As filed with the Securities and Exchange Commission on June 21, 2001
Registration No. 333-
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--------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT
Under
The Securities Act of 1933
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CROWN CASTLE INTERNATIONAL CORP.
(Exact name of Registrant as specified in its charter)
Delaware 4899 76-0470458
(State or other (Primary Standard (I.R.S. Employer
jurisdiction of Industrial Identification Number)
incorporation or Classification Number)
organization)
------------
Mr. W. Benjamin Moreland
Senior Vice President
Chief Financial Officer and Treasurer
510 Bering Drive
Suite 500
Houston, Texas 77057
(713) 570-3000
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
------------
Copies to:
Stephen L. Burns, Esq.
Cravath, Swaine & Moore
825 Eighth Avenue
New York, New York 10019
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [_]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
CALCULATION OF REGISTRATION FEE
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Proposed
Proposed Maximum
Title of Each Class of Amount Maximum Aggregate Amount of
Securities to be to be Offering Price Offering Registration
Registered Registered Per Unit Price(1) Fee(2)
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9 3/8% Senior Notes Due
2011.................. $450,000,000 100% $450,000,000 $112,500
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(1) Estimated solely for the purpose of calculating the registration fee under
Rule 457 of the Securities Act of 1933.
(2)Calculated pursuant to Rule 457(f)(2).
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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
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++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission relating to these securities is effective. +
+This prospectus is not an offer to sell these securities and it is not an +
+offer to buy these securities in any state where the offer or sale is not +
+permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED JUNE 21, 2001
PROSPECTUS
[LOGO OF CROWN CASTLE INTERNATIONAL]
CROWN CASTLE INTERNATIONAL CORP.
--------
OFFER TO EXCHANGE
UP TO $450,000,000 PRINCIPAL AMOUNT
OUTSTANDING
9 3/8% SENIOR NOTES DUE 2011
FOR
A LIKE PRINCIPAL AMOUNT OF
REGISTERED 9 3/8% SENIOR NOTES
DUE 2011
The new 9 3/8% Senior Notes Due 2011 will be free of the transfer
restrictions that apply to our outstanding, unregistered 9 3/8% Senior Notes
Due 2011 that you currently hold, but will otherwise have substantially the
same terms of these outstanding old notes. This offer will expire at 5:00 p.m.,
New York City time, on , 2001, unless we extend it. The new notes will not
trade on any established exchange.
--------
Please see "Risk Factors" beginning on page 10 for a discussion of certain
factors you should consider in connection with the exchange offer.
--------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of the new notes or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
--------
The date of this prospectus is June 21, 2001.
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TABLE OF CONTENTS
Page Page
---- ----
Where You Can Find More The Exchange Offer............... 22
Information....................... ii Description of Notes............. 30
Incorporation of Documents by Certain U.S. Federal Income Tax
Reference......................... ii Considerations.................. 70
Prospectus Summary................. 1 Plan of Distribution............. 70
Risk Factors....................... 9 Legal Matters.................... 71
Use of Proceeds.................... 17 Experts.......................... 71
Selected Financial and Other Data.. 18 Certain Currency Translations.... 71
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i
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings and other information regarding
issuers are available to the public over the Internet at the SEC's web site at
http:/www.sec.gov. You may also read and copy any document we file with the SEC
at the SEC's following public reference facilities:
Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center Citicorp Office
Room 1024 Suite 1300 500 West Madison Street
Washington, D.C. 20549 New York, New York 10048 Suite 1400
Chicago, Illinois 60661-
2511
Copies of these documents may also be obtained at prescribed rates by writing
to the Public Reference Section of the SEC at 450 Fifth Street, N.W., Room
1024, Washington, D.C. 20549. Please call 1-800-SEC-0330 for further
information on the operations of the public reference facilities. Our SEC
filings are also available at the offices of the New York Stock Exchange at 20
Broad Street, New York, NY 10005.
INCORPORATION OF DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with them into this prospectus, which means that:
. incorporated documents are considered part of this prospectus;
. we can disclose important business and financial information about us,
that is not included in or delivered with this prospectus, to you by
referring you to those other documents; and;
. information contained in later-dated documents will supplement, modify
or supersede, as applicable, the information contained in earlier-
dated documents, and information that we subsequently file with the
SEC will automatically update and supersede this incorporated
information.
We incorporate by reference into this prospectus the documents listed
below, as amended and supplemented, and all documents filed by us with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
after the date of this prospectus and prior to the time that the exchange offer
made hereby is completed:
. Annual Report on Form 10-K, as amended, for the year ended December
31, 2000;
. Current Reports on Form 8-K dated January 12, 2001, January 16, 2001,
April 27, 2001 and May 10, 2001, and Amendment No. 1 to Current Report
on Form 8-K/A dated April 11, 2001;
. Our Definitive Proxy Statement dated May 8, 2001; and
. Quarterly Report on Form 10-Q for the quarterly period ended March 31,
2001.
You can obtain any of the filings incorporated by reference into this
document through us or from the SEC through the SEC's web site or at the
addresses listed above. Documents incorporated by reference into this
prospectus, except for any exhibits to those documents that are not expressly
incorporated by reference into those documents, are available from us without
charge by requesting them in writing or by telephone at the following address
and telephone number:
Crown Castle International Corp.
510 Bering Drive
Suite 500
Houston, Texas 77057
Attention: Corporate Secretary
Telephone: (713) 570-3000.
ii
If you request any incorporated documents from us, we will mail them to you
by first class mail, or by another equally prompt means, within one business
day after we receive your request. However, in order to obtain timely delivery
of these documents, you must make your request no later than five business days
before the expiration date of the exchange offer.
Unless the context requires otherwise, all references in this document to
"this prospectus" include all documents incorporated by reference into this
prospectus.
iii
PROSPECTUS SUMMARY
This summary highlights information contained elsewhere in this prospectus
or incorporated by reference herein. It may not contain all the information
that is important to you. We encourage you to read this entire prospectus and
each of the incorporated documents carefully.
The Company
We are a leading owner and operator of towers and transmission networks for
wireless communications and broadcast transmission companies. As of December
31, 2000, we owned, leased or managed 12,918 towers and rooftops, including
9,872 sites in the United States and Puerto Rico, 2,330 sites in the United
Kingdom and 716 sites in Australia. Our customers currently include many of the
world's major wireless communications and broadcast companies, including
Verizon, Cingular, Nextel, Sprint PCS, AT&T Wireless, Cable & Wireless Optus,
Vodafone, BT Cellnet, One 2 One, Hutchison and the British Broadcasting
Corporation.
Our strategy is to use our leading domestic and international position to
capture the growing opportunities to consolidate ownership and management of
existing towers and other wireless and transmission infrastructure and to build
and operate new towers and wireless and transmission networks and
infrastructure created by:
. the transfer to third parties, or outsourcing, of tower ownership and
management by major wireless carriers;
. the need for existing wireless carriers to expand coverage and improve
capacity;
. the additional demand for towers and wireless infrastructure created by
new entrants into the wireless communications industry;
. the privatization of state-run broadcast transmission networks; and
. the introduction of wireless technologies including broadband data, or
"3G" technology.
