Clear Channel Communications, Inc.

P.O. Box 659512
San Antonio, Texas 78265-9512

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

To Be Held April 26, 2006

     As a shareholder of Clear Channel Communications, Inc., you are hereby given notice of and invited to attend, in person or by proxy, the Annual Meeting of Shareholders of Clear Channel Communications, Inc. to be held at The Watermark Hotel, 212 West Crockett Street, San Antonio, Texas 78205, on April 26, 2006, at 8:00 a.m. local time, for the following purposes:

	1.		to elect 11 directors to serve for the coming year;
	2.		to ratify the selection of Ernst & Young LLP as independent auditors for the year ending December 31, 2006;
	3.		to consider two shareholder proposals, if presented at the meeting; and
	4.		to transact any other business which may properly come before the meeting or any adjournment thereof.

     Only shareholders of record at the close of business on March 10, 2006 are entitled to notice of and to vote at the meeting.

     Two cut-out admission tickets are included on the back cover of this document and are required for admission to the meeting. Please contact Clear Channel’s Corporate Secretary at Clear Channel’s corporate headquarters if you need additional tickets. If you plan to attend the annual meeting, please note that space limitations make it necessary to limit attendance to shareholders and one guest. Admission to the annual meeting will be on a first-come, first-served basis. Registration and seating will begin at 7:30 a.m. Each shareholder may be asked to present valid picture identification, such as a driver’s license or passport. Shareholders holding stock in brokerage accounts (“street name” holders) will need to bring a copy of a brokerage statement reflecting stock ownership as of the record date. Cameras (including cellular telephones with photographic capabilities), recording devices and other electronic devices will not be permitted at the annual meeting. The annual meeting will begin promptly at 8:00 a.m.

     Your attention is directed to the accompanying proxy statement. In addition, although mere attendance at the meeting will not revoke your proxy, if you attend the meeting you may revoke your proxy and vote in person. To assure that your shares are represented at the meeting, please complete, date, sign and mail the enclosed proxy card in the return envelope provided for that purpose.

		By Order of the Board of Directors
		Randall T. Mays Secretary

San Antonio, Texas
March 10, 2006

2006 ANNUAL MEETING OF SHAREHOLDERS
NOTICE OF ANNUAL MEETING AND PROXY STATEMENT
TABLE OF CONTENTS

QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING			1
Why am I receiving these materials?			1
What information is contained in these materials?			1
What proposals will be voted on at the annual meeting?			1
Which of my shares may I vote?			1
What is the difference between holding shares as a shareholder of record and as a beneficial owner?			1
If my shares are held in “street name” by my broker, will my broker vote my shares for me?			2
How can I vote my shares in person at the annual meeting?			2
How can I vote my shares without attending the annual meeting?			2
May I change my vote?			2
What if I return my proxy card without specifying my voting choices?			3
What does it mean if I receive more than one proxy or voting instruction card?			3
What constitutes a quorum?			3
What are Clear Channel’s voting recommendations?			3
Where can I find the voting results of the annual meeting?			3
THE BOARD OF DIRECTORS			3
Compensation of Directors			3
Board Meetings			4
Independence of Directors			4
Committees of the Board			6
PROPOSAL 1: ELECTION OF DIRECTORS			7
Nominees for Director			7
CODE OF BUSINESS CONDUCT AND ETHICS			9
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT			9
EXECUTIVE COMPENSATION			10
Summary Compensation Table			11
Stock Option Grant Table			13
Stock Option Exercises and Holding Table			14
Equity Compensation Plans			15
Employment Agreements			16
REPORT OF THE COMPENSATION COMMITTEE AND THE EXECUTIVE PERFORMANCE SUBCOMMITTEE			18
STOCK PERFORMANCE GRAPH			22
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE			23
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION			23
CERTAIN TRANSACTIONS			23
AUDIT COMMITTEE REPORT			24
AUDITOR FEES			25
PROPOSAL 2: SELECTION OF INDEPENDENT AUDITORS			26
PROPOSALS 3 AND 4 - SHAREHOLDER PROPOSALS			26
SHAREHOLDER PROPOSALS FOR THE 2007 ANNUAL MEETING			30
ADVANCE NOTICE PROCEDURES			30
OTHER MATTERS			30
NYSE MATTERS			30
GENERAL			30
APPENDIX A – AUDIT COMMITTEE CHARTER			A-1
APPENDIX B – EXCERPTS FROM CLEAR CHANNEL’S 2005 ANNUAL REPORT ON FORM 10-K			B-1

PROXY STATEMENT

     This proxy statement contains information related to the annual meeting of shareholders of Clear Channel Communications, Inc. to be held on Wednesday, April 26, 2006, beginning at 8:00 a.m., at the Watermark Hotel, 212 West Crockett Street, San Antonio, Texas, and at any postponements or adjournments thereof. This proxy statement is being mailed to shareholders on or about March 24, 2006.

QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING

Q:

Why am I receiving these materials?

A:

Clear Channel’s Board of Directors (the “Board”) is providing these proxy materials for you in connection with Clear Channel’s annual meeting of shareholders (the “annual meeting”), which will take place on April 26, 2006. The Board is soliciting proxies to be used at the annual meeting. You are also invited to attend the annual meeting and are requested to vote on the proposals described in this proxy statement.

Q:

What information is contained in these materials?

A:

The information included in this proxy statement relates to the proposals to be voted on at the annual meeting, the voting process, the compensation of our directors and our most highly paid executive officers, and certain other required information. Following this proxy statement are excerpts from Clear Channel’s 2005 Annual Report on Form 10-K including Consolidated Financial Statements, Notes to the Consolidated Financial Statements, and Management’s Discussion and Analysis. A Proxy Card and a return envelope are also enclosed.

Q:

What proposals will be voted on at the annual meeting?

A:

There may be up to four proposals scheduled to be voted on at the annual meeting: the election of directors, the ratification of Ernst & Young LLP as Clear Channel’s independent accountants for the year ending December 31, 2006, and, if presented, two shareholder proposals.

Q:

Which of my shares may I vote?

A:

All shares owned by you as of the close of business on March 10, 2006 (the “Record Date”) may be voted by you. These shares include shares that are: (1) held directly in your name as the shareholder of record, and (2) held for you as the beneficial owner through a stockbroker, bank or other nominee. Each of your shares is entitled to one vote at the annual meeting.

Q:

What is the difference between holding shares as a shareholder of record and as a beneficial owner?

A:

Most shareholders of Clear Channel hold their shares through a stockbroker, bank or other nominee rather than directly in their own name. As summarized below, there are some distinctions between shares held of record and those owned beneficially.

     SHAREHOLDER OF RECORD: If your shares are registered directly in your name with Clear Channel’s transfer agent, The Bank of New York, you are considered, with respect to those shares, the shareholder of record, and these proxy materials are being sent directly to you by The Bank of New York on behalf of Clear Channel. As the shareholder of record, you have the right to grant your voting proxy directly to Clear Channel or to vote in person at the annual meeting. Clear Channel has enclosed a proxy card for you to use.

     BENEFICIAL OWNER: If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the beneficial owner of shares held in street name, and these proxy materials are being forwarded to you by your broker or nominee who is considered, with respect to those shares, the shareholder of record. As the beneficial owner, you have the right to direct your broker on how to vote and are also invited to attend the annual meeting. However, since you are not the shareholder of record, you may not vote these shares in person at the annual meeting, unless you obtain a signed proxy from the record holder giving you the right to vote the shares. Your broker or nominee has enclosed a voting instruction card for you to use in directing the broker or nominee regarding how to vote your shares.

Q:

If my shares are held in “street name” by my broker, will my broker vote my shares for me?

A:

Under New York Stock Exchange (“NYSE”) rules, brokers will have discretion to vote the shares of customers who fail to provide voting instructions. Your broker will send you directions on how you can instruct your broker to vote. If you do not provide instructions to your broker to vote your shares, they may either vote your shares on the matters being presented at the annual meeting or leave your shares unvoted.

Q:

How can I vote my shares in person at the annual meeting?

A:		Shares held directly in your name as the shareholder of record may be voted by you in person at the annual meeting. If you choose to do so, please bring the enclosed proxy card and proof of identification. Even if you plan to attend the annual meeting, Clear Channel recommends that you also submit your proxy as described below so that your vote will be counted if you later decide not to attend the annual meeting. You may request that your previously submitted proxy card not be used if you desire to vote in person when you attend the annual meeting. Shares held in “street name” may be voted in person by you at the annual meeting only if you obtain a signed proxy from the record holder giving you the right to vote the shares. Your vote is important. Accordingly, you are urged to sign and return the accompanying proxy card whether or not you plan to attend the annual meeting.
		If you plan to attend the annual meeting, please note that space limitations make it necessary to limit attendance to shareholders and one guest. Admission to the annual meeting will be on a first-come, first-served basis. Registration and seating will begin at 7:30 a.m. Each shareholder may be asked to present valid picture identification, such as a driver’s license or passport. Shareholders holding stock in brokerage accounts (“street name” holders) will need to bring a copy of a brokerage statement reflecting stock ownership as of the record date. Cameras (including cellular telephones with photographic capabilities), recording devices and other electronic devices will not be permitted at the annual meeting.

Q:

How can I vote my shares without attending the annual meeting?

A:

Whether you hold shares directly as the shareholder of record or beneficially in “street name,” when you return your proxy card or voting instructions accompanying this proxy statement, properly signed, the shares represented will be voted in accordance with your directions. You can specify your choices by marking the appropriate boxes on the enclosed proxy card.

Q:

May I change my vote?

A:

If you are a shareholder of record, you may change your vote or revoke your proxy at any time before your shares are voted at the annual meeting by sending the Secretary of Clear Channel a proxy card dated later than your last vote, notifying the Secretary of Clear Channel in writing, or voting at the annual meeting.

Q

What if I return my proxy card without specifying my voting choices?

A:

If your proxy card is signed and returned without specifying choices, the shares will be voted as recommended by the Board.

Q:

What does it mean if I receive more than one proxy or voting instruction card?

A:

It means your shares are registered differently or are in more than one account. Please provide voting instructions for all proxy and voting instruction cards you receive.

Q:

What constitutes a quorum?

A:		The presence, in person or by proxy, of the holders of a majority of the outstanding shares of Clear Channel’s Common Stock is necessary to constitute a quorum at the annual meeting. Only votes cast “for” a matter constitute affirmative votes. Votes “withheld” or abstaining from voting are counted for quorum purposes, but since they are not cast “for” a particular matter, they will have the same effect as negative votes or a vote “against” a particular matter.
		Under New York Stock Exchange Rules, the proposals to elect directors and to ratify the selection of independent auditors are considered “discretionary” items. This means that brokerage firms may vote in their discretion on these matters on behalf of clients who have not furnished voting instructions at least 15 days before the date of the annual meeting. In contrast, the shareholder proposals are “non-discretionary” items. This means brokerage firms that have not received voting instructions from their clients on these proposals may not vote on them. These so-called “broker non-votes” will be included in the calculation of the number of votes considered to be present at the annual meeting for purposes of determining a quorum, but will not be considered in determining the number of votes necessary for approval and will have no effect on the outcome of the vote for the shareholder proposals.

Q:

What are Clear Channel’s voting recommendations?

A:

The Board recommends that you vote your shares “FOR” each of the nominees to the Board, “FOR” the ratification of Ernst & Young LLP as Clear Channel’s independent accountants for the year ending December 31, 2006, and “AGAINST” the two shareholder proposals.

Q:

Where can I find the voting results of the annual meeting?

A:

Clear Channel will announce preliminary voting results at the annual meeting and publish final results in Clear Channel’s quarterly report on Form 10-Q for the second quarter of 2006, which will be filed with the Securities and Exchange Commission (the “SEC”) by August 9, 2006.

THE BOARD OF DIRECTORS

     The Board is responsible for the management and direction of Clear Channel and for establishing broad corporate policies. However, in accordance with corporate legal principles, it is not involved in day-to-day operating details. Members of the Board are kept informed of Clear Channel’s business through discussions with the Chief Executive Officer, President and Chief Financial Officer and other executive officers, by reviewing analyses and reports sent to them, and by participating in board and committee meetings.

COMPENSATION OF DIRECTORS

     Each non-employee director is paid a $50,000 annual retainer provided that he or she attends not less than 75% of the meetings of the Board. The chairpersons of each of the Audit Committee, Compensation Committee and Nominating and Governance Committee are paid an additional annual retainer of $20,000, $10,000, and $5,000, respectively. All members of the Audit Committee are paid an additional annual retainer of $7,500 and each member of the Compensation Committee and Nominating and Governance Committee are paid an additional annual

retainer of $3,000. In addition, in April 2005, each non-employee director was granted options to purchase 7,500 shares of Clear Channel common stock to be vested 20% annually over five years. Each non-employee director was offered the opportunity to accept an award of 1,500 shares of restricted stock in place of this grant. Six directors accepted this opportunity. The restricted stock award vests 20% annually over five years. In addition, in December 2005, each non-employee director was granted options to purchase 22,500 shares of Clear Channel common stock to be vested 20% annually over five years. Each non-employee director was offered the opportunity to accept an award of 5,625 shares of restricted stock in place of this grant. Six directors accepted this opportunity.

BOARD MEETINGS

     During 2005, the Board held eight meetings. Each of the nominees named below attended at least 75% of the aggregate of the total number of meetings of the Board held during such director’s term and at least 75% of the total number of meetings held by committees of the Board on which that director served. Clear Channel encourages, but does not require, directors to attend the annual meetings of shareholders. All ten members of the Board as of the date of Clear Channel’s 2005 Annual Meeting of Shareholders were in attendance.

