form_11-k.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
_____________________________
FORM 11-K
_____________________________
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x
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Annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934
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For the fiscal year ended December 31, 2010
or
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¨
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Transition report pursuant to Section 15(d) of the Securities Exchange Act of 1934
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For the transition period from to
Commission File Number
001-32663
_____________________________
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A.
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Full title of the plan and the address of the plan, if different from that of the issuer named below:
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CLEAR CHANNEL COMMUNICATIONS, INC. 401(k) SAVINGS PLAN
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B.
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Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:
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CLEAR CHANNEL OUTDOOR HOLDINGS, INC.
200 East Basse Road
San Antonio, Texas 78209
Telephone (210) 832-3700
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3
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16
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17
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Exhibit 23.1 – Consent of BKD, LLP
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To the Plan Administrator
Clear Channel Communications, Inc. 401(k) Savings Plan
San Antonio, Texas
We have audited the accompanying statements of net assets available for benefits of the Clear Channel Communications, Inc. 401(k) Savings Plan as of December 31, 2010 and 2009, and the related statement of changes in net assets available for benefits for the year ended December 31, 2010. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements 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 that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of Clear Channel Communications, Inc. 401(k) Savings Plan as of December 31, 2010 and 2009, and the changes in its net assets available for plan benefits for the year ended December 31, 2010, in conformity with accounting principles generally accepted in the United States of America.
The accompanying supplemental schedule is presented for the purpose of additional analysis and is not a required part of the basic financial statements but is supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule is the responsibility of the Plan’s management. The supplemental schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.
As discussed in Note 3, the Plan changed its method of accounting for notes receivable from participants.
/s/ BKD, LLP
San Antonio, Texas
June 24, 2011
Federal Employer Identification Number: 44-0160260
Clear Channel Communications, Inc. 401(k) Savings Plan
December 31, 2010 and 2009
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Assets
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2010
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2009
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Investments, at Fair Value
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Plan interest in Clear Channel Communications, Inc. Master Trust
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$ |
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629,983,833 |
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$ |
553,303,765 |
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Total investments, at fair value
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629,983,833 |
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553,303,765 |
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Receivables
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Employer's contribution
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471,143 |
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- |
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Participants' contributions
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1,281,910 |
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1,205,646 |
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Notes receivable from participants
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12,158,578 |
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11,737,589 |
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Total receivables
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13,911,631 |
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12,943,235 |
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Total assets
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643,895,464 |
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566,247,000 |
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Liabilities
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Administrative fees payable
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10,486 |
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11,722 |
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Total liabilities
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10,486 |
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11,722 |
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Net Assets Available for Benefits
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$ |
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643,884,978 |
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$ |
566,235,278 |
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2
See Notes to Financial Statements
Clear Channel Communications, Inc. 401(k) Savings Plan
December 31, 2010
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Investment Income
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Plan interest in Clear Channel Communications, Inc. Master Trust
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$ |
81,310,395 |
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Interest Income on Notes Receivables from Participants
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664,131 |
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Contributions
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Employer
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13,999,884 |
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Participants
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37,629,486 |
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Rollovers
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1,854,493 |
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Total contributions
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53,483,863 |
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Total additions
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135,458,389 |
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Deductions
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Benefits paid to participants
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57,748,629 |
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Administrative expenses
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60,060 |
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Total deductions
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57,808,689 |
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Net Increase
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77,649,700 |
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Net Assets Available for Benefits, Beginning of Year
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566,235,278 |
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Net Assets Available for Benefits, End of Year
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$ |
643,884,978 |
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3
See Notes to Financial Statements
Clear Channel Communications, Inc. 401(k) Savings Plan
December 31, 2010 and 2009
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Note 1:
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Description of Plan
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The following description of the Clear Channel Communications, Inc. (Company or Plan Sponsor) 401(k) Savings Plan (Plan) provides only general information. Participants should refer to the Plan document for a more complete description of the Plan’s provisions.
General
The Plan is a defined contribution plan generally covering all eligible employees of the Company and its subsidiaries. Prior to January 1, 2011, employees did not become eligible to participate in the Plan until completing one year of service. Beginning January 1, 2011, the eligibility service requirement was reduced from one year to 90 days. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended (ERISA).