Our main businesses are leasing antenna space on wireless and broadcast
towers that can accommodate multiple tenants and operating analog and digital
broadcast transmission networks and wireless networks. We also provide related
services to our customers, including network design, radio frequency
engineering, site acquisition, site development and construction, antenna
installation and network management and maintenance. We believe that our full
service capabilities are a key competitive advantage in forming strategic
partnerships to acquire large concentrations of towers, or tower clusters, and
in winning contracts for tower acquisitions, management and construction along
with wireless and transmission network management.
Our primary business in the United States is the leasing of antenna space
to wireless carriers. We believe that by owning and managing large tower
clusters we are able to offer customers the ability to fulfill rapidly and
efficiently their network expansion plans across particular markets or regions.
Our acquisition strategy has been focused on adding tower clusters to our tower
portfolio. As of December 31, 2000, we had tower clusters in 34 of the 50
largest U.S. metropolitan areas, and 68 of the 100 largest U.S. metropolitan
areas.
Our primary business in the United Kingdom, which is conducted through our
subsidiary Crown Castle UK Holdings Limited, or "CCUK", is the operation of
television and radio broadcast transmission networks and the leasing of antenna
space to wireless carriers. Following our 1997 acquisition of the BBC's
broadcast and tower infrastructure, we were awarded long-term contracts to
1
provide the BBC and other broadcasters analog and digital transmission
services. We also lease antenna space to wireless operators in the United
Kingdom on the towers we acquired from the BBC, as well as on various towers
that we acquired from wireless carriers or that we have constructed. We have
nationwide broadcast and wireless coverage in the United Kingdom.
In November 2000, CCUK entered into an agreement with British
Telecommunications plc, or "British Telecom", to lease space on as many as
4,000 British Telecom exchange sites throughout the United Kingdom. We expect
to invest approximately $325 million over the next two years developing the
British Telecom site portfolio for the deployment of 3G wireless services.
In February 2001, CCUK signed a definitive agreement with Hutchison 3G UK
Limited, or "Hutchison", whereby Hutchison will lease space on a minimum of
4,000 CCUK sites (a minimum take up of 1,000 sites per year for each of 2001
through 2004) throughout the United Kingdom. In addition, in February 2001,
CCUK signed an initial agreement with its existing customer BT Cellnet pursuant
to which BT Cellnet will lease additional space on CCUK sites throughout the
United Kingdom with a minimum take up of 1,500 additional sites by the end of
2003.
Our primary business in Australia, which is conducted through Crown Castle
Australia Pty Limited, or "CCAL", is the leasing of antenna space to wireless
carriers. We currently operate 716 towers in Australia that we purchased from
Cable & Wireless Optus during 2000. Further, in April 2001, CCAL purchased 638
wireless communications towers from Vodafone Australia for approximately $113
million (Australian $226 million). Giving effect to this transaction, CCAL
operates approximately 1,350 towers in Australia with a strategic presence in
all of Australia's licensed regions including Sydney, Melbourne, Brisbane,
Adelaide and Perth. CCAL is owned 66.7% by us and 33.3% by Permanent Nominees
(Aust) Ltd on behalf of a group of professional and institutional investors
lead by Jump Capital Limited.
On April 27, 2001, we purchased 49% of the outstanding capital stock of RAI
Way S.p.A., or "RAI Way", for a purchase price of approximately Italian Lire
791.4 billion (approximately $384 million). RAI Way manages over 2,300
broadcast transmission sites across Italy, making it one of Italy's largest
tower networks, and provides broadcast coverage to approximately 99% of the
Italian population. RAI Way currently has over 700 existing telecom tenants and
employs over 750 people.
We believe our towers are attractive to a diverse range of wireless
communications industries, including personal communications services,
cellular, enhanced specialized mobile radio, specialized mobile radio, paging,
and fixed microwave, as well as radio and television broadcasting. In the
United States our major customers include Verizon, Cingular, Powertel, Nextel,
Sprint PCS and AT&T Wireless. In the United Kingdom our major customers include
the BBC, BT Cellnet, NTL, ONdigital, One 2 One, Orange, Virgin Radio and
Hutchison. Our principal customers in Australia are Cable & Wireless Optus,
Vodafone Australia, OneTel and Hutchison Australia.
We are continuing our ongoing construction program to enhance our tower
portfolios. In 2000, we constructed 1,178 towers. In 2001, we plan to construct
approximately 1,500 towers, at an estimated aggregate cost of approximately
$330 million, for lease to wireless carriers such as Verizon, Cingular, Nextel,
Hutchison and BT Cellnet. The actual number of towers built may vary depending
on acquisition opportunities and potential build-to-suit contracts from large
wireless carriers.
Our principal executive offices are located at 510 Bering Drive, Suite 500,
Houston, Texas, 77057, and our telephone number is (713) 570-3000.
Recent Developments
On May 16, 2001, we closed the private placement of the old notes.
2
The Offering
Summary of Terms of the Exchange Offer
Background..................... On May 16, 2001, we completed a private
placement of the old notes. In connection
with that private placement, we entered into
a registration rights agreement in which we
agreed, among other things, to deliver this
prospectus to you and to complete an exchange
offer.
The Exchange Offer............. We are offering to exchange our new notes
which have been registered under the
Securities Act of 1933 for a like principal
amount of our outstanding, unregistered old
notes. Old notes may only be tendered in
integral multiples of $1,000 principal amount
at maturity.
As of the date of this prospectus,
$450,000,000 in aggregate principal amount of
our old notes is outstanding.
Resale of New Notes............ We believe that new notes issued pursuant to
the exchange offer in exchange for old notes
may be offered for resale, resold and
otherwise transferred by you without
compliance with the registration and
prospectus delivery provisions of the
Securities Act of 1933, provided that:
. you are acquiring the new notes in the
ordinary course of your business;
. you have not engaged in, do not intend to
engage in, and have no arrangement or
understanding with any person to
participate in the distribution of the new
notes; and
. you are not our affiliate as defined under
Rule 405 of the Securities Act of 1933.
Each participating broker-dealer that
receives new notes for its own account
pursuant to the exchange offer in exchange
for old notes that were acquired as a result
of market-making or other trading activity
must acknowledge that it will deliver a
prospectus in connection with any resale of
new notes. See "Plan of Distribution".
Any holder of old notes who:
. is our affiliate;
. does not acquire new notes in the ordinary
course of its business;
. tenders in the exchange offer with the
intention to participate, or for the
purpose of participating, in a distribution
of new notes; or
. is a broker-dealer that acquired the old
notes directly from us
must comply with the registration and
prospectus delivery requirements of the
Securities Act of 1933 in connection with the
resale of new notes.