INDEPENDENCE OF DIRECTORS

     The Board has adopted a set of Corporate Governance Guidelines, addressing, among other things, standards for evaluating the independence of Clear Channel’s directors. The full text of the guidelines can be found on Clear Channel’s Internet website at www.clearchannel.com. A copy may also be obtained upon request from the Secretary of Clear Channel. In February 2005, the Board enhanced its Corporate Governance Guidelines by adopting the following standards for determining the independence of its members:

	1.		A director must not be, or have been within the last three years, an employee of Clear Channel. In addition, a director’s immediate family member (“immediate family member is defined to include a person’s spouse, parents, children, siblings, mother and father-in-law, sons and daughters-in-law and anyone (other than domestic employees) who shares such person’s home) must not be, or have been within the last three years, an executive officer of Clear Channel.
	2.		A director or immediate family member must not have received, during any twelve month period within the last three years, more than $100,000 per year in direct compensation from Clear Channel, other than as director or committee fees and pension or other forms of deferred compensation for prior service (and no such compensation may be contingent in any way on continued service).
	3.		A director must not be a current partner of a firm that is Clear Channel’s internal or external auditor or a current employee of such a firm. In addition, a director must not have an immediate family member who is a current employee of such a firm and who participates in the firm’s audit, assurance or tax compliance (but not tax planning) practice. Finally, a director or immediate family member must not have been, within the last three years, a partner or employee of such a firm and personally worked on Clear Channel’s audit within that time.
	4.		A director or an immediate family member must not be, or have been within the last three years, employed as an executive officer of another company where any of Clear Channel’s present executive officers at the same time serve or served on that company’s compensation committee.
	5.		A director must not (a) be a current employee, and no director’s immediate family member may be a current executive officer, of any company that has made payments to, or received payments from, Clear Channel (together with its consolidated subsidiaries) for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million, or 2% of such other company’s consolidated gross revenues.
	6.		A director must not own, together with ownership interests of his or her family, ten percent (10%) or more of any company that has made payments to, or received payments from, Clear Channel (together with its consolidated subsidiaries) for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million, or 2% of such other company’s consolidated gross revenues.

7.

A director or immediate family member must not be or have been during the last three years, a director, trustee or officer of a charitable organization (or hold a similar position), to which Clear Channel (together with its consolidated subsidiaries) makes contributions in an amount which, in any of the last three fiscal years, exceeds the greater of $50,000, or 5% of such organization’s consolidated gross revenues.

     Pursuant to the Corporate Governance Guidelines, the Board undertook its annual review of director independence in February 2006. During this review, the Board considered transactions and relationships during the prior year between each director or any member of his or her immediate family and Clear Channel and its subsidiaries, affiliates and investors, including those reported under “Certain Transactions” below. The Board also examined transactions and relationships between directors or their affiliates and members of the senior management or their affiliates. As provided in the Corporate Governance Guidelines, the purpose of this review was to determine whether any such relationships or transactions were inconsistent with a determination that the director is independent.

     As a result of this review, the Board affirmatively determined that, of the directors nominated for election at the annual meeting, B. J. McCombs, Alan D. Feld, Perry J. Lewis, Phyllis B. Riggins, Theodore H. Strauss, J. C. Watts, John H. Williams and John B. Zachry are independent of Clear Channel and its management under the listing standards of the NYSE and the standards set forth in the Corporate Governance Guidelines, including those standards enumerated in paragraphs 1-7 above. In addition, the Board has determined that every member of the Audit Committee, the Compensation Committee and the Nominating and Governance Committee is independent.

     The rules of the NYSE require that non-management directors of a listed company meet periodically in executive sessions. Clear Channel’s non-management directors have met separately in executive sessions without management present.

     The Board has created the office of Presiding Director to serve as the lead non-management director of the Board. The Board has established that the office of the Presiding Director shall at all times be held by an “independent” director, as that term is defined from time to time by the listing standards of the NYSE and as determined by the Board in accordance with the Board’s Corporate Governance Guidelines. The Presiding Director has the power and authority to do the following:

	•		to preside at all meetings of non-management directors when they meet in executive session without management participation;
	•		to set agendas, priorities and procedures for meetings of non-management directors meeting in executive session without management participation;
	•		to generally assist the Chairman of the Board;
	•		to add agenda items to the established agenda for meetings of the Board;
	•		to request access to Clear Channel’s management, employees and its independent advisers for purposes of discharging his or her duties and responsibilities as a director; and
	•		to retain independent outside financial, legal or other advisors at any time, at the expense of Clear Channel, on behalf of any committee or subcommittee of the Board.

     The directors serving as the chairperson of the Compensation Committee of the Board, the chairperson of the Audit Committee of the Board and the chairperson of the Nominating and Governance Committee of the Board shall each take turns serving as the Presiding Director on a rotating basis, each such rotation to take place effective the first day of each calendar quarter.

     Currently, Mr. McCombs, the Chairman of the Nominating and Governance Committee, is serving as the Presiding Director. As part of the standard rotation established by the Board, Mr. Williams, the Chairman of the Compensation Committee and Executive Performance Subcommittee, will begin his service as the Presiding Director on April 1, 2006.

COMMITTEES OF THE BOARD

     The Board has three committees: the Compensation Committee, the Nominating and Governance Committee and the Audit Committee. The Compensation Committee has established an Executive Performance Subcommittee. Each committee has a written charter which guides its operations. The written charters are all available on Clear Channel’s Internet website at www.clearchannel.com, or a copy may be obtained upon request from the Secretary of Clear Channel. The table below sets forth members of each committee.

BOARD COMMITTEE MEMBERSHIP

Executive

Nominating and

Compensation

Performance

Governance

Audit

Name

Committee

Subcommittee

Committee

Committee

Perry J. Lewis

X

*

B. J. McCombs

X

X

*

Phyllis B. Riggins

X

Theodore H. Strauss

X

X

J. C. Watts

X

X

John H. Williams

X

*

X

*

X

X

John B. Zachry

X

X

X

The Compensation Committee

     The Compensation Committee administers Clear Channel’s stock option plans and performance-based compensation plans, determines compensation arrangements for all officers and makes recommendations to the Board concerning directors of Clear Channel and its subsidiaries (except with respect to matters entrusted to the Executive Performance Subcommittee as described below). See the Report of the Compensation Committee and the Executive Performance Subcommittee later in this document, which details the basis on which the Compensation Committee and its subcommittee determines executive compensation. The Compensation Committee met five times during 2005. All members of the Compensation Committee are independent as defined by the listing standards of the NYSE and Clear Channel’s independence standards.

     The Executive Performance Subcommittee of the Compensation Committee has as its principal responsibility to review and advise the Board with respect to performance-based compensation of executive and other corporate officers who are, or who are likely to become, subject to Section 162(m) of the Internal Revenue Code. Section 162(m), which among other things, limits the deductibility of compensation in excess of $1 million paid to a corporation’s chief executive officer and the four other most highly compensated executive officers. The Executive Performance Subcommittee of the Compensation Committee met two times during 2005.

The Nominating and Governance Committee

     The Nominating and Governance Committee is responsible for developing and reviewing background information for candidates for the Board of Directors, including those recommended by shareholders, and makes recommendations to the Board of Directors regarding such candidates as well as committee membership. The Nominating and Governance Committee met four times during 2005. All members of the Nominating and Governance Committee are independent as defined by the listing standards of the NYSE and Clear Channel’s independence standards.

     Our directors take a critical role in guiding Clear Channel’s strategic direction and oversee the management of Clear Channel. Board candidates are considered based upon various criteria, such as their broad-based business and professional skills and experiences, global business and social perspectives, concern for the long-term interests of the shareholders, and personal integrity and judgment. In addition, directors must have time available to devote to Board activities and to enhance their knowledge of the industries in which Clear Channel operates.

     Accordingly, we seek to attract and retain highly qualified directors who have sufficient time to attend to their substantial duties and responsibilities to Clear Channel. Recent developments in corporate governance and financial reporting have resulted in an increased demand for such highly qualified and productive public company directors.

     The Nominating and Governance Committee will consider director candidates recommended by shareholders. Any shareholder wishing to propose a nominee should submit a recommendation in writing to the Secretary of Clear Channel at least 90 days in advance of the annual meeting, indicating the nominee’s qualifications and other relevant biographical information and providing confirmation of the nominee’s consent to serve as a director. Shareholders should direct such proposals to: Board of Directors – Presiding Director, P.O. Box 659512 San Antonio, Texas 75265-9512.

The Audit Committee

     The Audit Committee is responsible for reviewing Clear Channel’s accounting practices and audit procedures. Additionally, Audit Committee members Perry J. Lewis and Phyllis B. Riggins have both been designated as “Financial Experts” as defined by the SEC. See the Audit Committee Report later in this document, which details the duties and performance of the Committee. The Audit Committee met nine times during 2005. All members of the Audit Committee are independent as defined by the listing standards of the NYSE and Clear Channel’s independence standards.

Shareholder Communication with the Board

     Shareholders desiring to communicate with the Board should do so by sending regular mail to Board of Directors – Presiding Director, P.O. Box 659512 San Antonio, Texas 75265-9512.

PROPOSAL 1: ELECTION OF DIRECTORS

     The Board intends to nominate, at the annual meeting of shareholders, the 11 persons listed as nominees below. Each of the directors elected at the annual meeting will serve until the next annual meeting of shareholders or until his or her successor shall have been elected and qualified, subject to earlier resignation and removal. The directors are to be elected by a plurality of the votes cast by the holders of the shares of Clear Channel common stock represented and entitled to be voted at the annual meeting. Unless authority to vote for directors is “withheld” in the proxy, the persons named therein intend to vote “FOR” the election of the 11 nominees listed. Each of the nominees listed below is currently a director and is standing for re-election. Each nominee has indicated a willingness to serve as director if elected. Should any nominee become unavailable for election, discretionary authority is conferred to vote for a substitute. Management has no reason to believe that any of the nominees will be unable or unwilling to serve if elected.

NOMINEES FOR DIRECTOR

     The nominees for director are Alan D. Feld, Perry J. Lewis, L. Lowry Mays, Mark P. Mays, Randall T. Mays, B. J. McCombs, Phyllis B. Riggins, Theodore H. Strauss, J. C. Watts, John H. Williams and John B. Zachry.

     Alan D. Feld, age 69, is the sole shareholder of a professional corporation which is a partner in the law firm of Akin Gump Strauss Hauer & Feld LLP. He has served as a director of Clear Channel since 1984. Mr. Feld also serves on the board of trustees of CenterPoint Properties Trust and American Beacon Mutual Funds.

     Perry J. Lewis, age 68, is a private investor. From February 2002 to February 2006 he served as an Advisory Director of CRT Capital Group LLC, a trading and investment banking firm. Prior to that Mr. Lewis was Managing Director of Heartland Industrial Partners, a private equity capital firm, for the remainder of the relevant five year period. Mr. Lewis was the Chairman of Broadcasting Partners, Inc. from its inception in 1988 until its merger with Evergreen Media Corporation, and was Chief Executive Officer of Broadcasting Partners, Inc. from 1993 to 1995. Mr. Lewis is a founder of Morgan, Lewis, Githens & Ahn, an investment banking and leveraged

buyout firm, which was established in 1982. He has served as a director of Clear Channel since August 30, 2000. He had served as a director of AMFM Inc. prior to that time and Evergreen Media Corporation prior to AMFM’s acquisition of Evergreen Media Corporation. Mr. Lewis also serves as a director of Superior Essex, Inc.

     L. Lowry Mays, age 70, is the founder of Clear Channel and currently serves as Chairman of the Board. Prior to October of 2004, he served as Chairman and Chief Executive Officer of Clear Channel and has been a director for the relevant five year period. Mr. Lowry Mays is a director of our publicly traded subsidiary, Clear Channel Outdoor Holdings, Inc. Mr. Lowry Mays is the father of Mark P. Mays and Randall T. Mays, who serve as the Chief Executive Officer, and the President and Chief Financial Officer of Clear Channel, respectively. Mr. Lowry Mays also serves as a director of Live Nation, Inc.

     Mark P. Mays, age 42, was Clear Channel’s President and Chief Operating Officer from February 1997 until his appointment as our President and Chief Executive Officer in October 2004. He relinquished his duties as President in February 2006. Mr. Mark Mays has served as a director since May 1998. Mr. Mark Mays is a director of our publicly traded subsidiary, Clear Channel Outdoor Holdings, Inc. Mr. Mark Mays is the son of L. Lowry Mays, Clear Channel’s Chairman and the brother of Randall T. Mays, Clear Channel’s President and Chief Financial Officer. Mr. Mark Mays also serves as a director of Live Nation, Inc.

     Randall T. Mays, age 40, was appointed Executive Vice President and Chief Financial Officer of Clear Channel in February 1997 and was appointed Secretary in April 2003. He was appointed president in February 2006. He has served as a director since April 1999. Mr. Randall Mays is a director of our publicly traded subsidiary, Clear Channel Outdoor Holdings, Inc. Mr. Randall Mays is the son of L. Lowry Mays, Clear Channel’s Chairman and the brother of Mark P. Mays, Clear Channel’s Chief Executive Officer. Mr. Randall Mays also serves as a director of Live Nation, Inc.

     B. J. McCombs, age 78, is a private investor. He has served as a director of Clear Channel for the relevant five year period.

     Phyllis B. Riggins, age 53, has been a Managing Director of Bluffview Capital, LP since May 2003. Prior thereto, she was a Managing Director and Group Head – Media/Telecommunication of Banc of America Securities (and its predecessors) global corporate and investment banking for the remainder of the relevant five year period. Ms. Riggins has served as a director of Clear Channel since December 2002.

     Theodore H. Strauss, age 81, is the Chairman of the Advisory Board for the Dallas Region of the Texas State Bank, a position he has held since 2005. Prior thereto, he was a Senior Managing Director of Bear, Stearns & Co., Inc., an investment banking firm for the remainder of the relevant five year period. He has served as a director of Clear Channel since 1984. Mr. Strauss also serves as a director of Sizeler Property Investors, Inc.

     J. C. Watts, Jr., age 48, is the Chairman of JC Watts Companies, LLC, a consulting firm. Mr. Watts is a former member of the United States House of Representatives and represented the 4^th District of Oklahoma from 1995 to 2002. He served as the Chairman of the House Republican Conference. He has served as a director of Clear Channel since February 2003. Mr. Watts also serves as a director of Terex Corporation, Dillard’s, Inc. and Burlington Northern Santa Fe Corp.

     John H. Williams, age 72, was a Senior Vice President of First Union Securities, Inc. (formerly known as Everen Securities, Inc.), an investment banking firm, until his retirement in July 1999. He has served as a director of Clear Channel since 1984. Mr. Williams also serves as a director of GAINSCO, Inc.

     John B. Zachry, age 44, has been the Chief Executive Officer of Zachry Construction Corp. since August 2004. Prior to August 2004 he served as President and Chief Operating Officer of Zachry Construction Corp. for the remainder of the relevant five year period. He has served as a director of Clear Channel since his appointment in December 2005.