Contributions
Participants may elect to defer a portion of their compensation by an amount that does not exceed the maximum allowed under Internal Revenue Service (IRS) rules and regulations. Each year, participants may elect to contribute up to 25% of their eligible pay on a pre-tax basis, up to the annual IRS maximum 401(k) deferral limit of $16,500 in 2010. The Plan Sponsor limits the 401(k) deferral percentage elections of all highly compensated employees in the Plan to a maximum of 5% of pay. The IRS limits the amount of compensation that can be taken into account for Plan purposes. For 2010, the qualified plan compensation limit was $245,000. Employees participating in the Plan who attained age 50 by December 31 were eligible to contribute an additional $5,500 in pre-tax “catch-up” contributions. Participants may also contribute amounts representing distributions from other qualified defined benefit or defined contribution plans. Participants direct the investment of their contributions into various investment options offered by the Plan. The Plan currently offers one unitized majority-owned subsidiary common stock fund (Clear Channel Outdoor Holdings, Inc.) and 19 registered investment funds.
Employer contributions to the Plan include matching contributions. The Plan Sponsor suspended the employer matching contributions effective April 30, 2009. The employer discretionary matching contribution was reinstated by the Plan Sponsor effective April 1, 2010, retroactive to January 1, 2010, in an amount equal to 50% of the first 5% of each participant’s voluntary contributions under the Plan. Additionally, elective contributions may be made annually at the discretion of the Plan Sponsor’s Board of Directors. The employer contribution was $13,999,884 for the year ended December 31, 2010.
Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
Participant Accounts
Each participant’s account is credited with allocations of the Plan Sponsor’s contribution and Plan earnings (losses) and charged with certain stock fund expenses and transaction fees. Allocations are based on participant account balances and participant-directed transactions, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s vested account.
Forfeitures
Participant forfeitures of non-vested contributions and unclaimed benefits are used to reduce employer contributions to the Plan. For the year ended December 31, 2010, approximately $280,400 of forfeitures was used to reduce employer contributions. There were unallocated forfeitures of approximately $16,900 and $13,900 as of December 31, 2010 and 2009, respectively.
Vesting
Participants are immediately vested in their contributions plus actual earnings thereon. Vesting in the Plan Sponsor’s contributions is based on years of continuous service. A participant is 100% vested in the Plan Sponsor’s contributions to the participant’s account after seven years of credited service (or upon the death or disability of the participant or attainment of age 65) for contributions made prior to January 1, 2002. A participant is 100% vested in the Plan Sponsor’s contributions to the participant’s account after five years of credited service (or upon the death or disability of the participant or attainment of age 65) for contributions made after January 1, 2002.
Notes Receivable from Participants
Participants may borrow from $1,000 up to a maximum of the lesser of i) $50,000 reduced by the excess, if any, of (A) the highest outstanding balance of loans to the participant from the Plan during the one year period ending on the day before the day the loan is made, over (B) the outstanding balance of loans to the participant from the Plan on the date on which the loan is made, or ii) 50% of their vested account balance. The loans are secured by the balance in the participant’s account and bear a fixed interest rate equal to 1% above the prime rate as reported in the Wall Street Journal for the last business day of the quarter preceding the calendar quarter in which the loan is processed unless such rate is not “reasonable” within the meaning of ERISA, in which case a reasonable rate of interest shall be used.
Notes receivable from participants are reported at amortized principal balance plus accrued but unpaid interest. Delinquent notes receivable from participants are reclassified as distributions based upon the terms of the Plan document.
Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
Payment of Benefits
On termination of employment, the Plan provides that benefits will be paid by a lump-sum distribution, a rollover or a combination of a lump sum and rollover. Participants also may elect to receive all or part of their funds invested in the Clear Channel Outdoor Holdings, Inc. stock fund in the form of shares of Clear Channel Outdoor Holdings, Inc. common stock, subject to Plan requirements. The Plan Sponsor encourages terminated participants to review the distribution options available under the Plan.