3
Consequences If You Do Not
Exchange Your Old Notes....... Old notes that are not tendered in the
exchange offer or are not accepted for
exchange will continue to bear legends
restricting their transfer. You will not be
able to offer or sell the old notes unless:
. pursuant to an exemption from the
requirements of the Securities Act of
1933;
. the old notes are registered under the
Securities Act of 1933; or
. the transaction requires neither such an
exemption nor registration,
and after the exchange offer is closed, we
will no longer have an obligation to register
the old notes, except for some limited
exceptions. See "Risk Factors--Failure to
Exchange Your Old Notes".
Expiration Date................ 5:00 p.m., New York City time, on , 2001,
unless we extend the exchange offer.
Certain Conditions to the
Exchange Offer................ The exchange offer is subject to certain
customary conditions, which we may waive.
Special Procedures for
Beneficial Holders............ If you beneficially own old notes which are
registered in the name of a broker, dealer,
commercial bank, trust company or other
nominee and you wish to tender in the
exchange offer, you should contact such
registered holder promptly and instruct such
person to tender on your behalf. If you wish
to tender in the exchange offer on your own
behalf, you must, prior to completing and
execution the letter of transmittal and
delivering your old notes, either arrange to
have the old notes registered in your name or
obtain a properly completed bond power from
the registered holder. The transfer of
registered ownership may take considerable
time.
Withdrawal Rights.............. You may withdraw your tender of old notes at
any time before the offer expires.
Accounting Treatment........... We will not recognize any gain or loss for
accounting purposes upon the completion of
the exchange offer. The expenses of the
exchange offer that we pay will increase our
deferred financing costs in accordance with
generally accepted accounting principles. See
"The Exchange Offer--Accounting Treatment".
Certain Tax Consequences....... The exchange pursuant to the exchange offer
generally will not be a taxable event for
U.S. Federal income tax purposes.
Use of Proceeds................ We will not receive any proceeds from the
exchange or the issuance of new notes in
connection with the exchange offer.
Exchange Agent................. The Bank of New York is serving as exchange
agent in connection with the exchange offer.
4
Summary Description of the Securities to be Registered
The new notes have the same financial terms and covenants as the old notes,
which are as follows:
Securities offered............. $450,000,000 million in aggregate principal
amount of 9 3/8% Senior Notes due 2011.
Maturity....................... August 1, 2011
Issue price.................... 100%, plus accrued interest, if any, from May
16, 2001.
Interest....................... Annual rate--9 3/8%. Payment frequency--every
six months on February 1 and August 1,
beginning on August 1, 2001.
Ranking........................ These notes constitute senior debt of the
Company, and rank equally in right of payment
with all of our existing and future senior
debt, but will be effectively junior in right
of payment to the extent of the assets
securing our other senior debt. Our only
significant assets are the capital stock of
our subsidiaries, and the notes will not be
guaranteed by our subsidiaries. As a result,
the notes will be structurally subordinated
to all debt and other liabilities of our
subsidiaries, including borrowings under
their credit facilities.
Optional redemption............ On or after August 1, 2006, we may redeem
some or all of the notes at any time at the
redemption price listed in the "Description
of Notes" section under the heading "Optional
Redemption."
Before August 1, 2004, we may redeem up to
35% of the notes with the proceeds of public
offerings of equity or strategic investments
in us at the price listed in the "Description
of Notes" section under the heading "Optional
Redemption."
Mandatory offer to repurchase.. If we sell certain assets, or experience
specific kinds of changes of control, we must
offer to repurchase the notes at the price
listed in the "Description of Notes" section
under the heading "Repurchase at the Option
of Holders."
Basic covenants of Indenture... We will issue the notes under an indenture
with The Bank of New York. The indenture
will, among other things, restrict our
ability and the ability of our subsidiaries
to:
. borrow money;
. pay dividends on stock or repurchase stock;
. make investments;
. use assets as security in other
transactions; and
. sell assets or merge with or into other
companies.
For more details, see the "Description of the
Notes" section under the heading "Certain
Covenants."
Risk Factors
You should carefully consider all of the information in this prospectus. In
particular, you should evaluate the specific risk factors under "Risk Factors"
for a discussion of certain risks related to your participation in the exchange
offer.
5
Summary Financial and Other Data
The summary historical consolidated financial data set forth below for each
of the five years in the period ended December 31, 2000, and as of December 31,
1996, 1997, 1998, 1999 and 2000, have been derived from the consolidated
financial statements of CCIC, which have been audited by KPMG LLP, independent
auditors. The summary historical consolidated financial data set forth below
for the three months ended March 31, 2000 and 2001, and as of March 31, 2001,
have been derived from the unaudited consolidated financial statements of CCIC,
which include all adjustments that CCIC considers necessary for a fair
presentation of the financial position and results of operations for those
periods. Operating results for the three months ended March 31, 2001 are not
necessarily indicative of the results that may be expected for the entire year.
The results of operations for the three months ended March 31, 2001 are not
comparable to the three months ended March 31, 2000, the results for the year
ended December 31, 2000 are not comparable to the year ended December 31, 1999,
the results for the year ended December 31, 1999 are not comparable to the year
ended December 31, 1998, the results for the year ended December 31, 1998 are
not comparable to the year ended December 31, 1997, and the results for the
year ended December 31, 1997 are not comparable to the year ended December 31,
1996, in each case as a result of business and asset acquisitions completed in
1997, 1998, 1999 and 2000. Results of operations of these acquired businesses
and assets are included in CCIC's consolidated financial statements for the
periods after the respective dates of acquisition. The information set forth
below should be read in conjunction with the consolidated financial statements
and related notes and "Management's Discussion and Analysis of Financial
Condition and Results of Operations--Results of Operations" included in CCIC's
Annual Report on Form 10-K and Quarterly Report on Form 10-Q.