MANAGEMENT RECOMMENDS THAT YOU VOTE “FOR” THE DIRECTOR NOMINEES NAMED ABOVE.

CODE OF BUSINESS CONDUCT AND ETHICS

     Clear Channel adopted a Code of Business Conduct and Ethics applicable to all its directors and employees, including its chief executive officer, chief financial officer, and chief accounting officer, which is a “code of ethics” as defined by applicable rules of the SEC. This code is publicly available on Clear Channel’s Internet website at www.clearchannel.com. A copy may also be obtained upon request from the Secretary of Clear Channel. If Clear Channel makes any amendments to this code other than technical, administrative, or other non-substantive amendments, or grants any waivers, including implicit waivers, from a provision of this code that applies to Clear Channel’s chief executive officer, chief financial officer or chief accounting officer and relates to an element of the SEC’s “code of ethics” definition, Clear Channel will disclose the nature of the amendment or waiver, its effective date and to whom it applies on its website or in a report on Form 8-K filed with the SEC.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT

     The table below sets forth information concerning the beneficial ownership of Clear Channel common stock as of March 10, 2006, for each director currently serving on the Board and each of the nominees for director; each of the named executive officers not listed as a director, the directors and executive officers as a group and each person known to Clear Channel to own beneficially more than 5% of outstanding common stock. At the close of business on March 10, 2006, there were 512,651,974 shares of Clear Channel common stock outstanding. Except as otherwise noted, each shareholder has sole voting and investment power with respect to the shares beneficially owned.

		Amount and Nature of				Percent
Name		Beneficial Ownership				of Class
Alan D. Feld			74,228	(1)			*
Perry J. Lewis			189,838	(2)			*
L. Lowry Mays			31,566,109	(3)			6.1	%
Mark P. Mays			2,104,945	(4)			*
Randall T. Mays			1,717,625	(5)			*
B. J. McCombs			4,805,903	(6)			.9	%
Phyllis B. Riggins			15,675	(7)			*
Theodore H. Strauss			214,664	(8)			*
J.C. Watts			19,658	(9)			*
John H. Williams			61,534	(10)			*
John B. Zachry			—				*
Paul Meyer			21,874				*
John Hogan			370,406	(11)			*
FMR Corp. (12)			77,126,566				15.0	%
Capital Research and Management Company (13)			60,257,520				11.8	%
Morgan Stanley (14)			37,113,713				7.2	%
All Directors and Executive Officers as a Group (17 persons)			41,336,857	(15)			8.0	%

EXECUTIVE COMPENSATION

     Clear Channel believes that compensation of its executive and other officers should be directly and materially linked to operating performance. For fiscal year 2005, the executive compensation program consisted of a base salary, a pay-for-performance cash bonus plan, stock options and restricted stock grants based on Clear Channel’s cash flow growth and other objective measures of performance.

Summary Compensation Table

     The Summary Compensation Table shows certain compensation information for the years ended December 31, 2005, 2004 and 2003, for the Chief Executive Officer and each of the five most highly compensated executive officers whose total cash compensation exceeded $100,000 for services rendered in all capacities for the three years ended December 31, 2005 (hereinafter referred to as the “named executive officers”).

						ANNUAL COMPENSATION												LONG-TERM COMPENSATION
																		Awards								Payouts
														Other
														Annual				Restricted
														Compen				Stock								LTIP				All Other
Name And														-sation				Award(s)								Payout				Compen-
Principal Position		Year				Salary ($)				Bonus ($)				($) (1)				($)				Options (#)				($)				sation ($)
Mark Mays			2005				879,107				—				11,911				5,840,060	(3)			355,000	(4)			—				5,250	(5)
CEO (2)			2004				688,469				1,700,000				—				1,113,250	(3)			150,000				—				5,125	(5)
			2003				697,093				1,000,000				—				915,500	(3)			225,000				—				5,000	(5)
L. Lowry Mays			2005				750,944				—				14,889				1,167,560	(6)			505,000				—				5,250	(5)
Chairman			2004				1,009,894				1,700,000				—				1,113,250	(6)			150,000				—				5,125	(5)
			2003				1,012,838				1,000,000				—				915,500	(6)			225,000				—				5,000	(5)
Randall Mays			2005				787,441				—				11,029				5,840,060	(3)			355,000	(4)			—				5,250	(5)
President and CFO (7)			2004				688,293				1,700,000				—				1,113,250	(3)			150,000				—				5,125	(5)
			2003				692,617				1,000,000				—				915,500	(3)			225,000				—				5,000	(5)
Paul Meyer			2005				566,742				920,000				—				377,040	(8)			365,000	(4)			—				5,250	(5)
President and CEO —			2004				465,686				342,000				—				—				65,000				—				5,125	(5)
Clear Channel Outdoor			2003				403,992				420,000				—				—				40,000				—				5,000	(5)
John Hogan			2005				596,733				—				—				2,336,250	(9)			100,000				—				5,250	(5)
President and CEO —			2004				548,884				50,000				—				—				135,000				—				5,125	(5)
Clear Channel Radio			2003				530,824				15,000				—				—				85,000				—				5,000	(5)
Roger Parry* (10)			2005				818,641				444,949				—				125,680	(8)			20,000	(11)			—				269,992	(12)
			2004				785,355				598,719				—				—				35,000				—				214,502	(12)
			2003				680,493				54,472				—				—				35,000				—				195,234	(12)

Stock Option Grant Table

     The following table sets forth certain information concerning stock options to purchase shares of Clear Channel’s common stock granted to the named executive officers during the year ended December 31, 2005.

						Percent of
						Total
		Number of				Options
		Securities				Granted to
		Underlying				Employees				Exercise or								Grant Date
		Options				in Fiscal				Base Price				Expiration				Present
Name		Granted (#)				Year				($/share)				Date				Value ($) (1)
Mark Mays			210,000	(2)			2.9	%			31.42	(2)			1/12/15				1,967,700
Mark Mays			45,000	(3)			.6	%			34.34	(3)			2/16/15				469,800
L. Lowry Mays			210,000	(2)			2.9	%			31.42	(2)			1/12/15				1,598,100
L. Lowry Mays			45,000	(3)			.6	%			34.34	(3)			2/16/15				380,700
L. Lowry Mays			250,000				3.4	%			31.72				12/22/15				1,812,500
Randall Mays			210,000	(2)			2.9	%			31.42	(2)			1/12/15				1,967,700
Randall Mays			45,000	(3)			.6	%			34.34	(3)			2/16/15				469,800
Paul Meyer			—				—				—				—				—
John Hogan			100,000	(4)			1.4	%			31.42	(4)			1/12/12				808,750
Roger Parry			20,000	(5)			.3	%			31.42	(5)			1/12/12				161,750

     The following table sets forth certain information concerning stock options to purchase shares of Class A common stock of Clear Channel Outdoor Holdings, Inc. granted to the named executive officers during the year ended December 31, 2005.

						Percent of
						Total
		Number of				Options
		Securities				Granted to
		Underlying				Employees				Exercise or								Grant Date
		Options				in Fiscal				Base Price				Expiration				Present
Name		Granted (#)				Year				($/share)				Date				Value ($) (1)
Mark Mays			100,000				4	%			18.00				11/11/15				744,000
L. Lowry Mays			—				—				—				—				—
Randall Mays			100,000				4	%			18.00				11/11/15				744,000
Paul Meyer			365,000				15	%			18.00				11/11/12				2,294,025
John Hogan			—				—				—				—				—
Roger Parry			—				—				—				—				—

Stock Option Exercises and Holding Table

     The following table sets forth certain information regarding stock options to purchase shares of Clear Channel’s common stock exercised by the named executive officers during the year ended December 31, 2005, including the aggregate value of gains on the date of exercise. In addition, the table sets forth the number of shares covered by both exercisable and unexercisable stock options as of December 31, 2005. Also reported are the values of “in the money” options which represent the positive spread between the exercise price of any existing stock options and Clear Channel’s common stock price as of December 31, 2005.

Number of Securities

Value of Unexercised In-the-

Shares

Underlying Unexercised

Money Options at Fiscal Year

Acquired on

Options at Fiscal Year End

End

Exercise

(#)

($)

Name

(#)

Value Realized ($)

Exercisable/Unexercisable

Exercisable/Unexercisable(1)

Mark Mays

—

—

313,341 / 1,021,928

-0- / 248,007

L. Lowry Mays

—

—

3,118,916 / -0-

4,057,641 / -0-

Randall Mays

—

—

313,341 / 1,021,928

-0- / 248,007

Paul Meyer (2)

—

—

-0- / -0-

-0- / -0-

John Hogan

—

—

227,170 / 314,770

-0- / 393,145

Roger Parry (2)

—

—

-0- / -0-

-0- / -0-

     The following table sets forth certain information regarding stock options to purchase shares of Class A common stock of Clear Channel Outdoor Holding, Inc. exercised by the named executive officers during the year ended December 31, 2005, including the aggregate value of gains on the date of exercise. In addition, the table sets forth the number of shares covered by both exercisable and unexercisable stock options to purchase shares of Class A common stock of Clear Channel Outdoor Holding, Inc. as of December 31, 2005. Also reported are the values of “in the money” options which represent the positive spread between the exercise price of any existing stock options and the Clear Channel Outdoor Holding, Inc. Class A common stock price as of December 31, 2005.

Number of Securities

Value of Unexercised In-the-

Shares

Underlying Unexercised

Money Options at Fiscal Year

Acquired on

Options at Fiscal Year End

End

Exercise

Value

(#)

($)

Name

(#)

Realized ($)

Exercisable/Unexercisable

Exercisable/Unexercisable(1)

Mark Mays

—

—

-0- / 100,000

-0- / 205,000

L. Lowry Mays

—

—

-0- / -0-

-0- / -0-

Randall Mays

—

—

-0- / 100,000

-0- / 205,000

Paul Meyer (1)

—

—

276,673 / 501,141

-0- / 748,250

John Hogan

—

—

-0- / -0-

-0- / -0-

Roger Parry (1)

—

—

259,117 / 111,988

-0- / 76,024

Equity Compensation Plans

     The following table summarizes information, as of December 31, 2005, relating to Clear Channel’s equity compensation plans pursuant to which grants of options, restricted stock or other rights to acquire shares may be granted from time to time.

Number of securities

remaining available for

Number of securities

future issuance under

to be issued upon

Weighted-average

equity compensation

exercise price of

exercise price of

plans (excluding

outstanding options,

outstanding warrants

securities reflected in

Plan category

warrants and rights

and rights

column (a))

(a)

(b)

(c)

Equity compensation plans approved by security holders (1)

24,008,821

$

41.7124

32,752,567

Equity compensation plans not approved by security holders (2)

10,253

$

30.1435

1,533,222

Total (3)

24,019,074

$

41.7075

34,285,789

Employment Agreements

     On March 10, 2005, Clear Channel entered into amended and restated employment agreements with its three senior executives, L. Lowry Mays (Chairman), Mark Mays (Chief Executive Officer) and Randall Mays (President and Chief Financial Officer). These agreements amended and restated existing employment agreements dated October 1, 1999 between Clear Channel and the three executives. Each amended and restated agreement has a term of seven years with automatic daily extensions unless Clear Channel or the executive elects not to extend the agreement. Each of these employment agreements provides for a minimum base salary, subject to review and annual increase by the Compensation Committee. In addition, each agreement provides for an annual bonus pursuant to Clear Channel’s Annual Incentive Plan or as the Executive Performance Subcommittee determines. The employment agreements with the Chairman, Chief Executive Officer, and President and Chief Financial Officer provide for base minimum salaries of $350,000, $350,000 and $325,000, respectively, and for minimum option grants to acquire 50,000 shares of Clear Channel common stock; provided, however, that the annual option grant will not be smaller than the option grant in the preceding year unless waived by the executive. Each option will be exercisable at fair market value at the date of grant for a ten-year period even if the executive is not employed by Clear Channel. The Compensation Committee or the Executive Performance Subcommittee will determine the schedule upon which the options will vest and become exercisable.

     Each of these executive employment agreements provides for severance and change-in-control payments in the event that Clear Channel terminates an executive’s employment without “Cause” or if the executive terminates for “Good Reason.” “Cause” is narrowly defined, and any determination of “Cause” is subject to a supermajority vote of the independent members of Clear Channel’s independent directors. “Good Reason” includes defined change-in-control transactions involving Clear Channel, Clear Channel’s election not to automatically extend the term of the employment agreement, a diminution in the executive’s pay, duties or title or, (1) in the case of the Chief Executive Officer, at any time that the office of Chairman is held by someone other than L. Lowry Mays, Mark Mays or Randall Mays; or (2) in the case of the President and Chief Financial Officer, at any time that either of the offices of Chairman or Chief Executive Officer is held by someone other than L. Lowry Mays, Mark Mays or Randall Mays. If an executive is terminated by Clear Channel without “Cause” or the executive resigns for “Good Reason” then that executive will receive a lump-sum cash payment equal to the base salary and bonus that otherwise would have been paid for the remainder of the term of the agreement (using the highest bonus paid to executive in the three years preceding the termination but not less than $1,000,000 bonus for the Chief Executive Officer or the President and Chief Financial Officer, and $3,000,000 bonus for the Chairman), continuation of benefits, immediate vesting on the date of termination of all stock options held by the executive on the date of termination, and either: (i) an option to acquire 1,000,000 shares of Clear Channel’s common stock at fair market value as of the date of termination that is fully vested and exercisable for a period of ten years, or (ii) a grant of a number of shares of Clear Channel’s common stock equal to: (a) 1,000,000, divided by (b) the number computed by dividing: (x) the last reported sale price of Clear Channel’s common stock on the NYSE at the close of the trading day immediately preceding the date of termination of executive’s employment, by (y) the value of the stock option described in clause (i) above as determined by Clear Channel in accordance with generally accepted accounting principles. Certain tax gross up payments would also be due on such amounts. In the event the executive’s employment is terminated without “Cause” or for “Good Reason,” the employment agreements also restrict the executive’s business activities that compete with the business of Clear Channel for a period of two years following such termination.