The Plan Sponsor may periodically distribute the funds of terminated participants who do not make a distribution election. If the vested account balance is $1,000 or less upon termination of employment, the funds will be distributed in the form of a lump-sum distribution unless the participant has elected to rollover the distribution. If the vested account balance is greater than $1,000 but less than $5,000 upon termination of employment, the distribution will be paid in the form of a direct rollover to an individual retirement plan designated by the Clear Channel Communications, Inc. Retirement Benefits Committee unless the participant has elected to receive the distribution in a lump sum payment or as a direct rollover. For benefits over $5,000 upon termination of employment, participants may elect to have benefits paid by lump sum distribution, remain in the Plan until the earlier of age 65 or death of the participant or rolled over into another qualified plan. Absent such an election, participants whose benefits exceed $5,000 upon termination of employment will receive a lump sum payment as soon as administratively feasible after reaching age 65. Hardship withdrawals are available to Plan participants upon approval.
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Note 2:
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Summary of Accounting Policies
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Accounting Pronouncements
In January 2010, the Financial Accounting Standards Board (FASB) issued ASU No. 2010-06, Improving Disclosures about Fair Value Measurements. This update amends ASC Topic 820, Fair Value Measurements and Disclosures, to require new disclosures for significant transfers in and out of Level 1 and Level 2 fair value measurements, disaggregation regarding classes of assets and liabilities, valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements for Level 2 or Level 3. These disclosures are effective for the interim and annual reporting periods beginning after December 15, 2009. Additional new disclosures regarding the purchases, sales, issuances and settlements in the roll forward of activity in Level 3 fair value measurements are effective for fiscal years beginning after December 15, 2010 beginning with the first interim period. The Plan adopted certain of the relevant disclosure provisions of ASU 2010-06 on January 1, 2010. Since ASU 2010-06 only affects fair value disclosures, its adoption did not affect the Plan’s net asset available for benefits or its changes in net assets available for benefits.
Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
In September 2010, the FASB issued Account Standards Update 2010-25, Reporting Loans to Participants by Defined Contribution Pension Plans (ASU 2010-25). ASU 2010-25 requires participant loans to be measured at their unpaid principal balance plus any accrued but unpaid interest and classified as notes receivable from participants. ASU 2010-25 is effective for fiscal years ending after December 15, 2010, and is required to be applied retrospectively. Adoption of ASU 2010-25 did not change the value of participant loans from the amount previously reported as of December 31, 2009. Participant loans have been reclassified as notes receivable from participants as of December 31, 2009 (see Note 3).
Basis of Accounting
The financial statements of the Plan are prepared using the accrual method of accounting.
Investment Valuation
The Plan’s interest in the Clear Channel Communications, Inc. Master Trust is stated at fair value (see Note 4).
Payments of Benefits
Benefits are recorded when paid.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Plan administrator to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
Reclassifications
Certain reclassifications have been made to the 2009 financial statement to conform to the 2010 financial statement presentation. These reclassifications had no effect on changes in net assets available for benefits.
Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
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Note 3:
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Change in Accounting Principle
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During 2010, the Plan adopted the provisions of ASU 2010-25, Reporting Loans to Participants by Defined Contribution Plans. The ASU requires loans to participants to be reported as notes receivable from participants at their unpaid principal balance plus any accrued but unpaid interest, instead of being reported as part of investments at fair value as they were under previous guidance.
The following financial statement line items for fiscal years 2010 and 2009 were affected by the change in accounting principle.