Three Months
Years Ended December 31, Ended March 31,
------------------------------------------------- ------------------
1996 1997 1998 1999 2000 2000 2001
------- -------- -------- --------- --------- -------- --------
(Dollars in thousands, except per share amounts)
Statement of Operations
Data:
Net revenues:
Site rental and
broadcast
transmission.......... $ 5,615 $ 11,010 $ 75,028 $ 267,894 $ 446,039 $ 93,741 $134,042
Network services and
other................. 592 20,395 38,050 77,865 203,126 30,503 78,911
------- -------- -------- --------- --------- -------- --------
Total net revenues... 6,207 31,405 113,078 345,759 649,165 124,244 212,953
------- -------- -------- --------- --------- -------- --------
Costs of operations:
Site rental and
broadcast
transmission.......... 1,292 2,213 26,254 114,436 194,424 40,287 57,739
Network services and
other................. 8 13,137 21,564 42,312 120,176 15,901 55,456
------- -------- -------- --------- --------- -------- --------
Total costs of
operations.......... 1,300 15,350 47,818 156,748 314,600 56,188 113,195
------- -------- -------- --------- --------- -------- --------
General and
administrative......... 1,678 6,824 23,571 43,823 76,944 14,853 25,895
Corporate
development(a)......... 1,324 5,731 4,625 5,403 10,489 2,071 3,453
Restructuring charges... -- -- -- 5,645 -- -- --
Non-cash general and
administrative
compensation
charges(b)............. -- -- 12,758 2,173 3,127 461 1,395
Depreciation and
amortization........... 1,242 6,952 37,239 130,106 238,796 45,122 74,091
------- -------- -------- --------- --------- -------- --------
Operating income
(loss)................. 663 (3,452) (12,933) 1,861 5,209 5,549 (5,076)
Other income (expense):
Equity in earnings
(losses) of
unconsolidated
affiliate............. -- (1,138) 2,055 -- -- -- --
Interest and other
income (expense)(c)... 193 1,951 4,220 17,731 33,761 5,704 3,092
Interest expense and
amortization of
deferred financing
costs................. (1,803) (9,254) (29,089) (110,908) (241,294) (41,761) (66,655)
------- -------- -------- --------- --------- -------- --------
Loss before income
taxes, minority
interests,
extraordinary item and
cumulative effect of
change in accounting
principle.............. (947) (11,893) (35,747) (91,316) (202,324) (30,508) (68,639)
Provision for income
taxes.................. (10) (49) (374) (275) (246) (11) (60)
Minority interests...... -- -- (1,654) (2,756) (721) (1,541) 644
------- -------- -------- --------- --------- -------- --------
Loss before
extraordinary item and
cumulative effect of
change in accounting
principle.............. (957) (11,942) (37,775) (94,347) (203,291) (32,060) (68,055)
Extraordinary item--loss
on early extinguishment
of debt................ -- -- -- -- (1,495) (1,495) --
Cumulative effect of
change in accounting
principle for costs of
start-up activities.... -- -- -- (2,414) -- -- --
------- -------- -------- --------- --------- -------- --------
Net loss................ (957) (11,942) (37,775) (96,761) (204,786) (33,555) (68,055)
Dividends on preferred
stock.................. -- (2,199) (5,411) (28,881) (59,469) (11,493) (19,505)
------- -------- -------- --------- --------- -------- --------
Net loss after deduction
of dividends on
preferred stock........ $ (957) $(14,141) $(43,186) $(125,642) $(264,255) $(45,048) $(87,560)
======= ======== ======== ========= ========= ======== ========
6
Three Months Ended
Years Ended December 31, March 31,
--------------------------------------------------------- --------------------
1996 1997 1998 1999 2000 2000 2001
-------- --------- ---------- ----------- ----------- -------- ----------
(Dollars in thousands, except per share amounts)
Per common share--basic and
diluted:
Loss before extraordinary item
and cumulative effect of change
in accounting principle.......... $ (0.27) $ (2.27) $ (1.02) $ (0.94) $ (1.47) $ (0.27) $ (0.41)
Extraordinary item................ -- -- -- -- (0.01) (0.01) --
Cumulative effect of change in
accounting principle............. -- -- -- (0.02) -- -- --
-------- --------- ---------- ----------- ----------- -------- ----------
Net loss.......................... $ (0.27) $ (2.27) $ (1.02) $ (0.96) $ (1.48) $ (0.28) $ (0.41)
======== ========= ========== =========== =========== ======== ==========
Common shares outstanding--basic
and diluted (in thousands)....... 3,503 6,238 42,518 131,466 178,588 158,566 211,195
======== ========= ========== =========== =========== ======== ==========
Other Data:
Site data (at period end)(d):
Towers owned...................... 155 240 1,344 7,326 12,280 8,497 13,069
Towers managed.................... 7 133 129 13 480 13 240
Rooftop sites managed (revenue
producing)....................... 52 80 135 149 158 149 158
-------- --------- ---------- ----------- ----------- -------- ----------
Total sites owned and managed... 214 453 1,608 7,488 12,918 8,659 13,467
======== ========= ========== =========== =========== ======== ==========
EBITDA(e):
Site rental....................... $ 3,555 $ 7,682 $ 44,661 $ 139,966 $ 221,237 $ 48,528 $ 67,388
Network services and other........ (326) 1,549 (2,972) 5,222 36,384 4,675 6,475
Corporate development
expenses(a)...................... (1,324) (5,731) (4,625) (5,403) (10,489) (2,071) (3,453)
-------- --------- ---------- ----------- ----------- -------- ----------
Total EBITDA.................... $ 1,905 $ 3,500 $ 37,064 $ 139,785 $ 247,132 $ 51,132 $ 70,410
======== ========= ========== =========== =========== ======== ==========
Capital expenditures............... $ 890 $ 18,035 $ 138,759 $ 293,801 $ 636,506 $110,427 $ 251,860
Summary cash flow information:
Net cash provided by (used for)
operating activities............. (530) (624) 44,976 92,608 165,495 36,934 44,889
Net cash used for investing
activities....................... (13,916) (111,484) (149,248) (1,509,146) (1,957,687) (399,288) (224,928)
Net cash provided by financing
activities....................... 21,193 159,843 345,248 1,670,402 1,707,091 324,915 443,706
Ratio of earnings to fixed
charges(f)........................ -- -- -- -- -- -- --
Balance Sheet Data (at period end):
Cash and cash equivalents.......... $ 7,343 $ 55,078 $ 296,450 $ 549,328 $ 453,833 $ 716,941
Property and equipment, net........ 26,753 81,968 592,594 2,468,101 4,303,037 4,450,622
Total assets....................... 41,226 371,391 1,523,230 3,836,650 6,439,841 6,868,546
Total debt......................... 22,052 156,293 429,710 1,542,343 2,602,687 2,701,175
Redeemable preferred stock(g)...... 15,550 160,749 201,063 422,923 842,718 851,351
Total stockholders' equity
(deficit)......................... (210) 41,792 737,562 1,617,747 2,420,862 2,666,757
--------
(a) Corporate development expenses represent costs incurred in connection with
acquisitions and development of new business initiatives. These expenses
consist primarily of allocated compensation, benefits and overhead costs
that are not directly related to the administration or management of
existing towers. For the year ended December 31, 1997, such expenses
include (1) nonrecurring cash bonuses of $0.9 million paid to certain
executive officers in connection with our initial investment in CCUK and
(2) a nonrecurring cash charge of $1.3 million related to our purchase of
shares of our common stock from our former chief executive officer in
connection with our initial CCUK investment.
(b) Represents charges related to the issuance of stock options to certain
employees and executives, and the issuance of common stock and stock
options in connection with certain acquisitions.
(c) Includes a $1.2 million fee received in March 1997 as compensation for
leading an investment consortium which provided the equity financing in
connection with our initial CCUK investment.
(d) Represents our aggregate number of sites as of the end of each period.
(e) EBITDA is defined as operating income (loss) plus depreciation and
amortization, non-cash general and administrative compensation charges and
restructuring charges. EBITDA is presented as additional information
because management believes it to be a useful indicator of our ability to
meet debt service and capital expenditure requirements. It is not, however,
intended as an alternative measure of operating results or cash flow from
operations, as determined in accordance with generally accepted accounting
principles. Furthermore, our measure of EBITDA may not be comparable to
similarly titled measures of other companies.