     On August 5, 2005, Clear Channel Outdoor Holdings, Inc., a subsidiary of Clear Channel, entered into an employment agreement with Paul J. Meyer, which replaced the existing employment agreement by and between Mr. Meyer and the Company. The initial term of the new agreement ends on the third anniversary of the date of the agreement; the term automatically extends one day at a time beginning on the second anniversary of the date of the agreement, unless one party gives the other one year’s notice of expiration at or prior to the second anniversary of the date of the agreement. The contract calls for Mr. Meyer to be the President and Chief Operating Officer of Clear Channel Outdoor Holdings, Inc. for a base salary of $600,000 in the first year of the agreement; $625,000 in the second year of the agreement; and $650,000 in the third year of the agreement, subject to additional annual raises thereafter in accordance with company policies. Mr. Meyer is also eligible to receive a performance bonus as decided at the sole discretion of the board of directors and the compensation committee of Clear Channel Outdoor Holdings, Inc.

     Mr. Meyer may terminate his employment at any time after the second anniversary of the date of the agreement upon one year’s written notice. Clear Channel Outdoor Holdings, Inc. may terminate Mr. Meyer without “Cause” after the second anniversary of the date of the agreement upon one year’s written notice. “Cause” is narrowly defined in the agreement. If Mr. Meyer is terminated without “Cause,” he is entitled to receive a lump sum payment of accrued and unpaid base salary and prorated bonus, if any, and any payments to which he may be entitled under any applicable employee benefit plan. Mr. Meyer is prohibited by his employment agreement from activities that compete with Clear Channel Outdoor Holdings, Inc. for one year after he leaves Clear Channel Outdoor Holdings, Inc. and he is prohibited from soliciting Clear Channel Outdoor Holdings, Inc. employees for employment for 12 months after termination regardless of the reason for termination of employment.

     Effective February 1, 2004, Clear Channel Broadcasting, Inc. (“CCB”), a subsidiary of Clear Channel, entered into an employment agreement with John Hogan as President and Chief Executive Officer, Clear Channel Radio. The initial term of the agreement ended on January 31, 2006, but now automatically renews for successive one-day terms until terminated by either party.

     The agreement provides that CCB will pay Mr. Hogan an annual base salary of $550,000 for the period from February 1, 2004 through January 31, 2005; and $600,000 for the period from February 1, 2005 through January 31, 2006. Mr. Hogan will be eligible for additional annual raises after January 31, 2006 commensurate with company policy. No later than March 31 of each calendar year during the term, Mr. Hogan will be eligible to receive a performance bonus. The agreement also provided that Mr. Hogan receive a one-time grant of 50,000 options to purchase Clear Channel stock. Any future stock option grants will be granted based upon the performance of Mr. Hogan, which will be assessed in the sole discretion of CCB and the Compensation Committee of the Board. Mr. Hogan will also be entitled to participate in all pension, profit sharing, and other retirement plans, all incentive compensation plans, and all group health, hospitalization and disability or other insurance plans, paid vacation, sick leave and other employee welfare benefit plans in which other similarly situated employees may participate.

     Since Mr. Hogan’s contract renews daily for successive one-day terms, Mr. Hogan’s employment may now be terminated by either CCB or Mr. Hogan at any time. If Mr. Hogan’s employment with CCB is terminated by CCB without Cause, CCB will: (1) pay Mr. Hogan his base salary for one year; and (2) pay Mr. Hogan any payments to which he may be entitled under any applicable employee benefit plan; and (3) pay Mr. Hogan $1,600,000.00 over 3 years commencing on the effective date of the termination and in accordance with CCB’s standard payroll practices as consideration for certain non-compete obligations. “Cause” is narrowly defined in the agreement. If Mr. Hogan terminates his own employment for any reason, CCB will pay Mr. Hogan his then current base salary for one year. Mr. Hogan is prohibited by the agreement from activities that compete with CCB or its affiliates for one year after he leaves CCB, and he is prohibited from soliciting CCB’s employees for employment for 12 months after termination regardless of the reason for termination of employment.

     Effective May 27, 2005, Roger Parry and Clear Channel Outdoor, Inc. (“CCO”), a subsidiary of Clear Channel, entered into a letter agreement pursuant to which Mr. Parry resigned his position as Chief Executive Officer of Clear Channel International. From June 1, 2005 through May 31, 2006, CCO agreed to pay Mr. Parry a base salary of Pound Sterling 37,493.75 per month, and a car allowance of Pound Sterling 3,124.50 per month. In addition, Mr. Parry is eligible to receive a performance based bonus. From June 1, 2005 through May 31, 2006, Mr. Parry will continue to have the right to participate in employee benefit plans as in effect on the effective date of the letter agreement. Beginning on June 1, 2006 through May 31, 2009, Mr. Parry will continue to be employed by CCO as a non-executive level employee at a salary of Pound Sterling 2,000.00 per month. After May 31, 2006, Mr. Parry will no longer be eligible to receive bonus compensation. Mr. Parry agreed to certain non-competition covenants during the term of the letter agreement.

REPORT OF THE COMPENSATION COMMITTEE AND THE EXECUTIVE PERFORMANCE SUBCOMMITTEE

     The following Report of the Compensation Committee and the Executive Performance Subcommittee and the performance graphs included elsewhere in this proxy statement do not constitute soliciting material and should not be deemed filed or incorporated by reference into any other company filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent Clear Channel specifically incorporates this Report or the performance graphs by reference therein.

     The Compensation Committee of the Board of Directors and the Committee’s Executive Performance Subcommittee have furnished the following report on executive compensation for fiscal year 2005.

Overall Policy

     The financial success of Clear Channel is linked to the ability of its executive and other officers to direct Clear Channel’s current operations, to assess the advantages of potential acquisitions, and to realign the operations of acquired entities with the operating policies of Clear Channel. The fundamental objective of Clear Channel’s compensation strategy is to attract, retain and motivate top quality executive and other officers through compensation and incentives which align the interests of Clear Channel’s officers and senior management with the interests of Clear Channel’s shareholders.

     Clear Channel believes that compensation of its executive and other officers and senior managers should be directly and materially linked to operating performance. For fiscal year 2005, the executive compensation program consisted of a base salary, a pay-for-performance cash bonus plan, stock options and restricted stock awards. The annual pay-for-performance criteria are based on Clear Channel’s year-over-year improvements in financial results using a combination of metrics including earnings per share, free cash flow per share and operating income before depreciation, amortization and non-cash compensation expense.

     The Compensation Committee and the Executive Performance Subcommittee believe that this four-component approach best serves the interests of Clear Channel and its shareholders. It enables Clear Channel to meet the requirements of the highly competitive environment in which Clear Channel operates while ensuring that officers and senior managers are compensated in a way that advances the interests of all shareholders. Under this approach, compensation of these officers and senior managers involves a high proportion of pay that is “at risk”, namely, the annual pay-for-performance cash bonus, stock options and restricted stock awards. The annual pay-for-performance cash bonus is also based entirely on Clear Channel’s financial performance relative to goals established at the start of the fiscal year. Stock options and restricted stock awards constitute a significant portion of long-term remuneration that is tied directly to stock price appreciation that benefits all of Clear Channel’s shareholders.

     The compensation of Clear Channel’s Chairman, Chief Executive Officer and President and Chief Financial Officer is based on the performance of Clear Channel as a whole. The compensation of Clear Channel’s President and Chief Executive Officer of Radio, its President and Chief Executive Officer of Television and its President of International Radio are compensated based on the performance of their respective operating divisions. The President and Chief Operating Officer of Clear Channel Outdoor Holdings, Inc., a non-wholly owned publicly traded subsidiary of the Company, has been identified by the Board of Directors of the Company as an executive officer of the Company, but in the future his compensation shall be determined by the compensation committee of the board of directors of Clear Channel Outdoor Holdings, Inc.

     In carrying out its responsibilities, as in prior years, for 2005 the Compensation Committee engaged a leading national executive compensation consulting firm to develop and provide market pay data to better evaluate the appropriateness and competitiveness of overall compensation paid to Clear Channel’s executive officers. In 2005 we also utilized that firm’s services to study and advise Executive Management, the Board and the Compensation Committee regarding the development of an equity incentive grant initiative to a multi-divisional population of Clear Channel employees and executive officers in recognition of the successful completion of the realignment of Clear Channel’s businesses. For setting 2005 salary and performance objectives the compensation consultant developed market pay data from proxy statements and other sources, when available, of leading media companies (“Media Peers”) identified as key competitors for business and/or executive talent and from a group of general industry companies (“General Industry Peers”) selected on the basis of criteria that were deemed to be comparable with Clear Channel in terms of market capitalization, exchange traded, scope of operations, revenue, free cash flow, total assets, total capital and number of employees.

     The consultant provided the Compensation Committee with market pay data for base salary, bonus, total cash compensation, long-term incentives, and total direct compensation for Media Peers and General Industry Peers. Market pay data was provided at the 25^th, 50^th and 75^th percentiles of peer pay levels. Based on the Compensation Committee’s assessments of peer pay levels and of each executive officer’s skills, performance and contributions, the Committee determined that overall compensation paid to its executive officers was competitively positioned (within the 25^th and 50^th percentiles) compared to Media Peers and was appropriate in comparison to general industry pay practices, performance considerations, and Clear Channel’s desire to motivate and retain its executive officers.

Compensation

     Base Salary

     Base salaries of executive officers are set at levels comparable to salaries paid by companies in similar industries in which Clear Channel operates. The salaries of all executive officers are determined through mutual negotiations between the executive and the Compensation Committee. We may enter into employment agreements with executive officers in which case Clear Channel is required to compensate those executive officers in accordance with their employment agreements. Clear Channel currently has employment agreements with its Chairman, its Chief Executive Officer, its President and Chief Financial Officer and its President and Chief Executive Officer of Clear Channel Radio. In addition, Clear Channel Outdoor Holdings, Inc. currently has an employment agreement with its President and Chief Operating Officer which, when executed, was approved by the Compensation Committee. In the future, the compensation of the President and Chief Operation Officer of Clear Channel Outdoor Holdings, Inc. will be determined by the compensation committee of the board of directors of Clear Channel Outdoor Holdings, Inc. The Compensation Committee and the independent members of the Board of Directors believe that employment agreements with key executives are in the best interests of Clear Channel to assure continuity of management.

     Bonus Plans

     In fiscal year 2005, executive officers of Clear Channel participated in Clear Channel’s 2005 Annual Incentive Plan. This plan was administered by the Executive Performance Subcommittee and provided for performance-based bonuses for executives who were “covered employees” pursuant to Section 162(m) of the Internal Revenue Code. Under the plan, the Subcommittee establishes specific company “performance-based goals” applicable to each covered executive officer for the ensuing fiscal year performance period. The budgeted goals established for fiscal year 2005 were based upon the executives achieving certain goals, including an increase in cash flow per share over the prior year and other objective measures of performance. Performance goals for each executive officer were set pursuant to an extensive annual operating plan developed in February 2005 by the Chief Executive Officer, Mark P. Mays, in consultation with the Chief Financial Officer and other senior executive officers, including the principal executive officers of Clear Channel’s various operating divisions. The Chief Executive Officer, Mark P. Mays, made recommendations as to the compensation levels and performance goals of Clear Channel’s executive officers to the Compensation Committee for its review, consideration and approval.

     In addition, for fiscal year 2005, the Subcommittee established an objective formula for calculating the maximum bonus payable to each participating executive officer. These maximum bonus amounts were set above Clear Channel’s historical bonus levels for executives, because the Section 162(m) regulations allow only “negative discretion” in respect of this type of plan, and the Subcommittee desired flexibility to recognize exceptional individual performance when warranted.

     For fiscal year 2005, the Subcommittee established overall Company performance targets for each participating executive officer, including the Chairman, Chief Executive Officer and President and Chief Financial Officer based upon the achievement of specified levels of growth in earnings per share for Clear Channel. The

performance goals for the participating executive officers (the principal executive officers of Clear Channel’s main operating divisions: Domestic Radio, International Radio, Television, Domestic Outdoor, International Outdoor and Entertainment) included a component attributable to growth in cash flow of their respective operating division, and also a component attributable to growth in cash flow for Clear Channel as a whole. After the end of the fiscal year, the Subcommittee confirmed that the 2005 targets had only been achieved by the Domestic Outdoor and International Outdoor operating divisions and, accordingly, annual bonuses were only paid to Paul Meyer and Roger Parry under the plan.

     Stock Options

     Stock option grants to executive officers of Clear Channel were determined based in part on the achievement of the performance goals described previously in this report. All decisions to grant stock options are in the sole discretion of the Compensation Committee or the Executive Performance Subcommittee, as applicable.

     The employment agreements with the Chairman, Chief Executive Officer and the President and Chief Financial Officer contemplate the award of annual option grants to acquire not less than 50,000 shares of Clear Channel common stock.

     Restricted Stock Awards

     Restricted stock awards to key executives of Clear Channel were determined based in part on the achievement of certain performance goals as discussed previously in this report. All decisions to award restricted stock are in the sole discretion of the Compensation Committee and the Executive Performance Subcommittee, as applicable.

     The Committee intends to review contractual employment and compensation arrangements annually, including base salary and annual and long term incentive compensation to be assured that its key elements reflects objective of aligning the interests of Clear Channel’s officers with those of its shareholders.

Chief Executive Officer Compensation

     The Clear Channel Compensation Committee and the Executive Performance Subcommittee established the Chief Executive Officer’s performance goals and determined the amount of his incentive bonus. The position of Chief Executive Officer for Clear Channel has been held by Mark Mays since October 20, 2004, when he was elected by the Board of Directors as President and Chief Executive Officer of Clear Channel. In February 2006 Mr. Mark Mays relinquished the office of President.

     Clear Channel entered into a seven-year employment agreement with Mark Mays, to serve as President and Chief Operating Officer, effective October 1, 1999. The employment agreement provides for a minimum annual base salary of $350,000. The salary amount is subject to review by the Clear Channel Compensation Committee of the Board and may be increased on an annual basis at the beginning of each fiscal year. The term of the employment agreement is automatically extended at the end of each day by one additional day for each day expired during the employment period, in the absence of a notice of non-extension from Mark Mays. The employment agreement contemplates that Mark Mays will be awarded bonus compensation as determined by the Clear Channel Executive Performance Subcommittee of the Board and an annual option grant to acquire not less than 50,000 shares of Clear Channel common stock. The employment agreement provides for substantial severance and change-in-control payments and option grants in the event that Clear Channel terminates Mark Mays’ employment without “Cause” or if Mark Mays terminates for “Good Reason.” On March 10, 2005, Clear Channel entered into an amended and restated employment agreement Mark Mays, which amended and restated the existing employment agreement dated October 1, 1999. The changes to the original employment agreement reflect the fact that Mark Mays serves as Clear Channel’s President and Chief Executive Officer and that the offices of Chairman and Chief Executive Officer are no longer combined. The amended and restated employment agreement for Mark Mays also eliminated provisions in his original employment agreement that provided for the doubling of a lump sum cash severance payment to be paid in the event that his employment was terminated under certain circumstances. In addition, changes to his employment agreement provide Mark Mays with the choice of receiving a number of shares of Clear Channel common stock based on a formula as part of a severance package in lieu of a stock option grant in cases where Mark Mays is terminated by Clear Channel without cause or he resigns for good reason.