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2010
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Statement of Net Assets Available for Benefits
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As Computed
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Under
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As Computed
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Previous
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Under
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Effect of
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Guidance
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ASU 2010-25
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Change
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Investments
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$ |
642,142,411 |
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$ |
629,983,833 |
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$ |
(12,158,578 |
) |
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Notes receivable from participants
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$ |
- |
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$ |
12,158,578 |
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$ |
12,158,578 |
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2009
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Statement of Net Assets Available for Benefits
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As Previously
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Effect of
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Reported
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As Adjusted
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Change
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Investments
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$ |
565,041,354 |
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$ |
553,303,765 |
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$ |
(11,737,589 |
) |
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Notes receivable from participants
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$ |
- |
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$ |
11,737,589 |
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$ |
11,737,589 |
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Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
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2010
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Statement of Changes in Net Assets
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Available for Benefits
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As Computed
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Under
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As Computed
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Previous
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Under
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Effect of
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Guidance
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ASU 2010-25
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Change
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Investment income
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$ |
81,974,526 |
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$ |
81,310,395 |
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$ |
(664,131 |
) |
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Interest income from notes receivable from participants
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$ |
- |
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$ |
664,131 |
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$ |
664,131 |
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Note 4:
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Plan Interest in Clear Channel Communications, Inc. Master Trust
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The Master Trust was established for the investment of assets of the Plan and other Clear Channel Communications, Inc. sponsored retirement plans. These investments in the Master Trust consist of and are valued as follows:
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·
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Clear Channel Outdoor Holdings, Inc. common stock – quoted market price
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·
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Registered investment funds – net asset value of shares held
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The purpose of the Master Trust is the collective investment of the assets of participating employee benefit plans of the Company. The Master Trust’s assets are allocated among participating plans by assigning to each plan those transactions (primarily contributions and benefit payments) which can be specifically identified and allocating among all plans (in proportion to the fair value of the assets assigned to each plan) the income and expenses resulting from the collective investment of the assets.
Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
The proportionate interest of the Plan in the Master Trust at December 31, 2010 and 2009 was approximately 98.8% and 98.7%, respectively. The following table presents the fair values of investments and investment income for the Master Trust as of December 31:
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2010
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2009
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Investments at Fair Value
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Clear Channel Outdoor Holdings, Inc.
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common stock (unitized*)
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$ |
2,113,697 |
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$ |
1,357,496 |
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Registered investment funds
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635,863,772 |
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559,197,074 |
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| |
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$ |
637,977,469 |
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$ |
560,554,570 |
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2010
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Investment Income
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Net appreciation fair value of investments
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Clear Channel Outdoor Holdings, Inc.
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common stock (unitized*)
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$ |
537,845 |
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Registered investment funds
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|
69,059,797 |
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| |
|
|
69,597,642 |
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| |
|
|
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Interest and dividends
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|
12,689,695 |
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Interest on notes receivables from participants
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|
|
667,910 |
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| |
|
$ |
82,955,247 |
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| |
|
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|
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*A non-registered fund comprised of the underlying company stock and a short-term cash component.
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Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
|
Note 5:
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Fair Value of Assets and Liabilities
|
Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures, requires new disclosures for significant transfers in and out of Level 1 and Level 2 fair value measurements, disaggregation regarding classes of assets and liabilities, valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements for Level 2 or Level 3. That framework provides a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under FASB ASC 820 are described as follows:
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Level 1
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Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the plan has the ability to access.
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|
|
Level 2
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Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
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|
|
Level 3
|
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
Following is a description of the valuation methodologies used for assets measured at fair value on a recurring basis and recognized in the accompanying statements of net assets available for benefits, as well as the general classification of such assets and liabilities pursuant to the valuation hierarchy.
