million.During the first quarter of 2014, CC Finco repurchased $52.9 million aggregate principal amount of iHeartCommunications’ outstanding 5.5%Senior Notes due 2014 and $9.0 million aggregate principal amount of iHeartCommunications’ outstanding 4.9% Senior Notes due 2015 for a total of $63.1million, including accrued interest, through open market purchases. In connection with these transactions, we recognized a loss of $3.9 million.During 2013, we recognized a loss of $84.0 million due to a debt exchange related to iHeartCommunications’ 10.75% Senior Cash Pay Notes due2016 and 11.00%/11.75% Senior Toggle Notes due 2016 into 14.0% Senior Notes due 2021. In addition, we recognized a loss of $3.9 million due to thewrite-off of deferred loan costs in connection with the prepayment of Term Loan A of iHeartCommunications’ senior secured credit facilities. Other Income (Expense), NetOther income of $9.1 million for 2014 primarily related to gains on foreign exchange transactions. In connection with the June 2013 exchange offer of a portion of 10.75% Senior Cash Pay Notes due 2016 and 11.00%/11.75% Senior Toggle Notesdue 2016 for newly-issued 14.0% Senior Notes due 2021 and in connection with the senior secured credit facility amendments discussed elsewhere in theMD&A, all of which were accounted for as modifications of existing debt, we incurred expenses of $23.6 million partially offset by $1.8 million in foreignexchange gains on short-term intercompany accounts. Income Tax Benefit (Expense)The effective tax rate for the year ended December 31, 2014 was (8.3%) as compared to 17.3% for the year ended December38 31, 2013. The effective tax rate for 2014 was impacted by the $339.8 million valuation allowance recorded against the Company’s current period federal andstate net operating losses due to the uncertainty of the ability to utilize those losses in future periods. This expense was partially offset by $28.9 million innet tax benefits associated with a decrease in unrecognized tax benefits resulting from the expiration of statutes of limitations to assess taxes in the UnitedKingdom and several state jurisdictions. The effective tax rate for the year ended December 31, 2013 was 17.3% and was primarily impacted by the $143.5 million valuation allowancerecorded during the period as additional deferred tax expense. The valuation allowance was recorded against a portion of the U.S. Federal and State netoperating losses due to the uncertainty of the ability to utilize those losses in future periods. This expense was partially offset by tax benefits recorded duringthe period due to the settlement of our U.S. Federal and certain State tax examinations during the year. Pursuant to the settlements, we recorded a reduction toincome tax expense of approximately $20.2 million to reflect the net tax benefits of the settlements. iHM Results of OperationsOur iHM operating results were as follows: (In thousands)Years Ended December 31, % 2014 2013 ChangeRevenue$ 3,161,503 $ 3,131,595 1% Direct operating expenses 921,089 942,644 (2%) SG&A expenses 1,052,578 1,020,097 3% Depreciation and amortization 240,868 262,136 (8%) Operating income$ 946,968 $ 906,718 4% iHM revenue increased $29.9 million during 2014 compared to 2013 driven primarily by political advertising, our traffic and weather business andthe impact of strategic sales initiatives, and higher core national broadcast revenues, including events and digital revenue. Digital streaming revenue washigher for the year as a result of increased advertising on our iHeartRadio platform. Partially offsetting these increases was a decrease in core local broadcastradio and syndication revenues. Direct operating expenses decreased $21.6 million during 2014, primarily resulting from lower costs in our national syndication business partiallyoffset by higher programming and content costs, including sports programming and music license and performance royalties. SG&A expenses increased$32.5 million during 2014 primarily due to higher compensation expense, including commissions. Strategic revenue and efficiency costs included in SG&Aexpenses increased $4.4 million compared to 2013. Depreciation and amortization decreased $21.3 million, primarily due to intangible assets becoming fully amortized.39 Americas Outdoor Advertising Results of OperationsOur Americas outdoor operating results were as follows: (In thousands)Years Ended December 31, % 2014 2013 ChangeRevenue$ 1,253,190 $ 1,290,452 (3%) Direct operating expenses 555,614 566,669 (2%) SG&A expenses 211,969 220,732 (4%) Depreciation and amortization 194,640 196,597 (1%) Operating income$ 290,967 $ 306,454 (5%) Our Americas outdoor revenue decreased $37.3 million compared to 2013, including negative movements in foreign exchange of $3.4 million.Excluding the impact of foreign exchange movements, Americas outdoor revenue decreased $33.9 million driven primarily by lower spending by nationalaccounts and the nonrenewal of certain airport contracts. Revenues were also lower in our Los Angeles market as a result of the impact of litigation asdiscussed further in Item 3 of Part I of this Annual Report on Form 10-K. Direct operating expenses decreased $11.1 million compared to 2013, including a decrease of $2.5 million from movements in foreign exchange.Excluding the impact of foreign exchange movements, direct operating expenses in our Americas outdoor segment decreased $8.6 million, primarily due tolower site lease expenses related to the decrease in revenues and from the nonrenewal of certain airport contracts. SG&A expenses decreased $8.8 millioncompared to 2013, including a decrease of $0.4 million from movements in foreign exchange. Excluding the impact of foreign exchange movements, SG&Aexpenses in our Americas outdoor segment decreased $8.4 million primarily due to lower commission expense in connection with lower revenues andproperty tax refunds. International Outdoor Advertising Results of OperationsOur International outdoor operating results were as follows: (In thousands)Years Ended December 31, % 2014 2013 ChangeRevenue$ 1,708,069 $ 1,655,738 3% Direct operating expenses 1,041,274 1,028,059 1% SG&A expenses 336,550 322,840 4% Depreciation and amortization 207,431 203,927 2% Operating income$ 122,814 $ 100,912 22% International outdoor revenue increased $52.3 million compared to 2013, including a decrease of $19.3 million from movements in foreignexchange. Excluding the impact of foreign exchange movements, revenues increased $71.6 million primarily driven by revenue growth in Europe includingItaly, due to a new contract for the Rome airports, as well as Sweden, France, and the UK. Revenue in emerging markets also increased, particularly in Chinaand Mexico primarily as a result of new contracts. Direct operating expenses increased $13.2 million compared to 2013, including a decrease of $9.4 million from movements in foreign exchange.Excluding the impact of movements in foreign exchange, direct operating expenses increased $22.6 million primarily as a result of higher variable costsassociated with new contracts, including the Rome airports contract in Italy. SG&A expenses increased $13.7 million compared to 2013, including a decreaseof $4.1 million from movements in foreign exchange. Excluding the impact of movements in foreign exchange, SG&A expenses increased $17.8 millionprimarily due to higher compensation expense, including commissions, in connection with higher revenues, as well as higher litigation expenses. 40 Consolidated Results of OperationsThe comparison of our historical results of operations for the year ended December 31, 2013 to the year ended December 31, 2012 is as follows: (In thousands)Years Ended December 31, % 2013 2012 ChangeRevenue$ 6,243,044 $ 6,246,884 (0%) Operating expenses: Direct operating expenses (excludes depreciation and amortization) 2,554,087 2,498,400 2% Selling, general and administrative expenses (excludes depreciation and amortization) 1,649,861 1,666,418 (1%) Corporate expenses (excludes depreciation and amortization) 313,514 293,207 7% Depreciation and amortization 730,828 729,285 0% Impairment charges 16,970 37,651 (55%) Other operating income, net 22,998 48,127 (52%) Operating income 1,000,782 1,070,050 (6%) Interest expense 1,649,451 1,549,023 Gain (loss) on marketable securities 130,879 (4,580) Equity in earnings (loss) of nonconsolidated affiliates (77,696) 18,557 Loss on extinguishment of debt (87,868) (254,723) Other income (expense), net (21,980) 250 Loss before income taxes (705,334) (719,469) Income tax benefit 121,817 308,279 Consolidated net loss (583,517) (411,190) Less amount attributable to noncontrolling interest 23,366 13,289 Net loss attributable to the Company$ (606,883) $ (424,479) Consolidated RevenueOur consolidated revenue decreased $3.8 million including the increase of $3.5 million from the impact of movements in foreign exchangecompared to 2012. Excluding the impact of foreign exchange movements and $20.4 million impact of our divestiture of our international neon businessduring 2012, revenue increased $13.1 million. iHM revenue increased $46.8 million, driven by growth from national advertising includingtelecommunications, retail, and entertainment, and higher advertising revenues from our digital services primarily as a result of increased demand as listeninghours have increased. Americas outdoor revenue increased $11.2 million, driven primarily by bulletin revenue growth as a result of increases in occupancy,capacity and rates in our traditional and digital product lines. International outdoor revenue decreased $11.9 million including the impact of favorablemovements in foreign exchange of $5.2 million compared to 2012. Excluding the impact of foreign exchange movements and the $20.4 million impact ofour divestiture of our international neon business during 2012, International outdoor revenue increased $3.3 million. Declines in certain countries as a resultof weakened macroeconomic conditions were partially offset by growth in street furniture and billboard revenue in other countries. Revenue in our Othercategory declined $54.0 million as a result of decreased political advertising through our media representation business. Consolidated Direct Operating ExpensesDirect operating expenses increased $55.7 million including an increase of $3.6 million due to the effects of movements in foreign exchangecompared to 2012 and the impact of our divestiture of our international neon business of $13.0 million during 2012. iHM direct operating expensesincreased $59.9 million, primarily due to higher promotional and sponsorship costs for events such as the iHeartRadio Music Festival and Jingle Balls and anincrease in digital expenses related to our iHeartRadio digital platform including higher digital streaming fees due to increased listening hours, as well asmusic licensing fees, partially offset by a decline in traffic expenses. Americas outdoor direct operating expenses decreased $15.7 million, primarily due todecreased site lease expense associated with declining revenues of some of our lower-margin product lines. Direct operating expenses in our Internationaloutdoor segment increased $6.9 million, including a $4.8 million increase due to the effects of movements in foreign exchange. The increase in expenseexcluding the impact of movements in foreign exchange and $13.0 million impact of our divestiture of our international neon business during 2012 wasprimarily driven by higher site lease and other expenses as a result of increased revenues in certain countries due to revenue growth and new contracts. Theseincreases were partially offset by lower variable costs in other countries where revenues have declined.41 Consolidated SG&A ExpensesSG&A expenses decreased $16.6 million including an increase of $1.7 million due to the effects of movements in foreign exchange compared to2012. iHM SG&A expenses increased $27.0 million primarily due to compensation expenses and amounts related to our variable compensation plansincluding commissions, which were higher for the 2013 period in connection with increasing national and digital revenues. SG&A expenses in our Americasoutdoor segment increased $9.5 million including a $7.8 million decrease in expenses related to a favorable court ruling in 2012, with other 2013 increasesbeing driven by higher compensation expenses including commissions and amounts related to our variable compensation plans and legal costs. OurInternational outdoor SG&A expenses decreased $40.6 million including a $1.9 million increase due to the effects of movements in foreign exchangecompared to the same period of 2012. Excluding the impact of foreign exchange movements and excluding the $4.2 million impact of our divestiture of ourinternational neon business during 2012, SG&A expenses decreased $38.3 million primarily due to certain expenses during the 2012 period related to legaland other costs in Brazil that did not recur during 2013, as well as lower expenses as a result of cost saving initiatives. Corporate ExpensesCorporate expenses increased $20.3 million during 2013 compared to 2012. This increase was primarily driven by increases in compensationexpenses including amounts related to our variable compensation plans and strategic initiatives as well as $7.8 million in executive transition costs and legalcosts related to stockholder litigation. Revenue and Efficiency InitiativesIncluded in the amounts for direct operating expenses, SG&A and corporate expenses discussed above are expenses of $57.9 million incurred inconnection with our strategic revenue and efficiency initiatives. The costs were incurred to improve revenue growth, enhance yield, reduce costs, andorganize each business to maximize performance and profitability. These costs consist primarily of consulting expenses, consolidation of locations andpositions, severance related to workforce initiatives and other costs incurred in connection with streamlining our businesses. These costs are expected toprovide benefits in future periods as the initiative results are realized. Of these costs, $15.1 million are reported within direct operating expenses,$22.3 million are reported within SG&A and $20.5 million are reported within corporate expense. In 2012, such costs totaled $13.8 million, $47.2 million,and $15.2 million, respectively. Depreciation and AmortizationDepreciation and amortization increased $1.5 million during 2013 compared to 2012, primarily due to fixed asset additions primarily consisting ofdigital assets and software, which are depreciated over shorter useful lives partially offset by various assets becoming fully depreciated in 2013. Impairment ChargesWe performed our annual impairment tests as of October 1, 2013 and 2012 on our goodwill, FCC licenses, billboard permits, and other intangibleassets and recorded impairment charges of $17.0 million and $37.7 million, respectively. During 2013, we recognized a $10.7 million goodwill impairmentcharge in our International outdoor segment related to a decline in the estimated fair value of one market. Please see Note 2 to the consolidated financialstatements included in Item 8 of Part II of this Annual Report on Form 10-K for a further description of the impairment charges. Other Operating Income, NetOther operating income of $23.0 million in 2013 primarily related to the gain on the sale of certain outdoor assets in our Americas outdoor segment. Other operating income of $48.1 million in 2012 primarily related to the gain on the sale of our international neon business in the third quarter of2012. Interest ExpenseInterest expense increased $100.4 million during 2013 compared to 2012 primarily as a result of interest expense associated with the impact ofrefinancing transactions resulting in higher interest rates. Please refer to “Sources of Capital” for additional discussion of debt issuances and exchanges. Ourweighted average cost of debt during 2013 and 2012 was 7.6% and 6.7%, respectively. 42 Gain (Loss) on Marketable SecuritiesThe gain on marketable securities of $130.9 million during 2013 resulted from the sale of the shares we held in Sirius XM Radio, Inc.The loss on marketable securities of $4.6 million during 2012 primarily related to the impairment of our investment in Independent News & MediaPLC (“INM”) during 2012 and the impairment of a cost-basis investment during 2012. The fair value of INM was below cost for an extended period of timeand recovery of the value was not probable. As a result, we considered the guidance in ASC 320-10-S99 and reviewed the length of the time and the extent towhich the market value was less than cost, the financial condition and the near-term prospects of the issuer. After this assessment, we concluded that theimpairment at each date was other than temporary and recorded non-cash impairment charges to our investment in INM, as noted above. We obtained thefinancial information for our cost-basis investment and noted continued doubt of the investment’s ability to continue as a going concern. After evaluatingthe financial condition of the investment, we concluded that the investment was other than temporarily impaired and recorded a non-cash impairment chargeto that investment. Equity in Earnings (Loss) of Nonconsolidated AffiliatesEquity in loss of nonconsolidated affiliates of $77.7 million for 2013 primarily included the loss from our investments in ARN and New ZealandRadio Network. On February 18, 2014, a subsidiary of the Company sold its 50% interest in ARN. As of December 31, 2013 the book value of ourinvestment in ARN exceeded the estimated selling price. Accordingly, we recorded an impairment charge of $95.4 million during the fourth quarter of 2013to write down the investment to its estimated fair value. Equity in earnings of nonconsolidated affiliates of $18.6 million for 2012 primarily included earnings from our investments in Australia RadioNetwork and New Zealand Radio Network. Loss on Extinguishment of DebtWe recognized a loss of $84.0 million due to a debt exchange during the fourth quarter of 2013 related to iHeartCommunications’ 10.75% SeniorCash Pay Notes due 2016 and 11.00%/11.75% Senior Toggle Notes due 2016 into 14.0% Senior Notes due 2021. In addition, we recognized a loss of$3.9 million due to the write-off of deferred loan costs in connection with the prepayment of Term Loan A of iHeartCommunications’ senior secured creditfacilities. In connection with the refinancing of Clear Channel Worldwide Holdings, Inc. (“CCWH”) Series A Senior Notes and Series B Senior Notes due 2017with an interest rate of 9.25% (the “Existing CCWH Senior Notes”) with the CCWH Series A Senior Notes and Series B Senior Notes due 2022 with a statedinterest rate of 6.5% (the “CCWH Senior Notes”) during the fourth quarter of 2012, CCWH paid existing note holders a tender premium of 7.4% of face valueon the $1,724.7 million of Existing CCWH Senior Notes that were tendered in the tender offer and a call premium of 6.9% on the $775.3 million of ExistingCCWH Senior Notes that were redeemed following the tender offer. The tender premium of $128.3 million and the call premium of $53.8 million areincluded in the loss on extinguishment of debt. In addition, we recognized a loss of $39.0 million due to the write-off of deferred loan costs in connectionwith the call of the Existing CCWH Senior Notes, and recognized losses of $33.7 million in connection with a prepayment during the first quarter of 2012and a debt exchange during the fourth quarter of 2012 related to iHeartCommunications’ senior secured credit facilities as discussed elsewhere in thisMD&A. Other Income (Expense), NetIn connection with the June 2013 exchange offer of a portion of 10.75% Senior Cash Pay Notes due 2016 and 11.00%/11.75% Senior Toggle Notesdue 2016 for newly-issued 14.0% Senior Notes due 2021 and in connection with the senior secured credit facility amendments discussed elsewhere in theMD&A, all of which were accounted for as modifications of existing debt, we incurred expenses of $23.6 million partially offset by $1.8 million in foreignexchange gains on short-term intercompany accounts. Other income of $0.3 million for 2012 primarily related to miscellaneous dividend and other income of $3.2 million offset by $3.0 million in foreignexchange losses on short-term intercompany accounts. Income Tax BenefitThe effective tax rate for the year ended December 31, 2013 was 17.3% as compared to 42.8% for the year ended December 31, 2012. The effectivetax rate for 2013 was primarily impacted by the $143.5 million valuation allowance recorded during the period as additional deferred tax expense. Thevaluation allowance was recorded against a portion of the U.S. Federal and State net operating losses due to the uncertainty of the ability to utilize thoselosses in future periods. This expense was partially offset by tax benefits recorded during the period due to the settlement of our U.S. Federal and certainState tax examinations during the year. 43 Pursuant to the settlements, we recorded a reduction to income tax expense of approximately $20.2 million to reflect the net tax benefits of the settlements. The effective tax rate for the year ended December 31, 2012 was 42.8% and was favorably impacted by our settlement of U.S. Federal and foreign taxexaminations during the year. Pursuant to the settlements, we recorded a reduction to income tax expense of approximately $60.6 million to reflect the nettax benefits of the settlements. This benefit was partially offset by additional tax recorded during 2012 related to the write-off of deferred tax assetsassociated with the vesting of certain equity awards. iHM Results of OperationsOur iHM operating results were as follows: (In thousands)Years Ended December 31, % 2013 2012 ChangeRevenue$ 3,131,595 $ 3,084,780 2%Direct operating expenses 942,644 882,785 7%SG&A expenses 1,020,097 993,116 3%Depreciation and amortization 262,136 262,409 (0%)Operating income$ 906,718 $ 946,470 (4%) iHM revenue increased $46.8 million during 2013 compared to 2012, primarily due to an increase in national advertising revenue across variousmarkets and advertising categories, including telecommunications, retail, and entertainment, as well as growth in digital advertising revenue as a result ofincreased listenership on our iHeartRadio platform, with total listening hours increasing 29%. Promotional and sponsorship revenues were also higher drivenby events, such as the iHeartRadio Music Festival, Jingle Balls, iHeartRadio Ultimate Pool Party, and album release events. These increases were partiallyoffset by lower political revenues compared to 2012, as well as a decline in our traffic business as a result of integration activities and certain contract losses. Direct operating expenses increased $59.9 million during 2013 primarily from events, promotional cost, compensation, and higher streaming andperformance royalty expenses during 2013 due to increased listenership on our iHeartRadio platform. In addition, we incurred higher music license fees afterreceiving a one-time $20.7 million credit in 2012 from one of our performance rights organizations. These increases were partially offset by lower costs inour traffic business as a result of lower revenues and reduced spending on strategic revenue and cost initiatives. SG&A expenses increased $27.0 millionprimarily on our variable compensation plans, including commissions, as a result of an increase in national and digital revenue. In addition, we also incurredhigher legal fees and research expenses related to sales and programming activities in 2013. Americas Outdoor Advertising Results of OperationsOur Americas outdoor advertising operating results were as follows: (In thousands)Years Ended December 31, % 2013 2012 ChangeRevenue$ 1,290,452 $ 1,279,257 1%Direct operating expenses 566,669 582,340 (3%)SG&A expenses 220,732 211,245 4%Depreciation and amortization 196,597 192,023 2%Operating income$ 306,454 $ 293,649 4% Our Americas outdoor revenue increased $11.2 million during 2013 compared to 2012, driven primarily by increases in revenues from bulletins andposters. Traditional bulletins and posters had increases in occupancy and rates in connection with new contracts, while the increase for digital displays wasdriven by higher occupancy and capacity. The increase for digital displays was negatively impacted by lower revenues in our Los Angeles market as a resultof the impact of litigation as discussed further in Item 3 of Part I of this Annual Report on Form 10-K. Partially offsetting these increases were declines inspecialty business revenues due primarily to a significant contract during 2012 that did not recur during 2013, and declines in our airport business drivenprimarily by the loss of certain of our U.S. airport contracts and other airport revenue. 44 Direct operating expenses decreased $15.7 million, primarily due to the benefits resulting from our previous strategic cost initiatives as well asreduced variable costs associated with site lease expenses due to reduced revenues on lower margin products. SG&A expenses increased $9.5 millionprimarily due to the 2012 period being impacted by a favorable court ruling that resulted in a $7.8 million decrease in expenses, with other 2013 increasesbeing driven by legal costs related to the Los Angeles litigation discussed further in Item 3 of Part I of this Annual Report on Form 10-K, as well ascompensation expenses including commissions and amounts related to our variable compensation plans, which were higher for the 2013 period inconnection with increasing our revenues, partially offset by a decrease in costs during 2013 associated with our strategic revenue and cost initiativescompared to 2012. Depreciation and amortization increased $4.6 million, primarily due to our continued deployment of digital billboards partially offset by assetsbecoming fully depreciated during 2013. International Outdoor Advertising Results of OperationsOur International outdoor operating results were as follows: (In thousands)Years Ended December 31, % 2013 2012 ChangeRevenue$ 1,655,738 $ 1,667,687 (1%)Direct operating expenses 1,028,059 1,021,152 1%SG&A expenses 322,840 363,417 (11%)Depreciation and amortization 203,927 205,258 (1%)Operating income$ 100,912 $ 77,860 30% International outdoor revenue decreased $11.9 million during 2013 compared to 2012, including an increase of $5.2 million from movements inforeign exchange, and the divestiture of our international neon business which had $20.4 million in revenues during 2012. Excluding the impact of foreignexchange and the divestiture, revenues increased $3.3 million. Revenue growth in certain markets including China, Latin America, and the UK primarily instreet furniture advertising revenue, as well as higher transit advertising sales resulting from new contracts in Norway, was partially offset by lower revenuesin other countries in Europe as a result of weakened macroeconomic conditions. Direct operating expenses increased $6.9 million including an increase of $4.8 million from movements in foreign exchange, and the divestiture ofour international neon business during 2012 which had $13.0 million in direct operating expenses during 2012. Excluding the impact of movements inforeign exchange and the divestiture, direct operating expenses increased $15.1 million driven primarily by increases in variable costs in certain marketssuch as China, Norway and Latin America resulting from increased revenues partially offset by declines in expenses in response to declining revenues inother countries in Europe. SG&A expenses decreased $40.6 million including an increase of $1.9 million from movements in foreign exchange and thedivestiture of our international neon business during 2012, which had $4.2 million in SG&A expenses during 2012. Excluding the impact of movements inforeign exchange and the divestiture, SG&A expenses decreased $38.3 million primarily due to the absence in 2013 of $22.7 million in expenses incurredduring 2012 in connection with legal and other costs in Brazil as well as decreases in 2013 in strategic revenue and cost initiative expenses. Reconciliation of Segment Operating Income to Consolidated Operating Income (In thousands)Years Ended December 31, 2014 2013 2012iHM$ 946,968 $ 906,718 $ 946,470 Americas outdoor advertising 290,967 306,454 293,649 International outdoor advertising 122,814 100,912 77,860 Other 59,739 23,061 58,829 Impairment charges (24,176) (16,970) (37,651) Other operating income, net 40,031 22,998 48,127 Corporate expense (1) (354,757) (342,391) (317,234) Consolidated operating income$ 1,081,586 $ 1,000,782 $ 1,070,050 (1) Corporate expenses include expenses related to iHM, Americas outdoor, International outdoor and our Other category, as45 well as overall executive, administrative and support functions. Share-Based Compensation ExpenseAs of December 31, 2014, there was $22.4 million of unrecognized compensation cost, net of estimated forfeitures, related to unvested share-basedcompensation arrangements that will vest based on service conditions. This cost is expected to be recognized over a weighted average period ofapproximately three years. In addition, as of December 31, 2014, there was $24.7 million of unrecognized compensation cost, net of estimated forfeitures,related to unvested share-based compensation arrangements that will vest based on market, performance and service conditions. This cost will be recognizedwhen it becomes probable that the performance condition will be satisfied. Share-based compensation expenses are recorded in corporate expenses and were $10.7 million, $16.7 million and $28.5 million for the years endedDecember 31, 2014, 2013 and 2012, respectively. On October 22, 2012, we granted 1.8 million restricted shares of our Class A common stock (the “Replacement Shares”) in exchange for 2.0 millionstock options granted under the Clear Channel 2008 Executive Incentive Plan pursuant to an option exchange program (the “Program”) that expired onNovember 19, 2012. In addition, on October 22, 2012, we granted 1.5 million fully-vested shares of our Class A common stock (the “Additional Shares”)pursuant to a tax assistance program offered in connection with the Program. Upon the expiration of the Program on November 19, 2012, we repurchased0.9 million of the Additional Shares from the employees who elected to participate in the Program and timely delivered to us a properly completed electionform under Internal Revenue Code Section 83(b) to fund tax withholdings in connection with the Program. Employees who ceased to be eligible, declined toparticipate in the Program or, in the case of the Additional Shares, declined to participate in the tax assistance program, forfeited their Replacement Sharesand Additional Shares on November 19, 2012 and retained their stock options with no changes to the terms. We accounted for the exchange program as amodification of the existing awards under ASC 718 and will recognize incremental compensation expense of approximately $1.7 million over the serviceperiod of the new awards. We recognized $2.6 million of expense related to the Additional Shares granted in connection with the tax assistance program. LIQUIDITY AND CAPITAL RESOURCESCash FlowsThe following discussion highlights cash flow activities during the years ended December 31, 2014, 2013 and 2012. (In thousands)Years Ended December 31, 2014 2013 2012Cash provided by (used for): Operating activities$ 245,116 $ 212,872 $ 485,132 Investing activities$ (88,682) $ (133,365) $ (397,021) Financing activities$ (398,001) $ (595,882) $ (95,349) Operating Activities2014Cash provided by operating activities in 2014 was $245.1 million compared to $212.9 million of cash provided in 2013. Our consolidated net lossincluded $877.5 million of non-cash items in 2014. Our consolidated net loss in 2013 included $782.5 million of non-cash items. Non-cash items affectingour net loss include impairment charges, depreciation and amortization, deferred taxes, provision for doubtful accounts, amortization of deferred financingcharges and note discounts, net, share-based compensation, gain on disposal of operating and fixed assets, gain on marketable securities, equity in (earnings)loss of nonconsolidated affiliates, loss on extinguishment of debt, and other reconciling items, net as presented on the face of the consolidated statement ofcash flows. Cash paid for interest was $2.6 million lower in 2014 compared to the prior year due to the timing of accrued interest payments from refinancingtransactions. 2013Cash provided by operating activities in 2013 was $212.9 million compared to $485.1 million of cash provided in 2012. Our consolidated net lossincluded $782.5 million of non-cash items in 2013. Our consolidated net loss in 2012 included $873.5 million of non-cash items. Non-cash items affectingour net loss include impairment charges, depreciation and amortization, deferred taxes, provision for doubtful accounts, amortization of deferred financingcharges and note discounts, net, share-based compensation, gain46 on disposal of operating and fixed assets, gain on marketable securities, equity in loss of nonconsolidated affiliates, loss on extinguishment of debt, and otherreconciling items, net as presented on the face of the consolidated statement of cash flows. Cash paid for interest was $162.1 million higher in 2013compared to the prior year due to the timing of accrued interest with the issuance of CCWH’s Subordinated Notes during the first quarter of 2012 andiHeartCommunications’ 9.0% Priority Guarantee Notes due 2019 during the fourth quarter of 2012. 2012The $110.2 million increase in cash flows from operations to $485.1 million in 2012 compared to $374.9 million in 2011 was primarily driven bychanges in working capital. Our consolidated net loss in 2012 included $873.5 million of non-cash items. Non-cash items affecting our net loss includeimpairment charges, depreciation and amortization, deferred taxes, provision for doubtful accounts, amortization of deferred financing charges and notediscounts, net, share-based compensation, gain on disposal of operating and fixed assets, loss on marketable securities, equity in earnings of nonconsolidatedaffiliates, loss on extinguishment of debt, and other reconciling items, net as presented on the face of the consolidated statement of cash flows. Cash paid forinterest was $120.6 million higher during 2012 compared to the prior year. Cash provided by operations in 2012 compared to 2011 also reflected lowervariable compensation payments in 2012 associated with our employee incentive programs based on 2011 operating performance compared to suchpayments made in 2011 based on 2010 performance. Investing Activities2014Cash used for investing activities of $88.7 million in 2014 primarily reflected capital expenditures of $318.2 million, partially offset by proceeds of$236.6 million primarily from the sale of our 50% interest in ARN and the sale of our 50% interest in Buspak. We spent $50.4 million for capitalexpenditures in our iHM segment primarily related to leasehold improvements and IT infrastructure, $97.0 million in our Americas outdoor segmentprimarily related to the construction of new advertising structures such as digital displays, $130.2 million in our International outdoor segment primarilyrelated to billboard and street furniture advertising structures, $5.7 million in our Other category, and $34.9 million by Corporate primarily related toequipment and software. 2013Cash used for investing activities of $133.4 million during 2013 reflected our capital expenditures of $324.5 million as well as proceeds from thesale of our shares of Sirius XM Radio, Inc. of $135.6 million. We spent $75.7 million for capital expenditures in our iHM segment primarily related toleasehold improvements, $89.0 million in our Americas outdoor segment primarily related to the construction of new advertising structures such as digitaldisplays, $108.6 million in our International outdoor segment primarily related to new advertising structures such as billboards and street furniture andrenewals of existing contracts, $9.9 million in our Other category related to our national representation business, and $41.3 million by Corporate primarilyrelated to equipment and software. Other cash provided by investing activities were $81.6 million of proceeds from sales of other operating and fixed assets. 2012Cash used for investing activities of $397.0 million during 2012 reflected capital expenditures of $390.3 million. We spent $65.8 million for capitalexpenditures in our iHM segment, $117.7 million in our Americas outdoor segment primarily related to the installation of new digital displays,$150.1 million in our International outdoor segment primarily related to new billboard, street furniture and mall contracts and renewals of existing contracts,$17.4 million in our Other category related to our national representation business, and $39.3 million by Corporate. Partially offsetting cash used forinvesting activities were $59.7 million of proceeds from the divestiture of our international neon business and the sales of other operating assets. Financing Activities2014Cash used for financing activities of $398.0 million in 2014 primarily reflected payments on long-term debt and the payment by CCOH of adividend to CCOH shareholders, partially offset by proceeds from the issuance of long-term debt. iHeartCommunications received cash proceeds from theissuance by CCU Escrow Corporation of 10% Senior Notes due 2018 ($850.0 million in aggregate principal amount), the sale by a subsidiary ofiHeartCommunications of 14% Senior Notes due 2021 to private purchasers ($227.0 million in aggregate principal amount) and the issuance to privatepurchasers of 9% Priority Guarantee Notes due 2022 ($1,000.0 million in aggregate principal amount). This was partially offset by the redemption of $567.1million principal amount outstanding of iHeartCommunications’ 5.5% Senior Notes due 2014 (including $158.5 million principal amount of the notes heldby a subsidiary of the Company) and $241.0 million principal amount outstanding of iHeartCommunications’ 4.9% Senior Notes due 2015, the repayment ofthe full $247.0 million principal amount outstanding under iHeartCommunications’ receivables-based47 credit facility, and the prepayment of $974.9 million aggregate principal amount of the Term B facility due 2016 and $16.1 million aggregate principalamount of the Term loan C facility due 2016. In addition, during 2014, CC Finco repurchased $239.0 million aggregate principal amount of notes, for a totalpurchase price of $222.4 million, including accrued interest. 2013Cash used for financing activities of $595.9 million in 2013 primarily reflected payments on long-term debt. iHeartCommunications repaid its5.75% senior notes at maturity for $312.1 million (net of $187.9 million principal amount held by and repaid to a subsidiary of iHeartCommunications)using cash on hand. iHeartCommunications prepaid $846.9 million outstanding under its Term Loan A under its senior secured credit facilities using theproceeds from the issuance of iHeartCommunications’ 11.25% Priority Guarantee Notes, borrowings under its receivables based credit facility, and cash onhand. Other cash used for financing activities included payments to holders of 10.75% Senior Cash Pay Notes due 2016 and 11.00%/11.75% Senior ToggleNotes due 2016 in connection with exchange offers in June 2013 of $32.5 million and in December 2013 of $22.7 million, payment of an applicable highyield discount obligation to holders of 11.00%/11.75% Senior Toggle Notes due 2016 in August 2013 of $25.3 million, payments to repurchasenoncontrolling interests of $61.1 million and $91.9 million in payments for dividends and other payments to noncontrolling interests. 