     At the end of 2005, the annual salary of Mark Mays, Clear Channel’s Chief Executive Officer, was $895,000 pursuant to his employment contract with Clear Channel. For his performance as President and Chief Executive Officer in 2004 and pursuant to performance goals established in 2004 by the Executive Performance Subcommittee, in January 2005 and February 2005, Mark Mays was granted, under Clear Channel’s 2005 Annual Incentive Plan, 34,000 shares of restricted stock and options for the purchase of 255,000 shares of Clear Channel common stock. As a result of the December 21, 2005 spin-off of Clear Channel’s entertainment division and pursuant to the recapitalization provision of the stock option agreement, these grants were subsequently adjusted pursuant to an intrinsic value method to 264,685 options. In addition, Mark Mays was awarded 150,000 shares of restricted stock in December 2005 as part of a equity incentive grant initiative to a multi-divisional population of Clear Channel employees, in recognition of the successful completion of the strategic realignment of Clear Channel businesses. Mr. Mays also received a grant of options to purchase 100,000 shares of Clear Channel Outdoor Holdings common stock in recognition of his performance in successfully completing the IPO of approximately 10% of Clear Channel’s outdoor advertising division.

     The Compensation Committee and Executive Performance Subcommittee utilized information gathered from an independent executive compensation consulting firm in determining the overall compensation package for the Clear Channel Chief Executive Officer. The amount of salary paid to Mark Mays for performance as Chief Executive Officer during fiscal year 2005 was made in accordance with the terms of his employment agreement as described above and in accordance with performance-based criteria discussed previously in this report.

Policy on Deductibility of Compensation

     Section 162(m) of the Internal Revenue Code limits the tax deduction for compensation paid to the named executive officers to $1 million. However, performance-based compensation that has been approved by shareholders is excluded from the $1 million limit if, among other requirements, the compensation is payable only upon attainment of pre-established, objective performance goals and the board committee that establishes such goals consists only of outside directors (as defined for purposes of Section 162(m)).

     At the 2005 annual Clear Channel shareholder meeting, the shareholders approved an annual incentive plan, which meets the requirements of Section 162(m) with respect to the performance-based compensation paid to the Chief Executive Officer, as discussed above. The Clear Channel Compensation Committee intends to utilize available tax deductions whenever appropriate and consistent with its compensation philosophy. However, the Committee may from time to time approve elements of compensation for certain officers that may not be fully deductible.

		Respectfully submitted,
		THE COMPENSATION COMMITTEE John Williams, J.C. Watts and B.J. McCombs
		THE EXECUTIVE PERFORMANCE SUBCOMMITTEE John Williams and J.C. Watts

SECTION 16(A) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE

     Section 16(a) of the Securities Exchange Act of 1934 requires Clear Channel’s directors, executive officers and beneficial owners of more than 10% of any class of equity securities of Clear Channel to file reports of ownership and changes in ownership with the SEC and the NYSE. Directors, executive officers and greater than 10% shareholders are required to furnish Clear Channel with copies of all Section 16(a) forms they file.

     Based solely on its review of the copies of such forms received by it, or written representations from certain reporting persons that no such forms were required to be filed by those persons, Clear Channel believes that all such Section 16(a) filing requirements were satisfied during fiscal year 2005, except that Mr. Strauss was late in filing one transaction which was an open market sale of shares and Mr. Meyer was late in filing the transactions in connection with the Initial Public Offering of Clear Channel Outdoor Holdings, Inc. related to the conversion of his Clear Channel options to Clear Channel Outdoor options.

COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION

     None of the members of the Compensation Committee during fiscal 2005 or as of the date of this proxy statement is or has been an officer or employee of Clear Channel. Mr. B. J. McCombs serves on Clear Channel’s Compensation Committee. Clear Channel leases certain office space in San Antonio, Texas, from the children of L. Lowry Mays and a limited partnership owned and controlled by the children of B. J. McCombs. This lease had 2005 monthly rentals of $13,271 and expired on December 31, 2005. The lease was renewed on January 1, 2006 with current monthly rentals of $16,908. Mr. Mays and Mr. McCombs do not serve as a trustee for any of the trusts nor are either of them beneficiaries of any of the trusts. Mr. Mays and Mr. McCombs have no pecuniary or other retained interest in any of the trusts. A limited partnership owned and controlled by the children of B. J. McCombs purchased an aggregate of $562,182 of radio, television and outdoor advertising for its various automobile dealerships from Clear Channel subsidiaries during 2005. Clear Channel believes the transactions described above are no less favorable to Clear Channel than could be obtained with nonaffiliated parties.

CERTAIN TRANSACTIONS

     Kathryn Mays Johnson, daughter of L. Lowry Mays and sister of Mark Mays and Randall Mays, earned $63,571 during 2005 for her services to Clear Channel as its Senior Vice President, Corporate Relations.

     In May 1977, Clear Channel and its then shareholders, including L. Lowry Mays and B.J. McCombs, entered into a Buy-Sell Agreement restricting the disposition of the outstanding shares of Clear Channel common stock owned by L. Lowry Mays and B.J. McCombs and their heirs, legal representatives, successors and assigns. The Buy-Sell Agreement provides that in the event that a restricted party desires to dispose of his shares, other than by disposition by will or intestacy or through gifts to such restricted party’s spouse or children, such shares must be offered for a period of 30 days to Clear Channel. Any shares not purchased by Clear Channel must then be offered for a period of 30 days to the other restricted parties. If all of the offered shares are not purchased by Clear Channel or the other restricted parties, the restricted party offering his or her shares may sell them to a third party during a period of 90 days thereafter at a price and on terms not more favorable than those offered to Clear Channel and the other restricted parties. In addition, a restricted party may not individually, or in concert with others, sell any shares so as to deliver voting control to a third party without providing in any such sale that all restricted parties will be offered the same price and terms for their shares. All shares of Clear Channel common stock owned by Mr. McCombs have been released from the terms of the Buy-Sell Agreement.

AUDIT COMMITTEE REPORT

     The following Report of the Audit Committee concerns the Committee’s activities regarding oversight of Clear Channel’s financial reporting and auditing process and does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Company filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent Clear Channel specifically incorporates this Report by reference therein.

     The Audit Committee is comprised solely of independent directors and it operates under a written charter adopted by the Board of Directors. The charter reflects standards set forth in SEC regulations and NYSE rules. The composition of the Audit Committee, the attributes of its members and the responsibilities of the Committee, as reflected in its charter, are intended to be in accordance with applicable requirements for corporate audit committees. The Committee reviews and assesses the adequacy of its charter on an annual basis. The full text of the Audit Committee’s charter can be found on Clear Channel’s Internet website at www.clearchannel.com. A copy may also be obtained upon request from the Secretary of Clear Channel.

     As set forth in more detail in the charter, the Audit Committee’s purpose is to assist the Board of Directors in its general oversight of Clear Channel’s financial reporting, internal control and audit functions. Management is responsible for the preparation, presentation and integrity of Clear Channel’s financial statements, accounting and financial reporting principles and internal controls and procedures designed to ensure compliance with accounting standards, applicable laws and regulations. Ernst & Young LLP, Clear Channel’s independent auditing firm, is responsible for performing an independent audit of the consolidated financial statements and expressing an opinion on the conformity of those financial statements with accounting principles generally accepted in the United States, as well as expressing an opinion on (i) management’s assessment of the effectiveness of internal control over financial reporting and (ii) the effectiveness of internal control over financial reporting.

     The Audit Committee members are not professional accountants or auditors, and their functions are not intended to duplicate or to certify the activities of management and the independent auditor, nor can the Committee certify that the independent auditor is “independent” under applicable rules. The Committee serves a board-level oversight role, in which it provides advice, counsel and direction to management and the auditors on the basis of the information it receives, discussions with management and the auditors and the experience of the Committee’s members in business, financial and accounting matters.

     Among other matters, the Audit Committee monitors the activities and performance of Clear Channel’s internal and external auditors, including the audit scope, external audit fees, auditor independence matters and the extent to which the independent auditor may be retained to perform non-audit services. The Audit Committee has ultimate authority and responsibility to select, evaluate and, when appropriate, replace Clear Channel’s independent auditor. The Audit Committee also reviews the results of the internal and external audit work with regard to the adequacy and appropriateness of Clear Channel’s financial, accounting and internal controls. Management and independent auditor presentations to and discussions with the Audit Committee also cover various topics and events that may have significant financial impact or are the subject of discussions between management and the independent auditor. In addition, the Audit Committee generally oversees Clear Channel’s internal compliance programs.

     The Committee has implemented procedures to ensure that during the course of each fiscal year it devotes the attention that it deems necessary or appropriate to each of the matters assigned to it under the Committee’s charter. To carry out its responsibilities, the Committee met eight times during the year ended December 31, 2005. The Audit Committee also meets privately with the internal and external auditors as well as management immediately following four of these meetings.

     During the course of 2005, management completed the documentation, testing and evaluation of Clear Channel’s internal control over financial reporting in response to the requirements set forth in Section 404 of the Sarbanes-Oxley Act of 2002 and related regulations. The Audit Committee was kept apprised of the progress of the evaluation and provided oversight and advice to management during the process. In connection with this oversight,

the Audit Committee received periodic updates provided by management and Ernst & Young LLP at each regularly scheduled Audit Committee meeting. At the conclusion of the process, management provided the Audit Committee with a report on the effectiveness of Clear Channel’s internal control over financial reporting. The Audit Committee also reviewed the report of management contained in Clear Channel’s Annual Report on Form 10-K for the year ended December 31, 2005 filed with the SEC, as well as Ernst & Young LLP’s Report of Independent Registered Public Accounting Firm included in Clear Channel’s Annual Report on Form 10-K related to its audit of (i) the consolidated financial statements and financial statement schedule, (ii) management’s assessment of the effectiveness of internal control over financial reporting, and (iii) the effectiveness of internal control over financial reporting.

     In overseeing the preparation of Clear Channel’s financial statements, the Committee met with both management and Clear Channel’s outside auditors to review and discuss all financial statements prior to their issuance and to discuss significant accounting issues. Management advised the Committee that all financial statements were prepared in accordance with generally accepted accounting principles. The Committee’s review included discussion with the outside auditors of matters required to be discussed pursuant to Statement on Auditing Standards No. 61 (Communication With Audit Committees).

     With respect to Clear Channel’s outside auditors, the Committee, among other things, discussed with Ernst & Young LLP matters relating to its independence, including its letter and the written disclosures made to the Committee as required by the Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees).

     Finally, the Committee continued to monitor the scope and adequacy of Clear Channel’s internal auditing program, including proposals for adequate staffing and to strengthen internal procedures and controls where appropriate.

     On the basis of these reviews and discussions, the Committee recommended to the Board of Directors that the Board approve the inclusion of Clear Channel’s audited financial statements in Clear Channel’s Annual Report on Form 10-K for the year ended December 31, 2005, for filing with the Securities and Exchange Commission.

		Respectfully submitted,
		THE AUDIT COMMITTEE
		Perry Lewis — Chairman,
		Phyllis B. Riggins, Theodore Strauss
		and John Williams

AUDITOR FEES

Ernst & Young LLP billed Clear Channel the following fees for services provided during the years ended December 31, 2005 and 2004:

		Fees Paid During Year Ended
		December 31,
(In thousands)		2005				2004
Annual audit fees (1)		$	11,797	(5)		$	8,260
Audit-related fees (2)			—				138
Tax fees (3)			2,830				2,182
All other fees (4)			—				—
Total fees for services		$	14,627			$	10,580

     Clear Channel’s Audit Committee has considered whether Ernst & Young LLP’s provision of non-audit services to Clear Channel is compatible with maintaining Ernst & Young LLP’s independence.

     The Audit Committee pre-approves all audit and permitted non-audit services (including the fees and terms thereof) to be performed for Clear Channel by its independent auditor. The chairperson of the Audit Committee may represent the entire committee for the purposes of pre-approving permissible non-audit services, provided that the decision to pre-approve any service is disclosed to the Audit Committee no later than its next scheduled meeting.

PROPOSAL 2: SELECTION OF INDEPENDENT AUDITORS

     Subject to ratification by the shareholders, the Audit Committee has reappointed Ernst & Young LLP as independent auditors to audit the financial statements of Clear Channel for the year ending December 31, 2006.

     Representatives of the firm of Ernst & Young LLP are expected to be present at the annual meeting of shareholders and will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions. The Audit committee may terminate the appointment of Ernst & Young as independent auditors without shareholder approval whenever the Audit Committee deems termination necessary or appropriate.

     The affirmative vote of the holders of a majority of Clear Channel’s outstanding common stock present or represented by proxy who are entitled to vote at the annual meeting is required to approve the proposal for the selection of independent auditors. Unless indicated to the contrary, the enclosed proxy will be voted for the proposal.

     THE BOARD RECOMMENDS THAT YOU VOTE “FOR” THE RATIFICATION OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS FOR THE YEAR ENDING DECEMBER 31, 2006.

SHAREHOLDER PROPOSALS

     The Company has been notified that two shareholders intend to present proposals for consideration at the annual meeting. The shareholders making these proposals have presented the proposals and supporting statements below, and we are presenting the proposals as they were submitted to us. We do not necessarily agree with all the statements contained in the proposals and the supporting statements, but we have limited our responses to the most important points and have not attempted to refute all the statements we disagree with. The address and stock

ownership of each of the proponents will be furnished by the Company’s Secretary to any person, orally or in writing as requested, promptly upon receipt of any oral or written request.