Investments
Where quoted market prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. Level 1 securities include: Common stocks which are valued at the closing price reported on the active market on which the individual securities are traded and Registered investment funds which are valued at the net asset value (NAV) of shares held by the Plan at year-end. If quoted market prices are not available, then fair values are estimated by using pricing models, quoted prices of securities with similar characteristics or discounted cash flows. There are no Level 2 or 3 securities held by the Plan. The following tables present the fair value measurements of assets recognized in the Master Trust measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at December 31, 2010 and 2009:
Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
| |
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2010
|
|
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|
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| |
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Fair Value Measurements Using
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Quoted Prices
|
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| |
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in Active
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|
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Significant
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|
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| |
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Markets for
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Other
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Significant
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| |
|
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Identical
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Observable
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Unobservable
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| |
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Assets
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|
|
Inputs
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|
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Inputs
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| |
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Fair Value
|
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(Level 1)
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(Level 2)
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(Level 3)
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| |
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Master Trust
|
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Registered investment funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International equity
|
|
$ |
56,305,856 |
|
|
$ |
56,305,856 |
|
|
$ |
- |
|
|
$ |
- |
|
|
Domestic equity
|
|
|
342,445,951 |
|
|
|
342,445,951 |
|
|
|
- |
|
|
|
- |
|
|
Life cycle
|
|
|
128,433,874 |
|
|
|
128,433,874 |
|
|
|
- |
|
|
|
- |
|
|
Bond
|
|
|
64,624,304 |
|
|
|
64,624,304 |
|
|
|
- |
|
|
|
- |
|
|
Money market
|
|
|
44,053,787 |
|
|
|
440,537,787 |
|
|
|
- |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Clear Channel Outdoor Holdings, Inc. common stock (unitized**)
|
|
|
2,113,697 |
|
|
|
2,113,697 |
|
|
|
- |
|
|
|
- |
|
|
Total assets at fair value*
|
|
$ |
637,977,469 |
|
|
$ |
637,977,469 |
|
|
$ |
- |
|
|
$ |
- |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2009 |
|
|
|
|
|
| |
|
|
|
|
|
Fair Value Measurements Using
|
|
| |
|
|
|
|
|
Quoted Prices
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
in Active
|
|
|
Significant
|
|
|
|
|
|
| |
|
|
|
|
|
Markets for
|
|
|
Other
|
|
|
Significant
|
|
| |
|
|
|
|
|
Identical
|
|
|
Observable
|
|
|
Unobservable
|
|
| |
|
|
|
|
|
Assets
|
|
|
Inputs
|
|
|
Inputs
|
|
| |
|
Fair Value
|
|
|
(Level 1)
|
|
|
(Level 2)
|
|
|
(Level 3)
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Master Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Registered investment funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International equity
|
|
$ |
52,680,839 |
|
|
$ |
52,680,839 |
|
|
$ |
- |
|
|
$ |
- |
|
|
Domestic equity
|
|
|
291,605,065 |
|
|
|
291,605,065 |
|
|
|
- |
|
|
|
- |
|
|
Life cycle
|
|
|
110,777,137 |
|
|
|
110,777,137 |
|
|
|
- |
|
|
|
- |
|
|
Bond
|
|
|
58,376,057 |
|
|
|
58,376,057 |
|
|
|
- |
|
|
|
- |
|
|
Money market
|
|
|
45,757,976 |
|
|
|
45,757,976 |
|
|
|
- |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Clear Channel Outdoor Holdings, Inc. common stock (unitized**)
|
|
|
1,357,496 |
|
|
|
1,357,496 |
|
|
|
- |
|
|
|
- |
|
|
Total assets at fair value*
|
|
$ |
560,554,570 |
|
|
$ |
560,554,570 |
|
|
$ |
- |
|
|
$ |
- |
|
Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
*The proportionate interest of the Plan in the Master Trust as of December 31, 2010 and 2009 was approximately 98.8% and 98.7%, respectively.
** A non-registered fund comprised of the underlying company stock and a short-term cash component.
The following presents investments that represent 5% or more of the Plan’s allocable interest in the underlying investments of the Master Trust as of December 31, 2010 and 2009:
| |
|
2010
|
|
|
2009
|
|
| |
|
|
|
|
|
|
|
LSV Value Equity Fund
|
|
$ |
37,058,360 |
|
|
$ |
32,767,019 |
|
|
Fidelity Growth Company Fund
|
|
$ |
38,893,490 |
|
|
$ |
30,625,901 |
|
|
Fidelity Retirement Money Market Portfolio
|
|
$ |
43,384,547 |
|
|
$ |
44,914,365 |
|
|
MSIFT Mid-Cap Growth Portfolio
|
|
$ |
68,293,467 |
|
|
$ |
53,485,309 |
|
|
PIMCO Total Return Fund
|
|
$ |
63,976,349 |
|
|
$ |
57,761,273 |
|
|
Fidelity Low-Priced Stock Fund
|
|
$ |
46,601,546 |
|
|
$ |
40,705,478 |
|
|
Fidelity Diversified International Fund
|
|
$ |
55,337,468 |
|
|
$ |
51,795,814 |
|
|
Spartan U.S. Equity Index Advantage Fund
|
|
$ |
111,724,125 |
|
|
$ |
102,921,414 |
|
|
Fidelity Freedom 2010 Fund
|
|
$ |
48,089,624 |
|
|
$ |
44,943,491 |
|
During 2010, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated in value as follows:
| |
|
|
|
|
Clear Channel Outdoor Holdings, Inc. common stock (unitized*)
|
|
$ |
537,845 |
|
|
Registered investment funds
|
|
|
68,233,167 |
|
| |
|
$ |
68,771,012 |
|
| |
|
|
|
|
|
|
*A non-registered fund comprised of the underlying company stock and a short-term cash component.