7
(f) For purposes of computing the ratio of earnings to fixed charges, earnings
represent income (loss) before income taxes, minority interests,
extraordinary item, cumulative effect of change in accounting principle,
fixed charges and equity in earnings (losses) of unconsolidated affiliate.
Fixed charges consist of interest expense, the interest component of
operating leases and amortization of deferred financing costs. For the
years ended December 31, 1996, 1997, 1998, 1999 and 2000, earnings were
insufficient to cover fixed charges by $0.9 million, $10.8 million, $37.8
million, $91.3 million and $202.3 million, respectively. For the three
months ended March 31, 2000 and 2001, earnings were insufficient to cover
fixed charges by $30.5 million and $68.6 million, respectively.
(g) The 1996 and 1997 amounts represent (1) the senior convertible preferred
stock we privately placed in August 1997 and October 1997, all of which has
been converted into shares of common stock, and (2) Series A convertible
preferred stock, Series B convertible preferred stock and Series C
convertible preferred stock we privately placed in April 1995, July 1996
and February 1997, respectively, all of which has been converted into
shares of common stock in connection with the completion of our initial
public offering in August 1998. The 1998, 1999, 2000 and 2001 amounts
represent (1) our exchangeable preferred stock we privately placed in
December 1998, (2) our convertible preferred stock we privately placed in
November 1999 and (3) our convertible preferred stock we sold in an
underwritten public offering in July 2000.
8
RISK FACTORS
You should carefully consider the risks described below, as well as the
other information included in this prospectus, when evaluating your investment
in the new notes.
Failure to Exchange Your Old Notes--If you fail to exchange your old notes,
they will continue to be restricted securities and may become less liquid.
Old notes which you do not tender or we do not accept will, following the
exchange offer, continue to be restricted securities, and you may not offer to
sell them except pursuant to an exemption from, or in a transaction not subject
to, the Securities Act of 1933 and applicable state securities law. We will
issue new notes in exchange for the old notes pursuant to the exchange offer
only following the satisfaction of the procedures and conditions set forth in
"The Exchange Offer--Procedures for Tendering". Such procedures and conditions
include timely receipt by the exchange agent of such old notes and of a
property completed and duly executed letter of transmittal.
Because we anticipate that most holders of old notes will elect to exchange
such old notes, we expect that the liquidity of the market for any old notes
remaining after the completion of the exchange offer may be substantially
limited. Any old notes tendered and exchanged in the exchange offer will reduce
the aggregate principal amount at maturity of the old notes outstanding.
Following the exchange offer, if you did not tender your old notes you
generally will not have any further registration rights, and such old notes
will continue to be subject to certain transfer restrictions. Accordingly, the
liquidity of the market for such old notes could be adversely affected. The old
notes are currently eligible for sale pursuant to Rule 144A and Regulation S
through the Private Offerings, Resale and Trading through Automated Linkages
market of the National Association of Securities Dealers, Inc.
Failure to Properly Manage Our Growth--If we are unable to successfully
integrate acquired operations or manage our existing operations as we grow, our
business will be adversely affected, and we may not be able to continue our
current business strategy.
We cannot guarantee that we will be able to successfully integrate acquired
businesses and assets into our business or implement our growth plans without
delay. If we fail to do so it could have a material adverse effect on our
financial condition and results of operations. We have grown significantly over
the past two years through acquisitions, and such growth continues to be an
important part of our business plan. The addition of over 11,000 towers to our
operations over the past two years has and will continue to increase our
current business considerably and adds significant operational complexities.
Successful integration of these transactions will depend primarily on our
ability to manage these combined operations and to integrate new management and
employees with and into our existing operations. Our net loss increased to
$68.1 million for the three months ended March 31, 2001 from $33.6 million for
the three months ended March 31, 2000, an increase of 103%, as a result of our
expanded business operations and the financing thereof, including a 64%
increase in depreciation and amortization and a 60% increase in interest
expense in the first quarter of 2001 as compared to the first quarter of 2000.
We expect that such net losses, at least in the near term, will continue to
exceed those of comparable prior-year periods as a result of our growth and the
financing thereof.
Implementation of our acquisition strategy may impose significant strains
on our management, operating systems and financial resources. We regularly
evaluate potential acquisition and joint venture opportunities and are
currently evaluating potential transactions that could involve substantial
expenditures, possibly in the near term. If we fail to manage our growth or
encounter unexpected difficulties during expansion, it could have a material
adverse effect on our financial condition and results of operations. The
pursuit and integration of acquisitions and joint venture opportunities will
9
require substantial attention from our senior management, which will limit the
amount of time they are able to devote to our existing operations.
Substantial Level of Indebtedness--Our substantial level of indebtedness could
adversely affect our ability to react to changes in our business. We may also
be limited in our ability to use debt to fund future capital needs.
We have a substantial amount of indebtedness. The following chart sets
forth certain important credit information and is presented as of March 31,
2001, both on an actual basis as well as on a pro forma basis giving effect to
the recent issuance of the old notes.
Actual Pro Forma
---------- ----------
(Dollars in
thousands)
Total indebtedness................................. $2,701,175 $3,151,175
Redeemable preferred stock......................... 851,351 851,351
Stockholders' equity............................... 2,666,757 2,666,757
Debt and redeemable preferred stock to equity
ratio............................................. 1.33x 1.50x
In addition, our earnings for the year ended December 31, 2000 and for the
fiscal quarter ended March 31, 2001 were insufficient to cover fixed charges by
$202.3 million and $68.6 million, respectively. After giving effect to the
recent issuance of the old notes, our pro forma earnings for the fiscal quarter
ended March 31, 2001 would have been insufficient to cover pro forma fixed
charges by $79.4 million.
As a result of our substantial indebtedness:
. we could be more vulnerable to general adverse economic and industry
conditions;
. we may find it more difficult to obtain additional financing to fund
future working capital, capital expenditures and other general
corporate requirements;
. we will be required to dedicate a substantial portion of our cash flow
from operations to the payment of principal and interest on our debt,
reducing the available cash flow to fund other projects;
. we may have limited flexibility in planning for, or reacting to,
changes in our business and in the industry; and
. we will have a competitive disadvantage relative to other companies
with less debt in our industry.
We cannot guarantee that we will be able to generate enough cash flow from
operations or that we will be able to obtain enough capital to service our
debt, including the new notes, pay our obligations under our convertible
preferred stock or fund our planned capital expenditures. In addition, we may
need to refinance some or all of our indebtedness, including the new notes, on
or before maturity. We cannot guarantee, however, that we will be able to
refinance our indebtedness on commercially reasonable terms or at all.
As a Holding Company, We Require Dividends from Subsidiaries to Meet Cash
Requirements or Pay Dividends--If our subsidiaries are unable to dividend cash
to us when we need it, we may be unable to pay dividends or satisfy our
obligations, including interest and principal payments, under our debt
instruments.
CCIC is a holding company with no business operations of its own. CCIC's
only significant asset is the outstanding capital stock of its subsidiaries.
CCIC conducts all of its business operations through its subsidiaries.