     The affirmative vote of the holders of a majority of shares represented in person or by proxy and entitled to vote on these proposals will be required for approval of each of these proposals. Abstentions will be counted as represented and entitled to vote and will therefore have the effect of a negative vote. Broker non-votes will not be considered entitled to vote on these proposals and therefore will not be counted in determining the number of shares necessary for approval.

PROPOSAL 3: SHAREHOLDER PROPOSAL
CORPORATE POLITICAL CONTRIBUTIONS

The following proposal has been submitted for a vote by the shareholders at the meeting:

     Resolved, that the shareholders of Clear Channel Communications, Inc. (“Company”) hereby request that the Company provide a report, updated semi-annually, disclosing the Company’s:

1.		Policies and procedures for political contributions (both direct and indirect) made with corporate funds.
2.		Monetary and non-monetary contributions to political candidates, political parties, political committees and other political entities organized and operating under 26 USC Sec. 527 of the Internal Revenue Code including the following:

a. An accounting of the Company’s funds contributed to any of the persons or organizations described above;

b. Identification of the person or persons in the Company who participated in making the decisions to contribute.

c. The internal guidelines or policies, if any, governing the Company’s political contributions.

This report shall be presented to the board of directors’ audit committee or other relevant oversight committee, and posted on the company’s website to reduce costs to shareholders.

Supporting Statements

As long-term shareholders of Clear Channel Communications, we support policies that apply transparency and accountability to corporate political giving. In our view, such disclosure is consistent with public policy in regard to public company disclosure.

Company executives exercise wide discretion over the use of corporate resources for political purposes. In 2003 — 04, the last fully reported election cycle, Clear Channel contributed as least $8200 in national contributions.
(The Center for Public Integrity, http://www.publicintegrity.org/527/db.aspx?act=main).

The company also gave at least $650,000 to initiatives in California in the 2004 election cycle.
(California Secretary of State, http://cal-access.ss.ca.gov/Campaign/Committees/Detail.aspx?id=1010975&session=2003&view=contributions)

Relying only on the limited data available for the Federal Election Commission and the Internal Revenue Service, the Center for Public Integrity, a leading campaign finance watchdog organization, provides an incomplete picture of the Company’s political donations. Complete disclosure by the company is necessary for the company’s Board and its shareholders to be able to fully evaluate the political use of corporate assets.

Although the Bi-Partisan Campaign Reform Act of 2002 prohibits corporate contributions to political parties at the federal level, it allows companies to contribute to independent political committees, also know as 527s.

Absent a system of accountability, corporate executives will be free to use the Company’s assets for political objectives that are not shared by and may be inimical to the interests of the Company and its shareholders. There is currently no single source of information that provides the information sought by this resolution. That is why we urge your support for this critical governance reform.

STATEMENT OF THE COMPANY’S BOARD OF DIRECTORS AND MANAGEMENT
IN OPPOSITION TO THE PROPOSAL.

     The Company’s Board of Directors and management unanimously recommend that you vote “AGAINST” the proposal for the following reasons:

     The Board of Directors and management of the Company are committed to adhering to the highest standards of ethics and transparency and compliance with all laws and regulations related to political contributions. As required by law, the Company reports its political contributions to appropriate federal and state election commissions. This information is freely available through these commissions and other publicly accessible means. The Company’s Code of Business Conduct and Ethics, which is posted on the Company’s website at www.clearchannel.com, states the Company’s policy regarding political contributions. Corporate political contributions are determined by Company management responsible for the Company’s government affairs. The Board of Directors believes that all political contributions made by the Company help support the Company’s businesses and are in the best interest of the Company and its shareholders. Accordingly, the Board of Directors and management of the Company believe that the information required to be disclosed under the proposal is duplicative of information already available to the Company’s stockholders and the public and would cause the Company to incur additional and unnecessary expense. Therefore, the Board of Directors and management of the Company unanimously recommend a vote “AGAINST” this proposal and your proxy will be so voted unless you specify otherwise.

PROPOSAL 4: SHAREHOLDER PROPOSAL
COMPENSATION COMMITTEE INDEPENDENCE

WHEREAS, we believe the primary role of the Compensation Committee (the “Committee”) is structuring executive pay and evaluating executive performance. Critical to performing these functions is setting compensation policies and evaluating them annually; setting justifiable performance criteria and challenging performance benchmarks; retaining experts when needed to assist with the process and substance of the Committee’s work; and ensuring full and accurate disclosure of the scope of compensation;

NOW THEREFORE, BE IT RESOLVED, the shareholders request the board to amend the Committee charter to specify that the Committee be composed solely of independent directors as defined below. The charter should also specify (a) how to select a new independent Committee member if a current member ceases to be independent during the time between annual meetings of shareholders; and (b) that compliance with the policy is excused if no independent director is available and willing to serve on the Committee.

BE IT FURTHER RESOLVED, for the purpose of this proposal an independent director is someone whose only nontrivial professional, familial or financial connection to the corporation, its chairman or its executive officers is his/her directorship, and who also:

(1) is not or has not been, or whose relative is or in the past 5 years has not been, employed by the corporation or employed by, or a director of, an affiliate; and

(2) complies with Sections (b) — (h) of the Council of Institutional Investors Definition of Director Independence as found on its website at: http://www.cii.org/policies/ind_dir_defn.htm

STATEMENT OF THE COMPANY’S BOARD OF DIRECTORS AND MANAGEMENT
IN OPPOSITION TO THIS PROPOSAL

     The Company’s Board of Directors and management unanimously recommend that you vote “AGAINST” this proposal for the following reasons:

     The Board of Directors and management of the Company recognize the importance of having a compensation committee composed of members who are free to exercise independent judgment in making executive compensation decisions. Members of the Company’s Compensation Committee already meet the independence criteria set forth in the rules established by the New York Stock Exchange (NYSE) as well as the Company’s own independence standards established by the Board of Directors as part of the Company’s Corporate Governance Guidelines.

     The selection criteria referenced in the proposal would place restrictions on membership in the Company’s Compensation Committee that go beyond the limitations established by the existing NYSE rules and the independence standards adopted by the Board of Directors. The independence criteria established by the NYSE are the result of extensive research, input and analysis and have been adopted by the vast majority of NYSE-listed companies. The Board of Directors and management believe that the existing independence requirements adequately foster the exercise of independent judgment by members of the Company’s Compensation Committee in making executive compensation decisions. Since the members of the Company’s Compensation Committee already meet these existing independence requirements, the Board of Directors and management believe that the proposal would only serve to add unnecessary restrictions without providing any significant additional benefits.

     To have an effective Board of Directors, the Company must recruit individuals with a variety of talents, experience, knowledge and professional skills. Once the Company has selected the most suitable candidates from this limited pool of people, the Board of Directors must appoint members to several committees, including the Compensation Committee. While the members of the Compensation Committee must be free to exercise independent judgment in making executive compensation decisions, they must also have the background and business expertise necessary to address compensation issues and analyze executive performance on an informed basis. By setting standards that are different from those required by the NYSE, the Board of Directors and management believe that the proposal would make it more difficult to recruit and retain directors to serve as members of the Compensation Committee who have sufficient knowledge about the Company’s businesses and the industry in which it operates to make informed decisions and realistic assessments of the performance of its executives.

     In summary, the Board of Directors and management believe that the proposal is not necessary in light of the independence requirements already in place and would significantly impair the Company’s ability to recruit and retain directors who are talented and knowledgeable leaders in business and other walks of life to serve the interests of the shareholders. Therefore, the Board of Directors and management unanimously recommend a vote “AGAINST” this proposal and your proxy will be so voted unless you specify otherwise.

SHAREHOLDER PROPOSALS FOR 2007 ANNUAL MEETING

     Shareholders interested in submitting a proposal for inclusion in the proxy materials for the annual meeting of shareholders in 2007 may do so by following the procedures prescribed in SEC Rule 14a-8. To be eligible for inclusion, shareholder proposals must be received by the Secretary of Clear Channel no later than November 13, 2006. Proposals should be sent to Corporate Secretary, Clear Channel Communications, Inc., P.O. Box 659512, San Antonio, Texas 78265-9512.

ADVANCE NOTICE PROCEDURES

     Under our bylaws, shareholders may not present a proposal for consideration at any shareholders meeting unless such shareholder submits such proposal in writing to the secretary of Clear Channel not less than 90 days prior to the meeting. These requirements are separate from and in addition to the SEC’s requirements that a shareholder must meet in order to have a shareholder proposal included in Clear Channel’s proxy statement.

OTHER MATTERS

     The Board knows of no other business to be brought before the annual meeting. If any other matters properly come before the annual meeting, the proxies will be voted on such matters in accordance with the judgment of the persons named as proxies therein, or their substitutes, present and acting at the meeting.

NYSE MATTERS

     Clear Channel filed the CEO and CFO certifications required under Section 302 of the Sarbanes-Oxley Act with the SEC as exhibits to its most recently filed Form 10-K. Clear Channel also submitted a Section 12(a) CEO Certification to the NYSE last year.

GENERAL

     Neither Clear Channel management nor the Board knows of any matter to be acted upon at the Clear Channel shareholder meeting other than the matters described above. If any other matter properly comes before the Clear Channel shareholder meeting, however, the proxy holders will vote thereon in accordance with their best judgment.

     The cost of soliciting proxies will be borne by Clear Channel. Following the original mailing of the proxy soliciting material, regular employees of Clear Channel may solicit proxies by mail, telephone, facsimile, e-mail and personal interview. Clear Channel has also retained Georgeson Shareholder Communications Inc. to aid in the solicitation of proxies, at an estimated cost of $8,500 plus reimbursement of reasonable out-of pocket expenses. Proxy cards and materials will also be distributed to beneficial owners of stock, through brokers, custodians, nominees and other like parties. Clear Channel expects to reimburse such parties for their charges and expenses connected therewith.

     The SEC has adopted rules that permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements with respect to two or more shareholders sharing the same address by delivering a single proxy statement addressed to those shareholders. This process, which is commonly referred to as “householding,” potentially provides extra convenience for shareholders and cost savings for companies. Clear

Channel and some brokers household proxy materials, delivering a single proxy statement to multiple shareholders sharing an address unless contrary instructions have been received from the affected shareholders. Once you have received notice from your broker or us that they or we will be householding materials to your address, householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate proxy statement, please notify your broker if your shares are held in a brokerage account or us if you hold registered shares. You can notify us by sending a written request to Clear Channel Communications, Inc., Shareholder Relations, P.O. Box 659512, San Antonio, Texas 78265-9512.

     An electronic copy of Clear Channel’s Annual Report on Form 10-K filed with the SEC on March 10, 2006, is available free of charge at Clear Channel’s Internet website at www.clearchannel.com. A paper copy of the Form 10-K is also available without charge to shareholders upon written request to Clear Channel Communications, Inc., P.O. Box 659512, San Antonio, Texas 78265-9512.

     This document is dated March 14, 2006 and is first being mailed to shareholders on or about March 24, 2006.

		Randall T. Mays
		Secretary

APPENDIX A
AUDIT COMMITTEE CHARTER

Purpose

     The Audit Committee of the Board of Directors (the “Committee”) assists the Board of Directors in fulfilling its responsibility for oversight of the quality and integrity of the accounting, auditing and financial reporting practices of Clear Channel Communications, Inc. (the “Company”). More specifically, the Committee’s purposes are to:

1.

Assist Board oversight of:

	•		the quality and integrity of the financial statements of the Company,
	•		the Company’s compliance with legal and regulatory requirements,
	•		the independent auditor’s qualifications and independence, and
	•		the performance of the Company’s internal audit function and independent auditors.

2. Prepare an audit committee report as required by the SEC for inclusion in the Company’s annual proxy statement.

     The independent auditors for the Company shall report directly to the Committee, and the Committee has the direct authority and responsibility for the appointment, compensation, oversight and, where appropriate, replacement of the independent auditors.

     The Audit Committee has the authority to conduct any investigation appropriate to fulfilling its responsibilities, and it shall have direct access to the independent auditors as well as anyone else in the Company. The Audit Committee shall have the authority to retain, at the Company’s cost and expense, special independent legal, accounting, or other advisors or experts it deems necessary in the performance of its duties. The Company shall provide appropriate funding, as determined by the Audit Committee, for payment of ordinary administrative expenses of the Audit Committee that are necessary or appropriate in carrying out its duties, for payment of compensation to the outside legal, accounting or other advisors employed by the Audit Committee and compensation to the independent auditors or any other registered public accounting firm for the purpose of rendering or issuing an audit report or related work or performing other audit, review or attest services for the Company and to any independent counsel or other advisers employed by the Audit Committee.

Membership

     The Committee shall consist of at least three directors, each of whom has no material relationship with the Company and who is otherwise “independent” as defined in the listing standards of the New York Stock Exchange (the “NYSE”) and Rule 10A-3 promulgated under the Securities Exchange Act of 1934, as amended. Each member will also meet the audit committee independence requirements of the listing standards of the NYSE and applicable law. All members of the Committee shall be financially literate, with at least one member having accounting or related financial management expertise, as the foregoing qualifications are interpreted by the Board of Directors in its business judgment. The Board shall also determine whether any member of the Audit Committee is an “audit committee financial expert,” as defined by the rules of the SEC. If the Board has determined that a member of the Audit Committee is an audit committee financial expert, it may presume that such member has accounting or related financial management experience. No director may serve as a member of the Audit Committee if such director serves on the audit committees of more than two other public companies unless the Board determines that such simultaneous service would not impair the ability of such director to effectively serve on the Audit Committee, and discloses this determination in the Company’s annual proxy statement.

     The Board of Directors shall appoint one member of the Committee as chairperson. He or she shall be responsible for leadership of the Committee, including preparing the agenda, presiding over the meetings, making Committee assignments and reporting to the Board of Directors.

Meetings

     The Committee shall meet at least four times per year or more frequently as it shall determine is necessary to carry out its duties and responsibilities. The time, place and notice requirements, if any, of meetings of the Committee shall be determined by the Committee. The Committee shall keep minutes of each meeting and make such minutes available to the Board of Directors for its review. The Committee is expected to maintain free and open communication with the independent auditors, the internal auditors and management of the Company and shall periodically meet separately with them.

Responsibilities

  To carry out its purposes, the Committee shall have the following duties and responsibilities:

1.