2012Cash used for financing activities of $95.3 million during 2012 primarily reflected (i) the issuance of $2.2 billion of the CCWH Subordinated Notesby CCWH and the use of proceeds distributed to us in connection with a dividend declared by CCOH during 2012, in addition to cash on hand, to repay$2.1 billion of indebtedness under iHeartCommunications’ senior secured credit facilities, (ii) the issuance by CCWH of $2.7 billion aggregate principalamount of the CCWH Senior Notes and the use of the proceeds to fund the tender offer for and redemption of the Existing CCWH Senior Notes, (iii) therepayment of iHeartCommunications’ 5.0% senior notes at maturity for $249.9 million (net of $50.1 million principal amount held by and repaid to asubsidiary of iHeartCommunications with respect to notes repurchased and held by such entity), using a portion of the proceeds from iHeartCommunications’June 2011 issuance of $750.0 million aggregate principal amount of 9.0% Priority Guarantee Notes due 2021, along with available cash on hand and (iv) theexchange of $2.0 billion aggregate principal amount of term loans under iHeartCommunications’ senior secured credit facilities for $2.0 billion aggregateprincipal amount of newly issued 9.0% Priority Guarantee Notes due 2019. Our financing activities also reflect a $244.7 million reduction in noncontrollinginterest as a result of the dividend paid by CCOH in connection with the CCWH Subordinated Notes issuance, which represents the portion paid to partiesother than iHeartCommunications’ subsidiaries that own CCOH common stock. Anticipated Cash RequirementsOur primary source of liquidity is cash on hand, cash flow from operations and borrowing capacity under iHeartCommunications’ domesticreceivables based credit facility, subject to certain limitations contained in iHeartCommunications’ material financing agreements. A significant amountof our cash requirements are for debt service obligations. We anticipate cash interest requirements of approximately $1.6 billion during 2015. AtDecember 31, 2014, we had debt maturities totaling $3.6 million, $1,126.9 million, and $8.2 million in 2015, 2016, and 2017, respectively. It is ourpolicy to permanently reinvest the earnings of our non-U.S. subsidiaries as these earnings are generally redeployed in those jurisdictions for operatingneeds and continued functioning of their businesses. We have the ability and intent to indefinitely reinvest the undistributed earnings of consolidatedsubsidiaries based outside of the United States. If any excess cash held by our foreign subsidiaries were needed to fund operations in the United States,we could presently repatriate available funds without a requirement to accrue or pay U.S. taxes. This is a result of significant current and historic deficitsin our foreign earnings and profits, which gives us flexibility to make future cash distributions as non-taxable returns of capital. Our ability to fund our working capital, capital expenditures, debt service and other obligations, and to comply with the financial covenantsunder iHeartCommunications’ financing agreements, depends on our future operating performance and cash from operations and our ability to generatecash from other liquidity-generating transactions, which are in turn subject to prevailing economic conditions and other factors, many of which arebeyond our control. We are currently exploring, and expect to continue to explore, a variety of transactions to provide us with additional liquidity. Wecannot assure you that we will enter into or consummate any such liquidity-generating transactions, or that such transactions will provide sufficient cashto satisfy our liquidity needs, and we cannot currently predict the impact that any such transaction, if consummated, would have on us. If our futureoperating performance does not meet our expectations or our plans materially change in an adverse manner or prove to be materially inaccurate, we maynot be able to refinance the debt as currently contemplated. Our ability to refinance the debt will depend on the condition of the capital markets and ourfinancial condition at the time. There can be no assurance that refinancing alternatives will be available on terms acceptable to us or at all. Even ifrefinancing alternatives are available to us, we may not find them suitable or at comparable interest rates to the indebtedness being refinanced. Inaddition, the terms of our existing or48 future debt agreements may restrict us from securing a refinancing on terms that are available to us at that time. If we are unable to obtain sources ofrefinancing or generate sufficient cash through liquidity-generating transactions, we could face substantial liquidity problems, which could have amaterial adverse effect on our financial condition and on our ability to meet iHeartCommunications’ obligations. Our financing transactions during 2014 increased our annual interest expense. Our increased interest payment obligations will reduce ourliquidity over time, which could in turn reduce our financial flexibility and make us more vulnerable to changes in operating performance and economicdownturns generally, and could negatively affect iHeartCommunications’ ability to obtain additional financing in the future. We frequently evaluate strategic opportunities both within and outside our existing lines of business. We expect from time to time to pursueacquisitions or dispositions, which could be material. iHeartCommunications’ and its subsidiaries’ significant amount of indebtedness may limit ourability to pursue acquisitions. The terms of our existing or future debt agreements may also restrict our ability to engage in these transactions. Based on our current and anticipated levels of operations and conditions in our markets, we believe that cash on hand, cash flow fromoperations, borrowing capacity under iHeartCommunications’ receivables based credit facility and cash from other liquidity-generating transactions willenable us to meet our working capital, capital expenditure, debt service and other funding requirements for at least the next 12 months. Significantassumptions underlie this belief, including, among other things, that we will continue to be successful in implementing our business strategy and thatthere will be no material adverse developments in our business, liquidity or capital requirements, and that we will be able to consummate liquidity-generating transactions in a timely manner and on terms acceptable to us. We cannot assure you that this will be the case. If our future cash flows fromoperations, financing sources and other liquidity-generating transactions are insufficient to pay our debt obligations as they mature or to fund ourliquidity needs, we may be forced to reduce or delay our business activities and capital expenditures, sell material assets, seek additional capital orrefinance iHeartCommunications’ and its subsidiaries’ debt. We cannot assure you that we would be able to accomplish any of these alternatives on atimely basis or on satisfactory terms, if at all. We were in compliance with the covenants contained in iHeartCommunications’ material financing agreements as of December 31, 2014,including the maximum consolidated senior secured net debt to consolidated EBITDA limitation contained in iHeartCommunications’ senior securedcredit facilities. We believe our long-term plans, which include promoting spending in our industries and capitalizing on our diverse geographic andproduct opportunities, including the continued investment in our media and entertainment initiatives and continued deployment of digital displays, willenable us to continue generating cash flows from operations sufficient to meet our liquidity and funding requirements long term. However, ouranticipated results are subject to significant uncertainty and there can be no assurance that we will be able to maintain compliance with these covenants. In addition, our ability to comply with these covenants may be affected by events beyond our control, including prevailing economic, financial andindustry conditions. The breach of any covenants set forth in iHeartCommunications’ financing agreements would result in a default thereunder. Anevent of default would permit the lenders under a defaulted financing agreement to declare all indebtedness thereunder to be due and payable prior tomaturity. Moreover, the lenders under the receivables based facility under iHeartCommunications’ senior secured credit facilities would have the optionto terminate their commitments to make further extensions of credit thereunder. If we are unable to repay iHeartCommunications’ obligations under anysecured credit facility, the lenders could proceed against any assets that were pledged to secure such facility. In addition, a default or acceleration underany of iHeartCommunications’ material financing agreements could cause a default under other of our obligations that are subject to cross-default andcross-acceleration provisions. The threshold amount for a cross-default under the senior secured credit facilities is $100.0 million.49 Sources of CapitalAs of December 31, 2014 and 2013, we had the following debt outstanding, net of cash and cash equivalents: December 31,(In millions)2014 2013Senior Secured Credit Facilities: Term Loan B Facility Due 2016 916.1 1,891.0 Term Loan C - Asset Sale Facility Due 2016 15.2 34.8 Term Loan D Facility Due 2019 5,000.0 5,000.0 Term Loan E Facility Due 2019 1,300.0 1,300.0 Receivables Based Facility Due 2017 (1) - 247.0 9.0% Priority Guarantee Notes Due 2019 1,999.8 1,999.8 9.0% Priority Guarantee Notes Due 2021 1,750.0 1,750.0 11.25% Priority Guarantee Notes Due 2021 575.0 575.0 9.0% Priority Guarantee Notes Due 2022 1,000.0 - Subsidiary Senior Revolving Credit Facility due 2018 - - Other Secured Subsidiary Debt 19.2 21.1 Total Secured Debt 12,575.3 12,818.7 10.75% Senior Cash Pay Notes Due 2016 - 94.3 11.00%/11.75% Senior Toggle Notes Due 2016 - 127.9 14.0% Senior Notes Due 2021 1,661.6 1,404.2 iHeartCommunications Legacy Notes: 5.5% Senior Notes Due 2014 - 461.5 4.9% Senior Notes Due 2015 - 250.0 5.5% Senior Notes Due 2016 192.9 250.0 6.875% Senior Notes Due 2018 175.0 175.0 7.25% Senior Notes Due 2027 300.0 300.0 10.0% Senior Notes Due 2018 730.0 - Subsidiary Senior Notes: 6.5% Series A Senior Notes Due 2022 735.8 735.8 6.5% Series B Senior Notes Due 2022 1,989.3 1,989.3 Subsidiary Senior Subordinated Notes: 7.625% Series A Senior Notes Due 2020 275.0 275.0 7.625% Series B Senior Notes Due 2020 1,925.0 1,925.0 Other Subsidiary Debt 1.0 - Purchase accounting adjustments and original issue discount (234.9) (322.4) Total Debt 20,326.0 20,484.3 Less: Cash and cash equivalents 457.0 708.2 $ 19,869.0 $ 19,776.1 (1) The receivables based credit facility provides for borrowings of up to the lesser of $535.0 million (the revolving credit commitment) or theborrowing base amount, as defined under the receivables based facility, subject to certain limitations contained in iHeartCommunications’ materialfinancing agreements. Our subsidiaries have from time to time repurchased certain debt obligations of iHeartCommunications and our equity securities and equitysecurities outstanding of CCOH, and may in the future, as part of various financing and investment strategies, purchase additional outstanding indebtednessof iHeartCommunications or its subsidiaries or our outstanding equity securities or outstanding equity securities of CCOH, in tender offers, open marketpurchases, privately negotiated transactions or otherwise. We or our subsidiaries may also sell certain assets, securities, or properties. 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 ofoperations. These transactions could also require or result in amendments to the agreements governing outstanding debt obligations or changes in ourleverage or other financial ratios, which could have a material positive or negative impact on our ability to comply with the covenants50 contained in iHeartCommunications’ 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 FacilitiesAs of December 31, 2014, iHeartCommunications had a total of $7,231.2 million outstanding under its senior secured credit facilities, consisting of: · a $916.1 million Term Loan B, which matures on January 29, 2016; and· a $15.2 million Term Loan C, which matures on January 29, 2016; and· a $5.0 billion Term Loan D, which matures on January 30, 2019; and· a $1.3 billion Term Loan E, which matures on July 30, 2019. iHeartCommunications may raise incremental Term Loans of up to (a) $1.5 billion, plus (b) the excess, if any, of (x) 0.65 times pro formaconsolidated EBITDA (as calculated in the manner provided in the senior secured credit facilities documentation), over (y) $1.5 billion, plus (c) the aggregateamount of certain principal prepayments made in respect of the Term Loans under the senior secured credit facilities. Availability of such incremental TermLoans is subject, among other things, to the absence of any default, pro forma compliance with the financial covenant and the receipt of commitments byexisting or additional financial institutions. iHeartCommunications is the primary borrower under the senior secured credit facilities, except that certain of its domestic restricted subsidiaries areco-borrowers under a portion of the Term Loan facilities. Interest Rate and FeesBorrowings under iHeartCommunications’ senior secured credit facilities bear interest at a rate equal to an applicable margin plus, atiHeartCommunications’ option, either (i) a base rate determined by reference to the higher of (A) the prime lending rate publicly announced by theadministrative 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 offunds 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 B and Term Loan C – asset sale facility, (i) 2.65%, in the case of base rate loans and (ii) 3.65%, in thecase of Eurocurrency rate loans; and· with respect to loans under the Term Loan D, (i) 5.75% in the case of base rate loans and (ii) 6.75% in the case of Eurocurrency rate loans; and· with respect to loans under the Term Loan E, (i) 6.50% in the case of base rate loans and (ii) 7.50% in the case of Eurocurrency rate loans. The margin percentages are subject to adjustment based upon iHeartCommunications’ leverage ratio. PrepaymentsThe senior secured credit facilities require iHeartCommunications to prepay outstanding Term Loans, subject to certain exceptions, with: • 50% (which percentage may be reduced to 25% and to 0% based upon iHeartCommunications’ leverage ratio) of iHeartCommunications’annual excess cash flow (as calculated in accordance with the senior secured credit facilities), less any voluntary prepayments of Term Loansand 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 condemnationevents), subject to certain exceptions;• 100% (which percentage may be reduced to 75% and 50% based upon iHeartCommunications’ leverage ratio) of the net cash proceeds of salesor other dispositions by iHeartCommunications or its wholly-owned restricted subsidiaries of assets other than specified assets being marketedfor 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 iHeartCommunications’ senior securedcredit facilities, (ii) certain securitization financing (iii) certain issuances of Permitted Additional Notes (as defined in the senior secured creditfacilities) and (iv) certain issuances of Permitted Unsecured Notes and Permitted Senior Secured Notes (as defined in the senior secured creditfacilities); and51 • Net cash proceeds received by iHeartCommunications as dividends or distributions from indebtedness incurred at CCOH provided that theConsolidated 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 iHeartCommunications’senior secured credit facilities, certain securitization financing, issuances of Permitted Additional Notes and annual excess cash flow will be applied, atiHeartCommunications’ option, to the Term Loans (on a pro rata basis, other than that non-extended classes of Term Loans may be prepaid prior to anycorresponding extended class), in each case (i) first to the Term Loans outstanding under Term Loan B and (ii) one of (w) second, to outstanding Term Loan C—asset sale facility loans; third, to outstanding Term Loan D; and fourth, to outstanding Term Loan E, or (x) second, to outstanding Term Loan C—asset salefacility loans; third, to outstanding Term Loan E; and fourth, to outstanding Term Loan D, or (y) second, to outstanding Term Loan C—asset sale facilityloans; and third, ratably to outstanding Term Loan D and Term Loan E, or (z) second, ratably to outstanding Term Loan C—asset sale facility loans, TermLoan D and Term Loan E. In each case to the remaining installments thereof in direct order of maturity for the Term Loan C—asset sale facility loans. The foregoing prepayments with net cash proceeds of sales or other dispositions by iHeartCommunications or its wholly-owned restrictedsubsidiaries of assets other than specified assets being marketed for sale, subject to reinvestment rights and certain other exceptions, will be applied (i) first tothe Term Loan C—asset sale facility loans in direct order of maturity, and (ii) one of (w) second, to outstanding Term Loan B; third, to outstanding TermLoan D; and fourth, to outstanding Term Loan E, or (x) second, to outstanding Term Loan B; third, to outstanding Term Loan E; and fourth, to outstandingTerm Loan D, or (y) second, to outstanding Term Loan B; and third, ratably to outstanding Term Loan D and Term Loan E, or (z) second, ratably tooutstanding Term Loan B, Term Loan D and Term Loan E. The foregoing prepayments with net cash proceeds of issuances of Permitted Unsecured Notes and Permitted Senior Secured Notes and Net CashProceeds received by iHeartCommunications as a distribution from indebtedness incurred by CCOH will be applied (i) first, ratably to outstanding Term LoanB and Term Loan C in direct order of maturity, second, to the outstanding Term Loan D and, third, to outstanding Term Loan E, (ii) first, ratably tooutstanding Term Loan B and Term Loan C in direct order of maturity, second, to the outstanding Term Loan E and, third, to outstanding Term Loan D, (iii)first, ratably to outstanding Term Loan B and Term Loan C in direct order of maturity and, second, ratably to outstanding Term Loan D and Term Loan E or(iv) ratably to outstanding Term Loan B, Term Loan C, Term Loan D and Term Loan E. iHeartCommunications 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. AmendmentsOn October 25, 2012, iHeartCommunications 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 of 9.0% priority guarantee notes due 2019 issued in October 2012 as described under “—Sources of Capital—Refinancing Transactions” below);(ii) provide iHeartCommunications with greater flexibility to prepay tranche A Term Loans; (iii) following the repayment or extension of all tranche A TermLoans, permit below par non-pro rata purchases of Term Loans pursuant to customary Dutch auction procedures whereby all lenders of the class of TermLoans offered to be purchased will be offered an opportunity to participate; (iv) following the repayment or extension of all tranche A Term Loans, permit therepurchase 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, thedelayed draw Term Loan 1 and the delayed draw Term Loan 2 under the senior secured credit facilities; (vi) preserve revolving credit facility capacity in theevent iHeartCommunications repays all amounts outstanding under the revolving credit facility; and (vii) eliminate certain restrictions on the ability ofCCOH and its subsidiaries to incur debt. On October 31, 2012, iHeartCommunications repaid and permanently cancelled the commitments under itsrevolving credit facility, which was set to mature in July 2014. On February 28, 2013, iHeartCommunications repaid all $846.9 million of loans outstanding under its Term Loan A facility. On May 31, 2013, iHeartCommunications further amended the terms of its senior secured credit facilities by extending a portion of Term Loan B andTerm Loan C loans due 2016 through the creation of a new $5.0 billion Term Loan D due January 30, 2019. The amendment also permittediHeartCommunications to make applicable high yield discount obligation catch-up payments beginning after May 2018 with respect to the new TermLoan D and beginning in June 2018 with respect to the 14.0% Senior Notes due 2021, which were issued in connection with the exchange of a portion of theSenior Cash Pay Notes and Senior Toggle Notes. 52 In connection with the December 2013 refinancing discussed later, iHeartCommunications further amended the terms of its senior secured creditfacilities on December 18, 2013, to extend a portion of the Term Loan B and Term Loan C due 2016 through the creation of a new $1.3 billion Term Loan Edue July 30, 2019. Collateral and GuaranteesThe senior secured credit facilities are guaranteed by iHeartCommunications and each of iHeartCommunications’ existing and future materialwholly-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, includingprior liens permitted by the indenture governing the iHeartCommunications senior notes, and other exceptions, by: · a lien on the capital stock of iHeartCommunications;· 100% of the capital stock of any future material wholly-owned domestic license subsidiary that is not a “Restricted Subsidiary” under theindenture governing the iHeartCommunications senior notes;· certain assets that do not constitute “principal property” (as defined in the indenture governing the iHeartCommunications senior notes);· certain specified assets of iHeartCommunications and the guarantors that constitute “principal property” (as defined in the indenture governingthe iHeartCommunications senior notes) securing obligations under the senior secured credit facilities up to the maximum amount permitted tobe secured by such assets without requiring equal and ratable security under the indenture governing the iHeartCommunications senior notes;and· a lien on the accounts receivable and related assets securing iHeartCommunications’ receivables based credit facility that is junior to the liensecuring iHeartCommunications’ obligations under such credit facility. Certain Covenants and Events of DefaultThe senior secured credit facilities require iHeartCommunications to comply on a quarterly basis with a financial covenant limiting the ratio ofconsolidated secured debt, net of cash and cash equivalents, to consolidated EBITDA (as defined by iHeartCommunications’ senior secured credit facilities)for the preceding four quarters. iHeartCommunications’ secured debt consists of the senior secured credit facilities, the receivables-based credit facility, thepriority guarantee notes and certain other secured subsidiary debt. As required by the definition of consolidated EBITDA in iHeartCommunications’ seniorsecured credit facilities, iHeartCommunications’ consolidated EBITDA for the preceding four quarters of $1.9 billion is calculated as operating income (loss)before depreciation, amortization, impairment charges and other operating income (expense), net plus share-based compensation and is further adjusted forthe following items: (i) costs incurred in connection with the closure and/or consolidation of facilities, retention charges, consulting fees and other permittedactivities; (ii) extraordinary, non-recurring or unusual gains or losses or expenses and severance; (iii) non-cash charges; (iv) cash received fromnonconsolidated affiliates; and (v) various other items. 53 The following table reflects a reconciliation of consolidated EBITDA (as defined by iHeartCommunications’ senior secured credit facilities) to operatingincome and net cash provided by operating activities for the year ended December 31, 2014: Year Ended(In Millions)December 31, 2014Consolidated EBITDA (as defined by iHeartCommunications’ senior secured credit facilities)$ 1,942.2 Less adjustments to consolidated EBITDA (as defined by iHeartCommunications’ senior secured credit facilities): Costs incurred in connection with the closure and/or consolidation of facilities, retention charges, consulting fees, and other permitted activities (75.7) Extraordinary, non-recurring or unusual gains or losses or expenses and severance (as referenced in the definition ofconsolidated EBITDA in iHeartCommunications’ senior secured credit facilities) (31.6) Non-cash charges (35.8) Cash received from nonconsolidated affiliates (1.2) Other items (10.5) Less: Depreciation and amortization, Impairment charges, Other operating income (expense), net, and Share-based compensation expense (705.8) Operating income 1,081.6 Plus: Depreciation and amortization, Impairment charges, Gain (loss) on disposal of operating and fixed assets, and Share-based compensation expense 701.3 Less: Interest expense (1,741.6) Less: Current income tax expense (24.6) Plus: Other income (expense), net 9.1 Adjustments to reconcile consolidated net loss to net cash provided by operating activities (including Provision for doubtful accounts, Amortization of deferred financing charges and note discounts, net and Other reconciling items, net) 89.6 Change in assets and liabilities, net of assets acquired and liabilities assumed 129.7 Net cash provided by operating activities$ 245.1 The maximum ratio under this financial covenant is currently set at 8.75:1. At December 31, 2014, the ratio was 6.3:1. In addition, the senior secured credit facilities include negative covenants that, subject to significant exceptions, limit iHeartCommunications’ability and the ability of its restricted subsidiaries to, among other things: · incur additional indebtedness;· create liens on assets;· engage in mergers, consolidations, liquidations and dissolutions;· sell assets;· pay dividends and distributions or repurchase iHeartCommunications’ capital stock;· make investments, loans, or advances;· prepay certain junior indebtedness;· engage in certain transactions with affiliates;· amend material agreements governing certain junior indebtedness; and· change lines of business. The senior secured credit facilities include certain customary representations and warranties, affirmative covenants and events of default, includingpayment defaults, breach of representations and warranties, covenant defaults, cross-defaults to certain indebtedness, certain events of bankruptcy, certainevents under ERISA, material judgments, the invalidity of material provisions of the senior secured credit facilities documentation, the failure of collateralunder the security documents for the senior secured credit facilities, the failure of the senior secured credit facilities to be senior debt under the subordinationprovisions of certain of iHeartCommunications’ subordinated debt and a change of control. If an event of default occurs, the lenders under the senior secured54 credit facilities will be entitled to take various actions, including the acceleration of all amounts due under the senior secured credit facilities and all actionspermitted to be taken by a secured creditor. Receivables Based Credit FacilityAs of December 31, 2014, there were no borrowings outstanding under iHeartCommunications’ receivables based credit facility. The receivables based credit facility provides revolving credit commitments of $535.0 million, subject to a borrowing base. The borrowing base atany time equals 90% of the eligible accounts receivable of iHeartCommunications and certain of its subsidiaries. The receivables based credit facilityincludes a letter of credit sub-facility and a swingline loan sub-facility. iHeartCommunications and certain subsidiary borrowers are the borrowers under the receivables based credit facility. iHeartCommunications has theability to designate one or more of its restricted subsidiaries as borrowers under the receivables based credit facility. The receivables based credit facilityloans are available in U.S. dollars and letters of credit are available in a variety of currencies including U.S. dollars, Euros, Pounds Sterling, and Canadiandollars. Interest Rate and FeesBorrowings under the receivables based credit facility bear interest at a rate per annum equal to an applicable margin plus, atiHeartCommunications’ option, either (i) a base rate determined by reference to the highest of (a) the prime rate of Citibank, N.A. and (b) the Federal Fundsrate plus 0.50% or (ii) a Eurocurrency rate determined by reference to the rate (adjusted for statutory reserve requirements for Eurocurrency liabilities) forEurodollar deposits for the interest period relevant to such borrowing. The applicable margin for borrowings under the receivables based credit facility rangesfrom 1.50% to 2.00% for Eurocurrency borrowings and from 0.50% to 1.00% for base-rate borrowings, depending on average daily excess availability underthe receivables based credit facility during the prior fiscal quarter. In addition to paying interest on outstanding principal under the receivables based credit facility, iHeartCommunications is required to pay acommitment fee to the lenders under the receivables based credit facility in respect of the unutilized commitments thereunder. The commitment fee rateranges from 0.25% to 0.375% per annum dependent upon average unused commitments during the prior quarter. iHeartCommunications must also paycustomary letter of credit fees. MaturityBorrowings under the receivables based credit facility will mature, and lending commitments thereunder will terminate, on the fifth anniversary ofthe effectiveness of the receivables based credit facility (December 24, 2017), provided that, (a) the maturity date will be October 31, 2015 if on October 30,2015, greater than $500.0 million in aggregate principal amount is owing under certain of iHeartCommunications’ Term Loan credit facilities, (b) thematurity date will be May 3, 2016 if on May 2, 2016 greater than $500.0 million aggregate principal amount of iHeartCommunications’ 10.75% senior cashpay notes due 2016 and 11.00%/11.75% senior toggle notes due 2016 are outstanding and (c) in the case of any debt under clauses (a) and (b) that isamended or refinanced in any manner that extends the maturity date of such debt to a date that is on or before the date that is five years after the effectivenessof the receivables based credit facility, the maturity date will be one day prior to the maturity date of such debt after giving effect to such amendment orrefinancing if greater than $500,000,000 in aggregate principal amount of such debt is outstanding. PrepaymentsIf at any time the sum of the outstanding amounts under the receivables based credit facility exceeds the lesser of (i) the borrowing base and (ii) theaggregate commitments under the facility, iHeartCommunications will be required to repay outstanding loans and cash collateralize letters of credit in anaggregate amount equal to such excess. iHeartCommunications may voluntarily repay outstanding loans under the receivables based credit facility at anytime without premium or penalty, other than customary “breakage” costs with respect to Eurocurrency rate loans. Any voluntary prepaymentsiHeartCommunications makes will not reduce its commitments under the receivables based credit facility. Guarantees and SecurityThe facility is guaranteed by, subject to certain exceptions, the guarantors of iHeartCommunications’ senior secured credit facilities. All obligationsunder the receivables based credit facility, and the guarantees of those obligations, are secured by a perfected security interest in all ofiHeartCommunications’ and all of the guarantors’ accounts receivable and related assets and proceeds thereof that is senior to the security interest ofiHeartCommunications’ senior secured credit facilities in such accounts receivable and related55 assets and proceeds thereof, subject to permitted liens, including prior liens permitted by the indenture governing certain of iHeartCommunications’ seniornotes (the “Legacy Notes”), and certain exceptions. Certain Covenants and Events of DefaultIf borrowing availability is less than the greater of (a) $50.0 million and (b) 10% of the aggregate commitments under the receivables based creditfacility, in each case, for five consecutive business days (a “Liquidity Event”), iHeartCommunications will be required to comply with a minimum fixedcharge coverage ratio of at least 1.00 to 1.00 for fiscal quarters ending on or after the occurrence of the Liquidity Event, and will be continued to comply withthis minimum fixed charge coverage ratio until borrowing availability exceeds the greater of (x) $50.0 million and (y) 10% of the aggregate commitmentsunder the receivables based credit facility, in each case, for 30 consecutive calendar days, at which time the Liquidity Event shall no longer be deemed to beoccurring. In addition, the receivables based credit facility includes negative covenants that, subject to significant exceptions, limit iHeartCommunications’ability and the ability of its restricted subsidiaries to, among other things: · incur additional indebtedness;· create liens on assets;· engage in mergers, consolidations, liquidations and dissolutions;· sell assets;· pay dividends and distributions or repurchase capital stock;· make investments, loans, or advances;· prepay certain junior indebtedness;· engage in certain transactions with affiliates;· amend material agreements governing certain junior indebtedness; and· change lines of business. The receivables based credit facility includes 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 and a change of control. If an event of default occurs, the lenders under the receivables based credit facilitywill be entitled to take various actions, including the acceleration of all amounts due under iHeartCommunications’ receivables based credit facility and allactions permitted to be taken by a secured creditor. 9% Priority Guarantee Notes Due 2019As of December 31, 2014, iHeartCommunications had outstanding $2.0 billion aggregate principal amount of 9.0% priority guarantee notes due2019 (the “Priority Guarantee Notes due 2019”). The Priority Guarantee Notes due 2019 mature on December 15, 2019 and bear interest at a rate of 9.0% per annum, payable semi-annually in arrearson June 15 and December 15 of each year, which began on June 15, 2013. The Priority Guarantee Notes due 2019 are iHeartCommunications’ seniorobligations and are fully and unconditionally guaranteed, jointly and severally, on a senior basis by the guarantors named in the indenture. The PriorityGuarantee Notes due 2019 and the guarantors’ obligations under the guarantees are secured by (i) a lien on (a) the capital stock of iHeartCommunications and(b) certain property and related assets that do not constitute “principal property” (as defined in the indenture governing certain Legacy Notes ofiHeartCommunications), in each case equal in priority to the liens securing the obligations under iHeartCommunications’ senior secured credit facilities andiHeartCommunications’ priority guarantee notes due 2021 and 2022, subject to certain exceptions, and (ii) a lien on the accounts receivable and relatedassets securing iHeartCommunications’ receivables based credit facility junior in priority to the lien securing iHeartCommunications’ obligations thereunder,subject to certain exceptions. In addition to the collateral granted to secure the Priority Guarantee Notes due 2019, the collateral agent and the trustee for thePriority Guarantee Notes due 2019 entered into an agreement with the administrative agent for the lenders under the senior secured credit facilities to turnover to the trustee under the Priority Guarantee Notes due 2019, for the benefit of the holders of the Priority Guarantee Notes due 2019, a pro rata share of anyrecovery received on account of the principal properties, subject to certain terms and conditions. iHeartCommunications may redeem the Priority Guarantee Notes due 2019 at its option, in whole or part, at any time prior to July 15, 2015, at aprice equal to 100% of the principal amount of the Priority Guarantee Notes due 2019 redeemed, plus accrued and unpaid interest to the redemption date andplus an applicable premium. iHeartCommunications may redeem the Priority Guarantee Notes due 2019, in whole or in part, on or after July 15, 2015, at theredemption prices set forth in the indenture plus accrued and unpaid interest to the redemption date. Prior to July 15, 2015, iHeartCommunications may electto redeem up to 40% of the aggregate56 principal amount of the Priority Guarantee Notes due 2019 at a redemption price equal to 109.0% of the principal amount thereof, plus accrued and unpaidinterest to the redemption date, with the net proceeds of one or more equity offerings. The indenture governing the Priority Guarantee Notes due 2019 contains covenants that limit iHeartCommunications’ ability and the ability of itsrestricted subsidiaries to, among other things: (i) pay dividends, redeem stock or make other distributions or investments; (ii) incur additional debt or issuecertain preferred stock; (iii) modify any of iHeartCommunications’ existing senior notes; (iv) transfer or sell assets; (v) engage in certain transactions withaffiliates; (vi) create restrictions on dividends or other payments by the restricted subsidiaries; and (vii) merge, consolidate or sell substantially all ofiHeartCommunications’ assets. The indenture contains covenants that limit iHeartMedia Capital I, LLC’s ability, iHeartCommunications’ ability and theability of its restricted subsidiaries to, among other things: (i) create liens on assets and (ii) materially impair the value of the security interests taken withrespect to the collateral for the benefit of the notes collateral agent and the holders of the Priority Guarantee Notes due 2019. The indenture also provides forcustomary events of default. 9% Priority Guarantee Notes Due 2021As of December 31, 2014, iHeartCommunications had outstanding $1.75 billion aggregate principal amount of 9.0% priority guarantee notes due2021 (the “Priority Guarantee Notes due 2021”). The Priority Guarantee Notes due 2021 mature on March 1, 2021 and bear interest at a rate of 9.0% per annum, payable semi-annually in arrears onMarch 1 and September 1 of each year, which began on September 1, 2011. The Priority Guarantee Notes due 2021 are iHeartCommunications’ seniorobligations and are fully and unconditionally guaranteed, jointly and severally, on a senior basis by the guarantors named in the indenture. The PriorityGuarantee Notes due 2021 and the guarantors’ obligations under the guarantees are secured by (i) a lien on (a) the capital stock of iHeartCommunications and(b) certain property and related assets that do not constitute “principal property” (as defined in the indenture governing certain Legacy Notes ofiHeartCommunications), in each case equal in priority to the liens securing the obligations under iHeartCommunications’ senior secured credit facilities, thePriority Guarantee Notes due 2019, the 11.25% Priority Guarantee Notes and the Priority Guarantee Notes due 2022, subject to certain exceptions, and (ii) alien on the accounts receivable and related assets securing iHeartCommunications’ receivables based credit facility junior in priority to the lien securingiHeartCommunications’ obligations thereunder, subject to certain exceptions. iHeartCommunications may redeem the Priority Guarantee Notes due 2021 at its option, in whole or part, at any time prior to March 1, 2016, at aprice equal to 100% of the principal amount of the Priority Guarantee Notes due 2021 redeemed, plus accrued and unpaid interest to the redemption date andplus an applicable premium. iHeartCommunications may redeem the Priority Guarantee Notes due 2021, in whole or in part, on or after March 1, 2016, at theredemption prices set forth in the indenture plus accrued and unpaid interest to the redemption date. At any time on or before March 1, 2014,iHeartCommunications may elect to redeem up to 40% of the aggregate principal amount of the Priority Guarantee Notes due 2021 at a redemption priceequal to 109.0% of the principal amount thereof, plus accrued and unpaid interest to the redemption date, with the net proceeds of one or more equityofferings. The indenture governing the Priority Guarantee Notes due 2021 contains covenants that limit iHeartCommunications’ ability and the ability of itsrestricted subsidiaries to, among other things: (i) pay dividends, redeem stock or make other distributions or investments; (ii) incur additional debt or issuecertain preferred stock; (iii) modify any of iHeartCommunications’ existing senior notes; (iv) transfer or sell assets; (v) engage in certain transactions withaffiliates; (vi) create restrictions on dividends or other payments by the restricted subsidiaries; and (vii) merge, consolidate or sell substantially all ofiHeartCommunications’ assets. The indenture contains covenants that limit iHeartMedia Capital I, LLC’s ability, iHeartCommunications’ ability and theability of its restricted subsidiaries to, among other things: (i) create liens on assets and (ii) materially impair the value of the security interests taken withrespect to the collateral for the benefit of the notes collateral agent and the holders of the Priority Guarantee Notes due 2021. The indenture also provides forcustomary events of default. 11.25% Priority Guarantee Notes Due 2021As of December 31, 2014, iHeartCommunications had outstanding $575.0 million aggregate principal amount of 11.25% Priority Guarantee Notesdue 2021 (the “11.25% Priority Guarantee Notes”). The 11.25% Priority Guarantee Notes mature on March 1, 2021 and bear interest at a rate of 11.25% per annum, payable semi-annually on March 1and September 1 of each year, which began on September 1, 2013. The 11.25% Priority Guarantee Notes are iHeartCommunications’ senior obligations andare fully and unconditionally guaranteed, jointly and severally, on a senior basis by the guarantors named in the indenture governing such notes. The11.25% Priority Guarantee Notes and the guarantors’ obligations under the guarantees are secured by (i) a lien on (a) the capital stock ofiHeartCommunications and (b) certain property and related assets that do not constitute “principal property” (as defined in the indenture governing certainLegacy Notes of57 iHeartCommunications), in each case equal in priority to the liens securing the obligations under iHeartCommunications’ senior secured credit facilities,iHeartCommunications’ Priority Guarantee Notes due 2019, iHeartCommunications’ Priority Guarantee Notes due 2021, and iHeartCommunications’ PriorityGuarantee Notes due 2022, subject to certain exceptions, and (ii) a lien on the accounts receivable and related assets securing iHeartCommunications’receivables based credit facility junior in priority to the lien securing iHeartCommunications’ obligations thereunder, subject to certain exceptions. iHeartCommunications may redeem the 11.25% Priority Guarantee Notes at its option, in whole or part, at any time prior to March 1, 2016, at a priceequal to 100% of the principal amount of the 11.25% Priority Guarantee Notes redeemed, plus accrued and unpaid interest to the redemption date and plus anapplicable premium. In addition, until March 1, 2016, iHeartCommunications may elect to redeem up to 40% of the aggregate principal amount of the11.25% Priority Guarantee Notes at a redemption price equal to 111.25% of the principal amount thereof, plus accrued and unpaid interest to the redemptiondate, with the net proceeds of one or more equity offerings. iHeartCommunications may redeem the 11.25% Priority Guarantee Notes, in whole or in part, onor after March 1, 2016, at the redemption prices set forth in the indenture plus accrued and unpaid interest to the redemption date. The indenture governing the 11.25% Priority Guarantee Notes contains covenants that limit iHeartCommunications’ ability and the ability of itsrestricted subsidiaries to, among other things: (i) pay dividends, redeem stock or make other distributions or investments; (ii) incur additional debt or issuecertain preferred stock; (iii) modify any of iHeartCommunications’ existing senior notes; (iv) transfer or sell assets; (v) engage in certain transactions withaffiliates; (vi) create restrictions on dividends or other payments by the restricted subsidiaries; and (vii) merge, consolidate or sell substantially all ofiHeartCommunications’ assets. The indenture contains covenants that limit iHeartMedia Capital I, LLC’s ability, iHeartCommunications’ ability and theability of its restricted subsidiaries to, among other things: (i) create liens on assets and (ii) materially impair the value of the security interests taken withrespect to the collateral for the benefit of the notes collateral agent and the holders of the 11.25% Priority Guarantee Notes. The indenture also provides forcustomary events of default. 9% Priority Guarantee Notes Due 2022 As of December 31, 2014, iHeartCommunications had outstanding $1.0 billion aggregate principal amount of 9.0% priority guarantee notes due2022 (the “Priority Guarantee Notes due 2022”). The Priority Guarantee Notes due 2022 mature on September 15, 2022 and bear interest at a rate of 9.0% per annum, payable semi-annually in arrearson March 15 and September 15 of each year, which begins on March 15, 2015. The Priority Guarantee Notes due 2022 are iHeartCommunications’ seniorobligations and are fully and unconditionally guaranteed, jointly and severally, on a senior basis by the guarantors named in the indenture. The PriorityGuarantee Notes due 2022 and the guarantors’ obligations under the guarantees are secured by (i) a lien on (a) the capital stock of iHeartCommunications and(b) certain property and related assets that do not constitute “principal property” (as defined in the indenture governing certain Legacy Notes ofiHeartCommunications), in each case equal in priority to the liens securing the obligations under iHeartCommunications’ senior secured credit facilities, thePriority Guarantee Notes due 2019, the Priority Guarantee Notes due 2021 and the 11.25% Priority Guarantee Notes, subject to certain exceptions, and (ii) alien on the accounts receivable and related assets securing iHeartCommunications’ receivables based credit facility junior in priority to the lien securingiHeartCommunications’ obligations thereunder, subject to certain exceptions. iHeartCommunications may redeem the Priority Guarantee Notes due 2022 at its option, in whole or part, at any time prior to September 15, 2017, ata price equal to 100% of the principal amount of the Priority Guarantee Notes due 2022 redeemed, plus accrued and unpaid interest to the redemption dateand plus an applicable premium. iHeartCommunications may redeem the Priority Guarantee Notes due 2022, in whole or in part, on or after September 15,2017, at the redemption prices set forth in the indenture plus accrued and unpaid interest to the redemption date. At any time on or before September 15,2017, iHeartCommunications may elect to redeem up to 40% of the aggregate principal amount of the Priority Guarantee Notes due 2022 at a redemptionprice equal to 109.0% of the principal amount thereof, plus accrued and unpaid interest to the redemption date, with the net proceeds of one or more equityofferings. The indenture governing the Priority Guarantee Notes due 2022 contains covenants that limit iHeartCommunications’ ability and the ability of itsrestricted subsidiaries to, among other things: (i) pay dividends, redeem stock or make other distributions or investments; (ii) incur additional debt or issuecertain preferred stock; (iii) modify any of iHeartCommunications’ existing senior notes; (iv) transfer or sell assets; (v) engage in certain transactions withaffiliates; (vi) create restrictions on dividends or other payments by the restricted subsidiaries; and (vii) merge, consolidate or sell substantially all ofiHeartCommunications’ assets. The indenture contains covenants that limit iHeartMedia Capital I, LLC’s ability, iHeartCommunications’ ability and theability of its restricted subsidiaries to, among other things: (i) create liens on assets and (ii) materially impair the value of the security interests58 taken with respect to the collateral for the benefit of the notes collateral agent and the holders of the Priority Guarantee Notes due 2022. The indenture alsoprovides for customary events of default. Subsidiary Senior Revolving Credit Facility Due 2018During the third quarter of 2013, CCOH entered into a five-year senior secured revolving credit facility with an aggregate principal amount of$75.0 million. The revolving credit facility may be used for working capital needs, to issue letters of credit and for other general corporate purposes. AtDecember 31, 2014, there were no amounts outstanding under the revolving credit facility, and $62.2 million of letters of credit under the revolving creditfacility, which reduce availability under the facility. Senior Cash Pay Notes and Senior Toggle NotesAs of December 31, 2014, iHeartCommunications had no principal amounts outstanding of 10.75% senior cash pay notes due 2016 and11.00%/11.75% senior toggle notes due 2016. In August 2014, iHeartCommunications fully redeemed the remaining notes with proceeds from the issuanceof 14.0% Senior Notes due 2021. 