Accordingly, CCIC's only source of cash to pay dividends or make other
10
distributions on its capital stock or to pay interest and principal on its
outstanding indebtedness is distributions relating to its ownership interest in
its subsidiaries from the net earnings and cash flow generated by such
subsidiaries. We currently expect that the earnings and cash flow of CCIC's
subsidiaries will be retained and used by such subsidiaries in their
operations, including the service of their respective debt obligations. Even if
we did determine to make a distribution in respect of the capital stock of
CCIC's subsidiaries, there can be no assurance that CCIC's subsidiaries will
generate sufficient cash flow to pay or distribute such a dividend or funds, or
that applicable state law and contractual restrictions, including negative
covenants contained in the debt instruments of such subsidiaries, would permit
such dividends, distributions or payments. Furthermore, the terms of our credit
facilities place restrictions on our principal subsidiaries' ability to pay
dividends or to make distributions, and in any event, such dividends or
distributions may only be paid if no default has occurred under the applicable
instrument. Moreover, CCIC's subsidiaries are permitted under the terms of
their existing debt instruments to incur additional indebtedness that may
restrict or prohibit the making of distributions, the payment of dividends or
the making of loans by such subsidiaries to CCIC. See "--Substantial Level of
Indebtedness" and "--Ability to Service Debt".
Ability to Service Debt--To service our indebtedness, including the new notes,
we will require a significant amount of cash from our subsidiaries. An
inability to access our subsidiaries' cash flow may lead to an acceleration of
our indebtedness, including the new notes. Currently, the instruments governing
our subsidiaries' indebtedness do not allow sufficient funds to be distributed
to CCIC to service its indebtedness.
If CCIC is unable to refinance its subsidiary debt or renegotiate the terms
of such debt, CCIC may not be able to meet its debt service requirements,
including interest payments on our notes, in the future. Our 9% senior notes,
our 9 1/2% senior notes and our 10 3/4% senior notes require, and the notes
that are the subject of this exchange offer will require, annual cash interest
payments of approximately $16.2 million, $11.9 million, $53.8 million and $42.2
million, respectively. Prior to November 15, 2002, May 15, 2004 and August 1,
2004, the interest expense on our 10 5/8% discount notes, our 10 3/8% discount
notes and our 11 1/4% discount notes, respectively, will be comprised solely of
the amortization of original issue discount. Thereafter, the 10 5/8% discount
notes, the 10 3/8% discount notes and the 11 1/4% discount notes will require
annual cash interest payments of approximately $26.7 million, $51.9 million and
$29.3 million, respectively. Prior to December 15, 2003, we do not expect to
pay cash dividends on our exchangeable preferred stock or, if issued, cash
interest on the exchange debentures. Thereafter, assuming all dividends or
interest have been paid-in-kind, our exchangeable preferred stock or, if
issued, the exchange debentures will require annual cash dividends or interest
payments of approximately $47.8 million. Annual cash interest payments on the
CCUK bonds are (Pounds)11.25 million (approximately $16.0 million). In
addition, our various credit facilities will require periodic interest payments
on amounts borrowed thereunder, which amounts could be substantial.
Restrictive Debt Covenants--The terms of our debt instruments limit our ability
to take a number of actions that our management might otherwise believe to be
in our best interests. In addition, if we fail to comply with our covenants,
our debt could be accelerated.
Currently we have debt instruments in place that restrict our ability to
incur more indebtedness, pay dividends, create liens, sell assets and engage in
certain mergers and acquisitions. Our subsidiaries, under their debt
instruments, are also required to maintain specific financial ratios. Our
ability to comply with the restrictions of these instruments and to satisfy our
debt obligations will depend on our future operating performance. If we fail to
comply with the debt restrictions, we will be in default under those
instruments, which in some cases would cause the maturity of substantially all
of our long-term indebtedness to be accelerated.
11
We Require Significant Capital to Fund Our Operations and Make Acquisitions--If
we are unable to raise capital in the future, we will be unable to achieve our
currently contemplated business strategy and may not be able to fund our
operations.
We will require substantial capital (1) as we increase the number of towers
we own and manage by partnering with wireless carriers, by pursuing
opportunities to build new towers, or build-to-suit opportunities, for wireless
carriers and by pursuing other tower acquisition opportunities and (2) to
acquire existing transmission networks globally as opportunities arise. If we
are unable to raise capital when our needs arise, we will be unable to pursue
our current business strategy and may not be able to fund our operations.
To fund the execution of our business strategy, including the construction
of new towers that we have agreed to build, we expect to use the remaining net
proceeds of our recent offerings and borrowings available under our credit
facilities. We will have additional cash needs to fund our operations and
acquisitions in the future. We may also have additional cash needs in the near
term if additional tower acquisitions or build-to-suit opportunities arise.
Some of the opportunities that we are currently pursuing could require
significant additional capital. If we do not otherwise have cash available, or
borrowings under our credit facilities have otherwise been utilized, when our
cash need arises, we would be forced to seek additional debt or equity
financing or to forego the opportunity. In the event we determine to seek
additional debt or equity financing, there can be no assurance that any such
financing will be available, on commercially acceptable terms or at all, or
permitted by the terms of our existing indebtedness.
We May Not Be Able to Construct or Acquire New Towers at the Pace and in the
Locations that We Desire--If we are unable to do so, we may not be able to
satisfy our current agreements to build new towers and we may have difficulty
finding tenants to lease space on our new towers.
Our growth strategy depends in part on our ability to construct and operate
towers in conjunction with expansion by wireless carriers. If we are unable to
build new towers when wireless carriers require them, or we are unable to build
new towers where we believe the best opportunity to add tenants exists, we
could fail to meet our contractual obligations under build-to-suit agreements,
and we could lose opportunities to lease space on our towers.
We currently have plans to commence construction on approximately 1,500
additional towers during fiscal 2001. Our ability to construct these new towers
could be affected by a number of factors beyond our control, including:
. zoning and local permitting requirements and national regulatory
approvals;
. availability of construction equipment and skilled construction
personnel; and
. bad weather conditions.
In addition, as the concern over tower proliferation has grown in recent
years, certain communities have placed restrictions on new tower construction
or have delayed granting permits required for construction. You should consider
that:
. the barriers to new construction may prevent us from building towers
where we want;
. we may not be able to complete the number of towers planned for
construction in accordance with the requirements of our customers; and
. we cannot guarantee that there will be a significant need for the
construction of new towers once the wireless carriers complete their
tower networks.
12
All of the above factors could affect both our domestic and international
operations. In addition, competition laws could prevent us from acquiring or
constructing towers or tower networks in certain geographical areas.
Our Business Depends on the Demand for Wireless Communications--We will be
adversely affected by any slowdown in the growth of, or reduction in demand
for, wireless communications.
Demand for our site rentals depends on demand for communication sites from
wireless carriers, which, in turn, depends on the demand for wireless services.
The demand for our sites depends on many factors which we cannot control,
including:
. the level of demand for wireless services generally;
. the financial condition and access to capital of wireless carriers;
. the strategy of carriers relating to owning or leasing communication
sites;
. changes in telecommunications regulations; and
. general economic conditions.
