Clear Channel Outdoor Holdings (CCO)

There can be no assurance that Clear Channel Communications will use any amounts that it receives from CCOI in a manner that protects or enhances its credit. Any detriment to the credit of Clear Channel Communications could have a material adverse effect on our business.

Pursuant to our cash management arrangement with Clear Channel Communications, substantially all of the cash generated from our domestic operations is transferred daily into Clear Channel Communications accounts, and Clear Channel Communications may use these amounts for its own general corporate purposes pursuant to the terms of our existing cash management and intercompany arrangements. Further, upon issuance of the notes, Clear Channel Worldwide Holdings will enter into two proceeds loans with CCOI, pursuant to which it will loan to CCOI, on a senior unsecured basis, amounts equal to the proceeds of the offering of the notes. Upon receipt of such loans, CCOI will prepay Clear Channel Communications the remaining $2.0 billion outstanding under the CCU Intercompany Note. Clear Channel Communications has advised us that it will use the amounts received from CCOI in prepayment of the CCU Intercompany Note to repay $2.0 billion of indebtedness under its senior secured credit facilities. CCOI will use the remainder of the proceeds from the loans to pay fees and expenses associated with the offering and to fund $50.0 million of the Liquidity Amount, with the balance of the proceeds available to CCOI for general corporate purposes. In this regard, the board of directors could use all or a portion of the remaining proceeds for the payment of dividends to its shareholders, including Clear Channel Communications, and is not prohibited from doing so by the terms of any of its loan agreements or credit facilities. Clear Channel Communications may use any funds it receives from CCOI as dividends, as well as amounts received from us pursuant to the terms of our cash management arrangements with Clear Channel Communications, as it deems suitable, and we will have no control over its use of such funds. Accordingly, Clear Channel Communications may use such funds in a manner that does not protect or enhance its credit. Because we are a creditor and subsidiary of Clear Channel Communications, such a result could have a material adverse effect on our business.