With respect to the Independent Auditors

	•		Be directly responsible for the appointment, compensation, retention and oversight of the work of the independent auditors (including the resolution of disagreements between management and the independent auditors regarding financial reporting) who shall report directly to the Audit Committee.
	•		Be directly responsible for the appointment, compensation, retention and oversight of the work of any other registered public accounting firm engaged for the purpose of preparing an audit report or to perform other audit, review or attestation services, which firm shall also report directly to the Audit Committee.
	•		Review and evaluate the qualifications, performance and independence of the lead partner of the independent auditor.
	•		Discuss with management the timing and process for implementing the rotation of the lead audit partner, the concurring partner and any other active audit engagement team partner and consider whether there should be a regular rotation of the audit firm itself.
	•		Take into account the opinions of management and the Company’s internal auditors in assessing the independent auditor’s qualifications, performance and independence.
	•		Obtain and review a formal written statement from the independent auditor of the fees billed in each of the last two fiscal years for each of the following categories of services rendered by the independent auditors: (i) the audit of the Company’s annual financial statements and the reviews of the financial statements included in the Company’s Quarterly Reports on Form 10-Q or services that are normally provided by the independent auditors in connection with statutory and regulatory filings or engagements; (ii) assurance and related services not included in clause (i) that are reasonably related to the performance of the audit or review of the Company’s financial statements, in the aggregate and by each service, (iii) tax compliance, tax advice and tax planning services, in the aggregate and by each service; and (iv) all other products and services rendered by the independent auditors’ in the aggregate and by each service. Receive from the independent auditors the written disclosures and the letter from the independent auditors required by Independence Standards Board Standard No. 1 (Independence Standards Board Standard No. 1, Independence Discussions with Audit Committees) and discuss with the independent auditors the independent auditor’s independence.
	•		Have a clear understanding with the independent auditors that they are ultimately accountable, and shall report directly, to the Committee.
	•		Obtain from the independent auditors a formal written statement delineating all relationships between the independent auditors and the Company, including all non-audit services and fees, discuss with the auditors any disclosed relationships or services that may impact the quality of audit services or the auditors’ objectivity and independence, and take any appropriate action in response to the auditors’ statement to ensure the independence of the independent auditors. The Committee shall also review and approve fees paid to the independent auditors and review and approve dismissal of the independent auditors.
	•		At least annually, obtain and review a report of the independent auditors’ firm describing (1) the firm’s internal quality control procedures, (2) any material issues raised by the most recent internal quality control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities, within the last five years with respect to one or more independent audits carried out by the firm,

			and any steps taken to address any such issues, and (3) with a view towards assessing the independent auditor’s independence, all relationships between the independent auditors and the Company including each non-audit service provided to the Company.
	•		Have sole authority to approve (1) all audit and non-audit services (other than those non-audit services prohibited by law) to be provided by the independent auditors and (2) all fees and other terms of engagement of the independent auditors in providing such services. Before the independent auditors are engaged to perform any such non-audit services, the Committee must review and pre-approve such services. The chairperson of the Committee may represent the entire Committee for purposes of this review and approval so long as any such approval by the chairperson is disclosed to the Committee no later than the Committee’s next scheduled meeting.

2.

With respect to the internal auditing department

	•		Review the appointment and replacement of the director of the internal auditing department.
	•		Advise the director of the internal auditing department that he or she is expected to provide to the Audit Committee summaries of and, as appropriate, the significant reports to management prepared by the internal auditing department and management’s responses thereto.

3.

Review of Internal Audits, Annual External Audit and Quarterly Reviews

	•		Review with the independent auditors the annual audit scope and plan including the responsibilities, budget and staffing of the Company’s internal audit department.
	•		Review with management and the director of internal audit the internal audit department’s budget and staffing, results of internal audit department findings and proposed audit plans.
	•		Review and discuss the following items with management and the independent auditors upon the completion of the annual audit and before issuance of the financial statements and the filing of the Form 10-K:

	a.		The Company’s annual financial statements and related notes and the disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
	b.		The results of the independent auditors’ audit of the financial statements and the report thereon.
	c.		The qualitative judgments about the appropriateness and acceptability of accounting principles, financial disclosures and underlying estimates, the clarity of the financial disclosure practices used or proposed to be used, and other significant decisions made in preparing the financial statements.
	d.		Any other matters about the audit procedures or findings that SAS No. 61, as amended, requires the independent auditors to discuss with the Committee.
	e.		The contents of the certificates of the Chief Executive Officer and Chief Financial Officer required pursuant to Rule 13a-15 of the Securities Exchange Act of 1934, as amended.

     Based on the review and other procedures performed as set forth in this Charter, the Committee shall make its recommendation to the Board of Directors as to the inclusion of the Company’s audited financial statements in the Company’s Annual Report on Form 10-K.

•

Review and discuss the following items with management and the independent auditors before the filing of Form 10-Q:

	a.		The Company’s quarterly financial statements and related notes and the disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
	b.		The results of the independent auditors’ review of the financial statements.
	c.		The qualitative judgments about the appropriateness and acceptability of accounting principles, financial disclosures and underlying estimates, the clarity of the financial disclosure practices used or proposed to be used, and other significant decisions made in preparing the financial statements.
	d.		Any other matters about the review procedures or findings that SAS No. 71, as amended, requires the independent auditors to discuss with the Committee.
	e.		The contents of the certificates of the Chief Executive Officer and Chief Financial Officer required pursuant to Rule 13a-15 of the Securities Exchange Act of 1934, as amended.

	•		Review with management and the independent auditors the financial statements, related notes and other financial disclosures included in other Company filings with the Securities and Exchange Commission containing the Company’s financial statements before such filings are made.
	•		Review with management and the independent auditors any significant changes, either proposed or adopted, in accounting principles and their impact on the financial statements and in financial statement presentations.
	•		Require the independent auditors to timely (and no less than quarterly) report to the Committee (1) all critical accounting policies and practices used (or to be used), and (2) all alternate treatments of financial information within generally accepted accounting principles that have been discussed with management, ramifications of the use of these alternative disclosures and treatments, and the treatment preferred by the independent auditors.
	•		Review of effect of regulatory and accounting initiatives, as well as off-balance sheet structures, on the Company’s financial statements.
	•		Review with the independent auditor on a regular basis any problems or difficulties encountered while conducting the audit and the quarterly reviews and management’s response, including any restrictions on the independent auditor’s work or access to requested information and any significant disagreements with management. Among the items to be reviewed are: any accounting adjustments that were noted or proposed by the auditor but were “passed” (as immaterial or otherwise), any communications between the audit team and the audit firm’s national office with respect to auditing or accounting issues presented by the engagement, and any “management” or “internal control” letter issued, or proposed to be issued, by the audit firm to the Company.
	•		Review with management, the independent auditors and the director of internal audit:

	a.		The Company’s internal accounting controls and any special audit or review steps adopted in light of any material control deficiencies.
	b.		Any significant findings and recommendations made by the independent auditors or internal audit, together with management’s responses thereto.
	c.		Management’s assessment of internal controls and related internal control report.

•

Review and discuss with management earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies. The Committee’s responsibility to review and discuss press releases as well as financial information and earnings guidance may be done generally (i.e., discussion of the types of information to be disclosed and the type of presentation to be made). The Committee need not discuss in advance each earnings release or each instance in which the Company may provide earnings guidance.

Other

•

Regularly report Committee activities to the full Board of Directors with such recommendations as the Committee may deem appropriate.

	•		Discuss guidelines and policies with respect to risk assessment and risk management including the Company’s major financial risk exposures and the steps management has taken to monitor and control such exposures, including legal and ethical compliance programs.
	•		Oversee the Company’s Related Party Transactions Policy and fulfill such direct responsibilities with respect to related party transactions as set forth and defined in such policy.
	•		Review periodically with management and the General Counsel the status of legal and regulatory matters that may have a material impact on the Company’s financial statements and compliance policies.
	•		Receive any report by legal counsel regarding any evidence of a material violation of securities laws, breach of fiduciary duty or similar violation by the Company or its agents.
	•		Establish and maintain appropriate procedures for (1) the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters and (2) the confidential, anonymous submission by employees of concerns regarding accounting or auditing matters.
	•		Set clear hiring policies for current and former employees of the independent auditors.
	•		Prepare the report, for inclusion in the Company’s annual proxy statement, required by the Securities and Exchange Commission concerning certain matters relating to the Committee’s activities.
	•		Perform an annual performance evaluation of the Committee and review and reassess the adequacy of this Charter annually. If any revisions are deemed necessary or appropriate, submit the same to the Board for its consideration and approval.

General

     Although the fundamental responsibility for the Company’s financial statements and disclosures does not rest with the Audit Committee, the Committee must review: (a) major issues regarding accounting principles and financial statement presentations, including any significant changes in the Company’s selection or application of accounting principles, and major issues as to the adequacy of the Company’s internal controls and any special audit steps adopted in light of material control deficiencies; (b) analyses prepared by management and/or the independent auditor setting forth significant financial reporting issues and judgments made in connection with the preparation of the financial statements, including analyses of the effects of alternative GAAP methods on the financial statements; (c) the effect of regulatory and accounting initiatives, as well as off-balance sheet structures, on the financial statements of the Company; and (d) the type and presentation of information to be included in earnings press releases (paying particular attention to any use of “pro forma,” or “adjusted” non-GAAP, information) as well as review any financial information and earnings guidance provided to analysts and rating agencies.

     While the Committee has the duties and responsibilities set forth in this Charter, the Committee’s role is one of oversight. The Company’s management is responsible for the preparation, presentation and integrity of the Company’s financial statements and for the internal control over financial reporting. Management and the internal auditing department are responsible for maintaining appropriate accounting and financial reporting principles and policies and internal controls and procedures that provide for compliance with accounting standards and applicable laws and regulations. The independent auditors are responsible for auditing the annual financial statements, reviewing the Company’s quarterly financial statements prior to the filing of each quarterly report on Form 10-Q and other procedures. In fulfilling these responsibilities, it is recognized that members of the Audit Committee are not full-time employees of the Company and are not, and do not represent themselves to be, performing the functions of auditors or accountants. In this regard, management and the independent auditors have the affirmative responsibility to inform the Committee of important issues involving the Company’s financial reporting accounting policies and practices, audit matters, disclosure and internal controls in a timely and forthright manner. The Committee is not providing any expert or special assurance as to the Company’s financial statements or any professional certification as to the independent auditors’ work. Similarly, it is not the direct responsibility of the Committee to ensure that the Company complies with all laws and regulations.

APPENDIX B

PART II

ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

     Our common stock trades on the New York Stock Exchange under the symbol “CCU.” There were 3,520 shareholders of record as of February 28, 2006. This figure does not include an estimate of the indeterminate number of beneficial holders whose shares may be held of record by brokerage firms and clearing agencies. The following table sets forth, for the calendar quarters indicated, the reported high and low sales prices of the common stock as reported on the NYSE.

		Common Stock
		Market Price								Dividends
		High				Low				Declared
2004
First Quarter			47.76				38.90				.10
Second Quarter			44.50				35.35				.10
Third Quarter			37.24				30.62				.125
Fourth Quarter			35.07				29.96				.125
2005
First Quarter			35.07				31.14				.125
Second Quarter			34.81				28.75				.1875
Third Quarter			34.26				30.31				.1875
Fourth Quarter			33.44				29.60				.1875

Dividend Policy

     Our Board of Directors declared a quarterly cash dividend of 18.75 cents per share at its February 2006 meeting. We expect to continue to declare and pay quarterly cash dividends in 2006. The terms of our current credit facilities do not prohibit us from paying cash dividends unless we are in default under our credit facilities either prior to or after giving effect to any proposed dividend. However, any future decision by our Board of Directors to pay cash dividends will depend on, among other factors, our earnings, financial position, capital requirements and regulatory changes.

Purchases of Equity Securities by the Issuer and Affiliated Purchases

     On February 1, 2005, we publicly announced that our Board of Directors authorized a share repurchase program of up to $1.0 billion effective immediately. On August 9, 2005, our Board of Directors authorized an increase in and extension of the February 2005 program, which had $307.4 million remaining, by $692.6 million, for a total of $1.0 billion. On March 9, 2006, Our Board of Directors authorized an additional share repurchase program, permitting us to repurchase an additional $600.0 million of our common stock. This increase expires on March 9, 2007, although the program may be discontinued or suspended at anytime prior to its expiration. During the three months ended December 31, 2005, we repurchased the following shares:

										Total Number of				Maximum Dollar Value of
		Total Number								Shares Purchased as				Shares that May Yet Be
		of Shares				Average Price				Part of Publicly				Purchased Under the
Period		Purchased				Paid per Share				Announced Programs				Programs
October 1 through October 31			2,422,800			$	31.14				2,422,800			$	924,556,611
November 1 through November 30			3,726,900			$	30.65				3,726,900			$	824,104,694
December 1 through December 31			1,100,000			$	31.97				1,100,000			$	788,939,354
Total			7,249,700								7,249,700

ITEM 6. Selected Financial Data

(In thousands)						For the Years ended December 31, (1)
		2005				2004				2003				2002				2001
Results of Operations Information:
Revenue		$	6,610,418			$	6,634,890			$	6,250,930			$	5,940,500			$	5,462,253
Operating expenses:
Direct operating expenses (excludes non-cash compensation expense and depreciation and amortization)			2,466,755				2,330,817				2,141,163				1,938,162				1,781,540
Selling, general and administrative expenses (excludes non-cash compensation expense and depreciation and amortization)			1,919,640				1,911,788				1,870,161				1,802,904				1,740,978
Non-cash compensation expense			6,081				3,596				3,716				4,034				13,126
Depreciation and amortization			630,389				630,521				608,531				556,484				2,263,623
Corporate expenses (excludes non-cash compensation expense and depreciation and amortization)			165,207				164,722				150,407				160,216				150,883
Gain on disposition of assets – net			45,247				39,552				6,688				35,601				155,163
Operating income (loss)			1,467,593				1,632,998				1,483,640				1,514,301				(332,734	)
Interest expense			443,245				367,503				392,215				430,890				555,452
Gain (loss) on sale of assets related to mergers			¾				¾				¾				3,991				(213,706	)
Gain (loss) on marketable securities			(702	)			46,271				678,846				(3,096	)			25,820
Equity in earnings of nonconsolidated affiliates			38,338				22,285				20,669				27,140				3,703
Other income (expense) — net			17,344				(30,293	)			20,783				5,625				2,749
Income (loss) before income taxes, minority interest, discontinued operations and cumulative effect of a change in accounting principle			1,079,328				1,303,758				1,811,723				1,117,071				(1,069,620	)
Income tax benefit (expense)			(426,336	)			(499,364	)			(776,921	)			(441,341	)			113,557
Minority interest income (expense), net of tax			(17,847	)			(7,602	)			(3,906	)			1,778				(4,146	)
Income (loss) before discontinued operations and cumulative effect of a change in accounting principle			635,145				796,792				1,030,896				677,508				(960,209	)
Income (loss) from discontinued operations, net			300,517				49,007				114,695				47,315				(183,817	)
Income (loss) before cumulative effect of a change in accounting principle			935,662				845,799				1,145,591				724,823				(1,144,026	)
Cumulative effect of a change in accounting principle, net of tax of, $2,959,003 in 2004 and $4,324,446 in 2002			—				(4,883,968	)			—				(16,778,526	)			—
Net income (loss)		$	935,662			$	(4,038,169	)		$	1,145,591			$	(16,053,703	)		$	(1,144,026	)