A slowdown in the growth of, or reduction in, demand in a particular
wireless segment could adversely affect the demand for communication sites.
Moreover, wireless carriers often operate with substantial indebtedness, and
financial problems for our customers could result in accounts receivable going
uncollected, the loss of a customer (and associated lease revenue), or a
reduced ability of these customers to finance expansion activities. Finally,
advances in technology, such as the development of new satellite and antenna
systems, could reduce the need for land-based, or terrestrial, transmission
networks. The occurrence of any of these factors could have a material adverse
effect on our financial condition and results of operations.
Variability in Demand for Network Services May Reduce the Predictability of Our
Results--Our network services business has historically experienced significant
volatility in demand. As a result, the operating results of our network
services business for any particular period may vary significantly and should
not be considered as necessarily being indicative of longer-term results.
Demand for our network services fluctuates from period to period and within
periods. These fluctuations are caused by a number of factors, including:
. the timing of customers' capital expenditures;
. annual budgetary considerations of customers;
. the rate and volume of wireless carriers' tower build-outs;
. timing of existing customer contracts; and
. general economic conditions.
While demand for our network services fluctuates, we must incur certain
costs, such as maintaining a staff of network services employees in
anticipation of future contracts, even when there may be no current business.
Furthermore, as wireless carriers complete their build-outs, the need for the
construction of new towers and the demand for our network services could
decrease significantly and could result in fluctuations and, possibly,
significant declines in our operating performance.
We Operate Our Business in an Increasingly Competitive Industry and Many of Our
Competitors Have Significantly More Resources--As a result of this competition,
we may find
13
it more difficult to achieve favorable lease rates on our towers and we may be
forced to pay more for future tower acquisitions.
We face competition for site rental customers from various sources,
including:
. other large independent tower owners;
. wireless carriers that own and operate their own towers and lease
antenna space to other carriers;
. site development companies that acquire antenna space on existing
towers for wireless carriers and manage new tower construction; and
. traditional local independent tower operators.
Wireless carriers that own and operate their own tower portfolios generally
are substantially larger and have greater financial resources than we have.
Competition for tenants on towers could adversely affect lease rates and
service income.
In addition, competition for the acquisition of towers is intense, and we
expect it to continue to grow. We not only compete against other independent
tower owners and operators, but also against wireless carriers, broadcasters
and site developers. As competition consolidates, we may be faced with fewer
acquisition opportunities, as well as higher acquisition prices. While we
regularly explore acquisition opportunities, we cannot guarantee that we will
be able to identify suitable towers to acquire in the future.
A Substantial Portion of Our Revenues is Dependent Upon Agreements with the
BBC, NTL, Verizon, Cingular and Powertel.
If we were to lose our contracts with the BBC or our site sharing agreement
with NTL, we would likely lose a substantial portion of our revenues. The BBC
accounted for approximately 14.8% and 11.0% of our revenues for the twelve-
month period ended December 31, 2000 and the fiscal quarter ended March 31,
2001, respectively.
Our broadcast business is substantially dependent on our contracts with the
BBC. We cannot guarantee that the BBC will renew our contracts or that they
will not attempt to negotiate terms that are not as favorable to us as those in
place now. If we were to lose these BBC contracts, our business, results of
operations and financial condition would be materially adversely affected. The
initial term of our analog transmission contract with the BBC will expire on
March 31, 2007, and our digital transmission contract with the BBC expires on
October 31, 2010. In addition, our digital transmission contract with the BBC
may be terminated by the BBC after five years if the BBC's board of governors
does not believe that digital television in the United Kingdom has enough
viewers.
A substantial portion of our U.K. broadcast transmission operations is
conducted using sites owned by National Transmission Limited, or NTL, our
principal broadcast competitor in the United Kingdom. NTL also utilizes our
sites for their broadcast operations. This site sharing arrangement with NTL
may be terminated on December 31, 2015, or any 10-year anniversary of that
date, with five years' prior notice by either us or NTL, and may be terminated
sooner if there is a continuing breach of the agreement. We cannot guarantee
that this agreement will not be terminated, which could have a material adverse
effect on our business, results of operations and financial condition.
In addition, a substantial portion of our revenues are received from a few
major wireless carriers, particularly carriers that have transferred their
tower assets to us. We cannot guarantee that the lease or management service
agreements with such carriers will not be terminated or that these carriers
will renew such agreements.
14
Extensive Regulations, Which Could Change at Any Time and with Which We Could
Fail to Comply, Regulate Our Business--If we fail to comply with applicable
regulations, we could be fined or even lose our right to conduct some of our
business.
A variety of foreign, federal, state and local regulations apply to our
business. Failure to comply with applicable requirements may lead to civil
penalties or require us to assume costly indemnification obligations or breach
contractual provisions. We cannot guarantee that existing regulatory policies
will not adversely affect the timing or cost of new tower construction or that
additional regulations will not be adopted which increase delays or result in
additional costs. These factors could have a material adverse effect on our
financial condition and results of operations.
Since we signed our analog transmission contact with the BBC, the BBC has
increased its service requirements to include 24-hour broadcasting on our
transmission network for the BBC's two national television services and a
requirement for us to add a number of additional analog stations and service
enhancements to existing analog stations. As of March 31, 2001, the BBC has
agreed to increases of approximately (Pounds)4.9 million (approximately $7.3
million) per year in the charges payable by the BBC to us for these service
enhancements. These additional charges may require a revision amendment to that
part of CCUK's transmission telecommunications license dealing with price
regulation of analog broadcasting services to the BBC. We are in discussions
with the BBC and OFTEL, the relevant regulatory authority in the United
Kingdom, regarding wording which will modify the license regulatory provisions
to take into account these agreed additional payments. There can be no
assurances that such modification will be achieved as a result of these
discussions with OFTEL.
If We Fail to Complete Any or All of the Agreed-To Transactions, We Will Not
Recognize All of the Benefits of Such Transactions.
If one or more of our previously agreed-to transactions is not fully
completed or is completed on significantly different terms than those currently
contemplated, it could substantially affect the implementation of our business
strategy. As a result, our future site rental revenue would be adversely
affected. The agreements relating to these agreed-to transactions contain many
conditions that must be satisfied before we can consummate such agreed-to
transactions. In addition, each of the agreements relating to these agreed-to
transactions includes provisions that could result in our purchasing or
providing fewer towers pursuant to such agreements.
Emissions from Our Antennas May Create Health Risks--We could suffer from
future claims if the radio frequency emissions from equipment on our towers is
demonstrated to cause negative health effects.
The government imposes requirements and other guidelines on our towers
relating to radio frequency emissions. The potential connection between radio
frequency emissions and certain negative health effects, including some forms
of cancer, has been the subject of substantial study by the scientific
community in recent years. To date, the results of these studies have been
inconclusive. We cannot guarantee that claims relating to radio frequency
emissions will not arise in the future.
Our International Operations Expose Us to Changes in Foreign Currency Exchange
Rates--If we fail to properly match or hedge the currencies in which we conduct
business, we could suffer losses as a result of changes in currency exchange
rates.