|
Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
|
Note 7:
|
Related Party Transactions
|
Certain Plan investments are managed by Fidelity Management Trust Company (Fidelity). Fidelity is the trustee as defined by the Plan and, therefore, these transactions qualify as party-in-interest transactions.
The Plan Sponsor paid approximately $399,000 in professional fees related to the Plan for the year ended December 31, 2010.
Although it has not expressed any intent to do so, the Plan Sponsor has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants would become 100% vested in the employer’s contributions allocated to their account.
The IRS has determined and informed the Plan Sponsor by a letter dated April 11, 2003, that the Plan and related trust are designed in accordance with applicable sections of the Internal Revenue Code (IRC). Effective January 1, 2009, the Clear Channel Communications, Inc. 401(k) Savings Plan was amended and restated to reflect recent amendments to the Plan and clarify certain provisions under the Plan, among other matters. Although the Plan has been amended and restated since receiving the determination letter, the Plan administrator believes that the Plan is designed and is currently being operated in compliance with the applicable requirements of the IRC. The Plan filed an application with the IRS for a determination letter on January 15, 2010.
Note 10: Subsequent Events
In accordance with the terms of the stock purchase agreement entered into between Clear Channel Acquisition LLC and Westwood One, Inc., on April 29, 2011, employees of the acquired companies who then participated in the Westwood One Incorporated Savings and Profit Sharing Plan will be eligible to participate in the Plan effective July 1, 2011.
Clear Channel Communications, Inc. 401(k) Savings Plan
Notes to Financial Statements
December 31, 2010 and 2009
Note 11: Risk and Uncertainties
The Plan invests in various types of investment securities. Investment securities are exposed to various risks, such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the participants’ account balances and the amounts reported in the statements of net assets available for Plan benefits.
The recent global economic downturn and continued economic uncertainties present employee benefit plans with difficult circumstances and challenges, which in some cases have resulted in large and unanticipated declines in the fair value of investments. The financial statements have been prepared using values and information currently available to the Plan.
Given the volatility of economic conditions, the values of assets recorded in the financial statements could change rapidly, resulting in material future adjustments in investment values that could negatively impact the Plan.
SUPPLEMENTAL SCHEDULE
Clear Channel Communications, Inc. 401(k) Savings Plan
EIN: 74-1787539 PN 001
December 31, 2010
| |
|
|
|
|
Description of investment,
|
|
|
| |
|
|
|
|
including maturity date, rate
|
|
|
|
Identity of issuer, borrower,
|
|
|
of interest, collateral, par
|
|
Current
|
|
lessor or similar party
|
|
|
or maturity value
|
|
value
|
| |
|
|
|
|
|
|
|
|
*
|
Participant Loans
|
|
|
Various due dates with interest rates
|
|
| |
|
|
|
|
between 4.25% - 11.5%
|
|
$ 12,158,578
|
| |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
* Denotes party in-interest
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
| |
CLEAR CHANNEL COMMUNICATIONS, INC. 401(K) SAVINGS PLAN |
|
| |
|
|
|
|
Date: June 24, 2011
|
By:
|
/s/ Scott D. Hamilton |
|
| |
|
Name: Scott D. Hamilton |
|
| |
|
Title: Principal Accounting Officer |
|
| |
|
|
|
|
Exhibit
|
|
Description
|
|
23.1*
|
|
Consent of BKD, LLP
|
| |
|
|
* Filed herewith.