14.0% Senior Notes due 2021As of December 31, 2014, iHeartCommunications had outstanding approximately $1.66 billion of aggregate principal amount of 14.0% SeniorNotes due 2021 (net of $423.4 million principal amount issued to, and held by, a subsidiary of iHeartCommunications). The Senior Notes due 2021 mature on February 1, 2021. Interest on the Senior Notes due 2021 is payable semi-annually on February 1 and August 1of each year, which began on August 1, 2013. Interest on the Senior Notes due 2021 will be paid at the rate of (i) 12.0% per annum in cash and (ii) 2.0% perannum through the issuance of payment-in-kind notes (the “PIK Notes”). Any PIK Notes issued in certificated form will be dated as of the applicable interestpayment date and will bear interest from and after such date. All PIK Notes issued will mature on February 1, 2021 and have the same rights and benefits asthe Senior Notes due 2021. The Senior Notes due 2021 are fully and unconditionally guaranteed on a senior basis by the guarantors named in the indenturegoverning such notes. The guarantee is structurally subordinated to all existing and future indebtedness and other liabilities of any subsidiary of theapplicable subsidiary guarantor that is not also a guarantor of the Senior Notes due 2021. The guarantees are subordinated to the guarantees ofiHeartCommunications’ senior secured credit facility and certain other permitted debt, but rank equal to all other senior indebtedness of the guarantors. iHeartCommunications may redeem or purchase the Senior Notes due 2021 at its option, in whole or in part, at any time prior to August 1, 2015, at aredemption price equal to 100% of the principal amount of Senior Notes due 2021 redeemed plus an applicable premium. In addition, until August 1, 2015,iHeartCommunications may, at its option, on one or more occasions, redeem up to 60% of the then outstanding aggregate principal amount of Senior Notesdue 2021 at a redemption price equal to (x) with respect to the first 30% of the then outstanding aggregate principal amount of the Senior Notes due 2021,109.0% of the aggregate principal amount thereof and (y) with respect to the next 30% of the then outstanding aggregate principal amount of the SeniorNotes due 2021, 112.0% of the aggregate principal amount thereof, in each case plus accrued and unpaid interest thereon to the applicable redemption date. iHeartCommunications may redeem the Senior Notes due 2021, in whole or in part, on or after August 1, 2015, at the redemption prices set forth in theindenture plus accrued and unpaid interest to the redemption date. The indenture governing the Senior Notes due 2021 contains covenants that limit iHeartCommunications’ ability and the ability of its restrictedsubsidiaries to, among other things: (i) incur additional indebtedness or issue certain preferred stock; (ii) pay dividends on, or make distributions in respectof, their capital stock or repurchase their capital stock; (iii) make certain investments or other restricted payments; (iv) sell certain assets; (v) create liens oruse assets as security in other transactions; (vi) merge, consolidate or transfer or dispose of substantially all of their assets; (vii) engage in transactions withaffiliates; and (viii) designate their subsidiaries as unrestricted subsidiaries. iHeartCommunications Legacy NotesAs of December 31, 2014, iHeartCommunications had approximately $667.9 million aggregate principal amount of senior notes outstanding (net of$57.1 million aggregate principal amount held by a subsidiary of iHeartCommunications). The senior notes were the obligations of iHeartCommunications prior to the merger. The senior notes are senior, unsecured obligations that areeffectively subordinated to iHeartCommunications’ secured indebtedness to the extent of the value of iHeartCommunications’ assets securing suchindebtedness and are not guaranteed by any of iHeartCommunications’ subsidiaries and, as a result, are structurally subordinated to all indebtedness andother liabilities of iHeartCommunications’ subsidiaries. The senior59 notes rank equally in right of payment with all of iHeartCommunications’ existing and future senior indebtedness and senior in right of payment to allexisting and future subordinated indebtedness. 10.0% Senior Notes due 2018 As of December 31, 2014, iHeartCommunications had outstanding $730.0 million aggregate principal amount of senior notes due 2018 (net of$120.0 million aggregate principal amount held by a subsidiary of iHeartCommunications). The senior notes due 2018 mature on January 15, 2018 and bearinterest at a rate of 10.0% per annum, payable semi-annually on January 15 and July 15 of each year, which began on July 15, 2014. The senior notes due 2018 are senior, unsecured obligations that are effectively subordinated to iHeartCommunications’ secured indebtedness to theextent of the value of iHeartCommunications’ assets securing such indebtedness and are not guaranteed by any of iHeartCommunications’ subsidiaries and,as a result, are structurally subordinated to all indebtedness and other liabilities of iHeartCommunications’ subsidiaries. The senior notes due 2018 rankequally in right of payment with all of iHeartCommunications’ existing and future senior indebtedness and senior in right of payment to all existing andfuture subordinated indebtedness. CCWH Senior NotesAs of December 31, 2014, CCWH senior notes represented $2.7 billion aggregate principal amount of indebtedness outstanding, which consisted of$735.75 million aggregate principal amount of Series A Senior Notes due 2022 (the “Series A CCWH Senior Notes”) and $1,989.25 million aggregateprincipal amount of Series B CCWH Senior Notes due 2022 (the “Series B CCWH Senior Notes”). The CCWH Senior Notes are guaranteed by CCOH, ClearChannel Outdoor, Inc. (“CCOI”) and certain of CCOH’s direct and indirect subsidiaries. The CCWH Senior Notes are senior obligations that rank pari passu in right of payment to all unsubordinated indebtedness of CCWH and theguarantees of the CCWH Senior Notes rank pari passu in right of payment to all unsubordinated indebtedness of the guarantors. Interest on the CCWH SeniorNotes is payable to the trustee weekly in arrears and to the noteholders on May 15 and November 15 of each year, which began on May 15, 2013. At any time prior to November 15, 2017, CCWH may redeem the CCWH Senior Notes, in whole or in part, at a price equal to 100% of the principalamount of the CCWH Senior Notes plus a “make-whole” premium, together with accrued and unpaid interest, if any, to the redemption date. CCWH mayredeem the CCWH Senior Notes, in whole or in part, on or after November 15, 2017, at the redemption prices set forth in the applicable indenture governingthe CCWH Senior Notes plus accrued and unpaid interest to the redemption date. At any time on or before November 15, 2015, CCWH may elect to redeemup to 40% of the then outstanding aggregate principal amount of the CCWH Senior Notes at a redemption price equal to 106.500% of the principal amountthereof, plus accrued and unpaid interest to the redemption date, with the net proceeds of one or more equity offerings, subject to certain restrictions.Notwithstanding the foregoing, neither CCOH nor any of its subsidiaries is permitted to make any purchase of, or otherwise effectively cancel or retire anySeries A CCWH Senior Notes or Series B CCWH Senior Notes if, after giving effect thereto and, if applicable, any concurrent purchase of or other additionwith respect to any Series B CCWH Senior Notes or Series A CCWH Senior Notes, as applicable, the ratio of (a) the outstanding aggregate principal amountof the Series A CCWH Senior Notes to (b) the outstanding aggregate principal amount of the Series B CCWH Senior Notes shall be greater than 0.25, subjectto certain exceptions. The indenture governing the Series A CCWH Senior Notes contains covenants that limit CCOH and its restricted subsidiaries ability to, among otherthings: · incur or guarantee additional debt to persons other than iHeartCommunications and its subsidiaries (other than CCOH) or issue certain preferredstock;· create liens on its restricted subsidiaries’ assets to secure such debt;· create restrictions on the payment of dividends or other amounts to CCOH from its restricted subsidiaries that are not guarantors of the CCWHSenior Notes;· enter into certain transactions with affiliates;· merge or consolidate with another person, or sell or otherwise dispose of all or substantially all of its assets; and· sell certain assets, including capital stock of its subsidiaries, to persons other than iHeartCommunications and its subsidiaries (other thanCCOH). In addition, the indenture governing the Series A CCWH Senior Notes provides that if CCWH (i) makes an optional redemption of the Series BCCWH Senior Notes or purchases or makes an offer to purchase the Series B CCWH Senior Notes at or60 above 100% of the principal amount thereof, then CCWH shall apply a pro rata amount to make an optional redemption or purchase a pro rata amount of theSeries A CCWH Senior Notes or (ii) makes an asset sale offer under the indenture governing the Series B CCWH Senior Notes, then CCWH shall apply a prorata amount to make an offer to purchase a pro rata amount of Series A CCWH Senior Notes. The indenture governing the Series A CCWH Senior Notes does not include limitations on dividends, distributions, investments or asset sales. The indenture governing the Series B CCWH Senior Notes contains covenants that limit CCOH and its restricted subsidiaries ability to, among otherthings: · incur or guarantee additional debt or issue certain preferred stock;· redeem, repurchase or retire CCOH’s subordinated debt;· make certain investments;· create liens on its or its restricted subsidiaries’ assets to secure debt;· create restrictions on the payment of dividends or other amounts to it from its restricted subsidiaries that are not guarantors of the CCWH SeniorNotes;· enter into certain transactions with affiliates;· merge or consolidate with another person, or sell or otherwise dispose of all or substantially all of its assets;· sell certain assets, including capital stock of its subsidiaries;· designate its subsidiaries as unrestricted subsidiaries; and· pay dividends, redeem or repurchase capital stock or make other restricted payments. The Series A CCWH Senior Notes indenture and Series B CCWH Senior Notes indenture restrict CCOH’s ability to incur additional indebtedness butpermit CCOH to incur additional indebtedness based on an incurrence test. In order to incur (i) additional indebtedness under this test, CCOH’s debt toadjusted EBITDA ratios (as defined by the indentures) must be lower than 7.0:1 and 5.0:1 for total debt and senior debt, respectively, and (ii) additionalindebtedness that is subordinated to the CCWH Senior Notes under this test, CCOH’s debt to adjusted EBITDA ratios (as defined by the indentures) must belower than 7.0:1 for total debt. The indentures contain certain other exceptions that allow CCOH to incur additional indebtedness. The Series B CCWHSenior Notes indenture also permits CCOH to pay dividends from the proceeds of indebtedness or the proceeds from asset sales if its debt to adjusted EBITDAratios (as defined by the indentures) are lower than 7.0:1 and 5.0:1 for total debt and senior debt, respectively. The Series A CCWH Senior Notes indenturedoes not limit CCOH’s ability to pay dividends. The Series B CCWH Senior Notes indenture contains certain exceptions that allow CCOH to pay dividends,including (i) $525.0 million of dividends made pursuant to general restricted payment baskets and (ii) dividends made using proceeds received upon ademand by CCOH of amounts outstanding under the revolving promissory note issued by iHeartCommunications to CCOH. CCWH Senior Subordinated NotesAs of December 31, 2014, CCWH Subordinated Notes represented $2.2 billion of aggregate principal amount of indebtedness outstanding, whichconsist of $275.0 million aggregate principal amount of 7.625% Series A Senior Subordinated Notes due 2020 (the “Series A CCWH Subordinated Notes”)and $1,925.0 million aggregate principal amount of 7.625% Series B Senior Subordinated Notes due 2020 (the “Series B CCWH Subordinated Notes”). Interest on the CCWH Subordinated Notes is payable to the trustee weekly in arrears and to the noteholders on March 15 and September 15 of each year,which began on September 15, 2012. The CCWH Subordinated Notes are CCWH’s senior subordinated obligations and are fully and unconditionally guaranteed, jointly and severally,on a senior subordinated basis by CCOH, CCOI and certain of CCOH’s other domestic subsidiaries. The CCWH Subordinated Notes are unsecured seniorsubordinated obligations that rank junior to all of CCWH’s existing and future senior debt, including the CCWH Senior Notes, equally with any of CCWH’sexisting and future senior subordinated debt and ahead of all of CCWH’s existing and future debt that expressly provides that it is subordinated to the CCWHSubordinated Notes. The guarantees of the CCWH Subordinated Notes rank junior to each guarantor’s existing and future senior debt, including the CCWHSenior Notes, equally with each guarantor’s existing and future senior subordinated debt and ahead of each guarantor’s existing and future debt thatexpressly provides that it is subordinated to the guarantees of the CCWH Subordinated Notes. At any time prior to March 15, 2015, CCWH may redeem the CCWH Subordinated Notes, in whole or in part, at a price equal to 100% of theprincipal amount of the CCWH Subordinated Notes plus a “make-whole” premium, together with accrued and unpaid interest, if any, to the redemption date.CCWH may redeem the CCWH Subordinated Notes, in whole or in part, on or after March 15, 2015, at the redemption prices set forth in the applicableindenture governing the CCWH Subordinated Notes plus accrued and unpaid interest to the redemption date. At any time on or before March 15, 2015,CCWH may elect to redeem up to 40% of the61 then outstanding aggregate principal amount of the CCWH Subordinated Notes at a redemption price equal to 107.625% of the principal amount thereof,plus accrued and unpaid interest to the redemption date, with the net proceeds of one or more equity offerings, subject to certain restrictions. Notwithstanding the foregoing, neither CCOH nor any of its subsidiaries is permitted to make any purchase of, or otherwise effectively cancel or retire anySeries A CCWH Subordinated Notes or Series B CCWH Subordinated Notes if, after giving effect thereto and, if applicable, any concurrent purchase of orother addition with respect to any Series B CCWH Subordinated Notes or Series A CCWH Subordinated Notes, as applicable, the ratio of (a) the outstandingaggregate principal amount of the Series A CCWH Subordinated Notes to (b) the outstanding aggregate principal amount of the Series B CCWHSubordinated Notes shall be greater than 0.25, subject to certain exceptions. The indenture governing the Series A CCWH Subordinated Notes contains covenants that limit CCOH and its restricted subsidiaries ability to,among other things: · incur or guarantee additional debt to persons other than iHeartCommunications and its subsidiaries (other than CCOH) or issue certain preferredstock;· create restrictions on the payment of dividends or other amounts to CCOH from its restricted subsidiaries that are not guarantors of the notes;· enter into certain transactions with affiliates;· merge or consolidate with another person, or sell or otherwise dispose of all or substantially all of CCOH’s assets; and· sell certain assets, including capital stock of CCOH’s subsidiaries, to persons other than iHeartCommunications and its subsidiaries (other thanCCOH). In addition, the indenture governing the Series A CCWH Subordinated Notes provides that if CCWH (i) makes an optional redemption of theSeries B CCWH Subordinated Notes or purchases or makes an offer to purchase the Series B CCWH Subordinated Notes at or above 100% of the principalamount thereof, then CCWH shall apply a pro rata amount to make an optional redemption or purchase a pro rata amount of the Series A CCWHSubordinated Notes or (ii) makes an asset sale offer under the indenture governing the Series B CCWH Subordinated Notes, then CCWH shall apply a pro rataamount to make an offer to purchase a pro rata amount of Series A CCWH Subordinated Notes. The indenture governing the Series A CCWH Subordinated Notes does not include limitations on dividends, distributions, investments or assetsales. The indenture governing the Series B CCWH Subordinated Notes contains covenants that limit CCOH and its restricted subsidiaries ability to,among other things: · incur or guarantee additional debt or issue certain preferred stock;· make certain investments;· create restrictions on the payment of dividends or other amounts to CCOH from its restricted subsidiaries that are not guarantors of the notes;· enter into certain transactions with affiliates;· merge or consolidate with another person, or sell or otherwise dispose of all or substantially all of CCOH’s assets;· sell certain assets, including capital stock of CCOH’s subsidiaries;· designate CCOH’s subsidiaries as unrestricted subsidiaries; and· pay dividends, redeem or repurchase capital stock or make other restricted payments. The Series A CCWH Subordinated Notes indenture and Series B CCWH Subordinated Notes indenture restrict CCOH’s ability to incur additionalindebtedness but permit CCOH to incur additional indebtedness based on an incurrence test. In order to incur additional indebtedness under this test,CCOH’s debt to adjusted EBITDA ratios (as defined by the indentures) must be lower than 7.0:1. The indentures contain certain other exceptions that allowCCOH to incur additional indebtedness. The Series B CCWH Subordinated Notes indenture also permits CCOH to pay dividends from the proceeds ofindebtedness or the proceeds from asset sales if its debt to adjusted EBITDA ratios (as defined by the indentures) is lower than 7.0:1. The Series A CCWHSenior Subordinated Notes indenture does not limit CCOH’s ability to pay dividends. The Series B CCWH Subordinated Notes indenture contains certainexceptions that allow CCOH to pay dividends, including (i) $525.0 million of dividends made pursuant to general restricted payment baskets and(ii) dividends made using proceeds received upon a demand by CCOH of amounts outstanding under the revolving promissory note issued byiHeartCommunications to CCOH. 62 Refinancing Transactions2014 Refinancing TransactionsOn February 14, 2014, CC Finco, an indirect wholly-owned subsidiary of ours, sold $227.0 million in aggregate principal amount of 14.0% SeniorNotes due 2021 issued by iHeartCommunications to private purchasers in a transaction exempt from registration under the Securities Act of 1933, asamended. This $227.0 million in aggregate principal amount of 14.0% Senior Notes due 2021, which was previously eliminated in consolidation becausethe notes were held by a subsidiary, is now reflected on our consolidated balance sheet. CC Finco contributed the net proceeds from the sale of the 14.0%Senior Notes due 2021 to iHeartCommunications. On May 1, 2014, CCU Escrow Corporation issued $850.0 million in aggregate principal amount of 10.0% Senior Notes due 2018 in a private offer. On June 6, 2014, CCU Escrow Corporation merged into iHeartCommunications, and iHeartCommunications assumed CCU Escrow Corporation’s obligationsunder the Senior Notes due 2018. Using the proceeds from the issuance of the 10.0% Senior Notes due 2018, iHeartCommunications redeemed $567.1million aggregate principal amount of iHeartCommunications’ 5.5% Senior Notes due 2014 (including $158.5 million principal amount of the notes held bya subsidiary of iHeartCommunications) and $241.0 million aggregate principal amount of iHeartCommunications’ 4.9% Senior Notes due 2015. On August 22, 2014, iHeartCommunications issued and sold $222.2 million in aggregate principal amount of new 14.0% Senior Notes due 2021 toCC Finco in a transaction exempt from registration under the Securities Act of 1933, as amended. The new 14.0% Senior Notes due 2021 were issued asadditional notes under the indenture governing iHeartCommunications’ existing 14.0% Senior Notes due 2021. On August 22, 2014, iHeartCommunicationsredeemed all of the outstanding $94.3 million aggregate principal amount of 10.75% Senior Cash Pay Notes due 2016 and $127.9 million aggregateprincipal amount of 11.00%/11.75% Senior Toggle Notes due 2016 using proceeds of the issuance of the new 14.0% Senior Notes due 2021. On September 10, 2014, iHeartCommunications issued and sold $750.0 million in aggregate principal amount of Priority Guarantee Notes due 2022and used the net proceeds of such issuance to prepay at par $729.0 million of the loans outstanding under its term loan B facility and $12.1 million of theloans outstanding under its term loan C-asset sale facility, and to pay accrued and unpaid interest with regard to such loans to, but not including, the date ofprepayment. On September 29, 2014, iHeartCommunications issued an additional $250.0 million in aggregate principal amount of Priority Guarantee Notes due2022 and used the proceeds of such issuance to prepay at par $245.9 million of loans outstanding under its term loan B facility and $4.1 million of loansoutstanding under its term loan C-asset sale facility, and to pay accrued and unpaid interest with regard to such loans to, but not including, the date ofrepayment. 2013 Refinancing TransactionsIn February 2013, iHeartCommunications issued $575.0 million aggregate principal amount of the outstanding 11.25% Priority Guarantee Notesand used the net proceeds of such notes, together with the proceeds of borrowings under its receivables based credit facility and cash on hand, to prepay all$846.9 million of loans outstanding under its Term Loan A and to pay related fees and expenses. During June 2013, iHeartCommunications amended its senior secured credit facility by extending a portion of Term Loan B and Term Loan C loansdue 2016 through the creation of a new $5.0 billion Term Loan D due January 30, 2019. The amendment also permitted iHeartCommunications to makeapplicable high yield discount obligation catch-up payments beginning in May 2018 with respect to the new Term Loan D and any notes issued inconnection with iHeartCommunications’ exchange of its outstanding 10.75% senior cash pay notes due 2016 and 11.00%/11.75% senior toggle notes due2016. During June 2013, iHeartCommunications exchanged $348.1 million aggregate principal amount of senior cash pay notes for $348.0 millionaggregate principal amount of the Senior Notes due 2021 and $917.2 million aggregate principal amount of senior toggle notes (including $452.7 millionaggregate principal amount held by a subsidiary of iHeartCommunications) for $853.0 million aggregate principal amount of Senior Notes due 2021(including $421.0 million aggregate principal amount issued to the subsidiary of iHeartCommunications) and $64.2 million of cash (including $31.7 millionof cash paid to the subsidiary of iHeartCommunications), pursuant to the exchange offer. In connection with the exchange offer and the senior secured creditfacility amendment, both of which were accounted for as modifications of existing debt in accordance with ASC 470-50, we incurred expenses of$17.9 million which are included in “Other income (expenses), net”. Further, in December 2013, iHeartCommunications exchanged an additional $353.8 million aggregate principal amount of senior cash pay notes for$389.2 million aggregate principal amount of the Senior Notes due 2021 and $14.2 million of cash as well as63 an additional $212.1 million aggregate principal amount of senior toggle notes for $233.3 million aggregate principal amount of Senior Notes due 2021 and$8.5 million of cash, pursuant to the exchange offer. In connection with the exchange offer, which was accounted for as extinguishment of existing debt inaccordance with ASC 470-50, we incurred expenses of $84.0 million, which are included in “Loss on extinguishment of debt”. In addition, during December 2013, iHeartCommunications amended its senior secured credit facility by extending a portion of Term Loan B andTerm Loan C loans due 2016 through the creation of a new $1.3 billion Term Loan E due July 30, 2019. In connection with the senior secured credit facilityamendment, which was accounted for as modifications of existing debt, we incurred expenses of $5.5 million which are included in “Other income(expenses), net”.2012 Refinancing TransactionsIn March 2012, CCWH issued $275.0 million aggregate principal amount of the Series A CCWH Subordinated Notes and $1,925.0 millionaggregate principal amount of the Series B CCWH Subordinated Notes and in connection therewith, CCOH distributed a dividend of $6.0832 per share to itsstockholders of record. Using the CCOH dividend proceeds distributed to our wholly-owned subsidiaries, together with cash on hand, iHeartCommunicationsrepaid $2,096.2 million of indebtedness under its senior secured credit facilities. During October 2012, iHeartCommunications exchanged $2.0 billion aggregate principal amount of term loans under its senior secured creditfacilities for a like principal amount of newly issued iHeartCommunications Priority Guarantee Notes due 2019. The exchange offer, which was offered toeligible existing lenders under iHeartCommunications’ senior secured credit facilities, was exempt from registration under the Securities Act of 1933, asamended. We capitalized $11.9 million in fees and expenses associated with the offering and are amortizing them through interest expense over the life ofthe notes. In November 2012, CCWH issued $735.75 million aggregate principal amount of the Series A CCWH Senior Notes, which were issued at an issueprice of 99.0% of par, and $1,989.25 million aggregate principal amount of the Series B CCWH Senior Notes, which were issued at par. CCWH used the netproceeds from the offering of the CCWH Senior Notes, together with cash on hand, to fund the tender offer for and redemption of the Existing CCWH SeniorNotes. Dispositions and Other2014During 2014, the Company sold its 50% interest in Australian Radio Network (“ARN”), an Australian company that owns and operates radio stationsin Australia and New Zealand. An impairment charge of $95.4 million was recorded during the fourth quarter of 2013 to write down the investment to itsestimated fair value. Upon sale of ARN, the Company recognized a loss of $2.4 million and $11.5 million of foreign exchange losses, which were reclassifiedfrom accumulated other comprehensive income. During 2014, our International outdoor segment sold its 50% interest in Buspak, a bus advertising company in Hong Kong and recognized a gain onsale of $4.5 million. 2013During 2013, our Americas outdoor segment divested certain outdoor advertising assets in Times Square for approximately $18.7 million resultingin a gain of $12.2 million. In addition, our iHM segment exercised a put option that sold five radio stations in the Green Bay market for approximately$17.6 million and recorded a gain of $0.5 million. These net gains are included in “Other operating income, net.” We sold our shares of Sirius XM Radio, Inc. for $135.5 million and recognized a gain on the sale of securities of $130.9 million. This net gain isincluded in “Gain on sale of marketable securities.” 2012During 2012, our International outdoor segment sold its international neon business and its outdoor advertising business in Romania, resulting in anaggregate gain of $39.7 million included in “Other operating income, net.” 64 Uses of CapitalDebt Repurchases, Maturities and Other2014During the period of October 1, 2014 through December 31, 2014, CC Finco repurchased via open market transactions a total of $177.1 millionaggregate principal amount of notes, comprised of $57.1 million of iHeartCommunications’ outstanding 5.5% Senior Notes due 2016 and $120.0 million ofiHeartCommunications’ outstanding 10.0% Senior Notes due 2018, for a total purchase price of $159.3 million, including accrued interest. The notesrepurchased by CC Finco were not cancelled and remain outstanding. On September 29, 2014, iHeartCommunications prepaid at par $245.9 million of the loans outstanding under its Term Loan B facility and$4.1million of the loans outstanding under its Term Loan C-asset sale facility, using the net proceeds of the Priority Guarantee Notes due 2022 issued onsuch date. On September 10, 2014, iHeartCommunications prepaid at par $729.0 million of the loans outstanding under its Term Loan B facility and $12.1million of the loans outstanding under its Term Loan C-asset sale facility, using the net proceeds of the Priority Guarantee Notes due 2022 issued on suchdate. On August 22, 2014, iHeartCommunications redeemed all of the outstanding $94.3 million aggregate principal amount of 10.75% Senior Cash PayNotes due 2016 and $127.9 million aggregate principal amount of 11.00%/11.75% Senior Toggle Notes due 2016 using proceeds of the issuance to CCFinco of new 14.0% Senior Notes due 2021. On June 6, 2014, using the proceeds from the issuance of the 10.0% Senior Notes due 2018, iHeartCommunications redeemed $567.1 millionaggregate principal amount of iHeartCommunications’ 5.5% Senior Notes due 2014 (including $158.5 million principal amount of the notes held by asubsidiary of iHeartCommunications) and $241.0 million aggregate principal amount of iHeartCommunications’ 4.9% Senior Notes due 2015. During March 2014, CC Finco repurchased, through open market purchases, a total of $61.9 million aggregate principal amount of notes, comprisedof $52.9 million of iHeartCommunications’ outstanding 5.5% Senior Notes due 2014 and $9.0 million of iHeartCommunications’ outstanding 4.9% SeniorNotes due 2015, for a total purchase price of $63.1 million, including accrued interest. CC Finco contributed the notes to a subsidiary of ours andiHeartCommunications cancelled these notes subsequent to the purchase. During February 2014, iHeartCommunications repaid all principal amounts outstanding under its receivables based credit facility, using cash onhand. This voluntary repayment did not reduce the commitments under this facility and iHeartCommunications has the ability to redraw amounts under thisfacility at any time. 2013During August 2013, iHeartCommunications made a $25.3 million scheduled applicable high-yield discount obligation payment to the holders ofthe senior toggle notes. During February 2013, using the proceeds from the issuance of the 11.25% Priority Guarantee Notes along with borrowings under the receivablesbased credit facility of $269.5 million and cash on hand, iHeartCommunications prepaid all $846.9 million outstanding under its Term Loan A under itssenior secured credit facilities. We recorded a loss of $3.9 million in “Loss on extinguishment of debt” related to the accelerated expensing of loan fees. During January 2013, iHeartCommunications repaid its 5.75% senior notes at maturity for $312.1 million (net of $187.9 million principal amountrepaid to a subsidiary of iHeartCommunications with respect to notes repurchased and held by such entity), plus accrued interest, using cash on hand. 2012During November 2012, CCWH repurchased $1,724.7 million aggregate principal amount of the Existing CCWH Senior Notes in a tender offer forthe Existing CCWH Senior Notes. Simultaneously with the early settlement of the tender offer, CCWH called for redemption all of the remaining$775.3 million aggregate principal amount of Existing CCWH Senior Notes that were not purchased on the early settlement date of the tender offer. Inconnection with the redemption, CCWH satisfied and discharged its obligations under the Existing CCWH Senior Notes indentures by depositing with thetrustee sufficient funds to pay the redemption65 price, plus accrued and unpaid interest on the remaining outstanding Existing CCWH Senior Notes to, but not including, the December 19, 2012 redemptiondate. During October 2012, iHeartCommunications consummated a private exchange offer of $2.0 billion aggregate principal amount of term loans underits senior secured credit facilities for a like principal amount of newly issued Priority Guarantee Notes due 2019. The exchange offer was available only toeligible lenders under the senior secured credit facilities, and the Priority Guarantee Notes due 2019 were offered only in reliance on exemptions fromregistration under the Securities Act of 1933, as amended. In connection with the issuance of the CCWH Subordinated Notes, CCOH paid the $2,170.4 million CCOH dividend on March 15, 2012 to itsClass A and Class B stockholders, consisting of $1,925.7 million distributed to CC Holdings and CC Finco and $244.7 million distributed to otherstockholders. In connection with the Subordinated Notes issuance and CCOH dividend, iHeartCommunications repaid indebtedness under its senior securedcredit facilities in an amount equal to the aggregate amount of dividend proceeds distributed to CC Holdings and CC Finco, or $1,925.7 million. Of thisamount, a prepayment of $1,918.1 million was applied to indebtedness outstanding under iHeartCommunications’ revolving credit facility, thus permanentlyreducing the revolving credit commitments under iHeartCommunications’ revolving credit facility to $10.0 million. During the fourth quarter of 2012, therevolving credit facility was permanently paid off and terminated using available cash on hand. The remaining $7.6 million prepayment was allocated on apro rata basis to iHeartCommunications’ term loan facilities. In addition, on March 15, 2012, using cash on hand, iHeartCommunications made voluntary prepayments under its senior secured credit facilities inan aggregate amount equal to $170.5 million, as follows: (i) $16.2 million under its Term Loan A due 2014, (ii) $129.8 million under its Term Loan B due2016, (iii) $10.0 million under its Term Loan C due 2016 and (iv) $14.5 million under its delayed draw term loans due 2016. In connection with theprepayments on iHeartCommunications’ senior secured credit facilities, we recorded a loss of $15.2 million in “Loss on extinguishment of debt” related tothe accelerated expensing of loan fees. During March 2012, iHeartCommunications repaid its 5.0% senior notes at maturity for $249.9 million (net of $50.1 million principal amountrepaid to a subsidiary of iHeartCommunications with respect to notes repurchased and held by such entity), plus accrued interest, using a portion of theproceeds from the June 2011 offering of priority guarantee notes, along with cash on hand. Capital ExpendituresCapital expenditures for the years ended December 31, 2014, 2013 and 2012 were as follows: (In millions)Years Ended December 31, 2014 2013 2012iHM$ 50.4 $ 75.7 $ 65.8 Americas outdoor advertising 97.0 89.0 117.7 International outdoor advertising 130.2 108.5 150.1 Corporate and Other 40.6 51.3 56.7 Total capital expenditures$ 318.2 $ 324.5 $ 390.3 Our capital expenditures are not of significant size individually and primarily relate to the ongoing deployment of digital displays andimprovements to traditional displays in our Americas outdoor segment as well as new billboard and street furniture contracts and renewals of existingcontracts in our International outdoor segment, studio and broadcast equipment at iHM and software at Corporate. DividendsWe have never paid cash dividends on our Class A common stock. iHeartCommunications’ debt financing arrangements include restrictions on itsability to pay dividends as described in this MD&A, which in turn affects our ability to pay dividends. AcquisitionsThe Company is the beneficiary of Aloha Station Trust, LLC (the “Aloha Trust”), which owns and operates radio stations which the Aloha Trust is required todivest in order to comply with Federal Communication Commission (“FCC”) media ownership rules, and which are being marketed for sale. During 2014, theAloha Trust completed a transaction in which it exchanged two radio stations for a portfolio of 29 radio stations. In this transaction the Company received 28 radio stations. One radio station was placed into the Brunswick Station Trust, LLC in order to comply with FCC media ownership rules where it is beingmarketed for sale, and the Company is the beneficiary of this trust. The exchange was accounted for at fair value in accordance with ASC 805, Business66 Combinations. The disposal of these radio stations resulted in a gain on sale of $43.5 million, which is included in other operating income. This acquisitionresulted in an aggregate increase in net assets of $49.2 million, which includes $13.8 million in indefinite-lived intangible assets, $10.2 million in definite-lived intangibles, $8.1 million in property, plant and equipment and $0.8 million of assumed liabilities. In addition, the Company recognized $17.9 millionof goodwill. During 2012, we completed the acquisition of WOR-AM in New York City for $30.0 million and WFNX in Boston for $14.5 million. Theseacquisitions resulted in an aggregate increase of $5.3 million to property plant and equipment, $15.2 million to intangible assets and $24.7 million togoodwill, in addition to $0.7 million of assumed liabilities. Stock PurchasesOn August 9, 2010, iHeartCommunications announced that its board of directors approved a stock purchase program under whichiHeartCommunications or its subsidiaries may purchase up to an aggregate of $100.0 million of our Class A common stock and/or the Class A common stockof CCOH. The stock purchase program does not have a fixed expiration date and may be modified, suspended or terminated at any time atiHeartCommunications’ discretion. During 2014, CC Finco purchased 5,000,000 shares of CCOH’s Class A common stock for approximately $48.8 million. During 2012, CC Finco purchased 111,291 shares of our Class A common stock for $692,887. During 2011, CC Finco purchased 1,553,971 shares ofCCOH’s Class A common stock through open market purchases for approximately $16.4 million. As of December 31, 2014, an aggregate $34.2 million wasavailable under the stock purchase program to purchase our Class A common stock and/or the Class A common stock of CCOH. On January 7, 2015 CC Finco purchased an additional 2,000,000 shares of CCOH’s Class A common stock for $20.4 million. Certain Relationships with the SponsorsiHeartCommunications is party to a management agreement with certain affiliates of Bain Capital Partners, LLC and Thomas H. Lee Partners, L.P.(together, the “Sponsors”) and certain other parties pursuant to which such affiliates of the Sponsors will provide management and financial advisory servicesuntil 2018. These arrangements require management fees to be paid to such affiliates of the Sponsors for such services at a rate not greater than $15.0 millionper year, plus reimbursable expenses. During the years ended December 31, 2014, 2013 and 2012, we recognized management fees and reimbursableexpenses of $15.2 million, $15.8 million and $15.9 million, respectively. CCOH DividendIn connection with the cash management arrangements for CCOH, iHeartCommunications maintains an intercompany revolving promissory notepayable by iHeartCommunications to CCOH (the “Note”), which consists of the net activities resulting from day-to-day cash management services providedby iHeartCommunications to CCOH. As of December 31, 2014, the balance of the Note was $947.8 million, all of which is payable on demand. The Note iseliminated in consolidation in our consolidated financial statements.The Note previously was the subject of litigation. Pursuant to the terms of the settlement of that litigation, CCOH’s board of directors established acommittee for the specific purpose of monitoring the Note. That committee has the non-exclusive authority, pursuant to the terms of its charter, to demandpayments under the Note under certain specified circumstances tied to the Company’s liquidity or the amount outstanding under the Due from Note as longas CCOH makes a simultaneous dividend equal to the amount so demanded.On August 11, 2014, in accordance with the terms of its charter, (i) that committee demanded repayment of $175 million outstanding under the Noteon such date and (ii) CCOH paid a special cash dividend in aggregate amount equal to $175 million to CCOH’s stockholders of record as of August 4, 2014.As the indirect parent of CCOH, we were entitled to approximately 88% of the proceeds from such dividend through our wholly-owned subsidiaries. Theremaining approximately 12% of the proceeds from the dividend, or approximately $21 million, was paid to the public stockholders of CCOH and isincluded in Dividends and other payments to noncontrolling interests in our consolidated statement of cash flows. We funded the net payment of this $21million with cash on hand, which reduced the amount of cash we have available to fund our working capital needs, debt service obligations and otherobligations. Following satisfaction of the demand, the balance outstanding under the Note was reduced by $175 million. Commitments, Contingencies and GuaranteesWe are currently involved in certain legal proceedings arising in the ordinary course of business and, as required, have accrued our estimate of theprobable costs for resolution of those claims for which the occurrence of loss is probable and the amount can be reasonably estimated. These estimates havebeen developed in consultation with counsel and are based upon an analysis of potential results, assuming a combination of litigation and settlementstrategies. It is possible, however, that future results of67 operations for any particular period could be materially affected by changes in our assumptions or the effectiveness of our strategies related to theseproceedings. Please refer to Item 3. “Legal Proceedings” within Part I of this Annual Report on Form 10-K. Certain agreements relating to acquisitions provide for purchase price adjustments and other future contingent payments based on the financialperformance of the acquired companies generally over a one to five-year period. The aggregate of these contingent payments, if performance targets are met,would not significantly impact our financial position or results of operations. In addition to our scheduled maturities on our debt, we have future cash obligations under various types of contracts. We lease office space, certainbroadcast facilities, equipment and the majority of the land occupied by our outdoor advertising structures under long-term operating leases. Some of ourlease agreements contain renewal options and annual rental escalation clauses (generally tied to the consumer price index), as well as provisions for ourpayment of utilities and maintenance. We have minimum franchise payments associated with non-cancelable contracts that enable us to display advertising on such media as buses, trains,bus shelters and terminals. The majority of these contracts contain rent provisions that are calculated as the greater of a percentage of the relevant advertisingrevenue or a specified guaranteed minimum annual payment. Also, we have non-cancelable contracts in our radio broadcasting operations related to programrights and music license fees. In the normal course of business, our broadcasting operations have minimum future payments associated with employee and talent contracts. Thesecontracts typically contain cancellation provisions that allow us to cancel the contract with good cause.68 The scheduled maturities of iHeartCommunications’ senior secured credit facilities, receivables based facility, priority guarantee notes, other long-term debt outstanding, and our future minimum rental commitments under non-cancelable lease agreements, minimum payments under other non-cancelablecontracts, payments under employment/talent contracts, capital expenditure commitments and other long-term obligations as of December 31, 2014 are asfollows: (In thousands)Payments due by PeriodContractual ObligationsTotal 2015 2016-2017 2018-2019 ThereafterLong-term Debt: Secured Debt$ 12,575,294 $ 2,746 $ 942,122 $ 8,304,255 $ 3,326,171 Senior Notes due 2021 1,661,697 - - - 1,661,697 iHeartCommunications Legacy Notes 667,900 - 192,900 175,000 300,000 Senior Notes due 2018 730,000 - - 730,000 - CCWH Senior Notes 2,725,000 - - - 2,725,000 CCWH Senior Subordinated Notes 2,200,000 - - - 2,200,000 Other Long-term Debt 1,024 858 106 60 - Interest payments on long-term debt (1) 9,037,483 1,645,039 3,223,040 2,691,292 1,478,112 Non-cancelable operating leases 2,923,445 435,118 650,363 512,793 1,325,171 Non-cancelable contracts 2,040,323 593,123 699,390 411,690 336,120 Employment/talent contracts 198,944 80,442 107,433 11,069 - Capital expenditures 209,487 55,968 137,438 1,679 14,402 Unrecognized tax benefits (2) 112,737 2,327 - - 110,410 Other long-term obligations (3) 343,795 11,365 81,682 24,800 225,948 Total$ 35,427,129 $ 2,826,986 $ 6,034,474 $ 12,862,638 $ 13,703,031 (1) Interest payments on the senior secured credit facilities assume the interest rate is held constant over the remaining term.