						For the Years ended December 31, (1)
		2005				2004				2003				2002				2001
Net income (loss) per common share:
Basic:
Income (loss) before discontinued operations and cumulative effect of a change in accounting principle		$	1.16			$	1.34			$	1.68			$	1.12			$	(1.62	)
Discontinued operations			.55				.08				.18				.08				(.31	)
Income (loss) before cumulative effect of a change in accounting principle			1.71				1.42				1.86				1.20				(1.93	)
Cumulative effect of a change in accounting principle			—				(8.19	)			—				(27.65	)			—
Net income (loss)		$	1.71			$	(6.77	)		$	1.86			$	(26.45	)		$	(1.93	)
Diluted:
Income (loss) before discontinued operations and cumulative effect of a change in accounting principle		$	1.16			$	1.33			$	1.67			$	1.11			$	(1.62	)
Discontinued operations			.55				.08				.18				.07				(.31	)
Income (loss) before cumulative effect of a change in accounting principle			1.71				1.41				1.85				1.18				(1.93	)
Cumulative effect of a change in accounting principle			—				(8.16	)			—				(26.74	)			—
Net income (loss)		$	1.71			$	(6.75	)		$	1.85			$	(25.56	)		$	(1.93	)
Dividends declared per share		$	.69			$	.45			$	.20			$	—			$	—

(In thousands)		As of December 31,
		2005				2004				2003				2002				2001
Balance Sheet Data:
Current assets		$	2,248,409			$	2,269,922			$	2,185,682			$	2,123,495			$	1,941,299
Property, plant and equipment — net			3,255,649				3,328,165				3,476,900				3,496,340				3,215,677
Total assets			18,703,376				19,927,949				28,352,693				27,672,153				47,603,142
Current liabilities			2,107,313				2,184,552				1,892,719				3,010,639				2,959,857
Long-term debt, net of current maturities			6,155,363				6,941,996				6,898,722				7,357,769				7,938,655
Shareholders’ equity			8,826,462				9,488,078				15,553,939				14,210,092				29,736,063

The Selected Financial Data should be read in conjunction with Management’s Discussion and Analysis.

ITEM 7. Management’s Discussion and Analysis of Results of Operations and Financial Condition

Executive Summary

     Our 2005 revenues declined $24.5 million compared to 2004. Revenues from our radio business declined 6% in 2005 compared to 2004. 2005 was our first full year of our Less is More initiative in which we reduced the number of commercial minutes broadcast on our radio stations. The lower number of commercial minutes broadcast resulted in lower radio revenues in 2005 compared to 2004, which was partially offset by improved yield, or revenue per commercial, on our radio advertisements in 2005 over 2004. Partially offsetting this decline was revenue growth in our outdoor segments, which combined delivered 9% revenue growth over 2004. From the Americas, we experienced improved pricing on our outdoor inventory during 2005 and internationally, our street furniture inventory experienced improved yields as well. Additionally, we completed the initial public offering of 10% of our outdoor business. Lastly, we completed the spin-off of our live entertainment and sports representation businesses during the fourth quarter of 2005, which was part of our strategic realignment of our businesses that we announced in the second quarter of 2005.

Strategic Realignment of Businesses

     On April 29, 2005, we announced a plan to strategically realign our businesses. The plan included an initial public offering (“IPO”) of approximately 10% of the common stock of our outdoor segment, which trades on the New York Stock Exchange under the symbol “CCO” and a 100% spin-off of our live entertainment segment and sports representation business, which now operates under the name Live Nation and trades on the New York Stock Exchange under the symbol “LYV”. We completed the IPO on November 11, 2005 and the spin-off on December 21, 2005.

     The IPO consisted of the sale of 35.0 million shares of Class A common stock of our indirect, wholly owned subsidiary, Clear Channel Outdoor Holdings, Inc. (“CCO”). After completion of the IPO, we own all 315.0 million shares of CCO’s outstanding Class B common stock, representing approximately 90% of the outstanding shares of CCO’s common stock and approximately 99% of the total voting power of CCO’s common stock. The net proceeds from the offering, after deducting underwriting discounts and offering expenses, were approximately $600.6 million. All of the net proceeds of the offering were used to repay a portion of the outstanding balances of intercompany notes owed to us by CCO.

     The spin-off consisted of a dividend of .125 share of Live Nation common stock for each share of our common stock held on December 21, 2005, the date of the distribution. Additionally, Live Nation repaid approximately $220.0 million of intercompany notes owed to us by Live Nation. We do not own any shares of Live Nation common stock. Our Board of Directors determined that the spin-off was in the best interests of our shareholders because: (i) it would enhance the success of both us and Live Nation by enabling each to resolve management and systemic problems that arose by the operation of the businesses within a single affiliated group; (ii) it would improve the competitiveness of our business by resolving inherent conflicts and the appearance of such conflicts with artists and promoters; (iii) it would simplify and reduce our and Live Nation’s regulatory burdens and risks; (iv) it would enhance the ability of us and Live Nation to issue equity efficiently and effectively for acquisitions and financings; and (v) it would enhance the efficiency and effectiveness of our and Live Nation’s equity-based compensation. Operating results of Live Nation through December 21, 2005 are reported in discontinued operations for all years presented. After the date of the spin-off, Live Nation is an independent company.

     On August 9, 2005, we announced our intention to return approximately $1.6 billion of capital to shareholders through either share repurchases, a special dividend or a combination of both. Since announcing our intent through March 8, 2006, we have returned approximately $955.0 million to shareholders by repurchasing 31.9 million shares of our common stock. Since announcing a share repurchase program in March 2004, we have repurchased approximately 109.3 million shares of our common stock for approximately $3.6 billion. Subject to our financial condition, market conditions, economic conditions and other factors, it remains our intention to return the remaining balance of the approximately $1.6 billion in capital to our shareholders through either share repurchases, a special dividend or a combination of both. We intend to fund any share repurchases and/or a special dividend from funds generated from the repayment of intercompany debt, the proceeds of any new debt offerings, available cash balances and cash flow from operations. The timing and amount of a special dividend, if any, is in the discretion of our Board of Directors and will be based on the factors described above.

Format of Presentation

     Management’s discussion and analysis of our results of operations and financial condition should be read in conjunction with the consolidated financial statements and related footnotes. Our discussion is presented on both a consolidated and segment basis. Our reportable operating segments are Radio Broadcasting, which includes our national syndication business, Americas Outdoor Advertising and International Outdoor Advertising. Included in the “other” segment are television broadcasting and our media representation business, Katz Media.

     We manage our operating segments primarily focusing on their operating income, while Corporate expenses, Gain on disposition of assets — net, Interest expense, Gain (loss) on marketable securities, Equity in earnings of nonconsolidated affiliates, Other income (expense) – net, Income tax benefit (expense), Minority interest — net of tax, Discontinued operations and Cumulative effect of a change in accounting principle are managed on a total company basis and are, therefore, included only in our discussion of consolidated results.

Radio Broadcasting

     Our local radio markets are run predominantly by local management teams who control the formats selected for their programming. The formats are designed to reach audiences with targeted demographic characteristics that appeal to our advertisers. Our advertising rates are principally based on how many people in a targeted audience listen to our stations, as measured by an independent ratings service. The size of the market influences rates as well, with larger markets typically receiving higher rates than smaller markets. Also, our advertising rates are influenced by the time of day the advertisement airs, with morning and evening drive-time hours typically the highest. Radio advertising contracts are typically less than one year.

     During the first quarter of 2005, we completed the rollout of our Less is More initiative, which lowered the amount of commercial minutes played per hour by approximately 15% — 20% across our stations. We believe lowering the amount of commercial minutes can improve our ratings, which will lead to an increase in the size of the audience listening to our stations. Another key component of Less is More is encouraging advertisers to invest in shorter advertisements rather than the traditional 60-second spot. Based on our research, we believe that the effectiveness of a commercial is not related to its length. Because effectiveness is not tied to the length of the advertisement, on a cost per thousand listeners reached basis, we believe we can provide our advertisers a more efficient investment with our new shorter commercials than with the traditional 60-second commercials.

     Management monitors macro level indicators to assess our radio operations’ performance. Due to the geographic diversity and autonomy of our markets, we have a multitude of market specific advertising rates and audience demographics. Therefore, our discussion of the results of operations of our radio broadcasting segment focuses on the macro level indicators that management monitors to assess our radio segment’s financial condition and results of operations.

     Management looks at our radio operations’ overall revenues as well as local advertising, which is sold predominately in a station’s local market, and national advertising, which is sold across multiple markets. Local advertising is sold by our local radio stations’ sales staffs while national advertising is sold, for the most part, through our national representation firm.

     Local advertising, which is our largest source of advertising revenue, and national advertising revenues are tracked separately, because these revenue streams have different sales forces and respond differently to changes in the economic environment. Management also looks at radio revenue by market size, as defined by Arbitron. Typically, larger markets can reach larger audiences with wider demographics than smaller markets. Over half of our radio revenue and divisional operating expenses comes from our 50 largest markets. Additionally, management reviews our share of target demographics listening to the radio in an average quarter hour. This metric gauges how well our formats are attracting and keeping listeners.

     A significant portion of our radio segment’s expenses vary in connection with changes in revenue. These variable expenses primarily relate to costs in our sales department, such as salaries, commissions and bad debt. Our programming and general and administrative departments incur most of our fixed costs, such as talent costs, rights fees, utilities and office salaries. Lastly, our highly discretionary costs are in our marketing and promotions department, which we primarily incur to maintain and/or increase our audience share.

Outdoor Advertising

     Our revenues are derived from selling advertising space on the displays that we own or operate in key markets worldwide, consisting primarily of billboards, street furniture displays and transit displays. 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 acquired permanent easements. Our advertising contracts with clients typically outline the number of displays reserved, the duration of the advertising campaign and the unit price per display. The margins on our billboard contracts tend to be higher than those on contracts for our other displays.

     Generally, our advertising rates are based on the “gross rating points,’’ or total number of impressions delivered expressed as a percentage of a market population, of a display or group of displays. The number of “impressions’’ delivered by a display is measured by the number of people passing the site during a defined period of time and, in some

international markets, is weighted to account for such factors as illumination, proximity to other displays and the speed and viewing angle of approaching traffic. To monitor our business, management typically reviews the average rates, average revenues per display, occupancy, and inventory levels of each of our display types by market. In addition, because a significant portion of our advertising operations are conducted in foreign markets, principally France and the United Kingdom, management reviews the operating results from our foreign operations on a constant dollar basis. A constant dollar basis allows for comparison of operations independent of foreign exchange movements. Because revenue-sharing and minimum guaranteed payment arrangements are more prevalent in our international operations, the margins in our international operations typically are less than the margins in our Americas operations. Foreign currency transaction gains and losses, as well as gains and losses from translation of financial statements of subsidiaries and investees in highly inflationary countries, are included in operations.

     The significant expenses associated with our operations include (i) direct production, maintenance and installation expenses, (ii) site lease expenses for land under our displays and (iii) revenue-sharing or minimum guaranteed amounts payable under our street furniture and transit display contracts. Our direct production, maintenance and installation expenses include costs for printing, transporting and changing the advertising copy on our displays, the related labor costs, the vinyl and paper costs and the costs for cleaning and maintaining our displays. Vinyl and paper costs vary according to the complexity of the advertising copy and the quantity of displays. Our site lease expenses include lease payments for use of the land under our displays, as well as any revenue-sharing arrangements we may have with the landlords. The terms of our Americas site leases generally range from 1 to 50 years. Internationally, the terms of our site leases generally range from 3 to 15 years, but may vary across our networks.

Fiscal Year 2005 Compared to Fiscal Year 2004
Consolidated

(In thousands)		Years Ended December 31,								% Change
		2005				2004				2005 v. 2004
Revenue		$	6,610,418			$	6,634,890			0%
Operating expenses:
Direct operating expenses (excludes non-cash compensation expense of $212 and $930 in 2005 and 2004, respectively and depreciation and amortization)			2,466,755				2,330,817			6%
Selling, general and administrative expenses (exclusive of non-cash compensation expense and depreciation and amortization)			1,919,640				1,911,788			0%
Non-cash compensation expense			6,081				3,596			69%
Depreciation and amortization			630,389				630,521			0%
Corporate expenses (excludes non-cash compensation expense of $5,869 and $2,666 in 2005 and 2004, respectively and depreciation and amortization)			165,207				164,722			0%
Gain on disposition of assets — net			45,247				39,552			14%
Operating income			1,467,593				1,632,998			(10%)
Interest expense			443,245				367,503
Gain (loss) on marketable securities			(702	)			46,271
Equity in earnings of nonconsolidated affiliates			38,338				22,285
Other income (expense) — net			17,344				(30,293	)
Income before income taxes, minority interest expense, discontinued operations and cumulative effect of a change in accounting principle			1,079,328				1,303,758
Income tax benefit (expense):
Current			(43,513	)			(367,679	)
Deferred			(382,823	)			(131,685	)
Income tax benefit (expense)			(426,336	)			(499,364	)
Minority interest expense, net of tax			17,847				7,602
Income before discontinued operations and cumulative effect of a change in accounting principle			635,145				796,792
Income from discontinued operations, net			300,517				49,007
Cumulative effect of a change in accounting principle, net of tax of $2,959,003			—				(4,883,968	)
Net income (loss)		$	935,662			$	(4,038,169	)