Clear Channel Outdoor Settles Shareholder Suit Over Loan To Parent
April 4, 2013 at 4:08 AM (PT)
CLEAR CHANNEL OUTDOOR HOLDINGS, INC. has reached agreement with shareholders to settle a lawsuit over a loan the company made to its parent company, CLEAR CHANNEL COMMUNICATIONS, INC.
The billboard company, its parent, and investors BAIN CAPITAL and THOMAS H. LEE PARTNERS were sued in MARCH 2012 by stockholders complaining about the DECEMBER 2009 loan, which the suit alleged constituted a breach of fiduciary duties by CLEAR CHANNEL COMMUNICATIONS to CLEAR CHANNEL OUTDOOR and the stockholders by allegedly requiring the outdoor company to agree to amend the terms of its 2005 Revolving Promissory Note by extending the term and changing the interest rate to below market.
A settlement reached on MARCH 28th has the outdoor company demanding payment of $200 million outstanding under the Note and declaring a dividend of $200 million, and amending the interest rate as well as establishing a Board committee to monitor the Note.