(2) The non-current portion of the unrecognized tax benefits is included in the “Thereafter” column as we cannot reasonably estimate the timing oramounts of additional cash payments, if any, at this time.(3) Other long-term obligations consist of $53.9 million related to asset retirement obligations recorded pursuant to ASC 410-20, which assumes theunderlying assets will be removed at some period over the next 50 years. Also included are $52.3 million of contract payments in our syndicatedradio and media representation businesses and $237.6 million of various other long-term obligations. SEASONALITYTypically, our iHM, Americas outdoor and International outdoor segments experience their lowest financial performance in the first quarter of thecalendar year, with International outdoor historically experiencing a loss from operations in that period. Our International outdoor segment typicallyexperiences its strongest performance in the second and fourth quarters of the calendar year. We expect this trend to continue in the future. MARKET RISKWe are exposed to market risks arising from changes in market rates and prices, including movements in interest rates, foreign currency exchangerates and inflation. Interest Rate RiskA significant amount of our long-term debt bears interest at variable rates. Accordingly, our earnings will be affected by changes in interest rates. AtDecember 31, 2014, approximately 35% of our aggregate principal amount of long-term debt bears interest at floating rates. Assuming the current level ofborrowings and assuming a 100% change in LIBOR, it is estimated that our interest expense for the year ended December 31, 2014 would have changed by$11.2 million. In the event of an adverse change in interest rates, management may take actions to mitigate our exposure. However, due to the uncertainty of theactions that would be taken and their possible effects, the preceding interest rate sensitivity analysis assumes no such actions. Further, the analysis does notconsider the effects of the change in the level of overall economic activity that could exist in such an environment.69 Foreign Currency Exchange Rate RiskWe have operations in countries throughout the world. Foreign operations are measured in their local currencies. As a result, our financial resultscould be affected by factors such as changes in foreign currency exchange rates or weak economic conditions in the foreign markets in which we haveoperations. We believe we mitigate a small portion of our exposure to foreign currency fluctuations with a natural hedge through borrowings in currenciesother than the U.S. dollar. Our foreign operations reported net income of $80.2 million for the year ended December 31, 2014. We estimate a 10% increase inthe value of the U.S. dollar relative to foreign currencies would have increased our net loss for the year ended December 31, 2014 by $8.0 million. A 10%decrease in the value of the U.S. dollar relative to foreign currencies during the year ended December 31, 2014 would have decreased our net loss by acorresponding amount. This analysis does not consider the implications that such currency fluctuations could have on the overall economic activity that could exist in suchan environment in the U.S. or the foreign countries or on the results of operations of these foreign entities. InflationInflation is a factor in the economies in which we do business and we continue to seek ways to mitigate its effect. Inflation has affected ourperformance in terms of higher costs for wages, salaries and equipment. Although the exact impact of inflation is indeterminable, we believe we have offsetthese higher costs by increasing the effective advertising rates of most of our broadcasting stations and outdoor display faces in our iHM, Americas outdoor,and International outdoor operations. NEW ACCOUNTING PRONOUNCEMENTSDuring the first quarter of 2014, the Company adopted the Financial Accounting Standards Board’s (“FASB”) ASU No. 2013-04, ObligationsResulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date. This update providesguidance for the recognition, measurement and disclosure of obligations resulting from joint and several liability arrangements for which the total amount ofthe obligation within the scope of this guidance is fixed at the reporting date. The amendments are effective for fiscal years (and interim periods within)beginning after December 15, 2013 and are to be applied retrospectively to all prior periods presented for such obligations that exist at the beginning of anentity’s fiscal year of adoption. The adoption of this guidance did not have a material effect on the Company’s consolidated financial statements. During the first quarter of 2014, the Company adopted the FASB’s ASU No. 2013-05, Parent’s Accounting for the Cumulative TranslationAdjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity of an Investment in a Foreign Entity. The amendmentsare effective prospectively for the fiscal years (and interim periods within) beginning after December 15, 2013 and provide clarification guidance for therelease of the cumulative translation adjustment under current U.S. GAAP. The adoption of this guidance did not have a material effect on the Company’sconsolidated financial statements During the first quarter of 2014, the Company adopted the FASB’s ASU No. 2013-11, Presentation of an Unrecognized Tax Benefit When a NetOperating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. This update requires unrecognized tax benefits to be offset against adeferred tax asset for a net operating loss carryforward, similar tax loss or tax credit carryforward in certain situations. The amendments are effectiveprospectively for the fiscal years (and interim periods within) beginning after December 15, 2013. The adoption of this guidance did not have a materialeffect on the Company’s consolidated financial statements. During the second quarter of 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers. This new standard providesguidance for the recognition, measurement and disclosure of revenue resulting from contracts with customers and will supersede virtually all of the currentrevenue recognition guidance under U.S. GAAP. The standard is effective for the first interim period within annual reporting periods beginning afterDecember 15, 2016. The Company is currently evaluating the impact of the provisions of this new standard on its financial position and results ofoperations. During the third quarter of 2014, the FASB issued ASU No. 2014-12, Accounting for Share-Based Payments When the Terms of an Award ProvideThat a Performance Target Could Be Achieved after the Requisite Service Period. This new standard clarifies that a performance target in a share-basedcompensation award that could be achieved after an employee completes the requisite service period should be treated as a performance condition that affectsthe vesting of the award. The standard is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2015. The Company is currently evaluating the impact of the provisions of this new standard on its financial position and results of operations. 70 CRITICAL ACCOUNTING ESTIMATESThe preparation of our financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions thataffect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reportedamount of expenses during the reporting period. On an ongoing basis, we evaluate our estimates that are based on historical experience and on various otherassumptions that are believed to be reasonable under the circumstances. The result of these evaluations forms the basis for making judgments about thecarrying values of assets and liabilities and the reported amount of expenses that are not readily apparent from other sources. Because future events and theireffects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such difference could be material. Oursignificant accounting policies are discussed in the notes to our consolidated financial statements included in Item 8 of Part II of this Annual Report onForm 10-K. Management believes that the following accounting estimates are the most critical to aid in fully understanding and evaluating our reportedfinancial results, and they require management’s most difficult, subjective or complex judgments, resulting from the need to make estimates about the effectof matters that are inherently uncertain. The following narrative describes these critical accounting estimates, the judgments and assumptions and the effectif actual results differ from these assumptions. Allowance for Doubtful AccountsWe evaluate the collectability of our accounts receivable based on a combination of factors. In circumstances where we are aware of a specificcustomer’s inability to meet its financial obligations, we record a specific reserve to reduce the amounts recorded to what we believe will be collected. For allother customers, we recognize reserves for bad debt based on historical experience for each business unit, adjusted for relative improvements or deteriorationsin the agings and changes in current economic conditions. If our agings were to improve or deteriorate resulting in a 10% change in our allowance, we estimated that our bad debt expense for the year endedDecember 31, 2014 would have changed by approximately $4.0 million. Long-lived AssetsLong-lived assets, including structures and other property, plant and equipment and definite-lived intangibles, are reported at historical cost lessaccumulated depreciation and amortization. We estimate the useful lives for various types of advertising structures and other long-lived assets based on ourhistorical experience and our plans regarding how we intend to use those assets. Advertising structures have different lives depending on their nature, withlarge format bulletins generally having longer depreciable lives and posters and other displays having shorter depreciable lives. Street furniture and transitdisplays are depreciated over their estimated useful lives or appropriate contractual periods, whichever is shorter. Our experience indicates that the estimateduseful lives applied to our portfolio of assets have been reasonable, and we do not expect significant changes to the estimated useful lives of our long-livedassets in the future. When we determine that structures or other long-lived assets will be disposed of prior to the end of their useful lives, we estimate therevised useful lives and depreciate the assets over the revised period. We also review long-lived assets for impairment when events and circumstancesindicate that depreciable and amortizable long-lived assets might be impaired and the undiscounted cash flows estimated to be generated by those assets areless than the carrying amounts of those assets. When specific assets are determined to be unrecoverable, the cost basis of the asset is reduced to reflect thecurrent fair market value. We use various assumptions in determining the remaining useful lives of assets to be disposed of prior to the end of their useful lives and indetermining the current fair market value of long-lived assets that are determined to be unrecoverable. Estimated useful lives and fair values are sensitive tofactors including contractual commitments, regulatory requirements, future expected cash flows, industry growth rates and discount rates, as well as futuresalvage values. Our impairment loss calculations require management to apply judgment in estimating future cash flows, including forecasting useful lives ofthe assets and selecting the discount rate that reflects the risk inherent in future cash flows. If actual results are not consistent with our assumptions and judgments used in estimating future cash flows and asset fair values, we may be exposedto future impairment losses that could be material to our results of operations. Indefinite-lived Intangible AssetsIn connection with the Merger Agreement pursuant to which we acquired iHeartCommunications in 2008, we allocated the purchase price to all ofour assets and liabilities at estimated fair values, including our FCC licenses and our billboard permits. Indefinite-lived intangible assets, such as our FCClicenses and our billboard permits, are reviewed annually for possible impairment using the direct valuation method as prescribed in ASC 805-20-S99. Underthe direct valuation method, the estimated fair value of the indefinite-lived intangible assets was calculated at the market level as prescribed by ASC 350-30-35.Under the direct valuation method, it is assumed that rather than acquiring indefinite-lived intangible assets as a part of a going concern business, thebuyer hypothetically obtains indefinite-lived intangible assets and builds a new operation with similar attributes from scratch. Thus, the71 buyer incurs start-up costs during the build-up phase which are normally associated with going concern value. Initial capital costs are deducted from thediscounted cash flows model which results in value that is directly attributable to the indefinite-lived intangible assets. Our key assumptions using the direct valuation method are market revenue growth rates, market share, profit margin, duration and profile of thebuild-up period, estimated start-up capital costs and losses incurred during the build-up period, the risk-adjusted discount rate and terminal values. This datais populated using industry normalized information representing an average asset within a market. On October 1, 2014, we performed our annual impairment test in accordance with ASC 350-30-35 and recognized aggregate impairment charges of$15.7 million related to FCC Licenses in our iHM business. In determining the fair value of our FCC licenses, the following key assumptions were used:§ Revenue growth sales forecast and published by BIA Financial Network, Inc. (“BIA”), varying by market, were used for the initial four-year period;§ 2% revenue growth was assumed beyond the initial four-year period;§ Revenue was grown proportionally over a build-up period, reaching market revenue forecast by year 3;§ Operating margins of 12.5% in the first year gradually climb to the industry average margin in year 3 of up to 29.6%, depending on market; and§ Assumed discount rates of 9.5% for the 13 largest markets and 10.0% for all other markets. In determining the fair value of our billboard permits, the following key assumptions were used:§ Industry revenue growth forecast at 3.0% was used for the initial four-year period;§ 3% revenue growth was assumed beyond the initial four-year period;§ Revenue was grown over a build-up period, reaching maturity by year 2;§ Operating margins gradually climb to the industry average margin of up to 56%, depending on market size, by year 3; and§ Assumed discount rate of 8.5%. While we believe we have made reasonable estimates and utilized appropriate assumptions to calculate the fair value of our indefinite-livedintangible assets, it is possible a material change could occur. If future results are not consistent with our assumptions and estimates, we may be exposed toimpairment charges in the future. The following table shows the change in the fair value of our indefinite-lived intangible assets that would result from a100 basis point decline in our discrete and terminal period revenue growth rate and profit margin assumptions and a 100 basis point increase in our discountrate assumption: (In thousands) Revenue Profit DiscountDescription Growth Rate Margin RatesFCC license $ 387,466 $ 139,220 $ 414,736 Billboard permits $ 803,300 $ 137,600 $ 807,000 The estimated fair value of our FCC licenses and billboard permits at October 1, 2014 and 2013 was $5.5 billion and $5.6 billion, respectively,while the carrying value was $3.5 billion and $3.5 billion, respectively. GoodwillGoodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations. We testgoodwill at interim dates if events or changes in circumstances indicate that goodwill might be impaired. The fair value of our reporting units is used toapply value to the net assets of each reporting unit. To the extent that the carrying amount of net assets would exceed the fair value, an impairment chargemay be required to be recorded. The discounted cash flow approach we use for valuing goodwill as part of the two-step impairment testing approach involves estimating future cashflows expected to be generated from the related assets, discounted to their present value using a risk-adjusted discount rate. Terminal values are alsoestimated and discounted to their present value. On October 1, 2014, we performed our annual impairment test in accordance with ASC 350-30-35, resulting in no goodwill impairment charge. Indetermining the fair value of our reporting units, we used the following assumptions:72 § Expected cash flows underlying our business plans for the periods 2014 through 2018. Our cash flow assumptions are based on detailed, multi-year forecasts performed by each of our operating segments, and reflect the advertising outlook across our businesses.§ Cash flows beyond 2018 are projected to grow at a perpetual growth rate, which we estimated at 2% for our iHM segment, 3% for our Americasoutdoor and International outdoor segments, and 2.0% for our Other segment.§ In order to risk adjust the cash flow projections in determining fair value, we utilized a discount rate of approximately 8.5% to 12.0% for each ofour reporting units.Based on our annual assessment using the assumptions described above, a hypothetical 25% reduction in the estimated fair value in each of ourreporting units would not result in a material impairment condition. While we believe we have made reasonable estimates and utilized appropriate assumptions to calculate the estimated fair value of our reportingunits, it is possible a material change could occur. If future results are not consistent with our assumptions and estimates, we may be exposed to impairmentcharges in the future. The following table shows the decline in the fair value of each of our reportable segments that would result from a 100 basis pointdecline in our discrete and terminal period revenue growth rate and profit margin assumptions and a 100 basis point increase in our discount rate assumption: (In thousands) Revenue Profit DiscountDescription Growth Rate Margin RatesiHM $ 1,420,000 $ 340,000 $ 1,360,000 Americas Outdoor $ 790,000 $ 160,000 $ 740,000 International Outdoor $ 440,000 $ 240,000 $ 400,000 Tax AccrualsOur estimates of income taxes and the significant items giving rise to the deferred tax assets and liabilities are shown in the notes to our consolidatedfinancial statements and reflect our assessment of actual future taxes to be paid on items reflected in the financial statements, giving consideration to bothtiming and probability of these estimates. Actual income taxes could vary from these estimates due to future changes in income tax law or results from thefinal review of our tax returns by federal, state or foreign tax authorities. We use our judgment to determine whether it is more likely than not that our deferred tax assets will be realized. Deferred tax assets are reduced byvaluation allowances if the Company believes it is more than likely than not that some portion or the entire asset will not be realized. We use our judgment to determine whether it is more likely than not that we will sustain positions that we have taken on tax returns and, if so, theamount of benefit to initially recognize within our financial statements. We regularly review our uncertain tax positions and adjust our unrecognized taxbenefits (UTBs) in light of changes in facts and circumstances, such as changes in tax law, interactions with taxing authorities and developments in case law. These adjustments to our UTBs may affect our income tax expense. Settlement of uncertain tax positions may require use of our cash. Litigation AccrualsWe are currently involved in certain legal proceedings. Based on current assumptions, we have accrued an estimate of the probable costs for theresolution of those claims for which the occurrence of loss is probable and the amount can be reasonably estimated. Future results of operations could bematerially affected by changes in these assumptions or the effectiveness of our strategies related to these proceedings. Management’s estimates used have been developed in consultation with counsel and are based upon an analysis of potential results, assuming acombination of litigation and settlement strategies. Insurance AccrualsWe are currently self-insured beyond certain retention amounts for various insurance coverages, including general liability and property andcasualty. Accruals are recorded based on estimates of actual claims filed, historical payouts, existing insurance coverage and projected future development ofcosts related to existing claims. Our self-insured liabilities contain uncertainties because management must make assumptions and apply judgment toestimate the ultimate cost to settle reported claims and claims incurred but not reported as of December 31, 2014.73 If actual results are not consistent with our assumptions and judgments, we may be exposed to gains or losses that could be material. A 10% changein our self-insurance liabilities at December 31, 2014 would have affected our net loss by approximately $2.2 million for the year ended December 31, 2014. Asset Retirement ObligationsASC 410-20 requires us to estimate our obligation upon the termination or nonrenewal of a lease, to dismantle and remove our billboard structuresfrom the leased land and to reclaim the site to its original condition. Due to the high rate of lease renewals over a long period of time, our calculation assumes all related assets will be removed at some period over thenext 50 years. An estimate of third-party cost information is used with respect to the dismantling of the structures and the reclamation of the site. The interestrate used to calculate the present value of such costs over the retirement period is based on an estimated risk-adjusted credit rate for the same period. If ourassumption of the risk-adjusted credit rate used to discount current year additions to the asset retirement obligation decreased approximately 1%, our liabilityas of December 31, 2014 would not be materially impacted. Similarly, if our assumption of the risk-adjusted credit rate increased approximately 1%, ourliability would not be materially impacted. Share-Based CompensationUnder the fair value recognition provisions of ASC 718-10, share-based compensation cost is measured at the grant date based on the fair value ofthe award. Determining the fair value of share-based awards at the grant date requires assumptions and judgments about expected volatility and forfeiturerates, among other factors. If actual results differ significantly from these estimates, our results of operations could be materially impacted. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKRequired information is located within Item 7 of Part II of this Annual Report on Form 10-K.74 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA MANAGEMENT'S REPORT ON FINANCIAL STATEMENTS The consolidated financial statements and notes related thereto were prepared by and are the responsibility of management. The financial statements andrelated notes were prepared in conformity with U.S. generally accepted accounting principles and include amounts based upon management’s best estimatesand judgments. It is management’s objective to ensure the integrity and objectivity of its financial data through systems of internal controls designed to provide reasonableassurance that all transactions are properly recorded in our books and records, that assets are safeguarded from unauthorized use and that financial records arereliable to serve as a basis for preparation of financial statements. The financial statements have been audited by our independent registered public accounting firm, Ernst & Young LLP, to the extent required by auditingstandards of the Public Company Accounting Oversight Board (United States) and, accordingly, they have expressed their professional opinion on thefinancial statements in their report included herein. The Board of Directors meets with the independent registered public accounting firm and management periodically to satisfy itself that they are properlydischarging their responsibilities. The independent registered public accounting firm has unrestricted access to the Board, without management present, todiscuss the results of their audit and the quality of financial reporting and internal accounting controls. /s/ Robert W. Pittman Chairman and Chief Executive Officer /s/ Richard J. Bressler President and Chief Financial Officer /s/ Scott D. Hamilton Senior Vice President and Chief Accounting Officer75 Report of Independent Registered Public Accounting Firm The Board of Directors and ShareholdersiHeartMedia, Inc.We We have audited the accompanying consolidated balance sheets of iHeartMedia, Inc. and subsidiaries (the Company) as of December 31, 2014 and 2013,and the related consolidated statements of comprehensive loss, changes in shareholders’ deficit and cash flows for each of the three years in the period endedDecember 31, 2014. Our audits also included the financial statement schedule listed in the Index at Item 15(a)2. These financial statements and schedule arethe responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require thatwe plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includesexamining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accountingprinciples used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our auditsprovide a reasonable basis for our opinion.In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of iHeartMedia, Inc. andsubsidiaries at December 31, 2014 and 2013, and the consolidated results of their operations and their cash flows for each of the three years in the periodended December 31, 2014, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule,when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Company’s internal controlover financial reporting as of December 31, 2014, based on criteria established in Internal Control-Integrated Framework issued by the Committee ofSponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 19, 2015 expressed an unqualified opinionthereon. /s/ Ernst & Young LLPSan Antonio, TexasFebruary 19, 2015 76CONSOLIDATED BALANCE SHEETS OFIHEARTMEDIA, INC. AND SUBSIDIARIES (In thousands)December 31, December 31, 2014 2013CURRENT ASSETS Cash and cash equivalents$ 457,024 $ 708,151 Accounts receivable, net of allowance of $39,698 in 2014 and $48,401 in 2013 1,395,248 1,440,501 Prepaid expenses 191,572 203,485 Other current assets 136,299 161,157 Total Current Assets 2,180,143 2,513,294 PROPERTY, PLANT AND EQUIPMENT Structures, net 1,614,199 1,765,510 Other property, plant and equipment, net 1,084,865 1,132,120 INTANGIBLE ASSETS AND GOODWILL Indefinite-lived intangibles - licenses 2,411,071 2,416,406 Indefinite-lived intangibles - permits 1,066,748 1,067,783 Other intangibles, net 1,206,727 1,466,546 Goodwill 4,187,424 4,202,187 OTHER ASSETS Other assets 289,065 533,456 Total Assets$ 14,040,242 $ 15,097,302 CURRENT LIABILITIES Accounts payable$ 132,258 $ 131,370 Accrued expenses 799,475 807,210 Accrued interest 252,900 194,844 Deferred income 176,048 176,460 Current portion of long-term debt 3,604 453,734 Total Current Liabilities 1,364,285 1,763,618 Long-term debt 20,322,414 20,030,479 Deferred income taxes 1,563,888 1,537,820 Other long-term liabilities 454,863 462,020 Commitments and contingent liabilities (Note 7) SHAREHOLDERS' DEFICIT Noncontrolling interest 224,140 245,531 Class A Common Stock, par value $.001 per share, authorized 400,000,000 shares, issued 29,307,583 and 29,504,379 shares in 2014 and 2013, respectively 29 29 Class B Common Stock, par value $.001 per share, authorized 150,000,000 shares, issued 555,556 shares in 2014 and 2013 1 1 Class C Common Stock, par value $.001 per share, authorized 100,000,000 shares, issued 58,967,502 shares in 2014 and 2013 59 59 Additional paid-in capital 2,102,789 2,148,303 Accumulated deficit (11,682,390) (10,888,629) Accumulated other comprehensive loss (308,590) (196,073) Cost of shares (227,638 in 2014 and 1,402,227 in 2013) held in treasury (1,246) (5,856) Total Shareholders' Deficit (9,665,208) (8,696,635) Total Liabilities and Shareholders' Deficit$ 14,040,242 $ 15,097,302 See Notes to Consolidated Financial Statements77CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS OFIHEARTMEDIA, INC. AND SUBSIDIARIES(In thousands)Years Ended December 31, 2014 2013 2012 Revenue$ 6,318,533 $ 6,243,044 $ 6,246,884 Operating expenses: Direct operating expenses (excludes depreciation and amortization) 2,534,365 2,554,087 2,498,400 Selling, general and administrative expenses (excludes depreciation and amortization) 1,687,208 1,649,861 1,666,418 Corporate expenses (excludes depreciation and amortization) 320,331 313,514 293,207 Depreciation and amortization 710,898 730,828 729,285 Impairment charges 24,176 16,970 37,651 Other operating income, net 40,031 22,998 48,127 Operating income 1,081,586 1,000,782 1,070,050 Interest expense 1,741,596 1,649,451 1,549,023 Gain (loss) on marketable securities - 130,879 (4,580) Equity in earnings (loss) of nonconsolidated affiliates (9,416) (77,696) 18,557 Loss on extinguishment of debt (43,347) (87,868) (254,723) Other income (expense), net 9,104 (21,980) 250 Loss before income taxes (703,669) (705,334) (719,469) Income tax benefit (expense) (58,489) 121,817 308,279 Consolidated net loss (762,158) (583,517) (411,190) Less amount attributable to noncontrolling interest 31,603 23,366 13,289 Net loss attributable to the Company$ (793,761) $ (606,883) $ (424,479) Other comprehensive income (loss), net of tax: Foreign currency translation adjustments (121,878) (33,001) 40,242 Unrealized gain (loss) on securities and derivatives: Unrealized holding gain on marketable securities 327 16,576 23,103 Unrealized holding gain on cash flow derivatives - 48,180 52,112 Other adjustments to comprehensive income (loss) (11,438) 6,732 1,135 Reclassification adjustment for realized (gain) loss on securities included in net loss 3,317 (83,752) 2,045 Other comprehensive income (loss) (129,672) (45,265) 118,637 Comprehensive loss (923,433) (652,148) (305,842) Less amount attributable to noncontrolling interest (21,080) (2,476) 5,878 Comprehensive loss attributable to the Company$ (902,353) $ (649,672) $ (311,720) Net loss attributable to the Company per common share: Basic (9.46) (7.31) (5.23) Weighted average common shares outstanding — Basic$ 83,941 $ 83,364 $ 82,745 Diluted (9.46) (7.31) (5.23) Weighted average common shares outstanding — Diluted$ 83,941 $ 83,364 $ 82,745 See Notes to Consolidated Financial Statements78CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT OFIHEARTMEDIA, INC. AND SUBSIDIARIES Controlling Interest (In thousands, except share data) Accumulated Common Shares Non- Additional Other Class C Class B Class A controlling Common Paid-in Accumulated Comprehensive Treasury Shares Shares Shares Interest Stock Capital Deficit Income (Loss) Stock TotalBalances at December 31, 201158,967,502 555,556 24,106,139 $521,794 $83 $2,132,368 ($9,857,267) ($266,043) ($2,876) ($7,471,941)Net income (loss) 13,289 (424,479) (411,190) Issuance (forfeiture) of restricted stock 3,543,238 6,381 4 (4) (3,290) 3,091 Amortization of share- based compensation 10,589 17,951 28,540 Purchases of additional noncontrolling interest 28 28 Dividend declared and paid to noncontrolling interests (244,734) (244,734) Other (9,228) (8,394) (17,622) Other comprehensive income 5,878 112,759 118,637 Balances at December 31, 2012 58,967,502 555,556 27,649,377 303,997 87 2,141,921 (10,281,746) (153,284) (6,166) (7,995,191) Net income (loss) 23,366 (606,883) (583,517) Issuance (forfeiture) of restricted stock 1,855,002 4,192 2 (2) (423) 3,769 Amortization of share- based compensation 7,725 8,990 16,715 Dividend declared and paid to noncontrolling interests (91,887) (91,887) Other 614 (2,606) 733 (1,259) Other comprehensive income (2,476) (42,789) (45,265) Balances at December 31, 201358,967,502 555,556 29,504,379 $245,531 $89 $2,148,303 ($10,888,629) ($196,073) ($5,856) ($8,696,635)Net income (loss) 31,603 (793,761) (762,158) Issuance (forfeiture) of restricted stock (196,796) 2,237 (993) 1,244 Amortization of share- based compensation 7,743 2,970 10,713 Dividend declared and paid to noncontrolling interests (40,027) (40,027) Purchases of additional noncontrolling interest (1,944) (42,881) (3,925) (48,750) Other 77 (5,603) 5,603 77 Other comprehensive income (21,080) (108,592) (129,672) Balances at December 31, 201458,967,502 555,556 29,307,583 $224,140 $89 $2,102,789 ($11,682,390) ($308,590) ($1,246) ($9,665,208) See Notes to Consolidated Financial Statements79CONSOLIDATED STATEMENTS OF CASH FLOWS OFIHEARTMEDIA, INC. AND SUBSIDIARIES (In thousands)Years Ended December 31, 2014 2013 2012Cash flows from operating activities: Consolidated net loss$ (762,158) $ (583,517) $ (411,190) Reconciling items: Impairment charges 24,176 16,970 37,651 Depreciation and amortization 710,898 730,828 729,285 Deferred taxes 33,923 (158,170) (304,611) Provision for doubtful accounts 14,167 20,243 11,715 Amortization of deferred financing charges and note discounts, net 89,701 124,342 164,097 Share-based compensation 10,713 16,715 28,540 Gain on disposal of operating and fixed assets (44,512) (22,998) (48,127) (Gain) loss on marketable securities - (130,879) 4,580 Equity in (earnings) loss of nonconsolidated affiliates 9,416 77,696 (18,557) Loss on extinguishment of debt 43,347 87,868 254,723 Other reconciling items, net (14,325) 19,904 14,234 Changes in operating assets and liabilities, net of effects of acquisitions and dispositions: Increase in accounts receivable (13,898) (29,605) (34,238) Increase in accrued expenses 31,049 26,105 34,874 Increase (decrease) in accounts payable 6,404 (2,620) 13,863 Increase in accrued interest 88,560 16,014 20,223 Increase in deferred income 11,288 7,508 33,482 Changes in other operating assets and liabilities 6,367 (3,532) (45,412) Net cash provided by operating activities 245,116 212,872 485,132 Cash flows from investing activities: Proceeds from sale of other investments 236,618 135,571 - Purchases of businesses 841 (97) (50,116) Purchases of property, plant and equipment (318,164) (324,526) (390,280) Proceeds from disposal of assets 10,273 81,598 59,665 Purchases of other operating assets (4,541) (21,532) (14,826) Change in other, net (13,709) (4,379) (1,464) Net cash used for investing activities (88,682) (133,365) (397,021) Cash flows from financing activities: Draws on credit facilities 68,010 272,252 604,563 Payments on credit facilities (315,682) (27,315) (1,931,419) Proceeds from long-term debt 2,062,475 575,000 4,917,643 Payments on long-term debt (2,099,101) (1,248,860) (3,346,906) Payments to repurchase noncontrolling interests (48,750) (61,143) (7,040) Dividends and other payments to noncontrolling interests (40,027) (91,887) (251,665) Deferred financing charges (26,169) (18,390) (83,617) Change in other, net 1,243 4,461 3,092 Net cash used for financing activities (398,001) (595,882) (95,349) Effect of exchange rate changes on cash (9,560) (484) 3,566 Net decrease in cash and cash equivalents (251,127) (516,859) (3,672) Cash and cash equivalents at beginning of period 708,151 1,225,010 1,228,682 Cash and cash equivalents at end of period$ 457,024 $ 708,151 $ 1,225,010 SUPPLEMENTAL DISCLOSURES: Cash paid during the year for interest$ 1,540,860 $ 1,543,455 $ 1,381,396 Cash paid during the year for taxes 53,074 50,934 52,517 See Notes to Consolidated Financial Statements80IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESNature of BusinessiHeartMedia, Inc. (the “Company”) was formed in May 2007 by private equity funds sponsored by Bain Capital Partners, LLC and Thomas H. Lee Partners,L.P. (together, the “Sponsors”) for the purpose of acquiring the business of iHeartCommunications, Inc., a Texas company (“iHeartCommunications”). Theacquisition was completed on July 30, 2008 pursuant to the Agreement and Plan of Merger, dated November 16, 2006, as amended on April 18, 2007, May17, 2007 and May 13, 2008 (the “Merger Agreement”). The Company’s reportable operating segments are iHeartMedia (“iHM”), Americas outdoor advertising (“Americas outdoor”), and International outdooradvertising (“International outdoor”). The iHM segment provides media and entertainment services via broadcast and digital delivery. The Americasoutdoor and International outdoor segments provide outdoor advertising services in their respective geographic regions using various digital and traditionaldisplay types. Included in the “Other” category are the Company’s media representation business, Katz Media Group, as well as other general supportservices and initiatives, which are ancillary to its other businesses. Use of EstimatesThe preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management tomake estimates, judgments, and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes including,but not limited to, legal, tax and insurance accruals. The Company bases its estimates on historical experience and on various other assumptions that arebelieved to be reasonable under the circumstances. Actual results could differ from those estimates. Principles of ConsolidationThe consolidated financial statements include the accounts of the Company and its subsidiaries. Also included in the consolidated financial statements areentities for which the Company has a controlling financial interest or is the primary beneficiary. Investments in companies in which the Company owns 20 percent to 50 percent of the voting common stock or otherwise exercises significant influence over operating and financial policies of the Company areaccounted for using the equity method of accounting. All significant intercompany accounts have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the 2014 presentation. 81IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The Company is the beneficiary of two trusts created to comply with Federal Communications Commission (“FCC”) ownership rules. The radio stationsowned by the trusts are managed by independent trustees. The trustees are marketing these stations for sale, and the stations will have to be sold unless anystations may be owned by the Company under then-current FCC rules, in which case the trusts will be terminated with respect to such stations. The trustagreements stipulate that the Company must fund any operating shortfalls of the trust activities, and any excess cash flow generated by the trusts isdistributed to the Company. The Company is also the beneficiary of proceeds from the sale of stations held in the trusts. The Company consolidates thetrusts in accordance with ASC 810-10, which requires an enterprise involved with variable interest entities to perform an analysis to determine whether theenterprise’s variable interest or interests give it a controlling financial interest in the variable interest entity, as the trusts were determined to be a variableinterest entity and the Company is the primary beneficiary under the trusts. Cash and Cash EquivalentsCash and cash equivalents include all highly liquid investments with an original maturity of three months or less. Accounts ReceivableAccounts receivable are recorded at the invoiced amount, net of reserves for sales returns and allowances, and allowances for doubtful accounts. TheCompany evaluates the collectability of its accounts receivable based on a combination of factors. In circumstances where it is aware of a specific customer’sinability to meet its financial obligations, it records a specific reserve to reduce the amounts recorded to what it believes will be collected. For all othercustomers, it recognizes reserves for bad debt based on historical experience of bad debts as a percent of revenue for each business unit, adjusted for relativeimprovements or deteriorations in the agings and changes in current economic conditions. The Company believes its concentration of credit risk is limiteddue to the large number and the geographic diversification of its customers. Business CombinationsThe Company accounts for its business combinations under the acquisition method of accounting. The total cost of an acquisition is allocated to theunderlying identifiable net assets, based on their respective estimated fair values. The excess of the purchase price over the estimated fair values of the netassets acquired is recorded as goodwill. Determining the fair value of assets acquired and liabilities assumed requires management's judgment and ofteninvolves the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, asset livesand market multiples, among other items. Various acquisition agreements may include contingent purchase consideration based on performancerequirements of the investee. The Company accounts for these payments in conformity with the provisions of ASC 805-20-30, which establish therequirements related to recognition of certain assets and liabilities arising from contingencies. Property, Plant and EquipmentProperty, plant and equipment are stated at cost. Depreciation is computed using the straight-line method at rates that, in the opinion of management, areadequate to allocate the cost of such assets over their estimated useful lives, which are as follows: Buildings and improvements – 10 to 39 years Structures – 5 to 15 years Towers, transmitters and studio equipment – 7 to 20 years Furniture and other equipment – 3 to 20 years Leasehold improvements – shorter of economic life or lease term assuming renewal periods, if appropriate For assets associated with a lease or contract, the assets are depreciated at the shorter of the economic life or the lease or contract term, assuming renewalperiods, if appropriate. Expenditures for maintenance and repairs are charged to operations as incurred, whereas expenditures for renewal and betterments arecapitalized. The Company tests for possible impairment of property, plant, and equipment whenever events and circumstances indicate that depreciable assets might beimpaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amounts of those assets. When specific assetsare determined to be unrecoverable, the cost basis of the asset is reduced to reflect the current fair market value. Land LeasesMost of the Company’s outdoor advertising structures are located on leased land. Americas outdoor land leases are typically paid in advance for periodsranging from one to 12 months. International outdoor land leases are paid both in advance and in arrears, for82IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) periods ranging from one to 12 months. Most international street furniture display faces are operated through contracts with municipalities for up to20 years. The leased land and street furniture contracts often include a percent of revenue to be paid along with a base rent payment. Prepaid land leases arerecorded as an asset and expensed ratably over the related rental term and rent payments in arrears are recorded as an accrued liability. Intangible AssetsThe Company’s indefinite-lived intangible assets include FCC broadcast licenses in its iHM segment and billboard permits in its Americas outdooradvertising segment. The Company’s indefinite-lived intangible assets are not subject to amortization, but are tested for impairment at least annually. TheCompany tests for possible impairment of indefinite-lived intangible assets whenever events or changes in circumstances, such as a significant reduction inoperating cash flow or a dramatic change in the manner for which the asset is intended to be used indicate that the carrying amount of the asset may not berecoverable. The Company performs its annual impairment test for its FCC licenses and permits using a direct valuation technique as prescribed in ASC 805-20-S99. TheCompany engages Mesirow Financial Consulting LLC (“Mesirow Financial”), a third party valuation firm, to assist the Company in the development of theseassumptions and the Company’s determination of the fair value of its FCC licenses and permits. Other intangible assets include definite-lived intangible assets and permanent easements. The Company’s definite-lived intangible assets include primarilytransit and street furniture contracts, talent and representation contracts, customer and advertiser relationships, and site-leases, all of which are amortized overthe respective lives of the agreements, or over the period of time the assets are expected to contribute directly or indirectly to the Company’s future cashflows. The Company periodically reviews the appropriateness of the amortization periods related to its definite-lived intangible assets. These assets arerecorded at cost. Permanent easements are indefinite-lived intangible assets which include certain rights to use real property not owned by the Company. The Company tests for possible impairment of other intangible assets whenever events and circumstances indicate that they might be impaired and theundiscounted cash flows estimated to be generated by those assets are less than the carrying amounts of those assets. When specific assets are determined tobe unrecoverable, the cost basis of the asset is reduced to reflect the current fair market value. GoodwillAt least annually, the Company performs its impairment test for each reporting unit’s goodwill. The Company uses a discounted cash flow model todetermine if the carrying value of the reporting unit, including goodwill, is less than the fair value of the reporting unit. The Company identified its reportingunits in accordance with ASC 350-20-55. The U.S. radio markets are aggregated into a single reporting unit and the Company’s U.S. outdoor advertisingmarkets are aggregated into a single reporting unit for purposes of the goodwill impairment test. The Company also determined that within its Americasoutdoor segment, Canada constitutes a separate reporting unit and each country in its International outdoor segment constitutes a separate reporting unit. The Company had no impairment of goodwill in 2014. The Company recognized a non-cash impairment charge to goodwill of $10.7 million based ondeclining future cash flows expected in one country in the International outdoor segment for 2013. The Company had no impairment of goodwill for 2012. Nonconsolidated AffiliatesIn general, investments in which the Company owns 20 percent to 50 percent of the common stock or otherwise exercises significant influence over theinvestee are accounted for under the equity method. The Company does not recognize gains or losses upon the issuance of securities by any of its equitymethod investees. The Company reviews the value of equity method investments and records impairment charges in the statement of operations as acomponent of “Equity in earnings (loss) of nonconsolidated affiliates” for any decline in value that is determined to be other-than-temporary. Other InvestmentsOther investments are composed primarily of equity securities. These securities are classified as available-for-sale or trading and are carried at fair valuebased on quoted market prices. Securities are carried at historical value when quoted market prices are unavailable. The net unrealized gains or losses on theavailable-for-sale securities, net of tax, are reported in accumulated other comprehensive loss as a component of shareholders’ deficit. In addition, theCompany holds investments that do not have quoted market prices. The Company periodically assesses the value of available-for-sale and non-marketablesecurities and records impairment charges in the statement of comprehensive loss for any decline in value that is determined to be other-than-temporary. Theaverage cost method is used to compute the realized gains and losses on sales of equity securities.83IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The Company periodically assesses the value of its available-for-sale securities. Based on these assessments, there were no impairments during the yearsended December 31, 2014 and 2013. The Company concluded that other-than-temporary impairments existed at December 31, 2012 and recorded a noncashimpairment charge of $4.6 million during the year ended December 31, 2012. Such charge is recorded on the statement of comprehensive loss in “Gain (Loss)on marketable securities”. Derivative Instruments and Hedging ActivitiesPrior to the expiration of the Company’s interest rate swap agreement on September 30, 2013, the provisions of ASC 815-10 required the Company torecognize it as either an asset or liability in the consolidated balance sheet at fair value. The accounting for changes in the fair value of a derivativeinstrument depends on whether it has been designated and qualifies as part of a hedging relationship, and further, on the type of hedging relationship. Theinterest rate swap was designated and qualified as a hedging instrument, and was characterized as a cash flow hedge. The Company formally documented allrelationships between hedging instruments and hedged items, as well as its risk management objectives and strategies for undertaking various hedgetransactions. The Company formally assessed, both at inception and at least quarterly thereafter prior to expiration, whether the derivatives that were used inhedging transactions were highly effective in offsetting changes in either the fair value or cash flows of the hedged item. Financial InstrumentsDue to their short maturity, the carrying amounts of accounts and notes receivable, accounts payable, accrued liabilities, and short-term borrowingsapproximated their fair values at December 31, 2014 and 2013. Income TaxesThe Company accounts for income taxes using the liability method. Under this method, deferred tax assets and liabilities are determined based ondifferences between financial reporting bases and tax bases of assets and liabilities and are measured using the enacted tax rates expected to apply to taxableincome in the periods in which the deferred tax asset or liability is expected to be realized or settled. Deferred tax assets are reduced by valuation allowancesif the Company believes it is more likely than not that some portion or the entire asset will not be realized. Generally all earnings from the Company’sforeign operations are permanently reinvested and not distributed. The Company has not provided U.S. federal income taxes for temporary differences withrespect to investments in foreign subsidiaries, which at December 31, 2014 currently result in tax basis amounts greater than the financial reporting basis. Itis not apparent that these unrecognized deferred tax assets will reverse in the foreseeable future. If any excess cash held by our foreign subsidiaries wereneeded to fund operations in the United States, we could presently repatriate available funds without a requirement to accrue or pay U.S. taxes. This is aresult of significant current and historic deficits in our foreign earnings and profits, which gives us flexibility to make future cash distributions as non-taxablereturns of capital. We regularly review our tax liabilities on amounts that may be distributed in future periods and provide for foreign withholding and othercurrent and deferred taxes on any such amounts. The determination of the amount of federal income taxes, if any, that might become due in the event that ourforeign earnings are distributed is not practicable. Revenue RecognitioniHM revenue is recognized as advertisements or programs are broadcast and is generally billed monthly. Outdoor advertising contracts typically coverperiods of a few weeks up to one year and are generally billed monthly. Revenue for outdoor advertising space rental is recognized ratably over the term ofthe contract. Advertising revenue is reported net of agency commissions. Agency commissions are calculated based on a stated percentage applied to grossbilling revenue for the Company’s media and entertainment and outdoor operations. Payments received in advance of being earned are recorded as deferredincome. Revenue arrangements may contain multiple products and services and revenues are allocated based on the relative fair value of each delivered itemand recognized in accordance with the applicable revenue recognition criteria for the specific unit of accounting. Barter transactions represent the exchange of advertising spots or display space for merchandise, services or other assets. These transactions are recorded atthe estimated fair market value of the advertising spots or display space or the fair value of the merchandise or services received, whichever is most readilydeterminable. Revenue is recognized on barter and trade transactions when the advertisements are broadcasted or displayed. Expenses are recorded ratablyover a period that estimates when the merchandise, service or other assets received is utilized, or when the event occurs. Barter and trade revenues andexpenses from continuing operations are included in consolidated revenue and selling, general and administrative expenses, respectively. Barter and traderevenues and expenses from continuing operations were as follows: 84IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) (In millions)Years Ended December 31, 2014 2013 2012Barter and trade revenues$ 69.4 $ 66.0 $ 56.5 Barter and trade expenses 68.1 58.5 58.8 Advertising ExpenseThe Company records advertising expense as it is incurred. Advertising expenses were $103.0 million, $133.7 million and $113.4 million for the yearsended December 31, 2014, 2013 and 2012, respectively. Share-Based CompensationUnder the fair value recognition provisions of ASC 718-10, share-based compensation cost is measured at the grant date based on the fair value of the award. For awards that vest based on service conditions, this cost is recognized as expense on a straight-line basis over the vesting period. For awards that will vestbased on market or performance conditions, this cost will be recognized when it becomes probable that the performance conditions will be satisfied. Determining the fair value of share-based awards at the grant date requires assumptions and judgments about expected volatility and forfeiture rates, amongother factors. Foreign CurrencyResults of operations for foreign subsidiaries and foreign equity investees are translated into U.S. dollars using the average exchange rates during the year. The assets and liabilities of those subsidiaries and investees are translated into U.S. dollars using the exchange rates at the balance sheet date. The relatedtranslation adjustments are recorded in a separate component of shareholders’ deficit, “Accumulated other comprehensive loss”. Foreign currency transactiongains and losses are included in operations. New Accounting PronouncementsDuring the first quarter of 2014, the Company adopted the Financial Accounting Standards Board’s (“FASB”) ASU No. 2013-04, Obligations Resulting fromJoint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date. This update provides guidance forthe recognition, measurement and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of theobligation within the scope of this guidance is fixed at the reporting date. The amendments were effective for fiscal years (and interim periods within)beginning after December 15, 2013 and were to be applied retrospectively to all prior periods presented for such obligations that existed at the beginning ofan entity’s fiscal year of adoption. The adoption of this guidance did not have a material effect on the Company’s consolidated financial statements. During the first quarter of 2014, the Company adopted the FASB’s ASU No. 2013-05, Parent’s Accounting for the Cumulative Translation Adjustment uponDerecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity of an Investment in a Foreign Entity. The amendments were effectiveprospectively for the fiscal years (and interim periods within) beginning after December 15, 2013 and provide clarification guidance for the release of thecumulative translation adjustment under current U.S. GAAP. The adoption of this guidance did not have a material effect on the Company’s consolidatedfinancial statements During the first quarter of 2014, the Company adopted the FASB’s ASU No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net OperatingLoss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. This update requires unrecognized tax benefits to be offset against a deferredtax asset for a net operating loss carryforward, similar tax loss or tax credit carryforward in certain situations. The amendments were effective prospectivelyfor the fiscal years (and interim periods within) beginning after December 15, 2013. The adoption of this guidance did not have a material effect on theCompany’s consolidated financial statements. During the second quarter of 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers. This new standard provides guidance forthe recognition, measurement and disclosure of revenue resulting from contracts with customers and will supersede virtually all of the current revenuerecognition guidance under U.S. GAAP. The standard is effective for the first interim period within annual reporting periods beginning after December 15,2016. The Company is currently evaluating the impact of the provisions of this new standard on its financial position and results of operations. During the third quarter of 2014, the FASB issued ASU No. 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That aPerformance Target Could Be Achieved after the Requisite Service Period. This new standard clarifies that a performance target in a share-basedcompensation award that could be achieved after an employee completes the requisite service period should be treated as a performance condition that affectsthe vesting of the award. The standard is effective for annual periods85IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) and interim periods within those annual periods, beginning after December 15, 2015. The Company is currently evaluating the impact of the provisions ofthis new standard on its financial position and results of operations. NOTE 2 – PROPERTY, PLANT AND EQUIPMENT, INTANGIBLE ASSETS AND GOODWILLAcquisitionsThe Company is the beneficiary of Aloha Station Trust, LLC (the “Aloha Trust”), which owns and operates radio stations which the Aloha Trust is required todivest in order to comply with Federal Communication Commission (“FCC”) media ownership rules, and which are being marketed for sale. During 2014, theAloha Trust completed a transaction in which it exchanged two radio stations for a portfolio of 29 radio stations. In this transaction the Company received28 radio stations. One radio station was placed into the Brunswick Station Trust, LLC in order to comply with FCC media ownership rules where it is beingmarketed for sale, and the Company is the beneficiary of this trust. The exchange was accounted for at fair value in accordance with ASC 805, BusinessCombinations. The disposal of these radio stations resulted in a gain on sale of $43.5 million, which is included in other operating income, net. Thisacquisition resulted in an aggregate increase in net assets of $49.2 million, which includes $13.8 million in indefinite-lived intangible assets, $10.2 millionin definite-lived intangibles, $8.1 million in property, plant and equipment and $0.8 million of assumed liabilities. In addition, the Company recognized $17.9 million of goodwill. During 2012, a wholly owned subsidiary of the Company completed the acquisition of WOR-AM in New York City for $30.0 million and WFNX-FM inBoston for $14.5 million. These acquisitions resulted in an aggregate increase of $5.3 million to property plant and equipment, $15.2 million to intangibleassets and $24.7 million to goodwill, in addition to $0.7 million of assumed liabilities. Purchase accounting adjustments were finalized during 2013. DispositionsDuring 2013, the Company’s Americas outdoor segment divested certain outdoor advertising assets in Times Square for approximately $18.7 millionresulting in a gain of $12.2 million. In addition, iHM exercised a put option to sell five radio stations in the Green Bay market for approximately $17.6 million, resulting in a gain of $0.5 million. These net gains are included in “Other operating income, net.” During 2012, the Company’s International outdoor segment sold its international neon business and its outdoor advertising business in Romania, resulting inan aggregate gain of $39.7 million included in “Other operating income, net.” Property, Plant and EquipmentThe Company’s property, plant and equipment consisted of the following classes of assets at December 31, 2014 and 2013, respectively. (In thousands)December 31, December 31, 2014 2013Land, buildings and improvements$ 731,925 $ 723,268 Structures 2,999,582 3,021,152 Towers, transmitters and studio equipment 453,044 440,612 Furniture and other equipment 536,255 473,995 Construction in progress 95,671 123,814 4,816,477 4,782,841 Less: accumulated depreciation 2,117,413 1,885,211 Property, plant and equipment, net$ 2,699,064 $ 2,897,630 The Company recorded an impairment charge related to property of $4.5 million during 2014. The Company recorded an impairment charge related to radiobroadcast equipment in one market of $1.3 million based on a sales agreement entered into during the fourth quarter of 2013. The Company recognized animpairment charge for outdoor advertising structures in its Americas outdoor segment of $1.7 million during 2012. 86IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Indefinite-lived Intangible AssetsThe Company’s indefinite-lived intangible assets consist of FCC broadcast licenses and billboard permits. FCC broadcast licenses are granted to radiostations for up to eight years under the Telecommunications Act of 1996 (the “Act”). The Act requires the FCC to renew a broadcast license if the FCC findsthat the station has served the public interest, convenience and necessity, there have been no serious violations of either the Communications Act of 1934 orthe FCC’s rules and regulations by the licensee, and there have been no other serious violations which taken together constitute a pattern of abuse. Thelicenses may be renewed indefinitely at little or no cost. The Company does not believe that the technology of wireless broadcasting will be replaced in theforeseeable future. The Company’s billboard permits are granted for the right to operate an advertising structure at the specified location as long as the structure is in compliancewith the laws and regulations of each jurisdiction. The Company’s permits are located on owned land, leased land or land for which we have acquiredpermanent easements. In cases where the Company’s permits are located on leased land, the leases typically have initial terms of between 10 and 20 yearsand renew indefinitely, with rental payments generally escalating at an inflation-based index. If the Company loses its lease, the Company will typicallyobtain permission to relocate the permit or bank it with the municipality for future use. Due to significant differences in both business practices andregulations, billboards in the International outdoor segment are subject to long-term, finite contracts unlike the Company’s permits in the United States andCanada. Accordingly, there are no indefinite-lived intangible assets in the International outdoor segment. The impairment tests for indefinite-lived intangible assets consist of a comparison between the fair value of the indefinite-lived intangible asset at the marketlevel with its carrying amount. If the carrying amount of the indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized equal tothat excess. After an impairment loss is recognized, the adjusted carrying amount of the indefinite-lived asset is its new accounting basis. The fair value ofthe indefinite-lived asset is determined using the direct valuation method as prescribed in ASC 805-20-S99. Under the direct valuation method, the fair valueof the indefinite-lived assets is calculated at the market level as prescribed by ASC 350-30-35. The Company engaged Mesirow Financial, a third-partyvaluation firm, to assist it in the development of the assumptions and the Company’s determination of the fair value of its indefinite-lived intangible assets. The application of the direct valuation method attempts to isolate the income that is properly attributable to the indefinite-lived intangible asset alone (thatis, apart from tangible and identified intangible assets and goodwill). It is based upon modeling a hypothetical “greenfield” build-up to a “normalized”enterprise that, by design, lacks inherent goodwill and whose only other assets have essentially been paid for (or added) as part of the build-up process. TheCompany forecasts revenue, expenses, and cash flows over a ten-year period for each of its markets in its application of the direct valuation method. TheCompany also calculates a “normalized” residual year which represents the perpetual cash flows of each market. The residual year cash flow was capitalizedto arrive at the terminal value of the licenses in each market. Under the direct valuation method, it is assumed that rather than acquiring indefinite-lived intangible assets as part of a going concern business, the buyerhypothetically develops indefinite-lived intangible assets and builds a new operation with similar attributes from scratch. Thus, the buyer incurs start-upcosts during the build-up phase which are normally associated with going concern value. Initial capital costs are deducted from the discounted cash flowmodel which results in value that is directly attributable to the indefinite-lived intangible assets. The key assumptions using the direct valuation method are market revenue growth rates, market share, profit margin, duration and profile of the build-upperiod, estimated start-up capital costs and losses incurred during the build-up period, the risk-adjusted discount rate and terminal values. This data ispopulated using industry normalized information representing an average FCC license or billboard permit within a market. Annual Impairment Test to FCC Licenses and Billboard PermitsThe Company performs its annual impairment test on October 1 of each year. During 2014, the Company recognized a $15.7 million impairment charge related to FCC licenses in eleven markets due to changes in the revenue growthforecasts and margins for those markets. During 2013, the Company recognized a $2.0 million impairment charge related to FCC licenses in two markets dueto changes in the discount rates and weight-average cost of capital for those markets. In addition, the Company recognized a $2.5 million impairment chargerelated to billboard permits in a certain market due to increased start-up costs for that market exceeding market value. During 2012, the Company recognizeda $35.9 million impairment charge related to billboard permits in certain markets due to a change in the Company’s forecast of revenue growth within themarkets. There was no impairment of FCC licenses during 2012.87IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Other Intangible AssetsOther intangible assets include definite-lived intangible assets and permanent easements. The Company’s definite-lived intangible assets include primarilytransit and street furniture contracts, talent and representation contracts, customer and advertiser relationships, and site-leases, all of which are amortized overthe respective lives of the agreements, or over the period of time the assets are expected to contribute directly or indirectly to the Company’s future cashflows. Permanent easements are indefinite-lived intangible assets which include certain rights to use real property not owned by the Company. During 2014,the Company recognized a $3.4 million impairment charge to easements in three markets primarily due to declining revenue forecasts. There were noimpairments of other intangible assets for the years ended December 31, 2013 and 2012. The following table presents the gross carrying amount and accumulated amortization for each major class of other intangible assets at December 31, 2014and 2013, respectively: (In thousands)December 31, 2014 December 31, 2013 Gross Carrying Amount AccumulatedAmortization Gross CarryingAmount AccumulatedAmortizationTransit, street furniture and other outdoor contractual rights$ 716,723 $ (476,523) $ 777,521 $ (464,548) Customer / advertiser relationships 1,222,518 (765,596) 1,212,745 (645,988) Talent contracts 319,384 (223,936) 319,617 (195,403) Representation contracts 238,313 (206,338) 252,961 (200,058) Permanent easements 171,271 - 173,753 - Other 388,160 (177,249) 387,405 (151,459) Total$ 3,056,369 $ (1,849,642) $ 3,124,002 $ (1,657,456) Total amortization expense related to definite-lived intangible assets was $263.4 million, $289.0 million and $300.0 million for the years ended December31, 2014, 2013 and 2012, respectively. As acquisitions and dispositions occur in the future, amortization expense may vary. The following table presents the Company’s estimate of amortizationexpense for each of the five succeeding fiscal years for definite-lived intangible assets: (In thousands) 2015$ 236,019 2016 219,485 2017 197,061 2018 127,730 2019 42,274 Annual Impairment Test to GoodwillThe Company performs its annual impairment test on October 1 of each year. Each of the Company’s U.S. radio markets and outdoor advertising markets arecomponents. The U.S. radio markets are aggregated into a single reporting unit and the U.S. outdoor advertising markets are aggregated into a singlereporting unit for purposes of the goodwill impairment test using the guidance in ASC 350-20-55. The Company also determined that within its Americasoutdoor segment, Canada constitutes a separate reporting unit and each country in its International outdoor segment constitutes a separate reporting unit. The goodwill impairment test is a two-step process. The first step, used to screen for potential impairment, compares the fair value of the reporting unit withits carrying amount, including goodwill. If applicable, the second step, used to measure the amount of the impairment loss, compares the implied fair value ofthe reporting unit goodwill with the carrying amount of that goodwill. Each of the Company’s reporting units is valued using a discounted cash flow model which requires estimating future cash flows expected to be generatedfrom the reporting unit, discounted to their present value using a risk-adjusted discount rate. Terminal values were also estimated and discounted to theirpresent value. Assessing the recoverability of goodwill requires the Company to make estimates and assumptions about sales, operating margins, growthrates and discount rates based on its budgets, business plans,88IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) economic projections, anticipated future cash flows and marketplace data. There are inherent uncertainties related to these factors and management’sjudgment in applying these factors. In 2014, the Company concluded no goodwill impairment was required. In 2013, the Company concluded no goodwill impairment was required for iHM andAmericas outdoor. Based on declining future cash flows expected in one country in the International outdoor segment, the Company recognized a non-cashimpairment charge to goodwill of $10.7 million. The Company recognized no goodwill impairment for the year ended December 31, 2012. The following table presents the changes in the carrying amount of goodwill in each of the Company’s reportable segments: (In thousands)iHM Americas OutdoorAdvertising International OutdoorAdvertising Other ConsolidatedBalance as of December 31, 2012$ 3,236,688 $ 571,932 $ 290,316 $ 117,149 $ 4,216,085 Impairment - - (10,684) - (10,684) Acquisitions - - - 97 97 Dispositions - - (456) - (456) Foreign currency - - (974) - (974) Other (1,881) - - - (1,881) Balance as of December 31, 2013$ 3,234,807 $ 571,932 $ 278,202 $ 117,246 $ 4,202,187 Acquisitions 17,900 - - 299 18,199 Foreign currency - - (33,022) - (33,022) Other 60 - - - 60 Balance as of December 31, 2014$ 3,252,767 $ 571,932 $ 245,180 $ 117,545 $ 4,187,424 The balance at December 31, 2012 is net of cumulative impairments of $3.5 billion, $2.6 billion, $315.9 million and $212.0 million in the Company’s iHM,Americas outdoor, International outdoor and Other segments, respectively. NOTE 3 – INVESTMENTSThe Company’s most significant investments in nonconsolidated affiliates are listed below: Australian Radio NetworkThe Company owned a fifty-percent (50%) interest in Australian Radio Network (“ARN”), an Australian company that owns and operates radio stations inAustralia and New Zealand. An impairment charge of $95.4 million was recorded during the fourth quarter of 2013 to write down the investment to itsestimated fair value. On February 18, 2014, a subsidiary of the Company sold its 50% interest in ARN, recognizing a loss on the sale of $2.4 million and $11.5 million of foreign exchange losses that were reclassified from accumulated other comprehensive income at the date of the sale. Buspak The Company owned a 50% interest in Buspak, a bus advertising company in Hong Kong. On July 18, 2014, a subsidiary of the Company sold its 50%interest in Buspak, recognizing a gain on the sale of $4.5 million. The following table summarizes the Company's investments in nonconsolidated affiliates: 89IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) (In thousands)ARN AllOthers TotalBalance at December 31, 2012$ 353,062 $ 17,850 $ 370,912 Cash advances (repayments) - 3,051 3,051 Acquisitions of investments, net - 1,354 1,354 Equity in loss (75,318) (2,378) (77,696) Foreign currency translation adjustment (37,068) 4 (37,064) Distributions received (19,926) (1,750) (21,676) Other - (76) (76) Balance at December 31, 2013$ 220,750 $ 18,055 $ 238,805 Cash advances (repayments) - 3,452 3,452 Acquisitions of investments, net - 1,811 1,811 Equity in earnings (loss) (12,678) 3,262 (9,416) Foreign currency transaction adjustment 1,449 77 1,526 Distributions received (228) (1,000) (1,228) Proceeds on sale (220,783) (15,820) (236,603) Other 11,490 (344) 11,146 Balance at December 31, 2014$ - $ 9,493 $ 9,493 The investments in the table above are not consolidated, but are accounted for under the equity method of accounting, whereby the Company records itsinvestments in these entities in the balance sheet as “Other assets.” The Company's interests in their operations are recorded in the statement ofcomprehensive loss as “Equity in earnings (loss) of nonconsolidated affiliates.” NOTE 4 – ASSET RETIREMENT OBLIGATIONThe Company’s asset retirement obligation is reported in “Other long-term liabilities” with the current portion recorded in “Accrued liabilities” and relates toits obligation to dismantle and remove outdoor advertising displays and radio broadcasting towers from leased land and to reclaim the site to its originalcondition upon the termination or non-renewal of a lease or contract. When the liability is recorded, the cost is capitalized as part of the related long-livedassets’ carrying value. Due to the high rate of lease renewals over a long period of time, the calculation assumes that all related assets will be removed atsome period over the next 50 years. An estimate of third-party cost information is used with respect to the dismantling of the structures and the reclamationof the site. The interest rate used to calculate the present value of such costs over the retirement period is based on an estimated risk adjusted credit rate forthe same period. The following table presents the activity related to the Company’s asset retirement obligation: (In thousands)Years Ended December 31, 2014 2013Beginning balance$ 59,380 $ 56,849 Adjustment due to changes in estimates (5,391) 806 Accretion of liability 7,858 5,106 Liabilities settled (5,802) (3,323) Foreign Currency (1,834) (58) Ending balance$ 54,211 $ 59,380 90IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 5 – LONG-TERM DEBTLong-term debt at December 31, 2014 and 2013 consisted of the following: (In thousands)December 31, December 31, 20142013Senior Secured Credit Facilities 7,231,222 8,225,754 Receivables Based Facility Due 2017 - 247,000 Priority Guarantee Notes 5,324,815 4,324,815 Subsidiary Revolving Credit Facility Due 2018 - - Other Secured Subsidiary Debt 19,257 21,124 Total Consolidated Secured Debt 12,575,294 12,818,693 10.75% Senior Cash Pay Notes Due 2016 - 94,304 11.00%/11.75% Senior Toggle Notes Due 2016 - 127,941 14.0% Senior Notes Due 2021 1,661,697 1,404,202 iHeartCommunications Legacy Notes 667,900 1,436,455 10.0% Senior Notes Due 2018 730,000 - Subsidiary Senior Notes 4,925,000 4,925,000 Other Subsidiary Debt 1,024 10 Purchase accounting adjustments and original issue discount (234,897) (322,392) 20,326,018 20,484,213 Less: current portion 3,604 453,734 Total long-term debt$ 20,322,414 $ 20,030,479 The Company’s weighted average interest rates at December 31, 2014 and 2013 were 8.1% and 7.6%, respectively. The aggregate market value of theCompany’s debt based on market prices for which quotes were available was approximately $19.7 billion and $20.5 billion at December 31, 2014 and 2013,respectively. Under the fair value hierarchy established by ASC 820-10-35, the fair market value of the Company’s debt is classified as either Level 1 orLevel 2. Senior Secured Credit Facilities As of December 31, 2014, iHeartCommunications had senior secured credit facilities consisting of: (In thousands) December 31, December 31, Maturity Date 20142013Term Loan B1/29/2016 $ 916,061 1,890,978 Term Loan C1/29/2016 15,161 34,776 Term Loan D1/30/2019 5,000,000 5,000,000 Term Loan E7/30/2019 1,300,000 1,300,000 Total Senior Secured Credit Facilities $ 7,231,222 $ 8,225,754 iHeartCommunications is the primary borrower under the senior secured credit facilities, except that certain of its domestic restricted subsidiaries are co-borrowers under a portion of the term loan facilities. Interest Rate and FeesBorrowings under iHeartCommunications’ senior secured credit facilities bear interest at a rate equal to an applicable margin plus, at iHeartCommunications’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) theFederal 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 interestperiod relevant to such borrowing adjusted for certain additional costs.91IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The margin percentages applicable to the term loan facilities are the following percentages per annum: • with respect to loans under the Term Loan B and Term Loan C – asset sale facility, (i) 2.65%, in the case of base rate loans and (ii) 3.65%, in thecase of Eurocurrency rate loans; and• with respect to loans under the Term Loan D, (i) 5.75% in the case of base rate loans and (ii) 6.75% in the case of Eurocurrency rate loans; and• with respect to loans under the Term Loan E, (i) 6.50% in the case of base rate loans and (ii) 7.50% in the case of Eurocurrency rate loans.The margin percentages are subject to adjustment based upon iHeartCommunications’ leverage ratio. Collateral and GuaranteesThe senior secured credit facilities are guaranteed by iHeartCommunications and each of iHeartCommunications’ existing and future material wholly-owneddomestic 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 lienspermitted by the indenture governing the iHeartCommunications senior notes, and other exceptions, by: • a lien on the capital stock of iHeartCommunications;• 100% of the capital stock of any future material wholly-owned domestic license subsidiary that is not a “Restricted Subsidiary” under theindenture governing the iHeartCommunications senior notes;• certain assets that do not constitute “principal property” (as defined in the indenture governing the iHeartCommunications senior notes);• certain specified assets of iHeartCommunications and the guarantors that constitute “principal property” (as defined in the indenture governingthe iHeartCommunications senior notes) securing obligations under the senior secured credit facilities up to the maximum amount permitted tobe secured by such assets without requiring equal and ratable security under the indenture governing the iHeartCommunications senior notes;and• a lien on the accounts receivable and related assets securing iHeartCommunications’ receivables based credit facility that is junior to the liensecuring iHeartCommunications’ obligations under such credit facility.Certain Covenants and Events of DefaultThe senior secured credit facilities include negative covenants that, subject to significant exceptions, limit iHeartCommunications’ ability and the ability ofits restricted subsidiaries to, among other things: • incur additional indebtedness;• create liens on assets;• engage in mergers, consolidations, liquidations and dissolutions;• sell assets;• pay dividends and distributions or repurchase iHeartCommunications’ capital stock;• make investments, loans, or advances;• prepay certain junior indebtedness;• engage in certain transactions with affiliates;• amend material agreements governing certain junior indebtedness; and• change lines of business. Receivables Based Credit FacilityAs of December 31, 2014, there were no borrowings outstanding under iHeartCommunications’ receivables based credit facility. 92IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The receivables based credit facility provides revolving credit commitments of $535.0 million, subject to a borrowing base. The borrowing base at any timeequals 90% of the eligible accounts receivable of iHeartCommunications and certain of its subsidiaries. The receivables based credit facility includes a letterof credit sub-facility and a swingline loan sub-facility. iHeartCommunications and certain subsidiary borrowers are the borrowers under the receivables based credit facility. iHeartCommunications has the abilityto designate one or more of its restricted subsidiaries as borrowers under the receivables based credit facility. The receivables based credit facility loans areavailable in U.S. dollars and letters of credit are available in a variety of currencies including U.S. dollars, Euros, Pounds Sterling, and Canadian dollars. Interest Rate and FeesBorrowings under the receivables based credit facility bear interest at a rate per annum equal to an applicable margin plus, at iHeartCommunications’ option,either (i) a base rate determined by reference to the highest of (a) the prime rate of Citibank, N.A. and (b) the Federal Funds rate plus 0.50% or (ii) aEurocurrency rate determined by reference to the rate (adjusted for statutory reserve requirements for Eurocurrency liabilities) for Eurodollar deposits for theinterest period relevant to such borrowing. The applicable margin for borrowings under the receivables based credit facility ranges from 1.50% to 2.00% forEurocurrency borrowings and from 0.50% to 1.00% for base-rate borrowings, depending on average daily excess availability under the receivables basedcredit facility during the prior fiscal quarter. In addition to paying interest on outstanding principal under the receivables based credit facility, iHeartCommunications is required to pay a commitmentfee to the lenders under the receivables based credit facility in respect of the unutilized commitments thereunder. The commitment fee rate ranges from 0.25% to 0.375% per annum dependent upon average unused commitments during the prior quarter. iHeartCommunications must also pay customary letter ofcredit fees. MaturityBorrowings under the receivables based credit facility will mature, and lending commitments thereunder will terminate, on the fifth anniversary of theeffectiveness of the receivables based credit facility (December 24, 2017), provided that, (a) the maturity date will be October 31, 2015 if on October 30,2015, greater than $500.0 million in aggregate principal amount is owing under certain of iHeartCommunications’ term loan credit facilities, (b) the maturitydate will be May 3, 2016 if on May 2, 2016 greater than $500.0 million aggregate principal amount of iHeartCommunications’ 10.75% senior cash pay notesdue 2016 and 11.00%/11.75% senior toggle notes due 2016 are outstanding and (c) in the case of any debt under clauses (a) and (b) that is amended orrefinanced in any manner that extends the maturity date of such debt to a date that is on or before the date that is five years after the effectiveness of thereceivables based credit facility, the maturity date will be one day prior to the maturity date of such debt after giving effect to such amendment or refinancingif greater than $500,000,000 in aggregate principal amount of such debt is outstanding. Guarantees and SecurityThe facility is guaranteed by, subject to certain exceptions, the guarantors of iHeartCommunications’ senior secured credit facilities. All obligations underthe receivables based credit facility, and the guarantees of those obligations, are secured by a perfected security interest in all of iHeartCommunications’ andall of the guarantors’ accounts receivable and related assets and proceeds thereof that is senior to the security interest of iHeartCommunications’ seniorsecured credit facilities in such accounts receivable and related assets and proceeds thereof, subject to permitted liens, including prior liens permitted by theindenture governing certain of iHeartCommunications’ Legacy Notes, and certain exceptions. Certain Covenants and Events of DefaultThe receivables based credit facility includes negative covenants that, subject to significant exceptions, limit iHeartCommunications’ ability and the abilityof its restricted subsidiaries to, among other things: • incur additional indebtedness;• create liens on assets;• engage in mergers, consolidations, liquidations and dissolutions;• sell assets;• pay dividends and distributions or repurchase capital stock;• make investments, loans, or advances;• prepay certain junior indebtedness;93IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) • engage in certain transactions with affiliates;• amend material agreements governing certain junior indebtedness; and• change lines of business. Priority Guarantee Notes As of December 31, 2014, iHeartCommunications had outstanding Priority Guarantee Notes consisting of: (In thousands) December 31, December 31, Maturity Date Interest Rate Interest Payment Terms 201420139.0% Priority Guarantee Notes due201912/15/2019 9.0% Payable semi-annually inarrears on June 15 andDecember 15 of each year $ 1,999,815 1,999,815 9.0% Priority Guarantee Notes due20213/1/2021 9.0% Payable semi-annually inarrears on March 1 andSeptember 1 of each year 1,750,000 1,750,000 11.25% Priority Guarantee Notes due20213/1/2021 11.25% Payable semi-annually onMarch 1 and September 1 ofeach year 575,000 575,000 9.0% Priority Guarantee Notes due20229/15/2022 9.0% Payable semi-annually inarrears on March 15 andSeptember 15 of each year 1,000,000 - Total Priority Guarantee Notes $ 5,324,815 4,324,815 Guarantees and Security The Priority Guarantee Notes are iHeartCommunications’ senior obligations and are fully and unconditionally guaranteed, jointly and severally, on a seniorbasis by the guarantors named in the indentures. The Priority Guarantee Notes and the guarantors’ obligations under the guarantees are secured by (i) a lienon (a) the capital stock of iHeartCommunications and (b) certain property and related assets that do not constitute “principal property,” in each case equal inpriority to the liens securing the obligations under iHeartCommunications’ senior secured credit facilities and (ii) a lien on the accounts receivable andrelated assets securing iHeartCommunications’ receivables based credit facility junior in priority to the lien securing iHeartCommunications’ obligationsthereunder, subject to certain exceptions. In addition to the collateral granted to secure the Priority Guarantee Notes due 2019, the collateral agent and thetrustee for the Priority Guarantee Notes due 2019 entered into an agreement with the administrative agent for the lenders under the senior secured creditfacilities to turn over to the trustee under the Priority Guarantee Notes due 2019, for the benefit of the holders of the Priority Guarantee Notes due 2019, a prorata share of any recovery received on account of the principal properties, subject to certain terms and conditions. Redemptions iHeartCommunications may redeem the Priority Guarantee Notes at its option, in whole or part, at redemption prices set forth in the indentures, plus accruedand unpaid interest to the redemption dates plus applicable premiums. Certain Covenants The indentures governing the Priority Guarantee Notes contain covenants that limit iHeartCommunications’ ability and the ability of its restrictedsubsidiaries to, among other things: (i) pay dividends, redeem stock or make other distributions or investments; (ii) incur additional debt or issue certainpreferred stock; (iii) modify any of iHeartCommunications’ existing senior notes; (iv) transfer or sell assets; (v) engage in certain transactions with affiliates;(vi) create restrictions on dividends or other payments by the restricted subsidiaries; and (vii) merge, consolidate or sell substantially all ofiHeartCommunications’ assets. The indentures contain covenants that limit iHeartMedia Capital I, LLC’s and and iHeartCommunications’ ability and theability of its restricted subsidiaries to, among other things: (i) create liens on assets and (ii) materially impair the value of the security interests taken withrespect to the collateral94IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) for the benefit of the notes collateral agent and the holders of the Priority Guarantee Notes. The indentures also provide for customary events of default. Subsidiary Senior Revolving Credit Facility Due 2018During the third quarter of 2013, CCOH entered into a five-year senior secured revolving credit facility with an aggregate principal amount of $75.0 million. The revolving credit facility may be used for working capital needs, to issue letters of credit and for other general corporate purposes. At December 31, 2014,there were no amounts outstanding under the revolving credit facility, and $62.2 million of letters of credit under the revolving credit facility, which reduceavailability under the facility. Senior Cash Pay Notes and Senior Toggle NotesAs of December 31, 2014, iHeartCommunications had no principal amounts outstanding of 10.75% senior cash pay notes due 2016 and 11.00%/11.75%senior toggle notes due 2016. In August 2014, iHeartCommunications fully redeemed the remaining notes with proceeds from the issuance of 14.0% SeniorNotes due 2021. 14.0% Senior Notes due 2021As of December 31, 2014, iHeartCommunications had outstanding approximately $1.66 billion of aggregate principal amount of 14.0% Senior Notes due2021 (net of $423.4 million principal amount issued to, and held by, a subsidiary of iHeartCommunications). The Senior Notes due 2021 mature on February 1, 2021. Interest on the Senior Notes due 2021 is payable semi-annually on February 1 and August 1 of eachyear, which began on August 1, 2013. Interest on the Senior Notes due 2021 will be paid at the rate of (i) 12.0% per annum in cash and (ii) 2.0% per annumthrough the issuance of payment-in-kind notes (the “PIK Notes”). Any PIK Notes issued in certificated form will be dated as of the applicable interestpayment date and will bear interest from and after such date. All PIK Notes issued will mature on February 1, 2021 and have the same rights and benefits asthe Senior Notes due 2021. The Senior Notes due 2021 are fully and unconditionally guaranteed on a senior basis by the guarantors named in the indenturegoverning such notes. The guarantee is structurally subordinated to all existing and future indebtedness and other liabilities of any subsidiary of theapplicable subsidiary guarantor that is not also a guarantor of the Senior Notes due 2021. The guarantees are subordinated to the guarantees ofiHeartCommunications’ senior secured credit facility and certain other permitted debt, but rank equal to all other senior indebtedness of the guarantors. iHeartCommunications may redeem the Senior Notes due 2021, in whole or in part, within certain dates, at the redemption prices set forth in the indentureplus accrued and unpaid interest to the redemption date. The indenture governing the Senior Notes due 2021 contains covenants that limit iHeartCommunications’ ability and the ability of its restricted subsidiariesto, among other things: (i) incur additional indebtedness or issue certain preferred stock; (ii) pay dividends on, or make distributions in respect of, theircapital stock or repurchase their capital stock; (iii) make certain investments or other restricted payments; (iv) sell certain assets; (v) create liens or use assetsas security in other transactions; (vi) merge, consolidate or transfer or dispose of substantially all of their assets; (vii) engage in transactions with affiliates;and (viii) designate their subsidiaries as unrestricted subsidiaries. iHeartCommunications Legacy Notes As of December 31, 2014, iHeartCommunications had outstanding senior notes (net of $57.1 million aggregate principal amount held by a subsidary ofiHeartCommunications) consisting of:(In thousands) December 31, December 31, 201420135.5% Senior Notes Due 2014 $ - 461,455 4.9% Senior Notes Due 2015 - 250,000 5.5% Senior Notes Due 2016 192,900 250,000 6.875% Senior Notes Due 2018 175,000 175,000 7.25% Senior Notes Due 2027 300,000 300,000 Total Legacy Notes $ 667,900 1,436,455 95IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) These senior notes were the obligations of iHeartCommunications prior to the merger. The senior notes are senior, unsecured obligations that are effectivelysubordinated to iHeartCommunications’ secured indebtedness to the extent of the value of iHeartCommunications’ assets securing such indebtedness and arenot guaranteed by any of iHeartCommunications’ subsidiaries and, as a result, are structurally subordinated to all indebtedness and other liabilities ofiHeartCommunications’ subsidiaries. The senior notes rank equally in right of payment with all of iHeartCommunications’ existing and future seniorindebtedness and senior in right of payment to all existing and future subordinated indebtedness. 10.0% Senior Notes due 2018 As of December 31, 2014, iHeartCommunications had outstanding $730.0 million aggregate principal amount of senior notes due 2018 (net of$120.0 million aggregate principal amount held by a subsidiary of iHeartCommunications). The senior notes due 2018 mature on January 15, 2018 and bearinterest at a rate of 10.0% per annum, payable semi-annually on January 15 and July 15 of each year, which began on July 15, 2014. The senior notes due 2018 are senior, unsecured obligations that are effectively subordinated to iHeartCommunications’ secured indebtedness to theextent of the value of iHeartCommunications’ assets securing such indebtedness and are not guaranteed by any of iHeartCommunications’ subsidiaries and,as a result, are structurally subordinated to all indebtedness and other liabilities of iHeartCommunications’ subsidiaries. The senior notes due 2018 rankequally in right of payment with all of iHeartCommunications’ existing and future senior indebtedness and senior in right of payment to all existing andfuture subordinated indebtedness. Subsidiary Senior Notes As of December 31, 2014, the Company's subsidiary, Clear Channel Worldwide Holdings, Inc. ("CCWH") had outstanding notes consisting of: (In thousands) December 31, December 31, Maturity Date Interest Rate Interest Payment Terms 20142013CCWH Senior Notes: 6.5% Series A Senior Notes Due202211/15/2022 6.5% Payable to the trustee weeklyin arrears and to thenoteholders on May 15 andNovember 15 of each year $ 735,750 735,750 6.5% Series B Senior Notes Due202211/15/2022 6.5% Payable to the trustee weeklyin arrears and to thenoteholders on May 15 andNovember 15 of each year 1,989,250 1,989,250 CCWH Senior Subordinated Notes: 7.625% Series A Senior NotesDue 20203/15/2020 7.625% Payable to the trustee weeklyin arrears and to thenoteholders on March 15 andSeptember 15 of each year 275,000 275,000 7.625% Series B Senior NotesDue 20203/15/2020 7.625% Payable to the trustee weeklyin arrears and to thenoteholders on March 15 andSeptember 15 of each year 1,925,000 1,925,000 Total CCWH Notes $ 4,925,000 4,925,000 Guarantees and SecurityThe CCWH Senior Notes are guaranteed by CCOH, Clear Channel Outdoor, Inc. (“CCOI”) and certain of CCOH’s direct and indirect subsidiaries. The CCWHSenior Subordinated Notes are fully and unconditionally guaranteed, jointly and severally, on a senior subordinated basis by CCOH, CCOI and certain ofCCOH’s other domestic subsidiaries and rank junior to each guarantor’s existing and future senior debt, including the CCWH Senior Notes, equally with eachguarantor’s existing and future senior subordinated debt96IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) and ahead of each guarantor’s existing and future debt that expressly provides that it is subordinated to the guarantees of the CCWH Senior SubordinatedNotes. The CCWH Senior Notes are senior obligations that rank pari passu in right of payment to all unsubordinated indebtedness of CCWH and the guarantees ofthe CCWH Senior Notes rank pari passu in right of payment to all unsubordinated indebtedness of the guarantors. The CCWH Senior Subordinated Notes areunsecured senior subordinated obligations that rank junior to all of CCWH’s existing and future senior debt, including the CCWH Senior Notes, equally withany of CCWH’s existing and future senior subordinated debt and ahead of all of CCWH’s existing and future debt that expressly provides that it issubordinated to the CCWH Subordinated Notes. Redemptions CCWH may redeem the Subsidiary Senior Notes at its option, in whole or part, at redemption prices set forth in the indentures plus accrued and unpaidinterest to the redemption dates and plus an applicable premium. Certain Covenants The indentures governing the Subsidiary Senior Notes contain covenants that limit CCOH and its restricted subsidiaries ability to, among other things: • incur or guarantee additional debt or issue certain preferred stock;• in case of the Senior Notes, create liens on its restricted subsidiaries’ assets to secure such debt;• create restrictions on the payment of dividends or other amounts;• enter into certain transactions with affiliates;• merge or consolidate with another person, or sell or otherwise dispose of all or substantially all of its assets; and• sell certain assets, including capital stock of its subsidiaries. Future Maturities of Long-term Debt Future maturities of long-term debt at December 31, 2014 are as follows: (in thousands) 2015$ 3,604 2016 1,126,920 2017 8,208 2018 909,272 2019 8,300,043 Thereafter 10,212,868 Total (1)$ 20,560,915 (1) Excludes purchase accounting adjustments and original issue discount of $234.9 million, which is amortized through interest expense over the lifeof the underlying debt obligations. NOTE 6 – FAIR VALUE MEASUREMENTSASC 820-10-35 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined asobservable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly orindirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its ownassumptions. Marketable Equity SecuritiesThe Company’s marketable equity securities are measured at fair value on each reporting date. 97IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The marketable equity securities are measured at fair value using quoted prices in active markets. Due to the fact that the inputs used to measure themarketable equity securities at fair value are observable, the Company has categorized the fair value measurements of the securities as Level 1. The cost, unrealized holding gains or losses, and fair value of the Company’s investments at December 31, 2014 and 2013 are as follows: (In thousands) Gross Gross Amortized Unrealized Unrealized FairInvestments Cost Losses Gains Value2014 Available-for-sale $ 369 $ - $ 1,609 $ 1,978 Other cost investments 16,269 - - 16,269 Total $ 16,638 $ - $ 1,609 $ 18,247 2013 Available-for-sale $ 659 $ - $ 1,283 $ 1,942 Other cost investments 7,783 - - 7,783 Total $ 8,442 $ - $ 1,283 $ 9,725 During 2013, the Company sold shares of Sirius XM Radio, Inc. held by it for $135.5 million. In connection with the sale of shares of Sirius XM Radio, Inc., arealized gain of $130.9 million and income tax expense of $48.6 million were reclassified out of accumulated other comprehensive loss into “Gain onmarketable securities” and “Income tax benefit,” respectively. The net difference of $82.3 million is reported as a reduction of “Other comprehensive income(loss).” Other cost investments include various investments in companies for which there is no readily determinable market value. The Company recognized other-than-temporary impairments of $2.0 million on a cost investment for the year ended December 31, 2012, which was a non-cash impairment charge recorded in“Loss on marketable securities.” NOTE 7 – COMMITMENTS AND CONTINGENCIESThe Company accounts for its rentals that include renewal options, annual rent escalation clauses, minimum franchise payments and maintenance related todisplays under the guidance in ASC 840. The Company considers its non-cancelable contracts that enable it to display advertising on buses, bus shelters, trains, etc. to be leases in accordance with theguidance in ASC 840-10. These contracts may contain minimum annual franchise payments which generally escalate each year. The Company accounts forthese minimum franchise payments on a straight-line basis. If the rental increases are not scheduled in the lease, such as an increase based on subsequentchanges in the index or rate, those rents are considered contingent rentals and are recorded as expense when accruable. Other contracts may contain avariable rent component based on revenue. The Company accounts for these variable components as contingent rentals and records these payments asexpense when accruable. No single contract or lease is material to the Company’s operations. The Company accounts for annual rent escalation clauses included in the lease term on a straight-line basis under the guidance in ASC 840-20-25. TheCompany considers renewal periods in determining its lease terms if at inception of the lease there is reasonable assurance the lease will be renewed. Expenditures for maintenance are charged to operations as incurred, whereas expenditures for renewal and betterments are capitalized. The Company leases office space, certain broadcasting facilities, equipment and the majority of the land occupied by its outdoor advertising structures underlong-term operating leases. The Company accounts for these leases in accordance with the policies described above. The Company’s contracts with municipal bodies or private companies relating to street furniture, billboards, transit and malls generally require the Companyto build bus stops, kiosks and other public amenities or advertising structures during the term of the contract. The Company owns these structures and isgenerally allowed to advertise on them for the remaining term of the98IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) contract. Once the Company has built the structure, the cost is capitalized and expensed over the shorter of the economic life of the asset or the remaininglife of the contract. In addition, the Company has commitments relating to required purchases of property, plant and equipment under certain street furniture contracts. Certainof the Company’s contracts contain penalties for not fulfilling its commitments related to its obligations to build bus stops, kiosks and other public amenitiesor advertising structures. Historically, any such penalties have not materially impacted the Company’s financial position or results of operations. Certain acquisition agreements include deferred consideration payments based on performance requirements by the seller typically involving the completionof a development or obtaining appropriate permits that enable the Company to construct additional advertising displays. At December 31, 2014, theCompany believes its maximum aggregate contingency, which is subject to performance requirements by the seller, is approximately $30.0 million. As thecontingencies have not been met or resolved as of December 31, 2014, these amounts are not recorded. As of December 31, 2014, the Company's future minimum rental commitments under non-cancelable operating lease agreements with terms in excess of oneyear, minimum payments under non-cancelable contracts in excess of one year, capital expenditure commitments and employment/talent contracts consist ofthe following: (In thousands) Capital Non-Cancelable Non-Cancelable Expenditure Employment/Talent Operating Leases Contracts Commitments Contracts2015$ 435,118 $ 593,123 $ 55,968 $ 80,442 2016 347,487 437,022 70,385 75,760 2017 302,876 262,368 67,053 31,673 2018 269,697 240,128 922 11,069 2019 243,096 171,562 757 - Thereafter 1,325,171 336,120 14,402 - Total$ 2,923,445 $ 2,040,323 $ 209,487 $ 198,944 Rent expense charged to operations for the years ended December 31, 2014, 2013 and 2012 was $1.17 billion, $1.16 billion and $1.14 billion, respectively. In various areas in which the Company operates, outdoor advertising is the object of restrictive and, in some cases, prohibitive zoning and other regulatoryprovisions, either enacted or proposed. The impact to the Company of loss of displays due to governmental action has been somewhat mitigated by Federaland state laws mandating compensation for such loss and constitutional restraints. The Company and its subsidiaries are involved in certain legal proceedings arising in the ordinary course of business and, as required, have accrued anestimate of the probable costs for the resolution of those claims for which the occurrence of loss is probable and the amount can be reasonably estimated. These estimates have been developed in consultation with counsel and are based upon an analysis of potential results, assuming a combination of litigationand settlement strategies. It is possible, however, that future results of operations for any particular period could be materially affected by changes in theCompany’s assumptions or the effectiveness of its strategies related to these proceedings. Additionally, due to the inherent uncertainty of litigation, therecan be no assurance that the resolution of any particular claim or proceeding would not have a material adverse effect on the Company’s financial conditionor results of operations. Although the Company is involved in a variety of legal proceedings in the ordinary course of business, a large portion of its litigation arises in the followingcontexts: commercial disputes; defamation matters; employment and benefits related claims; governmental fines; intellectual property claims; and taxdisputes. Los Angeles Litigation In 2008, Summit Media, LLC, one of the Company’s competitors, sued the City of Los Angeles (the “City”), Clear Channel Outdoor, Inc. and CBS Outdoorin Los Angeles Superior Court (Case No. BS116611) challenging the validity of a settlement agreement that had been entered into in November 2006 amongthe parties and pursuant to which Clear Channel Outdoor, Inc. had taken down existing billboards and converted 83 existing signs from static displays todigital displays. In 2009 the Los Angeles Superior Court99IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) ruled that the settlement agreement constituted an ultra vires act of the City, and nullified its existence. After further proceedings, on April 12, 2013 the LosAngeles Superior Court invalidated 82 digital modernization permits issued to Clear Channel Outdoor, Inc. (77 of which displays were operating at the timeof the ruling), and Clear Channel Outdoor, Inc. was required to turn off the electrical power to all affected digital displays on April 15, 2013. The digitaldisplay structures remain intact but digital displays are currently prohibited in the City. Clear Channel Outdoor, Inc. is seeking permits under the existingCity sign code to either wrap the LED faces with vinyl or convert the LED faces to traditional static signs, and has obtained a number of such permits. ClearChannel Outdoor, Inc. is also pursuing a new ordinance to permit digital signage in the City. NOTE 8 – GUARANTEESAs of December 31, 2014, iHeartCommunications had outstanding surety bonds and commercial standby letters of credit of $47.7 million and $113.9 million, respectively, of which no letters of credit were cash secured. These letters of credit and surety bonds relate to various operational matters includinginsurance, bid, concession and performance bonds as well as other items. As of December 31, 2014, iHeartCommunications had outstanding bank guarantees of $55.1 million. Bank guarantees in the amount of $15.2 million arebacked by cash collateral.100IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 9 – INCOME TAXES Significant components of the provision for income tax benefit (expense) are as follows: (In thousands)Years Ended December 31, 2014 2013 2012Current - Federal$ (503) $ 10,586 $ 61,655 Current - foreign (27,256) (48,466) (48,579) Current - state 3,193 1,527 (9,408) Total current benefit (expense) (24,566) (36,353) 3,668 Deferred - Federal (29,284) 126,905 261,014 Deferred - foreign 4,308 8,932 27,970 Deferred - state (8,947) 22,333 15,627 Total deferred benefit (expense) (33,923) 158,170 304,611 Income tax benefit (expense)$ (58,489) $ 121,817 $ 308,279 Current tax expense of $24.6 million was recorded for 2014 as compared to a current tax expense of $36.4 million for 2013. The change in current tax wasprimarily due to a reduction in unrecognized tax benefits during 2014, which resulted from the expiration of statutes of limitations to assess taxes in theUnited Kingdom and several state jurisdictions. This decrease in unrecognized tax benefits resulted in a reduction to current tax expense of $35.4 millionduring 2014. Current tax expense of $36.4 million was recorded for 2013 as compared to a current tax benefit of $3.7 million for 2012. The change in current tax wasprimarily due to the Company’s settlement of U.S. federal and foreign tax examinations during 2012. Pursuant to the settlements, the Company recorded areduction to current income tax expense of approximately $67.3 million during 2012 to reflect the net current tax benefits of the settlements. Deferred tax expense of $33.9 million was recorded for 2014 compared with deferred tax benefit of $158.2 million for 2013. The change in deferred tax isprimarily due to the valuation allowance of $339.8 million recorded against the Company’s current period federal and state net operating losses during2014. Deferred tax benefit of $158.2 million for 2013 primarily relates to cancellation of debt income recognized during the year as a result of certain debtrestructuring transactions, and is lower when compared with the deferred tax benefit of $304.6 million for 2012. The decrease in deferred tax benefit in 2013is primarily due to the valuation allowance of $143.5 million recorded against a portion of the Company’s federal and state net operating losses.101IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Significant components of the Company's deferred tax liabilities and assets as of December 31, 2014 and 2013 are as follows: (In thousands)2014 2013Deferred tax liabilities: Intangibles and fixed assets$ 2,335,584 $ 2,402,168 Long-term debt 119,887 183,615 Investments in nonconsolidated affiliates 1,121 - Other investments 5,575 6,759 Other 8,857 6,655 Total deferred tax liabilities 2,471,024 2,599,197 Deferred tax assets: Accrued expenses 111,884 106,651 Investments in nonconsolidated affiliates - 1,824 Net operating loss carryforwards 1,445,340 1,287,239 Bad debt reserves 9,346 9,726 Other 34,017 35,527 Total gross deferred tax assets 1,600,587 1,440,967 Less: Valuation allowance 655,658 327,623 Total deferred tax assets 944,929 1,113,344 Net deferred tax liabilities$ 1,526,095 $ 1,485,853 Included in the Company’s net deferred tax liabilities are $37.8 million and $52.0 million of current net deferred tax assets for 2014 and 2013, respectively. The Company presents these assets in “Other current assets” on its consolidated balance sheets. The remaining $1.6 billion and $1.5 billion of net deferredtax liabilities for 2014 and 2013, respectively, are presented in “Deferred tax liabilities” on the consolidated balance sheets. The Company’s net foreign deferred tax liabilities were $13.6 million and $19.8 million for the periods ended December 31, 2014 and December 31, 2013,respectively. The deferred tax liability related to intangibles and fixed assets primarily relates to the difference in book and tax basis of acquired FCC licenses, billboardpermits and tax deductible goodwill created from the Company’s various stock acquisitions. In accordance with ASC 350-10, Intangibles—Goodwill andOther, the Company does not amortize FCC licenses and billboard permits. As a result, this deferred tax liability will not reverse over time unless theCompany recognizes future impairment charges related to its FCC licenses, permits and tax deductible goodwill or sells its FCC licenses or permits. As theCompany continues to amortize its tax basis in its FCC licenses, permits and tax deductible goodwill, the deferred tax liability will increase over time. At December 31, 2014, the Company had recorded net operating loss carryforwards (tax effected) for federal and state income tax purposes of approximately$1.3 billion, expiring in various amounts through 2034. The Company expects to realize the benefits of a portion of its deferred tax assets attributable tofederal and state net operating losses based upon expected future taxable income from deferred tax liabilities that reverse in the relevant federal and statejurisdictions and carryforward periods. As of December 31, 2014, the Company has recorded a partial valuation allowance of $487.1 million against thesedeferred tax assets attributable to federal and state net operating losses. In addition, the Company had recorded deferred tax assets for foreign net operatingloss carryforwards (tax effected) of approximately $153.0 million which are offset in part by an associated valuation allowance of $146.4 million. Additionaldeferred tax valuation allowance of $22.1 million offsets other foreign deferred tax assets that are not expected to be realized. Realization of these foreigndeferred tax assets is dependent upon the Company’s ability to generate future taxable income in appropriate tax jurisdictions and carryforward periods. Dueto the Company’s evaluation of negative factors including particular negative evidence of cumulative losses in these jurisdictions, the Company continuesto record valuation allowances on the foreign deferred tax assets that are not expected to be realized. The Company expects to realize its remaining grossdeferred tax assets based upon its assessment of deferred tax liabilities that will reverse in the same carryforward period and jurisdiction and are of the samecharacter as the net operating loss carryforwards and temporary differences that give rise to the deferred tax assets. Any deferred tax liabilities associated withacquired FCC licenses, billboard permits and tax-deductible goodwill intangible assets are not relied upon as a source of future taxable income, as theseintangible assets have an indefinite life. 102IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) At December 31, 2014, net deferred tax liabilities include a deferred tax asset of $28.9 million relating to stock-based compensation expense under ASC 718-10, Compensation—Stock Compensation. Full realization of this deferred tax asset requires stock options to be exercised at a price equaling or exceeding thesum of the grant price plus the fair value of the option at the grant date and restricted stock to vest at a price equaling or exceeding the fair market value at thegrant date. Accordingly, there can be no assurance that the stock price of the Company’s common stock will rise to levels sufficient to realize the entiredeferred tax benefit currently reflected in its balance sheet. The reconciliation of income tax computed at the U.S. Federal statutory tax rates to income tax benefit is: Years Ended December 31,(In thousands)2014 2013 2012 Amount Percent Amount Percent Amount PercentIncome tax benefit at statutory rates$ 246,284 35% $ 246,867 35% $ 251,814 35%State income taxes, net of federal tax effect 26,518 4% 32,768 4% 6,218 1%Foreign income taxes 11,074 2% (22,640) (3%) 8,782 2%Nondeductible items (5,533) (1%) (4,870) (1%) (4,617) (1%)Changes in valuation allowance and other estimates (333,641) (47%) (135,161) (19%) 50,697 7%Other, net (3,191) (1%) 4,853 1% (4,615) (1%)Income tax benefit (expense)$ (58,489) (8%) $ 121,817 17% $ 308,279 43% The Company’s effective tax rate for the year ended December 31, 2014 is (8%). The effective tax rate for 2014 was impacted by the $339.8 millionvaluation allowance recorded during the period as additional deferred tax expense. The valuation allowance was recorded against the Company’s currentperiod federal and state net operating losses due to the uncertainty of the ability to utilize those losses in future periods. This expense was partially offset by$28.9 million in net tax benefits associated with a decrease in unrecognized tax benefits resulting from the expiration of statute of limitations to assess taxesin the United Kingdom and several state jurisdictions. Foreign income before income taxes was approximately $97.2 million for 2014, and it should benoted that with limited exceptions, tax rates in our foreign jurisdictions are lower than that of the U.S. federal statutory rate. A tax benefit was recorded for the year ended December 31, 2013 of 17%. The effective tax rate for 2013 was impacted by the $143.5 million valuationallowance recorded during the period as additional deferred tax expense. The valuation allowance was recorded against a portion of the federal and state netoperating losses due to the uncertainty of the ability to utilize those losses in future periods. This expense was partially offset by $20.2 million in net taxbenefits recorded during the period due to the settlement of certain U.S. federal and state tax examinations during the year. Foreign income before incometaxes was approximately $48.3 million for 2013. A tax benefit was recorded for the year ended December 31, 2012 of 43%. The effective tax rate for 2012 was impacted by the Company’s settlement of U.S.federal and foreign tax examinations during the year. Pursuant to the settlements, the Company recorded a reduction to income tax expense of approximately$60.6 million to reflect the net tax benefits of the settlements. This benefit was partially offset by additional tax recorded during 2012 related to the write-offof deferred tax assets associated with the vesting of certain equity awards. Foreign income before income taxes was approximately $84.0 million for 2012. The Company continues to record interest and penalties related to unrecognized tax benefits in current income tax expense. The total amount of interestaccrued at December 31, 2014 and 2013 was $40.8 million and $49.4 million, respectively. The total amount of unrecognized tax benefits and accruedinterest and penalties at December 31, 2014 and 2013 was $147.7 million and $178.8 million, respectively, of which $110.4 million and $131.0 million isincluded in “Other long-term liabilities”, and $2.3 million and $11.6 million is included in “Accrued Expenses” on the Company’s consolidated balancesheets, respectively. In addition, $35.0 million and $36.1 million of unrecognized tax benefits are recorded net with the Company’s deferred tax assets for itsnet operating losses as opposed to being recorded in “Other long-term liabilities” at December 31, 2014 and 2013, respectively. The total amount ofunrecognized tax benefits at December 31, 2014 and 2013 that, if recognized, would impact the effective income tax rate is $68.8 million and $100.1 million, respectively. 103IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) (In thousands) Years Ended December 31,Unrecognized Tax Benefits 2014 2013Balance at beginning of period $ 129,375 $ 138,437 Increases for tax position taken in the current year 13,848 12,004 Increases for tax positions taken in previous years 6,003 13,163 Decreases for tax position taken in previous years (9,764) (21,928) Decreases due to settlements with tax authorities (8,181) (1,113) Decreases due to lapse of statute of limitations (24,367) (11,188) Balance at end of period $ 106,914 $ 129,375 The Company and its subsidiaries file income tax returns in the United States federal jurisdiction and various state and foreign jurisdictions. During 2014,the statute of limitations for certain tax years expired in the United Kingdom and several state jurisdictions resulting in a reduction to unrecognized taxbenefits of $24.4 million, excluding interest. Also during 2014, the Company settled certain U.S. federal and state examinations with taxing authorities,resulting in decreases in unrecognized tax benefits relating to cash tax payments of $8.2 million. All federal income tax matters through 2008 are closed andthe Company has effectively settled the 2009 and 2010 examinations with the IRS and is awaiting final approval of the settlement from the Joint Committeeon Taxation. The IRS is currently auditing the Company’s tax returns for the 2011 and 2012 periods. Substantially all material state, local, and foreignincome tax matters have been concluded for years through 2005. NOTE 10 – SHAREHOLDERS’ DEFICITThe Company reports its noncontrolling interests in consolidated subsidiaries as a component of equity separate from the Company’s equity. The followingtable shows the changes in shareholders’ deficit attributable to the Company and the noncontrolling interests of subsidiaries in which the Company has amajority, but not total ownership interest: (In thousands)The Company NoncontrollingInterests ConsolidatedBalances at January 1, 2014$ (8,942,166) $ 245,531 $ (8,696,635) Net income (loss) (793,761) 31,603 (762,158) Dividends and other payments to noncontrolling interests - (40,027) (40,027) Purchase of additional noncontrolling interests (46,806) (1,944) (48,750) Foreign currency translation adjustments (101,980) (19,898) (121,878) Unrealized holding gain on marketable securities 285 42 327 Other adjustments to comprehensive loss (10,214) (1,224) (11,438) Reclassifications 3,317 - 3,317 Other, net 1,977 10,057 12,034 Balances at December 31, 2014$(9,889,348) $224,140 $(9,665,208) (In thousands)The Company NoncontrollingInterests ConsolidatedBalances at January 1, 2013$(8,299,188) $ 303,997 $(7,995,191) Net income (loss) (606,883) 23,366 (583,517) Dividends and other payments to noncontrolling interests - (91,887) (91,887) Foreign currency translation adjustments (29,755) (3,246) (33,001) Unrealized holding gain on marketable securities 16,439 137 16,576 Unrealized holding gain on cash flow derivatives 48,180 - 48,180 Other adjustments to comprehensive loss 5,932 800 6,732 Reclassifications (83,585) (167) (83,752) Other, net 6,694 12,531 19,225 Balances at December 31, 2013$ (8,942,166) $ 245,531 $ (8,696,635) 104IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DividendsThe Company has not paid cash dividends since its formation and its ability to pay dividends is subject to restrictions should it seek to do so in the future.iHeart’s debt financing arrangements include restrictions on its ability to pay dividends thereby limiting the Company’s ability to pay dividends. Share-Based CompensationStock OptionsPrior to the merger, iHeartCommunications granted options to purchase its common stock to its employees and directors and its affiliates under its variousequity incentive plans typically at no less than the fair value of the underlying stock on the date of grant. These options were granted for a term notexceeding ten years and were forfeited, except in certain circumstances, in the event the employee or director terminated his or her employment orrelationship with iHeartCommunications or one of its affiliates. Prior to acceleration, if any, in connection with the merger, these options vested over a periodof up to five years. All equity incentive plans contained anti-dilutive provisions that permitted an adjustment of the number of shares ofiHeartCommunications’ common stock represented by each option for any change in capitalization. The Company has granted options to purchase its shares of Class A common stock to certain key executives under its equity incentive plan at no less than thefair value of the underlying stock on the date of grant. These options are granted for a term not to exceed ten years and are forfeited, except in certaincircumstances, in the event the executive terminates his or her employment or relationship with the Company or one of its affiliates. Approximately three-fourths of the options outstanding at December 31, 2014 vest based solely on continued service over a period of up to five years with the remainderbecoming eligible to vest over a period of up to five years if certain predetermined performance targets are met. The equity incentive plan containsantidilutive provisions that permit an adjustment of the number of shares of the Company’s common stock represented by each option for any change incapitalization. The Company accounts for its share-based payments using the fair value recognition provisions of ASC 718-10. The fair value of the portion of options thatvest based on continued service is estimated on the grant date using a Black-Scholes option-pricing model and the fair value of the remaining options whichcontain vesting provisions subject to service, market and performance conditions is estimated on the grant date using a Monte Carlo model. Expectedvolatilities were based on historical volatility of peer companies’ stock, including the Company, over the expected life of the options. The expected life ofthe options granted represents the period of time that the options granted are expected to be outstanding. The Company used historical data to estimateoption exercises and employee terminations within the valuation model. The Company includes estimated forfeitures in its compensation cost and updatesthe estimated forfeiture rate through the final vesting date of awards. The risk free interest rate is based on the U.S. Treasury yield curve in effect at the time ofgrant for periods equal to the expected life of the option. No options were granted during the years ended December 31, 2014 and 2013. The followingassumptions were used to calculate the fair value of the options granted during the year ended December 31, 2012:105IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Years Ended December 31, 2014(1) 2013(1) 2012Expected volatility N/A N/A 71% – 77%Expected life in years N/A N/A 6.3 – 6.5Risk-free interest rate N/A N/A 0.97% – 1.55%Dividend yield N/A N/A 0% (1) No options were granted in 2013 and 2014 The following table presents a summary of the Company's stock options outstanding at and stock option activity during the year ended December 31, 2014(“Price” reflects the weighted average exercise price per share): (In thousands, except per share data)Options Price WeightedAverageRemainingContractualTerm Outstanding, January 1, 2014 2,509 $ 33.11 Granted (1) - - Exercised - - Forfeited (125) 36.00 Expired (83) 36.00 Outstanding, December 31, 2014 (2) 2,301 32.85 4.3 years Exercisable 1,480 31.95 4.0 years Expected to Vest 797 35.20 4.7 years (1) The weighted average grant date fair value of options granted during the years ended December 31, 2012 was $2.68 per share. No options weregranted during the years ended December 31, 2013 and 2014.(2) Non-cash compensation expense has not been recorded with respect to 0.6 million shares as the vesting of these options is subject to performanceconditions that have not yet been determined probable to meet. A summary of the Company’s unvested options and changes during the year ended December 31, 2014 is presented below: (In thousands, except per share data) Options Weighted Average GrantDate Fair ValueUnvested, January 1, 2014 1,086 $ 10.74 Granted - - Vested (1) (140) 2.32 Forfeited (125) 2.16 Unvested, December 31, 2014 821 13.61 (1) The total fair value of the options vested during the years ended December 31, 2014, 2013 and 2012 was $0.3 million, $6.3 million and $3.9 million, respectively. 106IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Restricted Stock AwardsThe Company has granted restricted stock awards to its employees and affiliates under its equity incentive plan. The restricted stock awards are restricted intransferability for a term of up to five years. Restricted stock awards are forfeited, except in certain circumstances, in the event the employee terminates his orher employment or relationship with the Company prior to the lapse of the restriction. Dividends or distributions paid in respect of unvested restricted stockawards will be held by the Company and paid to the recipients of the restricted stock awards upon vesting of the shares. The following table presents a summary of the Company's restricted stock outstanding and restricted stock activity as of and during the year endedDecember 31, 2014 (“Price” reflects the weighted average share price at the date of grant): (In thousands, except per share data) Awards PriceOutstanding, January 1, 2014 3,919 $ 3.35 Granted 1,826 7.86 Vested (restriction lapsed) (506) 3.14 Forfeited (710) 8.85 Outstanding, December 31, 2014 4,529 5.02 CCOH Share-Based AwardsCCOH Stock OptionsThe Company’s subsidiary, CCOH, has granted options to purchase shares of its Class A common stock to employees and directors of CCOH and its affiliatesunder its equity incentive plan at no less than the fair market value of the underlying stock on the date of grant. These options are granted for a term notexceeding ten years and are forfeited, except in certain circumstances, in the event the employee or director terminates his or her employment or relationshipwith CCOH or one of its affiliates. These options vest solely on continued service over a period of up to five years. The equity incentive stock plan containsanti-dilutive provisions that permit an adjustment of the number of shares of CCOH’s common stock represented by each option for any change incapitalization. CCOH determined that the CCOH dividend discussed in Note 5 was considered a change in capitalization and therefore adjusted outstandingoptions as of March 15, 2012. No incremental compensation cost was recognized in connection with the adjustment. The fair value of each option awarded on CCOH common stock is estimated on the date of grant using a Black-Scholes option-pricing model. Expectedvolatilities are based on historical volatility of CCOH’s stock over the expected life of the options. The expected life of options granted represents the periodof time that options granted are expected to be outstanding. CCOH uses historical data to estimate option exercises and employee terminations within thevaluation model. CCOH includes estimated forfeitures in its compensation cost and updates the estimated forfeiture rate through the final vesting date ofawards. The risk free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for periods equal to the expected life of the option. The following assumptions were used to calculate the fair value of CCOH’s options on the date of grant: Years Ended December 31, 2014 2013 2012Expected volatility 54% – 56% 55% – 56% 54% – 56%Expected life in years 6.3 6.3 6.3Risk-free interest rate 1.73% – 2.08% 1.05% – 2.19% 0.92% – 1.48%Dividend yield 0% 0% 0%107IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The following table presents a summary of CCOH’s stock options outstanding at and stock option activity during the year ended December 31, 2014 (“Price”reflects the weighted average exercise price per share): (In thousands, except per share data) Options Price WeightedAverageRemainingContractualTerm AggregateIntrinsicValueOutstanding, January 1, 2014 6,909 $ 9.60 Granted (1) 627 8.64 Exercised (2) (459) 5.23 Forfeited (628) 8.11 Expired (424) 10.58 Outstanding, December 31, 2014 6,025 9.92 5.1 years $13,956 Exercisable 4,471 10.56 4.1 years $10,065 Expected to vest 1,487 8.08 7.8 years $3,729 (1) The weighted average grant date fair value of CCOH options granted during the years ended December 31, 2014, 2013 and 2012 was $4.69, $4.10and $4.43 per share, respectively.(2) Cash received from option exercises during the years ended December 31, 2014, 2013 and 2012 was $2.4 million, $4.2 million and $6.4 million,respectively. The total intrinsic value of the options exercised during the years ended December 31, 2014, 2013 and 2012 was $1.5 million, $5.0 million and $7.9 million, respectively.A summary of CCOH’s unvested options at and changes during the year ended December 31, 2014 is presented below: (In thousands, except per share data) Options Weighted Average GrantDate Fair ValueUnvested, January 1, 2014 2,645 $ 5.21 Granted 627 4.69 Vested (1) (1,091) 5.59 Forfeited (628) 4.74 Unvested, December 31, 2014 1,553 4.92 (1) The total fair value of CCOH options vested during the years ended December 31, 2014, 2013 and 2012 was $6.1 million, $7.1 million and $11.5 million, respectively. CCOH Restricted Stock AwardsCCOH has also granted both restricted stock and restricted stock unit awards to its employees and affiliates under its equity incentive plan. The restrictedstock awards represent shares of Class A common stock that hold a legend which restricts their transferability for a term of up to five years. The restrictedstock units represent the right to receive shares upon vesting, which is generally over a period of up to five years. Both restricted stock awards and restrictedstock units are forfeited, except in certain circumstances, in the event the employee terminates his or her employment or relationship with CCOH prior to thelapse of the restriction.108IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The following table presents a summary of CCOH’s restricted stock and restricted stock units outstanding at and activity during the year ended December 31,2014 (“Price” reflects the weighted average share price at the date of grant): (In thousands, except per share data) Awards PriceOutstanding, January 1, 2014 1,892 $ 6.83 Granted 1,040 8.88 Vested (restriction lapsed) (64) 6.86 Forfeited (410) 7.76 Outstanding, December 31, 2014 2,458 7.54 Share-Based Compensation CostThe share-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense on a straight-line basisover the vesting period. Share-based compensation payments are recorded in corporate expenses and were $10.7 million, $16.7 million and $28.5 million,during the years ended December 31, 2014, 2013 and 2012, respectively. The tax benefit related to the share-based compensation expense for the years ended December 31, 2014, 2013 and 2012 was $4.1 million, $6.3 million and $10.8 million, respectively. As of December 31, 2014, there was $22.4 million of unrecognized compensation cost related to unvested share-based compensation arrangements that willvest based on service conditions. This cost is expected to be recognized over a weighted average period of approximately three years. In addition, as ofDecember 31, 2014, there was $24.7 million of unrecognized compensation cost related to unvested share-based compensation arrangements that will vestbased on market, performance and service conditions. This cost will be recognized when it becomes probable that the performance condition will besatisfied. The Company completed a voluntary stock option exchange program on November 19, 2012 and exchanged 2.0 million stock options granted under theClear Channel 2008 Executive Incentive Plan for 1.8 million replacement restricted share awards with different service and performance conditions. TheCompany accounted for the exchange program as a modification of the existing awards under ASC 718 and will recognize incremental compensationexpense of approximately $1.7 million over the service period of the new awards. In connection with the exchange program, the Company granted anadditional 1.5 million restricted stock awards pursuant to a tax assistance program offered to employees participating in the exchange. Of the total 1.5 million restricted stock awards granted, 0.9 million were repurchased by the Company upon expiration of the exchange program while the remaining 0.6 million awards were forfeited. The Company recognized $2.6 million of expense related to the awards granted in connection with the tax assistance program. 109IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) (In thousands, except per share data) Years Ended December 31, 2014 2013 2012NUMERATOR: Net loss attributable to the Company – common shares $ (793,761) $ (606,883) $ (424,479) Less: Participating securities dividends - 2,566 8,456 Less: Income (loss) attributable to the Company – unvested shares - - - Net loss attributable to the Company per common share – basic and diluted $ (793,761) $ (609,449) $ (432,935) DENOMINATOR: Weighted average common shares outstanding – basic 83,941 83,364 82,745 Effect of dilutive securities: Stock options and common stock warrants (1) - - - Weighted average common shares outstanding – diluted 83,941 83,364 82,745 Net loss attributable to the Company per common share: Basic $ (9.46) $ (7.31) $ (5.23) Diluted $ (9.46) $ (7.31) $ (5.23) (1)6.8 million, 6.4 million and 5.4 million stock options and restricted shares were outstanding at December 31, 2014,2013 and 2012, respectively, that were not included in the computation of diluted earnings per share because to do sowould have been anti-dilutive. NOTE 11 – EMPLOYEE STOCK AND SAVINGS PLANSiHeartCommunications has various 401(k) savings and other plans for the purpose of providing retirement benefits for substantially all employees. Underthese plans, an employee can make pre-tax contributions and iHeartCommunications will match a portion of such an employee’s contribution. Employeesvest in these iHeartCommunications matching contributions based upon their years of service to iHeartCommunications. Contributions of $27.6 million, $26.6 million and $29.5 million to these plans for the years ended December 31, 2014, 2013 and 2012, respectively, were expensed. iHeartCommunications offers a non-qualified deferred compensation plan for a select group of management or highly compensated employees, under whichsuch employees were able to make an annual election to defer up to 50% of their annual salary and up to 80% of their bonus before taxes. iHeartCommunications suspended all salary and bonus deferrals and company matching contributions to the deferred compensation plan on January 1, 2010.iHeartCommunications accounts for the plan in accordance with the provisions of ASC 710-10. Matching credits on amounts deferred may be made iniHeartCommunications’ sole discretion and iHeartCommunications retains ownership of all assets until distributed. Participants in the plan have theopportunity to allocate their deferrals and any iHeartCommunications matching credits among different investment options, the performance of which is usedto determine the amounts to be paid to participants under the plan. In accordance with the provisions of ASC 710-10, the assets and liabilities of the non-qualified deferred compensation plan are presented in “Other assets” and “Other long-term liabilities” in the accompanying consolidated balance sheets,respectively. The asset and liability under the deferred compensation plan at December 31, 2014 was approximately $11.6 million recorded in “Other assets”and $11.6 million recorded in “Other long-term liabilities”, respectively. The asset and liability under the deferred compensation plan at December 31, 2013was approximately $11.8 million recorded in “Other assets” and $11.8 million recorded in “Other long-term liabilities”, respectively.110IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 12 — OTHER INFORMATIONThe following table discloses the components of “Other income (expense)” for the years ended December 31, 2014, 2013 and 2012, respectively: (In thousands)Years Ended December 31, 2014 2013 2012Foreign exchange gain (loss)$ 15,554 $ 1,772 $ (3,018) Debt modification expenses - (23,555) - Other (6,450) (197) 3,268 Total other income (expense), net$ 9,104 $ (21,980) $ 250 The following table discloses the increase (decrease) in net deferred income tax liabilities related to each component of other comprehensive income (loss)for the years ended December 31, 2014, 2013 and 2012, respectively: (In thousands)Years Ended December 31, 2014 2013 2012Foreign currency translation adjustments and other$ 2,559 $ (14,421) $ 3,210 Unrealized holding gain on marketable securities - (11,010) 15,324 Unrealized holding gain (loss) on cash flow derivatives - 28,759 30,074 Total increase in deferred tax liabilities$ 2,559 $ 3,328 $ 48,608 The following table discloses the components of “Other current assets” as of December 31, 2014 and 2013, respectively: (In thousands) As of December 31, 2014 2013Inventory $ 23,777 $ 26,872 Deferred tax asset 37,793 51,967 Deposits 4,466 5,126 Deferred loan costs 32,602 30,165 Other 37,661 47,027 Total other current assets $ 136,299 $ 161,157 111IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The following table discloses the components of “Other assets” as of December 31, 2014 and 2013, respectively: (In thousands) As of December 31, 2014 2013Investments in, and advances to, nonconsolidated affiliates $ 9,493 $ 238,805 Other investments 18,247 9,725 Notes receivable 242 302 Prepaid expenses 16,082 24,231 Deferred loan costs 130,267 143,763 Deposits 27,822 26,200 Prepaid rent 56,430 62,864 Non-qualified plan assets 11,568 11,844 Other 18,914 15,722 Total other assets $ 289,065 $ 533,456 The following table discloses the components of “Other long-term liabilities” as of December 31, 2014 and 2013, respectively: (In thousands) As of December 31, 2014 2013Unrecognized tax benefits $ 110,410 $ 131,015 Asset retirement obligation 53,936 59,125 Non-qualified plan liabilities 11,568 11,844 Deferred income 23,734 16,247 Deferred rent 125,530 120,092 Employee related liabilities 39,963 31,617 Other 89,722 92,080 Total other long-term liabilities $ 454,863 $ 462,020 112IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The following table discloses the components of “Accumulated other comprehensive loss,” net of tax, as of December 31, 2014 and 2013, respectively: (In thousands) As of December 31, 2014 2013Cumulative currency translation adjustment $ (291,520) $ (188,920) Cumulative unrealized gain on securities 1,397 1,101 Cumulative other adjustments (18,467) (8,254) Total accumulated other comprehensive loss $ (308,590) $ (196,073) NOTE 13 – SEGMENT DATAThe Company’s reportable segments, which it believes best reflect how the Company is currently managed, are iHM, Americas outdoor advertising andInternational outdoor advertising. Revenue and expenses earned and charged between segments are recorded at estimated fair value and eliminated inconsolidation. The iHM segment provides media and entertainment services via broadcast and digital delivery and also includes the Company’s nationalsyndication business. The Americas outdoor advertising segment consists of operations primarily in the United States and Canada. The Internationaloutdoor advertising segment primarily includes operations in Europe, Asia, Australia and Latin America. The Americas outdoor and International outdoordisplay inventory consists primarily of billboards, street furniture displays and transit displays. The Other category includes the Company’s mediarepresentation business as well as other general support services and initiatives which are ancillary to the Company’s other businesses. Corporate includesinfrastructure and support, including information technology, human resources, legal, finance and administrative functions of each of the Company’sreportable segments, as well as overall executive, administrative and support functions. Share-based payments are recorded in corporate expenses. The following table presents the Company’s reportable segment results for the years ended December 31, 2014, 2013 and 2012.113IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) (In thousands)iHM Americas OutdoorAdvertising InternationalOutdoorAdvertising Other Corporate andother reconcilingitems Eliminations ConsolidatedYear Ended December 31, 2014Revenue$ 3,161,503 $ 1,253,190 $ 1,708,069 $ 260,920 $ - $ (65,149) $ 6,318,533 Direct operating expenses 921,089 555,614 1,041,274 24,009 - (7,621) 2,534,365 Selling, general and administrative expenses 1,052,578 211,969 336,550 143,629 - (57,518) 1,687,208 Depreciation and amortization 240,868 194,640 207,431 33,543 34,416 - 710,898 Impairment charges - - - - 24,176 - 24,176 Corporate expenses - - - - 320,341 (10) 320,331 Other operating income, net - - - - 40,031 - 40,031 Operating income (loss)$ 946,968 $ 290,967 $ 122,814 $ 59,739 $ (338,902) $ - $ 1,081,586 Intersegment revenues$ 10 $ 3,436 $ - $ 61,703 $ - $ - $ 65,149 Segment assets$ 7,720,181 $ 3,527,935 $ 1,817,237 $ 277,388 $ 697,501 $ - $ 14,040,242 Capital expenditures$ 50,403 $ 97,053 $ 130,154 $ 5,744 $ 34,810 $ - $ 318,164 Share-based compensation expense$ - $ - $ - $ - $ 10,713 $ - $ 10,713 Year Ended December 31, 2013Revenue$ 3,131,595 $ 1,290,452 $ 1,655,738 $ 227,864 $ - $ (62,605) $ 6,243,044 Direct operating expenses 942,644 566,669 1,028,059 25,271 - (8,556) 2,554,087 Selling, general and administrative expenses 1,020,097 220,732 322,840 140,241 - (54,049) 1,649,861 Depreciation and amortization 262,136 196,597 203,927 39,291 28,877 - 730,828 Impairment charges - - - - 16,970 - 16,970 Corporate expenses - - - - 313,514 - 313,514 Other operating income, net - - - - 22,998 - 22,998 Operating income (loss)$ 906,718 $ 306,454 $ 100,912 $ 23,061 $ (336,363) $ - $ 1,000,782 Intersegment revenues$ - $ 2,473 $ - $ 60,132 $ - $ - $ 62,605 Segment assets$ 7,933,564 $ 3,693,308 $ 2,029,687 $ 534,363 $ 906,380 $ - $ 15,097,302 Capital expenditures$ 75,742 $ 88,991 $ 108,548 $ 9,933 $ 41,312 $ - $ 324,526 Share-based compensation expense$ - $ - $ - $ - $ 16,715 $ - $ 16,715 Year Ended December 31, 2012Revenue$ 3,084,780 $ 1,279,257 $ 1,667,687 $ 281,879 $ - $ (66,719) $ 6,246,884 Direct operating expenses 882,785 582,340 1,021,152 25,088 - (12,965) 2,498,400 Selling, general and administrative expenses 993,116 211,245 363,417 152,394 - (53,754) 1,666,418 Depreciation and amortization 262,409 192,023 205,258 45,568 24,027 - 729,285 Impairment charges - - - - 37,651 - 37,651 Corporate expenses - - - - 293,207 - 293,207 Other operating income, net - - - - 48,127 - 48,127 Operating income (loss)$ 946,470 $ 293,649 $ 77,860 $ 58,829 $ (306,758) $ - $ 1,070,050 Intersegment revenues$ - $ 1,175 $ 80 $ 65,464 $ - $ - $ 66,719 Segment assets$ 8,061,701 $ 3,835,235 $ 2,256,309 $ 815,435 $ 1,324,033 $ - $ 16,292,713 Capital expenditures$ 65,821 $ 117,647 $ 150,129 $ 17,438 $ 39,245 $ - $ 390,280 Share-based compensation expense$ - $ - $ - $ - $ 28,540 $ - $ 28,540 114IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Revenue of $1.8 billion, $1.7 billion and $1.7 billion derived from the Company’s foreign operations are included in the data above for the years endedDecember 31, 2014, 2013 and 2012, respectively. Revenue of $4.5 billion, $4.5 billion and $4.5 billion derived from the Company’s U.S. operations areincluded in the data above for the years ended December 31, 2014, 2013 and 2012, respectively. Identifiable long-lived assets of $682.7 million, $760.5 million and $805.2 million derived from the Company’s foreign operations are included in the dataabove for the years ended December 31, 2014, 2013 and 2012, respectively. Identifiable long-lived assets of $2.0 billion, $2.1 billion and $2.2 billionderived from the Company’s U.S. operations are included in the data above for the years ended December 31, 2014, 2013 and 2012, respectively. NOTE 14 — QUARTERLY RESULTS OF OPERATIONS (Unaudited)(In thousands, except per share data) Three Months EndedMarch 31, Three Months EndedJune 30, Three Months EndedSeptember 30, Three Months EndedDecember 31, 2014 2013 2014 2013 2014 2013 2014 2013Revenue $1,342,548 $1,343,058 $1,630,154 $1,618,097 $1,630,034 $1,587,522 $1,715,797 $1,694,367 Operating expenses: Direct operating expenses 596,496 597,780 643,222 632,586 645,981 648,743 648,666 674,978 Selling, general and administrative expenses 415,828 403,363 420,577 411,341 429,687 411,354 421,116 423,803 Corporate expenses 72,705 80,800 82,196 75,328 78,202 89,574 87,228 67,812 Depreciation and amortization 174,871 182,182 174,062 179,734 175,865 177,330 186,100 191,582 Impairment charges - - 4,902 - 35 - 19,239 16,970 Other operating income, net 165 2,395 (1,628) 1,113 47,172 6,186 (5,678) 13,304 Operating income 82,813 81,328 303,567 320,221 347,436 266,707 347,770 332,526 Interest expense 431,114 385,525 440,605 407,508 432,616 438,404 437,261 418,014 Gain (loss) on marketable securities - - - 130,898 - 31 - (50) Equity in earnings (loss) of nonconsolidated affiliates (13,326) 3,641 (16) 5,971 3,955 3,983 (29) (91,291) Gain (loss) on extinguishment of debt (3,916) (3,888) (47,503) - (4,840) - 12,912 (83,980) Other income (expense), net 1,541 (1,000) 12,157 (18,098) 2,617 1,709 (7,211) (4,591) Income (loss) before income taxes (364,002) (305,444) (172,400) 31,484 (83,448) (165,974) (83,819) (265,400) Income tax benefit (expense) (68,388) 96,325 621 (11,477) (24,376) 73,802 33,654 (36,833) Consolidated net income (loss) (432,390) (209,119) (171,779) 20,007 (107,824) (92,172) (50,165) (302,233) Less amount attributable to noncontrolling interest (8,200) (6,116) 14,852 12,805 7,028 9,683 17,923 6,994 Net income (loss) attributable to the Company $(424,190) $(203,003) $(186,631) $7,202 $(114,852) $(101,855) $(68,088) $(309,227) Net income (loss) to the Company per common share: Basic $(5.06) $(2.47) $(2.22) $0.09 $(1.37) $(1.22) $(0.81) $(3.70) Diluted $(5.06) $(2.47) $(2.22) $0.09 $(1.37) $(1.22) $(0.81) $(3.70) The Company's Class A common shares are quoted for trading on the OTC Bulletin Board under the symbol IHRT.115IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 15 – CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONSiHeartCommunications is a party to a management agreement with certain affiliates of Bain Capital Partners, LLC and Thomas H. Lee Partners, L.P. (together,the “Sponsors”) and certain other parties pursuant to which such affiliates of the Sponsors will provide management and financial advisory services until 2018. These agreements require management fees to be paid to such affiliates of the Sponsors for such services at a rate not greater than $15.0 million peryear, plus reimbursable expenses. For the years ended December 31, 2014, 2013 and 2012, the Company recognized management fees and reimbursableexpenses of $15.2 million, $15.8 million and $15.9 million, respectively. Stock PurchasesOn August 9, 2010, iHeartCommunications announced that its board of directors approved a stock purchase program under which iHeartCommunications orits subsidiaries may purchase up to an aggregate of $100.0 million of the Company’s Class A common stock and/or the Class A common stock of CCOH. Thestock purchase program does not have a fixed expiration date and may be modified, suspended or terminated at any time at iHeartCommunications’discretion. During 2014, CC Finco purchased 5,000,000 shares of CCOH’s Class A common stock for approximately $48.8 million. During 2012, CC Fincopurchased 111,291 shares of the Company’s Class A common stock for $692,887. During 2011, CC Finco purchased 1,553,971 shares of CCOH’s Class Acommon stock through open market purchases for approximately $16.4 million. As of December 31, 2014, an aggregate $34.2 million was available underthe stock purchase program to purchase the Company’s Class A common stock and/or the Class A common stock of CCOH. On January 7, 2015 CC Finco purchased an additional 2,000,000 shares of CCOH’s Class A common stock for $20.4 million. 116 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURENot Applicable ITEM 9A. CONTROLS AND PROCEDURESEvaluation of Disclosure Controls and ProceduresUnder the supervision and with the participation of management, including our Chief Executive Officer and our Chief Financial Officer, we have carried outan evaluation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on that evaluation, our ChiefExecutive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2014 to ensurethat information we are required to disclose in reports that are filed or submitted under the Exchange Act is recorded, processed, summarized and reportedwithin the time periods specified by the SEC and is accumulated and communicated to our management, including our Chief Executive Officer and our ChiefFinancial Officer, as appropriate to allow timely decisions regarding required disclosure. Management’s Report on Internal Control Over Financial ReportingOur management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financialreporting is a process designed under the supervision of our Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regardingthe reliability of financial reporting and preparation of our financial statements for external purposes in accordance with generally accepted accountingprinciples. As of December 31, 2014, management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internalcontrol over financial reporting established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of theTreadway Commission (2013 Framework). Based on the assessment, management determined that we maintained effective internal control over financialreporting as of December 31, 2014, based on those criteria. Ernst & Young LLP, the independent registered public accounting firm that audited our consolidated financial statements included in this Annual Report onForm 10-K, has issued an attestation report on the effectiveness of our internal control over financial reporting as of December 31, 2014. The report, whichexpresses an unqualified opinion on the effectiveness of our internal control over financial reporting as of December 31, 2014, is included in this Item underthe heading “Report of Independent Registered Public Accounting Firm.” Changes in Internal Control Over Financial ReportingThere were no changes in our internal control over financial reporting that occurred during the most recent fiscal quarter that have materially affected, or arereasonably likely to materially affect, our internal control over financial reporting.117 Report of Independent Registered Public Accounting FirmThe Board of Directors and ShareholdersiHeartMedia, Inc.We have audited iHeartMedia, Inc. and subsidiaries’ (the Company) internal control over financial reporting as of December 31, 2014, based on criteriaestablished in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013framework) (the COSO criteria). The Company’s management is responsible for maintaining effective internal control over financial reporting, and for itsassessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control OverFinancial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require thatwe plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all materialrespects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testingand evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considerednecessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal controlover financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are beingmade only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention ortimely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliancewith the policies or procedures may deteriorate.In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2014, based on theCOSO criteria.We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheetsof the Company as of December 31, 2014 and 2013, and the related consolidated statements of comprehensive loss, changes in shareholders’ deficit and cashflows for each of the three years in the period ended December 31, 2014 and our report dated February 19, 2015 expressed an unqualified opinion thereon. /s/ Ernst & Young LLPSan Antonio, TexasFebruary 19, 2015118 ITEM 9B. OTHER INFORMATIONNot Applicable119 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCEThe information required by this item with respect to our executive officers is set forth at the end of Part I of this Annual Report on Form 10-K. Our Code of Business Conduct and Ethics (the “Code of Conduct”) applies to all of our officers, directors and employees, including our principalexecutive officer, principal financial officer and principal accounting officer. The Code of Conduct is publicly available on our internet website atwww.iheartmedia.com. We intend to satisfy the disclosure requirements of Item 5.05 of Form 8-K regarding any amendment to, or waiver from, a provision ofthe Code of Conduct that applies to our principal executive officer, principal financial officer or principal accounting officer and relates to any element of thedefinition of code of ethics set forth in Item 406(b) of Regulation S-K by posting such information on our website, www.iheartmedia.com. All other information required by this item is incorporated by reference to the information set forth in our Definitive Proxy Statement for our2014 Annual Meeting of Stockholders (the “Definitive Proxy Statement”), which we expect to file with the SEC within 120 days after our fiscal year end. ITEM 11. EXECUTIVE COMPENSATION The information required by this item is incorporated by reference to our Definitive Proxy Statement, which we expect to file with the SEC within120 days after our fiscal year end. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS Plan CategoryNumber of Securities to be issuedupon exercise of outstanding options,warrants and rightsWeighted-Average exerciseprice of outstanding options,warrants and rights (1)Number of Securities remaining available forfuture issuance under equity compensation plans(excluding securities reflected in column (A))Equity Compensation Plansapproved by security holders(2)6,625,616(3) $35.03 879,189 Equity Compensation Plans notapproved by security holders---Total(4) 6,625,616 $35.03 879,189 (1) The weighted-average exercise price is calculated based solely on the exercise prices of the outstanding options and does not reflect theshares that will be issued upon the vesting of outstanding awards of restricted stock, which have no exercise price.(2) Represents the Clear Channel 2008 Executive Incentive Plan.(3) This number includes shares subject to outstanding awards granted, of which 2,096,860 shares are subject to outstanding options and4,528,756 shares are subject to outstanding restricted shares.(4) Does not include options to purchase an aggregate of 204,617 shares, at a weighted-average exercise price of $10.46, granted under plansassumed in connection with acquisition transactions. No additional options may be granted under these assumed plans. All other information required by this item is incorporated by reference to our Definitive Proxy Statement, which we expect to file with the SECwithin 120 days after our fiscal year end. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCEThe information required by this item is incorporated by reference to our Definitive Proxy Statement, which we expect to file with the SEC within120 days after our fiscal year end.120 ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICESThe information required by this item is incorporated by reference to our Definitive Proxy Statement, which we expect to file with the SEC within120 days after our fiscal year end. 121 PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES(a)1. Financial Statements. The following consolidated financial statements are included in Item 8: Consolidated Balance Sheets as of December 31, 2014 and 2013.Consolidated Statements of Comprehensive Loss for the Years Ended December 31, 2014, 2013 and 2012.Consolidated Statements of Changes in Shareholders’ Deficit for the Years Ended December 31, 2014, 2013 and 2012.Consolidated Statements of Cash Flows for the Years Ended December 31, 2014, 2013 and 2012.Notes to Consolidated Financial Statements (a)2. Financial Statement Schedule. The following financial statement schedule for the years ended December 31, 2014, 2013 and 2012 and related report of independent auditors is filed as partof this report and should be read in conjunction with the consolidated financial statements. Schedule II Valuation and Qualifying Accounts All other schedules for which provision is made in the applicable accounting regulation of the Securities and Exchange Commission are not required underthe related instructions or are inapplicable, and therefore have been omitted.122 SCHEDULE IIVALUATION AND QUALIFYING ACCOUNTS Allowance for Doubtful Accounts (In thousands) Charges Balance at to Costs, Write-off Balance Beginning Expenses of Accounts at End ofDescription of period and other Receivable Other (1) Period Year ended December 31, 2012 $ 63,098 $ 11,715 $ 14,082 $ (4,814) $ 55,917 Year ended December 31, 2013 $ 55,917 $ 20,242 $ 28,492 $ 734 $ 48,401 Year ended December 31, 2014 $ 48,401 $ 14,167 $ 20,368 $ (2,502) $ 39,698 (1) Primarily foreign currency adjustments and acquisition and/or divestiture activity.123 SCHEDULE IIVALUATION AND QUALIFYING ACCOUNTS Deferred Tax Asset Valuation Allowance (In thousands) Charges Balance at to Costs, Balance Beginning Expenses at end ofDescription of Period and other (1) Reversal (2) Adjustments (3) PeriodYear ended December 31, 2012 $ 193,052 $ 14,309 $ (21,727) $ (1,948) $ 183,686 Year ended December 31, 2013 $ 183,686 $ 149,107 $ (5) $ (5,165) $ 327,623 Year ended December 31, 2014 $ 327,623 $ 356,583 $ (230) $ (28,318) $ 655,658 (1) During 2012, 2013 and 2014, the Company recorded valuation allowances on deferred tax assets attributable to net operating losses in certainforeign jurisdictions. In addition, during 2013 and 2014 the Company recorded a valuation allowance of $143.5 million and $339.8 million,respectively, on a portion of its deferred tax assets attributable to federal and state net operating loss carryforwards due to the uncertainty of theability to utilize those losses in future periods.(2) During 2012, 2013 and 2014, the Company realized the tax benefits associated with certain foreign deferred tax assets, primarily related to foreignloss carryforwards, on which a valuation allowance was previously recorded. The associated valuation allowance was reversed in the period inwhich, based on the weight of available evidence, it is more-likely-than-not that the deferred tax asset will be realized.(3) During 2012, 2013 and 2014, the Company adjusted certain valuation allowances as a result of changes in tax rates in certain jurisdictions and as aresult of the expiration of carryforward periods for net operating loss carryforwards.124 (a)3. Exhibits.ExhibitNumber Description3.1 Certificate of Formation of iHeartMedia Capital I, LLC (Incorporated by reference to Exhibit 3.1.33 to theiHeartCommunications, Inc. Registration Statement on Form S-4 (File No. 333-158279) filed on March 30, 2009). 3.2 Limited Liability Company Agreement of iHeartMedia Capital I, LLC (Incorporated by reference to Exhibit 3.2.33 to theiHeartCommunications, Inc. Registration Statement on Form S-4 (File No. 333-158279) filed on March 30, 2009). 4.1 Senior Indenture dated October 1, 1997, by and between iHeartCommunications, Inc. and The Bank of New York, as Trustee(Incorporated by reference to Exhibit 4.2 to the iHeartCommunications, Inc. Quarterly Report on Form 10-Q for the quarterended September 30, 1997). 4.2 Third Supplemental Indenture dated June 16, 1998 to Senior Indenture dated October 1, 1997, by and betweeniHeartCommunications, Inc. and The Bank of New York, as Trustee (Incorporated by reference to Exhibit 4.2 to theiHeartCommunications, Inc. Current Report on Form 8-K filed on August 28, 1998). 4.3 Fourteenth Supplemental Indenture dated May 21, 2003, to Senior Indenture dated October 1, 1997, by and betweeniHeartCommunications, Inc. and The Bank of New York, as Trustee (Incorporated by reference to Exhibit 99.3 to theiHeartCommunications, Inc. Current Report on Form 8-K filed on May 22, 2003). 4.4 Seventeenth Supplemental Indenture dated September 20, 2004, to Senior Indenture dated October 1, 1997, by and betweeniHeartCommunications, Inc. and The Bank of New York, as Trustee (Incorporated by reference to Exhibit 10.1 to theiHeartCommunications, Inc. Current Report on Form 8-K filed on September 21, 2004). 4.5 Nineteenth Supplemental Indenture dated December 16, 2004, to Senior Indenture dated October 1, 1997, by and betweeniHeartCommunications, Inc. and The Bank of New York, as Trustee (Incorporated by reference to Exhibit 10.1 to theiHeartCommunications, Inc. Current Report on Form 8-K filed on December 17, 2004). 4.6 Indenture, dated as of February 23, 2011, among iHeartCommunications, Inc., iHeartMedia Capital I, LLC, the otherguarantors party thereto, Wilmington Trust FSB, as Trustee, and the other agents party thereto (Incorporated by reference toExhibit 4.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on February 24, 2011). 4.7 Supplemental Indenture, dated as of June 14, 2011, among iHeartCommunications, Inc. and Wilmington Trust FSB, as Trustee(Incorporated by reference to Exhibit 4.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on June 14,2011). 4.8 Indenture, dated as of October 25, 2012, among iHeartCommunications, Inc., iHeartMedia Capital I, LLC, as guarantor, theother guarantors party thereto, U.S. Bank National Association, as trustee, and Deutsche Bank Trust Company Americas, ascollateral agent (Incorporated by reference to Exhibit 4.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filedon October 25, 2012). 4.9 Indenture, dated as of February 28, 2013, among iHeartCommunications, Inc., iHeartMedia Capital I, LLC, as guarantor, theother guarantors party thereto, U.S. Bank National Association, as trustee, and Deutsche Bank Trust Company Americas, ascollateral agent (Incorporated by reference to Exhibit 4.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filedon March 1, 2013). 4.10 Indenture, dated as of June 21, 2013, among iHeartCommunications, Inc., iHeartMedia Capital I, LLC, as guarantor, the otherguarantors party thereto, Law Debenture Trust Company of New York, as trustee, and Deutsche Bank Trust CompanyAmericas, as paying agent, registrar and transfer agent (Incorporated by reference to Exhibit 4.1 to the iHeartCommunications,Inc. Current Report on Form 8-K filed on June 21, 2013). 4.11 Supplemental Indenture, dated as of December 16, 2013, by and among iHeartCommunications, Inc., iHeartMedia Capital I,LLC, as guarantor, the other guarantors party thereto, Law Debenture Trust Company of New York, as trustee, and DeutscheBank Trust Company Americas, as paying agent, registrar and transfer agent (Incorporated by reference to Exhibit 4.26 toAmendment No. 2 to the iHeartCommunications, Inc. Registration Statement on Form S-4 (File No. 333-192614) filed onDecember 24, 2013). 4.12 Supplemental Indenture, dated as of December 24, 2013, by and among iHeartCommunications, Inc., iHeartMedia Capital I,LLC, as guarantor, the other guarantors party thereto, Law Debenture Trust Company of New York, as trustee, and DeutscheBank Trust Company Americas, as paying agent, registrar and transfer agent (Incorporated by reference to Exhibit 4.28 toAmendment No. 2 to the iHeartCommunications, Inc. Registration Statement on Form S-4 (File No. 333-192614) filed onDecember 24, 2013). 4.13 Indenture with respect to 7.625% Series A Senior Subordinated Notes due 2020, dated as of March 15, 2012, by and amongClear Channel Worldwide Holdings, Inc., Clear Channel Outdoor Holdings, Inc., Clear Channel Outdoor, Inc., the otherguarantors party thereto and U.S. Bank National Association, as trustee (Incorporated by reference to Exhibit 4.1 to the ClearChannel Outdoor Holdings, Inc. Current Report on Form 8-K filed on March 16, 2012). 4.14 Indenture with respect to 7.625% Series B Senior Subordinated Notes due 2020, dated as of March 15, 2012, by and amongClear Channel Worldwide Holdings, Inc., Clear Channel Outdoor Holdings, Inc., Clear Channel Outdoor, Inc., the otherguarantors party thereto and U.S. Bank National Association, as trustee (Incorporated by reference to Exhibit 4.2 to the ClearChannel Outdoor Holdings, Inc. Current Report on Form 8-K filed on March 16, 2012). 4.15 Indenture with respect to 6.50% Series A Senior Notes due 2022, dated as of November 19, 2012, by and among ClearChannel Worldwide Holdings, Inc., Clear Channel Outdoor Holdings, Inc., Clear Channel Outdoor, Inc., the other guarantorsparty thereto and U.S. Bank National Association, as trustee (Incorporated by reference to Exhibit 4.1 to the Clear ChannelOutdoor Holdings, Inc. Current Report on Form 8-K filed on November 19, 2012). 4.16 4.17 4.18 4.19 4.20 4.21 Indenture with respect to 6.50% Series B Senior Notes due 2022, dated as of November 19, 2012, by and among ClearChannel Worldwide Holdings, Inc., Clear Channel Outdoor Holdings, Inc., Clear Channel Outdoor, Inc., the other guarantorsparty thereto and U.S. Bank National Association, as trustee (Incorporated by reference to Exhibit 4.2 to the Clear ChannelOutdoor Holdings, Inc. Current Report on Form 8-K filed on November 19, 2012). Indenture, dated as of May 1, 2014, among CCU Escrow Corporation and U.S. Bank National Association, as trustee(Incorporated by reference to Exhibit 4.2 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on June 6,2014). Supplemental Indenture, dated as of June 6, 2014, among iHeartCommunications, Inc. and U.S. Bank National Association, astrustee (Incorporated by reference to Exhibit 4.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on June6, 2014). Third Supplemental Indenture, dated as of August 22, 2014, by and among iHeartCommunications, Inc., iHeartMedia CapitalI, LLC, as guarantor, the other guarantors party thereto, and Law Debenture Trust Company of New York, as trustee(incorporated by reference to Exhibit 4.1 to the iHeartCommunications, Inc. Form 8-K filed on August 22, 2014). Indenture, dated as of September 10, 2014, among iHeartCommunications, Inc., iHeartMedia Capital I, LLC, as guarantor, theother guarantors party thereto, U.S. Bank National Association, as trustee, paying agent, registrar, authentication agent andtransfer agent, and Deutsche Bank Trust Company Americas, as collateral agent (incorporated by reference to Exhibit 4.1 toiHeartCommunications, Inc.’s Current Report on Form 8-K filed on September 10, 2014). Supplemental Indenture, dated as of September 29, 2014, among iHeartCommunications, Inc., iHeartMedia Capital I, LLC, asguarantor, certain subsidiary guarantors named therein, U.S. Bank National Association, as trustee, paying agent, registrar,authentication agent and transfer agent and Deutsche Bank Trust Company Americas, as the collateral agent (incorporated byreference to Exhibit 4.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on September 29, 2014). 10.1 Amended and Restated Credit Agreement, dated as of February 23, 2011, by and among iHeartCommunications, Inc., thesubsidiary co-borrowers and foreign subsidiary revolving borrowers party thereto, iHeartMedia Capital I, LLC, Citibank, N.A.,as Administrative Agent, the lenders from time to time party thereto and the other agents party thereto (Incorporated byreference to Exhibit 10.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on February 24, 2011). 10.2 Amendment No. 1 to Amended and Restated Credit Agreement, dated as of October 25, 2012, by and amongiHeartCommunications, Inc., iHeartMedia Capital I, LLC, the subsidiary co-borrowers party thereto, the foreign subsidiaryrevolving borrowers thereto, Citibank, N.A. as Administrative Agent, the lenders from time to time party thereto and the otheragents party thereto (Incorporated by reference to Exhibit 10.1 to the iHeartCommunications, Inc. Current Report on Form 8-Kfiled on October 25, 2012). 10.3 Collateral Sharing Agreement, dated as of October 25, 2012, by and among Citibank N.A. as Administrative Agent, U.S. BankNational Association, as trustee, and Deutsche Bank Trust Company Americas, as collateral agent (Incorporated by referenceto Exhibit 10.2 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on October 25, 2012). 10.4 Amendment No. 2 to Amended and Restated Credit Agreement, dated as of May 31, 2013, by and amongiHeartCommunications, Inc., iHeartMedia Capital I, LLC, the subsidiary co-borrowers party thereto, the foreign subsidiaryrevolving borrowers thereto, Citibank, N.A. as Administrative Agent, the lenders from time to time party thereto and the otheragents party thereto (Incorporated by reference to Exhibit 10.1 to the iHeartCommunications, Inc. Current Report on Form 8-Kfiled on June 4, 2013). 10.5 Amendment No. 3 to Amended and Restated Credit Agreement, dated as of December 18, 2013, by and amongiHeartCommunications, Inc., iHeartMedia Capital I, LLC, the subsidiary co-borrowers party thereto, the foreign subsidiaryrevolving borrowers thereto, Citibank, N.A., as Administrative Agent, the lenders from time to time party thereto and the otheragents party thereto (Incorporated by reference to Exhibit 10.1 to the iHeartCommunications, Inc. Current Report on Form 8-Kfiled on December 18, 2013). 10.6 Amended and Restated Credit Agreement, dated as of December 24, 2012, by and among iHeartCommunications, Inc.,iHeartMedia Capital I, LLC, the subsidiary borrowers party thereto, Citibank, N.A., as Administrative Agent, the lenders fromtime to time party thereto and the other agents party thereto (Incorporated by reference to Exhibit 10.1 to theiHeartCommunications, Inc. Current Report on Form 8-K filed on December 27, 2012). 10.7 Revolving Promissory Note dated November 10, 2005 payable by iHeartCommunications, Inc. to Clear Channel OutdoorHoldings, Inc. in the original principal amount of $1,000,000,000 (Incorporated by reference to Exhibit 10.8 to the ClearChannel Outdoor Holdings, Inc. Annual Report on Form 10-K for the year ended December 31, 2005). 10.8 First Amendment, dated as of December 23, 2009, to the Revolving Promissory Note, dated as of November 10, 2005, byiHeartCommunications, Inc., as Maker, to Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.41to the iHeartMedia, Inc. Annual Report on Form 10-K for the year ended December 31, 2009). 10.9 Second Amendment, dated as of October 23, 2013, to the Revolving Promissory Note, dated as of November 10, 2005, byiHeartCommunications, Inc., as Maker, to Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.1 tothe iHeartCommunications, Inc. Current Report on Form 8-K filed on October 23, 2013). 10.10 Revolving Promissory Note dated November 10, 2005 payable by Clear Channel Outdoor Holdings, Inc. toiHeartCommunications, Inc. in the original principal amount of $1,000,000,000 (Incorporated by reference to Exhibit 10.7 tothe Clear Channel Outdoor Holdings, Inc. Annual Report on Form 10-K for the year ended December 31, 2005). 10.11 First Amendment, dated as of December 23, 2009, to the Revolving Promissory Note, dated as of November 10, 2005, by ClearChannel Outdoor Holdings, Inc., as Maker, to iHeartCommunications, Inc. (Incorporated by reference to Exhibit 10.42 to theiHeartMedia, Inc. Annual Report on Form 10-K for the year ended December 31, 2009). 10.12 Corporate Services Agreement dated November 16, 2005 between Clear Channel Outdoor Holdings, Inc. and iHeartMediaManagement Services, L.P. (Incorporated by reference to Exhibit 10.3 to the Clear Channel Outdoor Holdings, Inc. AnnualReport on Form 10-K for the year ended December 31, 2005). 10.13 First Amended and Restated Management Agreement, dated as of July 28, 2008, by and among iHeartMedia, Inc., BT TripleCrown Merger Co., Inc., B Triple Crown Finco, LLC, T Triple Crown Finco, LLC, THL Managers VI, LLC and Bain CapitalPartners, LLC (Incorporated by reference to Exhibit 10.1 to the iHeartMedia, Inc. Current Report on Form 8-K filed on July 30,2008). 10.14 Amended and Restated Voting Agreement dated as of May 13, 2008 by and among BT Triple Crown Merger Co., Inc., BTriple Crown Finco, LLC, T Triple Crown Finco, LLC, iHeartMedia, Inc., Highfields Capital I LP, Highfields Capital II LP,Highfields Capital III LP and Highfields Capital Management LP (Incorporated by reference to Annex E to the iHeartMedia,Inc. Registration Statement on Form S-4 (File No. 333-151345) filed on June 2, 2008). 10.15 Voting Agreement dated as of May 13, 2008 by and among BT Triple Crown Merger Co., Inc., B Triple Crown Finco, LLC, TTriple Crown Finco, LLC, iHeartMedia, Inc., Abrams Capital Partners I, LP, Abrams Capital Partners II, LP, WhitecrestPartners, LP, Abrams Capital International, Ltd. and Riva Capital Partners, LP (Incorporated by reference to Annex F to theiHeartMedia, Inc. Registration Statement on Form S-4 (File No. 333-151345) filed on June 2, 2008). 10.16§ Stockholders Agreement, dated as of July 29, 2008, by and among iHeartMedia, Inc., BT Triple Crown Merger Co., Inc., ClearChannel Capital IV, LLC, Clear Channel Capital V, L.P., L. Lowry Mays, Randall T. Mays, Mark P. Mays, LLM Partners, Ltd.,MPM Partners, Ltd. and RTM Partners, Ltd. (Incorporated by reference to Exhibit 10.2 to the iHeartMedia, Inc. Annual Reporton Form 10-K for the year ended December 31, 2009). 10.17§ Side Letter Agreement, dated as of July 29, 2008, among iHeartMedia, Inc., Clear Channel Capital IV, LLC, Clear ChannelCapital V, L.P., L. Lowry Mays, Mark P. Mays, Randall T. Mays, LLM Partners, Ltd., MPM Partners Ltd. and RTM Partners,Ltd. (Incorporated by reference to Exhibit 10.3 to the iHeartMedia, Inc. Annual Report on Form 10-K for the year endedDecember 31, 2009). 10.18 Affiliate Transactions Agreement, dated as of July 30, 2008, by and among iHeartMedia, Inc., Bain Capital Fund IX, L.P.,Thomas H. Lee Equity Fund VI, L.P. and BT Triple Crown Merger Co., Inc. (Incorporated by reference to Exhibit 99.6 to theiHeartMedia, Inc. Form 8-A Registration Statement filed on July 30, 2008). 10.19§ Side Letter Agreement, dated as of December 22, 2009, by and among iHeartMedia, Inc., Clear Channel Capital IV, LLC,Clear Channel Capital V, L.P., Randall T. Mays and RTM Partners, Ltd. (Incorporated by reference to Exhibit 99.3 to theiHeartCommunications, Inc. Current Report on Form 8-K filed on December 29, 2009). 10.20§ Agreement Regarding Aircraft, dated May 31, 2013, by and among iHeartCommunications, Inc., Mark P. Mays, Randall T.Mays and L. Lowry Mays (Incorporated by reference to Exhibit 10.1 to the iHeartMedia, Inc. Quarterly Report on Form 10-Qfor the quarter ended June 30, 2013). 10.21§ Stock Purchase Agreement dated as of November 15, 2010 by and among iHeartMedia, Inc., Clear Channel Capital IV, LLC,Clear Channel Capital V, L.P. and Pittman CC LLC (Incorporated by reference to Exhibit 10.3 to the iHeartMedia, Inc.Quarterly Report on Form 10-Q for the quarter ended September 30, 2011). 10.22§ Aircraft Lease Agreement dated as of November 16, 2011 by and between Yet Again Inc. and iHeartMedia + Entertainment,Inc. (Incorporated by reference to Exhibit 10.23 to the iHeartMedia, Inc. Annual Report on Form 10-K for the year endedDecember 31, 2011). 10.23§ Aircraft Lease Agreement dated as of December 23, 2013 by and between FalconAgain Inc. and iHeartMedia + Entertainment,Inc. (Incorporated by reference to Exhibit 10.23 to the iHeartMedia, Inc. Annual Report on Form 10-K for the year endedDecember 31, 2013). 10.24§ Letter Agreement dated as of January 13, 2014 by and between FalconAgain Inc. and iHeartMedia + Entertainment, Inc.(Incorporated by reference to Exhibit 10.24 to the iHeartMedia, Inc. Annual Report on Form 10-K for the year endedDecember 31, 2013). 10.25§ Clear Channel 2008 Executive Incentive Plan (the “CC Executive Incentive Plan”) (Incorporated by reference to Exhibit10.26 to the iHeartMedia, Inc. Annual Report on Form 10-K for the year ended December 31, 2009). 10.26§ Amendment No. 1 to the CC Executive Incentive Plan, effective as of July 1, 2013 (Incorporated by reference to Exhibit 10.1to the iHeartMedia, Inc. Quarterly Report on Form 10-Q for the quarter ended September 30, 2013). 10.27§ Form of Senior Executive Option Agreement under the CC Executive Incentive Plan (Incorporated by reference to Exhibit10.20 to the iHeartMedia, Inc. Current Report on Form 8-K filed on July 30, 2008). 10.28§ Form of Senior Executive Restricted Stock Award Agreement under the CC Executive Incentive Plan (Incorporated byreference to Exhibit 10.21 to the iHeartMedia, Inc. Current Report on Form 8-K filed on July 30, 2008). 10.29§ Form of Senior Management Option Agreement under the CC Executive Incentive Plan (Incorporated by reference to Exhibit10.22 to the iHeartMedia, Inc. Current Report on Form 8-K filed on July 30, 2008). 10.30§ Form of Executive Option Agreement under the CC Executive Incentive Plan (Incorporated by reference to Exhibit 10.23 tothe iHeartMedia, Inc. Current Report on Form 8-K filed on July 30, 2008). 10.31§ Clear Channel Employee Equity Investment Program (Incorporated by reference to Exhibit 10.24 to the iHeartMedia, Inc.Current Report on Form 8-K filed on July 30, 2008). 10.32§ iHeartMedia, Inc. 2008 Annual Incentive Plan (Incorporated by reference to Exhibit 10.32 to the iHeartMedia, Inc. AnnualReport on Form 10-K for the year ended December 31, 2009). 10.33§ Summary Description of 2012 Supplemental Incentive Plan (Incorporated by reference to Exhibit 10.1 to the iHeartMedia,Inc. Current Report on Form 8-K filed on February 23, 2012). 10.34§ Summary Description of 2013 Supplemental Incentive Plan (Incorporated by reference to Exhibit 10.1 to the iHeartMedia,Inc. Current Report on Form 8-K filed on February 15, 2013). 10.35§ Clear Channel Outdoor Holdings, Inc. 2005 Stock Incentive Plan, as amended and restated (the “CCOH Stock IncentivePlan”) (Incorporated by reference to Exhibit 10.2 to the Clear Channel Outdoor Holdings, Inc. Current Report on Form 8-Kfiled on April 30, 2007). 10.36§ First Form of Option Agreement under the CCOH Stock Incentive Plan (Incorporated by reference to Exhibit 10.2 to the ClearChannel Outdoor Holdings, Inc. Registration Statement on Form S-8 (File No. 333-130229) filed on December 9, 2005). 10.37§ Form of Option Agreement under the CCOH Stock Incentive Plan (approved February 21, 2011) (Incorporated by reference toExhibit 10.33 to the iHeartMedia, Inc. Annual Report on Form 10-K for the year ended December 31, 2011). 10.38§ Form of Restricted Stock Award Agreement under the CCOH Stock Incentive Plan (Incorporated by reference to Exhibit 10.3to the Clear Channel Outdoor Holdings, Inc. Registration Statement on Form S-8 (File No. 333-130229) filed on December 9,2005). 10.39§ Form of Restricted Stock Unit Award Agreement under the CCOH Stock Incentive Plan (Incorporated by reference to Exhibit10.16 to the Clear Channel Outdoor Holdings, Inc. Annual Report on Form 10-K for the year ended December 31, 2010). 10.40§ Clear Channel Outdoor Holdings, Inc. 2012 Stock Incentive Plan (the “CCOH 2012 Stock Incentive Plan”) (Incorporated byreference to Exhibit 99.1 to the Clear Channel Outdoor Holdings, Inc. Registration Statement on Form S-8 (File No. 333-181514) filed on May 18, 2012). 10.41§ Clear Channel Outdoor Holdings, Inc. Amended and Restated 2006 Annual Incentive Plan (Incorporated by reference toAppendix B to the Clear Channel Outdoor Holdings, Inc. Definitive Proxy Statement on Schedule 14A for its 2012 AnnualMeeting of Stockholders filed on April 9, 2012). 10.42§ Relocation Policy - Chief Executive Officer and Direct Reports (Guaranteed Purchase Offer) (Incorporated by reference toExhibit 10.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on October 12, 2010). 10.43§ Relocation Policy - Chief Executive Officer and Direct Reports (Buyer Value Option) (Incorporated by reference to Exhibit10.2 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on October 12, 2010). 10.44§ Relocation Policy - Function Head Direct Reports (Incorporated by reference to Exhibit 10.3 to the iHeartCommunications,Inc. Current Report on Form 8-K filed on October 12, 2010). 10.45§ Form of iHeartMedia, Inc. and iHeartCommunications, Inc. Indemnification Agreement (Incorporated by reference to Exhibit10.26 to the iHeartMedia, Inc. Current Report on Form 8-K filed on July 30, 2008). 10.46§ Indemnification Agreement by and among iHeartMedia, Inc., iHeartCommunications, Inc. and Robert W. Pittman datedSeptember 18, 2012 (Incorporated by reference to Exhibit 10.3 to the iHeartMedia, Inc. Quarterly Report on Form 10-Q for thequarter ended September 30, 2012). 10.47§ Form of Clear Channel Outdoor Holdings, Inc. Independent Director Indemnification Agreement (Incorporated by reference toExhibit 10.1 to the Clear Channel Outdoor Holdings, Inc. Current Report on Form 8-K filed on June 3, 2009). 10.48§ Form of Clear Channel Outdoor Holdings, Inc. Affiliate Director Indemnification Agreement (Incorporated by reference toExhibit 10.2 to the Clear Channel Outdoor Holdings, Inc. Current Report on Form 8-K filed on June 3, 2009). 10.49§ Indemnification Agreement by and among Clear Channel Outdoor Holdings, Inc. and Robert W. Pittman dated September 18,2012 (Incorporated by reference to Exhibit 10.4 to the iHeartMedia, Inc. Quarterly Report on Form 10-Q for the quarter endedSeptember 30, 2012). 10.50§ Indemnification Agreement by and among Clear Channel Outdoor Holdings, Inc. and Thomas W. Casey dated September 5,2012 (Incorporated by reference to Exhibit 10.5 to the iHeartMedia, Inc. Quarterly Report on Form 10-Q for the quarter endedSeptember 30, 2012). 10.51§ Indemnification Agreement by and among Clear Channel Outdoor Holdings, Inc. and Robert H. Walls, Jr. dated September 5,2012 (Incorporated by reference to Exhibit 10.6 to the iHeartMedia, Inc. Quarterly Report on Form 10-Q for the quarter endedSeptember 30, 2012). 10.52§ Amended and Restated Employment Agreement, dated as of December 22, 2009, by and among Randall T. Mays,iHeartCommunications, Inc. and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.39 to the iHeartMedia, Inc.Annual Report on Form 10-K for the year ended December 31, 2009). 10.53§ Amended and Restated Employment Agreement, dated June 23, 2010, by and among Mark P. Mays, iHeartMedia, Inc., andiHeartCommunications, Inc., as successor to BT Triple Crown Merger Co., Inc. (Incorporated by reference to Exhibit 10.1 tothe iHeartMedia, Inc. Current Report on Form 8-K filed on June 24, 2010). 10.54§ Employment Agreement, dated as of October 2, 2011, between Robert Pittman and iHeartMedia, Inc. (Incorporated byreference to Exhibit 10.1 to the iHeartMedia, Inc. Quarterly Report on Form 10-Q for the quarter ended September 30, 2011). 10.55§ Amended and Restated Employment Agreement, dated as of January 13, 2014 between Robert Pittman and iHeartMedia, Inc.(Incorporated by reference to Exhibit 10.1 to the iHeartMedia, Inc. Current Report on Form 8-K filed on January 13, 2014). 10.56§ Employment Agreement by and between iHeartMedia, Inc. and Richard J. Bressler, dated July 29, 2013 (Incorporated byreference to Exhibit 10.1 to the iHeartMedia, Inc. Current Report on Form 8-K/A filed on August 2, 2013). 10.57§ Employment Agreement, dated as of December 15, 2009, between Tom Casey and iHeartCommunications, Inc. (Incorporatedby reference to Exhibit 10.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on January 5, 2010). 10.58§ Severance Agreement and General Release by and between iHeartCommunications, Inc. and Thomas W. Casey, datedSeptember 11, 2013 (Incorporated by reference to Exhibit 10.1 to the iHeartMedia, Inc. Current Report on Form 8-K filed onSeptember 13, 2013). 10.59§ Employment Agreement, dated as of January 1, 2010, between Robert H. Walls, Jr., and iHeartMedia Management Services,Inc. (Incorporated by reference to Exhibit 10.1 to the iHeartCommunications, Inc. Current Report on Form 8-K filed onJanuary 5, 2010). 10.60§ Amended and Restated Employment Agreement, dated as of November 15, 2010, between John E. Hogan and iHeartMedia +Entertainment, Inc. (Incorporated by reference to Exhibit 10.1 to the iHeartMedia, Inc. Current Report on Form 8-K filed onNovember 18, 2010). 10.61§ First Amendment dated February 23, 2012 to Amended and Restated Employment Agreement by and between iHeartMedia +Entertainment, Inc. and John E. Hogan dated November 15, 2010 (Incorporated by reference to Exhibit 10.2 to theiHeartMedia, Inc. Current Report on Form 8-K filed on February 23, 2012). 10.62§ Second Amendment to Amended and Restated Employment Agreement by and between iHeartMedia + Entertainment, Inc.and John Hogan, dated September 4, 2013 (Incorporated by reference to Exhibit 10.2 to the iHeartMedia, Inc. QuarterlyReport on Form 10-Q for the quarter ended September 30, 2013). 10.63§ Severance Agreement and General Release, dated as of January 13, 2014, by and between John Hogan and iHeartMedia +Entertainment, Inc. (Incorporated by reference to Exhibit 10.3 to the iHeartMedia, Inc. Form 8-K filed on January 13, 2014). 10.64§ Employment Agreement, effective as of January 24, 2012, between C. William Eccleshare and Clear Channel OutdoorHoldings, Inc. (Incorporated by reference to Exhibit 10.1 to the Clear Channel Outdoor Holdings, Inc. Current Report on Form8-K/A filed on July 27, 2012). 10.65§ Contract of Employment between Jonathan Bevan and Clear Channel Outdoor Ltd dated October 30, 2009 (Incorporated byreference to Exhibit 10.1 to the Clear Channel Outdoor Holdings, Inc. Current Report on Form 8-K filed on December 11,2009). 10.66§ Employment Agreement, effective as of January 1, 2013, between Clear Channel Outdoor, Inc. and Suzanne M. Grimes(Incorporated by reference to Exhibit 10.42 to the Clear Channel Outdoor Holdings, Inc. Annual Report on Form 10-K for theyear ended December 31, 2012). 10.67§ Form of Amendment to Senior Executive Option Agreement under the CC Executive Incentive Plan, dated as of October 14,2008 (Incorporated by reference to Exhibit 10.56 to the iHeartMedia, Inc. Annual Report on Form 10-K for the year endedDecember 31, 2011). 10.68§ Second Amendment, dated as of December 22, 2009, to the Senior Executive Option Agreement under the CC ExecutiveIncentive Plan, dated July 30, 2008, between Randall T. Mays and iHeartMedia, Inc. (Incorporated by reference to Exhibit99.2 to the iHeartCommunications, Inc. Current Report on Form 8-K filed on December 29, 2009). 10.69§ Second Amendment, dated as of June 23, 2010, to the Senior Executive Option Agreement under the CC Executive IncentivePlan, dated July 30, 2008, between Mark P. Mays and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.2 to theiHeartCommunications, Inc. Current Report on Form 8-K filed on June 24, 2010). 10.70§ Form of Executive Option Agreement under the CC Executive Incentive Plan, dated as of December 31, 2010, between TomCasey and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.42 to the iHeartCommunications, Inc. Annual Report onForm 10-K for the year ended December 31, 2010). 10.71§ Form of Executive Option Agreement under the CC Executive Incentive Plan, dated as of December 31, 2010, between JohnHogan and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.43 to the iHeartCommunications, Inc. Annual Reporton Form 10-K for the year ended December 31, 2010). 10.72§ Form of Executive Option Agreement under the CC Executive Incentive Plan, dated as of December 31, 2010, between RobertH. Walls, Jr. and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.44 to the iHeartCommunications, Inc. AnnualReport on Form 10-K for the year ended December 31, 2010). 10.73§ Form of Executive Replacement Option Agreement under the CC Executive Incentive Plan between John E. Hogan andiHeartMedia, Inc. (Incorporated by reference to Exhibit 99(a)(1)(iv) to the iHeartMedia, Inc. Schedule TO filed onFebruary 18, 2011). 10.74§ Form of Executive Option Agreement under the CC Executive Incentive Plan, dated as of May 19, 2011, between Scott D.Hamilton and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.63 to the iHeartMedia, Inc. Annual Report on Form10-K for the year ended December 31, 2011). 10.75§ Executive Option Agreement under the CC Executive Incentive Plan, dated as of October 2, 2011, between Robert W. Pittmanand iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.2 to the iHeartMedia, Inc. Quarterly Report on Form 10-Q forthe quarter ended September 30, 2011). 10.76§ Amendment to the Executive Option Agreement under the CC Executive Incentive Plan, dated as of January 13, 2014,between Robert W. Pittman and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.2 to the iHeartMedia, Inc. CurrentReport on Form 8-K filed on January 13, 2014). 10.77§ Form of Restricted Stock Agreement under the CC Executive Incentive Plan, dated October 15, 2012, between Robert W.Pittman and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.74 to the iHeartMedia, Inc. Annual Report on Form10-K for the year ended December 31, 2012). 10.78§ Form of Restricted Stock Agreement under the CC Executive Incentive Plan, dated October 15, 2012, between Robert H.Walls, Jr. and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.75 to the iHeartMedia, Inc. Annual Report on Form10-K for the year ended December 31, 2012). 10.79§ Form of Restricted Stock Agreement under the CC Executive Incentive Plan, dated October 22, 2012, between John E. Hoganand iHeartMedia, Inc. (including as Exhibit B thereto an Amendment to Mr. Hogan’s Employment Agreement datedNovember 15, 2010, as amended by the First Amendment dated February 23, 2012) (Incorporated by reference to Exhibit10.76 to the iHeartMedia, Inc. Annual Report on Form 10-K for the year ended December 31, 2012). 10.80§ Form of Restricted Stock Agreement under the CC Executive Incentive Plan, dated October 22, 2012, between Scott D.Hamilton and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.77 to the iHeartMedia, Inc. Annual Report on Form10-K for the year ended December 31, 2012). 10.81§ Form of Restricted Stock Agreement under the CC Executive Incentive Plan, dated October 22, 2012, between Robert H.Walls, Jr. and iHeartMedia, Inc. (Incorporated by reference to Exhibit 10.78 to the iHeartMedia, Inc. Annual Report on Form10-K for the year ended December 31, 2012). 10.82§ Restricted Stock Agreement under the CC Executive Incentive Plan, dated January 13, 2014, between Robert W. Pittman andiHeartMedia, Inc. (Incorporated by reference to Exhibit C of Exhibit 10.1 to the iHeartMedia, Inc. Current Report on Form 8-Kfiled on January 13, 2014). 10.83§ Form of Stock Option Agreement under the CCOH Stock Incentive Plan, dated September 17, 2009, between C. WilliamEccleshare and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.34 to the Clear ChannelOutdoor Holdings, Inc. Annual Report on Form 10-K for the year ended December 31, 2010). 10.84§ Form of Amended and Restated Stock Option Agreement under the CCOH Stock Incentive Plan, dated as of August 11, 2011,between C. William Eccleshare and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.1 to theClear Channel Outdoor Holdings, Inc. Current Report on Form 8-K filed on August 12, 2011). 10.85§ Form of Stock Option Agreement under the CCOH Stock Incentive Plan, dated December 13, 2010, between C. WilliamEccleshare and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.35 to the Clear ChannelOutdoor Holdings, Inc. Annual Report on Form 10-K for the year ended December 31, 2010). 10.86§ Form of Restricted Stock Unit Agreement under the CCOH Stock Incentive Plan, dated December 20, 2010, between C.William Eccleshare and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.36 to the ClearChannel Outdoor Holdings, Inc. Annual Report on Form 10-K for the year ended December 31, 2010). 10.87§ Form of Restricted Stock Unit Agreement under the CCOH Stock Incentive Plan, dated March 26, 2012, between Robert H.Walls, Jr. and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.3 to the iHeartMedia, Inc.Quarterly Report on Form 10-Q for the quarter ended March 31, 2012). 10.88§ Form of Restricted Stock Unit Agreement under the CCOH Stock Incentive Plan, dated May 10, 2012, between Thomas W.Casey and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.49 to the Clear Channel WorldwideHoldings, Inc. Registration Statement on Form S-4 (File No. 333-182265) filed on June 21, 2012). 10.89§ Form of Restricted Stock Unit Agreement under the CCOH 2012 Stock Incentive Plan, dated July 26, 2012, between C.William Eccleshare and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.2 to the Clear ChannelOutdoor Holdings, Inc. Current Report on Form 8-K/A filed on July 27, 2012). 10.90§ Form of Restricted Stock Unit Agreement under the CCOH 2012 Stock Incentive Plan, dated January 1, 2013, betweenSuzanne M. Grimes and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.50 to the ClearChannel Outdoor Holdings, Inc. Annual Report on Form 10-K for the year ended December 31, 2012). 10.91§ Form of Stock Option Agreement under the CCOH 2012 Stock Incentive Plan, dated April 10, 2013, between Clear ChannelOutdoor Holdings, Inc. and each of Jonathan D. Bevan, Suzanne M. Grimes and Franklin G. Sisson, Jr. (Incorporated byreference to Exhibit 10.1 to the Clear Channel Outdoor Holdings, Inc. Quarterly Report on Form 10-Q for the quarter endedJune 30, 2012). 10.92§ Form of Restricted Stock Award Agreement under the CCOH 2012 Stock Incentive Plan, dated April 10, 2013, betweenFranklin G. Sisson, Jr. and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.2 to the ClearChannel Outdoor Holdings, Inc. Quarterly Report on Form 10-Q for the quarter ended June 30, 2012). 10.93§ Form of Restricted Stock Unit Award Agreement under the CCOH 2012 Stock Incentive Plan, dated April 10, 2013, betweenJonathan D. Bevan and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit 10.3 to the Clear ChannelOutdoor Holdings, Inc. Quarterly Report on Form 10-Q for the quarter ended June 30, 2012). 10.94§ Restricted Stock Award Agreement under the CCOH 2012 Stock Incentive Plan, dated January 13, 2014, between Robert W.Pittman and Clear Channel Outdoor Holdings, Inc. (Incorporated by reference to Exhibit D of Exhibit 10.1 to the iHeartMedia,Inc. Current Report on Form 8-K filed on January 13, 2014). 10.95§ 10.96 Stipulation of Settlement, dated as of July 8, 2013, among legal counsel for iHeartCommunications, Inc. and the other nameddefendants, the special litigation committee of the board of directors of Clear Channel Outdoor Holdings, Inc. and theplaintiffs (Incorporated by reference to Exhibit 10.1 to the Clear Channel Outdoor Holdings, Inc. Current Report on Form 8-Kfiled on July 9, 2013). Employment Agreement by and between iHeartMedia Management Services, Inc. and Scott D. Hamilton, dated May 20, 2014(Incorporated by reference to Exhibit 10.1 to the iHeartMedia, Inc. Current Report on Form 8-K filed on June 25, 2014). 24* Power of Attorney (included on signature page). 31.1* Certification Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant toSection 302 of the Sarbanes-Oxley Act of 2002. 31.2* Certification Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant toSection 302 of the Sarbanes-Oxley Act of 2002. 32.1** Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2** Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101* Interactive Data Files.125 _________________* Filed herewith.** This exhibit is furnished herewith and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwisesubject to the liability of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or theSecurities Exchange Act of 1934.§ A management contract or compensatory plan or arrangement required to be filed as an exhibit pursuant to Item 601 of Regulation S-K.134 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signedon its behalf by the undersigned, thereunto duly authorized, on February 19, 2015. IHEARTMEDIA, INC. By: /s/ Robert W. Pittman Robert W. Pittman Chairman and Chief Executive Officer Power of Attorney Each person whose signature appears below authorizes Robert W. Pittman, Richard J. Bressler and Scott D. Hamilton, or any one of them, each ofwhom may act without joinder of the others, to execute in the name of each such person who is then an officer or director of the Registrant and to file anyamendments to this Annual Report on Form 10-K necessary or advisable to enable the Registrant to comply with the Securities Exchange Act of 1934, asamended, and any rules, regulations and requirements of the Securities and Exchange Commission in respect thereof, which amendments may make suchchanges in such report as such attorney-in-fact may deem appropriate. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrantand in the capacities and on the dates indicated. NameTitleDate/s/ Robert W. PittmanRobert W. PittmanChairman, Chief Executive Officer (Principal Executive Officer) and DirectorFebruary 19, 2015 /s/ Richard J. BresslerRichard J. BresslerPresident, Chief Financial Officer (Principal Financial Officer) and DirectorFebruary 19, 2015 /s/ Scott D. HamiltonScott D. Hamilton Senior Vice President, Chief Accounting Officer (Principal Accounting Officer) andAssistant SecretaryFebruary 19, 2015 /s/ David C. AbramsDavid C. Abrams DirectorFebruary 19, 2015 /s/ Irving L. AzoffIrving L. Azoff DirectorFebruary 19, 2015 /s/ James C. CarlisleJames C. Carlisle DirectorFebruary 19, 2015/s/ John P. ConnaughtonJohn P. Connaughton DirectorFebruary 19, 2015/s/ Julia B. DonnellyJulia B. Donnelly DirectorFebruary 19, 2015/s/ Matthew J. FreemanMatthew J. Freeman DirectorFebruary 19, 2015 /s/ Blair E. HendrixBlair E. Hendrix DirectorFebruary 19, 2015/s/ Jonathon S. JacobsonJonathon S. Jacobson DirectorFebruary 19, 2015 /s/ Ian K. LoringIan K. Loring DirectorFebruary 19, 2015 /s/ Mark P. MaysMark P. Mays DirectorFebruary 19, 2015 /s/ Scott M. SperlingScott M. Sperling DirectorFebruary 19, 2015135 136 EXHIBIT 11 – COMPUTATION OF LOSS PER SHARE (In thousands, except per share data)Year Ended December 31, 2014 2013 2012NUMERATOR: Net loss attributable to the Company – common shares$ (793,761) $ (606,883) $ (424,479) Less: Participating securities dividends - 2,566 8,456 Net loss attributable to the Company per common share – basic and diluted$ (793,761) $ (609,449) $ (432,935) DENOMINATOR: Weighted average common shares outstanding – basic 83,941 83,364 82,745 Effect of dilutive securities: Stock options and restricted stock (1) - - - Weighted average common shares outstanding – diluted 83,941 83,364 82,745 Net loss attributable to the Company per common share: Basic$ (9.46) $ (7.31) $ (5.23) Diluted$ (9.46) $ (7.31) $ (5.23) (1)6.8 million, 6.4 million, and 5.4 million stock options were outstanding at December 31, 2014, 2013 and 2012, respectively, that were not included inthe computation of diluted earnings per share because to do so would have been anti-dilutive.  Exhibit 21: Subsidiaries of Registrant, iHeartMedia, Inc. NameState of Incorporation 1567 Media, LLCDEAMFM Broadcasting Licenses, LLCDEAMFM Broadcasting, Inc.DEAMFM Operating, Inc.DEAMFM Radio Licenses, LLCDEAMFM Texas Broadcasting, LPDEAMFM Texas Licenses, LLCDEAMFM Texas, LLCDEAustin Tower CompanyTXCapstar Radio Operating CompanyDECapstar TX, LLCTXCC Broadcast Holdings, Inc.NVCC CV LP, LLCDECC Finco Holdings, LLCDECC Finco, LLCDECC Licenses, LLCDECCHCV LP, LLCDEChristal Radio Sales, Inc.DECine Guarantors II, Inc.CACiticasters Co.OHCiticasters Licenses, Inc.TXClear Channel Adshel, Inc.DEClear Channel Investments Holdings, LLCDEClear Channel Airports of Georgia, Inc.GAClear Channel Airports of Texas, JVTXClear Channel Brazil Holdco, LLCDEClear Channel Broadcasting Licenses, Inc. NVClear Channel Broadcasting, Inc.NVClear Channel Capital I, LLCDEClear Channel Capital II, LLCDEClear Channel Communications, Inc.TXClear Channel Electrical Services, LLCDEClear Channel Holdings, Inc.NVClear Channel Identity, Inc.TXClear Channel Investments, Inc.NVClear Channel Management Services, Inc.TXClear Channel Metra, LLCDEClear Channel Metro, LLCDEClear Channel Mexico Holdings, Inc.NVClear Channel Outdoor Holdings Company CanadaDEClear Channel Outdoor Holdings, Inc.DEClear Channel Outdoor, Inc.DEClear Channel Peoples, LLCDEClear Channel Real Estate, LLCClear Channel Real Estate Services, LLCDETXClear Channel Satellite Services, Inc.DEClear Channel Spectacolor, LLCDEClear Channel Worldwide Holdings, Inc.NVClear Channel/Interstate Philadelphia, LLCDECritical Mass Media, Inc.OHEller-PW Company, LLCCAExceptional Outdoor Advertising, Inc.FLGet Outdoors Florida, LLCFLInterspace Airport Advertising International, LLCPAInterspace Services, Inc.PAKatz Communications, Inc.DEKatz Media Group, Inc.DEKatz Millennium Sales & Marketing, Inc.DEKatz Net Radio Sales, Inc.DEKeller Booth Sumners Joint VentureTXKelnic II Joint VentureTXMetro Networks, Inc.DEMetro Networks Communications, Inc.MDMetro Networks Communications, LPDEMetro Networks Services, Inc.DEMiami Airport Concession LLCDEMilpitas Sign Company, LLCDEM Street CorporationWAOutdoor Management Services, Inc.NVPremiere Networks, Inc.DESmartRoute Systems, Inc.DESunset Billboards, LLCWATerrestrial RF Licensing, Inc.NVTLAC, Inc.DETower FM Consortium, LLCTX  NameCountry ofIncorporationAdshel (Brazil) LtdaBrazilAdshel LtdaBrazilAdshel MexicoAdshel New Zealand Ltd.Adshel Street Furniture Pty LtdMexicoNew ZealandAustraliaAircheck India Pvt. Ltd.IndiaAllied Outdoor Advertising Ltd.United KingdomArcadia Cooper Properties Ltd.United KingdomARN Holdings Pty Ltd.AustraliaBarrett Petrie Sutcliffe London Ltd.United KingdomBarrett Petrie Sutcliffe Ltd.United KingdomBK Studi BVNetherlandsB & P Outdoor BVCCO International Holdings BVCCO Ontario Holdings, Inc.NetherlandsNetherlandsCanadaC.F.D. Billboards Ltd.CCH Holding BVChina Outdoor Media Investment (HK) Co., Ltd.China Outdoor Media Investment Inc.Cine Guarantors II, Ltd.Cine Movile SA de CVCitysites Outdoor Advertising (Albert) Pty Ltd.Citysites Outdoor Advertising Pty Ltd.Citysites Outdoor Advertising (South Australia) Pty Ltd.Citysites Outdoor Advertising (West Australia) Pty Ltd.Clear Channel CAC AGCinemobile Systems International NVUnited KingdomNetherlandsHong KongBritish Virgin IslandsCanadaMexicoAustraliaAustraliaAustraliaAustraliaSwitzerlandNetherland AntillesClear Channel International BVNetherlandsClear Channel International Holdings BVNetherlandsClear Channel Adshel ASNorwayClear Channel Affitalia SRLItalyClear Channel Australia Pty Ltd.AustraliaClear Channel AWI AGSwitzerlandClear Channel Baltics & Russia ABSwedenClear Channel Banners LimitedUnited KingdomClear Channel Belgium SprlBelgiumClear Channel Brazil Holding S/ABrazilClear Channel (Central) Ltd.United KingdomClear Channel CVNetherlandsClear Channel Danmark A/SDenmarkClear Channel Entertainment of Brazil LtdaBrazilClear Channel Espana SLSpainClear Channel Espectaculos SLSpainClear Channel Estonia OUEstoniaClear Channel European Holdings SASFranceClear Channel Felice GmbHSwitzerlandClear Channel France SAFranceClear Channel GmbHSwitzerlandClear Channel Hillenaar BVNetherlandsClear Channel Holding AGSwitzerlandClear Channel Holding Italia SPAItalyClear Channel Holdings CVNetherlandsClear Channel Holdings, Ltd.United KingdomClear Channel Hong Kong Ltd.Hong KongClear Channel Infotrak AGSwitzerlandClear Channel International Ltd.United KingdomClear Channel Interpubli AGSwitzerlandClear Channel Ireland Ltd.IrelandClear Channel Italy Outdoor SRLItalyClear Channel Jolly Pubblicita SPAItalyClear Channel KNR Neth Antilles NVNetherlands AntillesClear Channel LatviaLatviaClear Channel LietuvaLithuaniaClear Channel (Midlands) Ltd.United KingdomClear Channel NI Ltd.United KingdomClear Channel (Northwest) Ltd.United KingdomClear Channel Norway ASNorwayClear Channel Outdoor Company CanadaCanadaClear Channel Outdoor Hungary KFTHungaryClear Channel Outdoor Mexico SA de CVMexicoClear Channel Outdoor Mexico, Operaciones SA de CVMexicoClear Channel Outdoor Mexico, Servicios Administrativos, SA de CVMexicoClear Channel Outdoor Mexico, Servicios Corporativos, SA de CVMexicoClear Channel Outdoor Pty Ltd.AustraliaClear Channel Outdoor Spanish Holdings S.L.SpainClear Channel Overseas Ltd.United KingdomClear Channel Pacific Pte Ltd.SingaporeClear Channel Aida GmbHSwitzerlandClear Channel Ofex AGSwitzerlandClear Channel Plakatron AGSwitzerlandClear Channel Poland Sp ZO.o. PolandClear Channel Russia Ltd.RussiaClear Channel Sales ABSwedenClear Channel Sao Paulo Participacoes LtdaBrazilClear Channel (Scotland) Ltd.ScotlandClear Channel Schweiz AGSwitzerlandClear Channel Singapore Pte Ltd.SingaporeClear Channel SmartbikeFranceClear Channel South America S.A.C.PeruClear Channel (South West) Ltd.United KingdomClear Channel Suomi OyFinlandClear Channel Sverige ABSwedenClear Channel Tanitim Ve Iletisim ASTurkeyClear Channel UK LtdUnited KingdomClear Channel UK One Ltd.United KingdomClear Channel UK Two Ltd.United KingdomClear Channel UK Three Ltd.United KingdomClear Media LimitedBermudaComurben SACR Phillips Investments Pty Ltd.MoroccoAustraliaEller Holding Company Cayman ICayman IslandsEller Holding Company Cayman IICayman IslandsEller Media Asesorias Y Comercializacion Publicitaria LtdaChileEller Media Servicios Publicitarios LtdaChileEpiclove Ltd.United KingdomEquipamientos Urbanos de Canarias SASpainEquipamientos Urbanos Del Sur SLSpainEquipamientos Urbanos - Gallega de Publicidad Disseno AIEFM Media Ltd.SpainUnited KingdomFoxmark UK Ltd.United KingdomGiganto Holding CaymanCayman IslandsGiganto Outdoor SAChileGrosvenor Advertising Ltd.United KingdomHainan Whitehorse Advertising Media Investment Company Ltd.ChinaIlluminated Awnings Systems Ltd.IrelandInterspace Airport Advertising Australia Pty Ltd.AustraliaInterspace Costa Rica Airport Advertising SACosta RicaInterspace Airport Advertising Curacao NVNetherlands AntillesInterspace Airport Advertising Netherlands Antilles NVNetherlands AntillesInterspace Airport Advertising West Indies Ltd.West IndiesInterspace Airport Advertising New Zealand Ltd.New ZealandInterspace Airport Advertising Grand CaymanInterspace Airport Advertising Trinidad & Tobago Ltd.Interspace Airport Advertising TCI Ltd.Cayman IslandsRepublic of Trinidad &TobagoTurks & CaicosKMS Advertising Ltd.United KingdomL & C Outdoor Ltda.BrazilMars Reklam Ve Producksiyon ASTurkeyMaurice Stam LtdMedia Monitors Dominican RepublicMedia Monitors (M) Sdn. Bhd.United KingdomPanamaMalaysiaMing Wai Holdings Ltd.British Virgin IslandsMore O'Ferrall Ireland Ltd.IrelandMultimark Ltd.United KingdomNitelites (Ireland) Ltd.Nobro SCIrelandMexicoOutstanding Media I Stockholm ABSwedenPaneles Napsa. S.A.PeruParkin Advertising Ltd.Perth Sign CompanyPhillips Finance Pty Ltd.Phillips Neon Pty Ltd.United KingdomAustraliaAustraliaAustraliaPostermobile Advertising Ltd.United KingdomPostermobile Ltd.United KingdomPremium Holdings Ltd.United KingdomPremium Outdoor Ltd.United KingdomProcom Publicidade via Publica LtdaChilePTKC Rotterdam BVNetherlandsPublicidade Klimes Sao Paulo LtdaBrazilRacklight SA de CVMexicoRadio Broadcasting Australia Pty Ltd.AustraliaRadio Computing Services (Africa) Pty Ltd.South AfricaRadio Computing Services (NZ) Ltd.New ZealandRadio Computing Services (SEA) Pte Ltd.SingaporeRadio Computing Services (Thailand) Ltd.ThailandRadio Computing Services (UK) Ltd.United KingdomRadio Computing Services Canada Ltd.CanadaRCS Radio Computing China, Inc.ChinaRadio Computing Services of Australia Pty Ltd.AustraliaRadio Computing Services (India) Pvt. Ltd.IndiaRCS Europe SARLFranceRegentfile Ltd.United KingdomRockbox Ltd.United KingdomService2CitiesShelter Advertising Pty Ltd.BelgiumAustraliaSignways Ltd.United KingdomSimon Outdoor Ltd.RussiaSites International Ltd.Storm Outdoor Ltd.Street Furniture (NSW) Pty Lt.dSupersigns Ltd.Supersigns Polska SP ZO.o.United KingdomUnited KingdomAustraliaBahamasPolandTeam Relay Ltd.United KingdomThe Canton Property Investment Co. Ltd.United KingdomThe Kildoon Property Co. Ltd.United KingdomTorpix Ltd.United KingdomTown & City Posters Advertising. Ltd.United KingdomTracemotion Ltd.United KingdomTrainer Advertising Ltd.Urban Design Furniture Pty Lt.dUnited KingdomAustraliaVision Media Group UK LimitedUnited KingdomVision Posters Ltd.United Kingdom   Exhibit 23: CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM - ERNST & YOUNG LLP We consent to the incorporation by reference in the following Registration Statements: 1. Registration Statement (Form S-8) pertaining to the Clear Channel 2008 Executive Incentive Plan; Amended and Restated Clear ChannelCommunications, Inc. 2001 Stock Incentive Plan (No. 333-152647); and 2. Registration Statement (Form S-8) pertaining to the Clear Channel Nonqualified Deferred Compensation Plan (No. 333-152648)of our reports dated February 19, 2015, with respect to the consolidated financial statements and schedule of iHeartMedia, Inc., and the effectiveness ofinternal control over financial reporting of iHeartMedia, Inc., included in this Annual Report (Form 10-K) for the year ended December 31, 2014. /s/ Ernst & Young LLPSan Antonio, TexasFebruary 19, 2015  EXHIBIT 31.1 - CERTIFICATION PURSUANT TO RULES 13A-14(A) AND 15D-14(A) UNDER THE SECURITIES EXCHANGE ACT OF 1934, ASADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Robert W. Pittman, certify that:1. I have reviewed this Annual Report on Form 10-K of iHeartMedia, Inc.;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financialcondition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in ExchangeAct Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrantand have:(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for externalpurposes in accordance with generally accepted accounting principles;(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectivenessof the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscalquarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, theregistrant’s internal control over financial reporting; and5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors:(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control overfinancial reporting.Date: February 19, 2015 /s/ Robert W. PittmanRobert W. PittmanChairman and Chief Executive Officer  EXHIBIT 31.2 - CERTIFICATION PURSUANT TO RULES 13A-14(A) AND 15D-14(A) UNDER THE SECURITIES EXCHANGE ACT OF 1934, ASADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Richard J. Bressler, certify that:1. I have reviewed this Annual Report on Form 10-K of iHeartMedia, Inc.;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financialcondition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in ExchangeAct Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrantand have:(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for externalpurposes in accordance with generally accepted accounting principles;(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectivenessof the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscalquarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, theregistrant’s internal control over financial reporting; and5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors:(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control overfinancial reporting.Date: February 19, 2015 /s/ Richard J. BresslerRichard J. BresslerPresident and Chief Financial Officer  EXHIBIT 32.1 – CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002 This certification is provided pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and accompanies the Annual Report on Form 10-K (the “Form 10-K”) for the year ended December 31, 2014 of iHeartMedia, Inc. (the “Company”).The undersigned hereby certifies that the Form 10-K fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of1934 and that the information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of theCompany.Dated: February 19, 2015 By: /s/ Robert W. PittmanName: Robert W. PittmanTitle: Chairman and Chief Executive Officer  EXHIBIT 32.2 – CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002 This certification is provided pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and accompanies the Annual Report on Form 10-K (the “Form 10-K”) for the year ended December 31, 2014 of iHeartMedia, Inc. (the “Company”).The undersigned hereby certifies that the Form 10-K fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of1934 and that the information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of theCompany.Dated: February 19, 2015 By: /s/ Richard J. BresslerName: Richard J. BresslerTitle: President and Chief Financial Officer 

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