We conduct business in countries outside the United States, which exposes
us to fluctuations in foreign currency exchange rates. We also intend to expand
our international operations in the future. For the fiscal quarter ended March
31, 2001, approximately 29.2% of our consolidated revenues originated outside
the United States, all of which were denominated in currencies other than U.S.
dollars, principally pounds sterling and Australian dollars. We have not
historically engaged in
15
significant hedging activities relating to our non-U.S. dollar operations, and
we could suffer future losses as a result of changes in currency exchange
rates.
We Are Heavily Dependent on Our Senior Management--If we lose members of our
senior management, we may not be able to find appropriate replacements on a
timely basis and our business could be adversely affected.
Our existing operations and continued future development depend to a
significant extent upon the performance and active participation of certain key
individuals as employees, including our chief executive officer and our
president. We cannot guarantee that we will be successful in retaining the
services of these or other key personnel. None of our executives have signed
noncompetition agreements. If we were to lose any of these individuals, we may
not be able to find appropriate replacements on a timely basis and our
financial condition and results of operations could be materially adversely
affected.
The New Notes Are Subject to the Risk of Fraudulent Conveyance Liability--
Federal and state statutes allow courts, under specific circumstances, to void
the new notes and require noteholders to return payments received from us.
Various laws enacted for the protection of creditors may apply to our
incurrence of indebtedness, including the issuance of the new notes in this
exchange offer. If these laws are held by a court to apply to the new notes,
you could be required to return payments you receive on the new notes, and the
new notes could be voided. If a court were to find in a lawsuit by an unpaid
creditor or representative of creditors that we did not receive fair
consideration or reasonably equivalent value for incurring such indebtedness or
obligation and, at the time of such incurrence, we
. were insolvent;
. were rendered insolvent by reason of such incurrence;
. were engaged in a business or transaction for which our remaining assets
constituted unreasonably small capital; or
. intended to incur or believe we would incur obligations beyond our
ability to pay such obligations as they mature,
such court could, subject to statutes of limitations, determine to invalidate
such indebtedness and obligations as fraudulent conveyances or subordinate such
indebtedness and obligations to existing or future creditors.
There is Currently No Market for the New Notes--If an active trading market for
the new notes does not develop, the liquidity and value of the new notes could
be harmed.
The new notes are new issues of securities for which there is currently no
trading market. We do not intend to apply for listing of the new notes on any
securities exchange or to seek approval for quotation through an automated
quotation system. Accordingly, there can be no assurance that an active market
will develop upon completion of the exchange offer or, if developed, that such
market will be sustained or as to the liquidity of any market.
This Prospectus Includes Forward-Looking Statements--If our expectations
reflected in these forward-looking statements prove to be incorrect, our actual
results could differ materially from these expectations.
This prospectus includes "forward-looking statements" within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act. All
statements other than statements of
16
historical facts included in this document, including, without limitation, the
statements under "Summary" and located elsewhere or incorporated in this
prospectus regarding industry prospects, our prospects and our financial
position are forward-looking statements. Although we believe that the
expectations reflected in such forward-looking statements are reasonable, we
can give no assurance that such expectations will prove to have been correct.
Important factors that could cause actual results to differ materially from our
expectations are disclosed in this document. All subsequent written and oral
forward-looking statements attributable to us or persons acting on our behalf
are expressly qualified in their entirety by the cautionary statements included
in this prospectus. In light of these risks, uncertainties and assumptions, the
forward-looking events discussed in this prospectus might not occur.
USE OF PROCEEDS
We will not receive any proceeds from the exchange offer.
17
SELECTED FINANCIAL AND OTHER DATA
The selected historical consolidated financial data set forth below for each
of the five years in the period ended December 31, 2000, and as of December 31,
1996, 1997, 1998, 1999 and 2000, have been derived from the consolidated
financial statements of CCIC, which have been audited by KPMG LLP, independent
auditors. The selected historical consolidated financial data set forth below
for the three months ended March 31, 2000 and 2001, and as of March 31, 2001,
have been derived from the unaudited consolidated financial statements of CCIC,
which include all adjustments that CCIC considers necessary for a fair
presentation of the financial position and results of operations for those
periods. Operating results for the three months ended March 31, 2001 are not
necessarily indicative of the results that may be expected for the entire year.
The results of operations for the three months ended March 31, 2001 are not
comparable to the three months ended March 31, 2000, the results for the year
ended December 31, 2000 are not comparable to the year ended December 31, 1999,
the results for the year ended December 31, 1999 are not comparable to the year
ended December 31, 1998, the results for the year ended December 31, 1998 are
not comparable to the year ended December 31, 1997, and the results for the
year ended December 31, 1997 are not comparable to the year ended December 31,
1996, in each case as a result of business and asset acquisitions completed in
1997, 1998, 1999 and 2000. Results of operations of these acquired businesses
and assets are included in CCIC's consolidated financial statements for the
periods after the respective dates of acquisition. The information set forth
below should be read in conjunction with the consolidated financial statements
and related notes and "Management's Discussion and Analysis of Financial
Condition and Results of Operations--Results of Operations" included in CCIC's
Annual Report on Form 10-K and Quarterly Report on Form 10-Q.
Three Months
Years Ended December 31, Ended March 31,
------------------------------------------------- ------------------
1996 1997 1998 1999 2000 2000 2001
------- -------- -------- --------- --------- -------- --------
(Dollars in thousands, except per share amounts)
Statement of Operations
Data:
Net revenues:
Site rental and
broadcast
transmission.......... $ 5,615 $ 11,010 $ 75,028 $ 267,894 $ 446,039 $ 93,741 $134,042
Network services and
other................. 592 20,395 38,050 77,865 203,126 30,503 78,911
------- -------- -------- --------- --------- -------- --------
Total net revenues..... 6,207 31,405 113,078 345,759 649,165 124,244 212,953
------- -------- -------- --------- --------- -------- --------
Costs of operations:
Site rental and
broadcast
transmission.......... 1,292 2,213 26,254 114,436 194,424 40,287 57,739
Network services and
other................. 8 13,137 21,564 42,312 120,176 15,901 55,456
------- -------- -------- --------- --------- -------- --------
Total costs of
operations............ 1,300 15,350 47,818 156,748 314,600 56,188 113,195
------- -------- -------- --------- --------- -------- --------
General and
administrative......... 1,678 6,824 23,571 43,823 76,944 14,853 25,895
Corporate
development(a)......... 1,324 5,731 4,625 5,403 10,489 2,071 3,453
Restructuring charges... -- -- -- 5,645 -- -- --
Non-cash general and
administrative
compensation charges(b)
....................... -- -- 12,758 2,173 3,127 461 1,395
Depreciation and
amortization........... 1,242 6,952 37,239 130,106 238,796 45,122 74,091
------- -------- -------- --------- --------- -------- --------
Operating income
(loss)................. 663 (3,452) (12,933) 1,861 5,209 5,549 (5,076)
Other income (expense):
Equity in earnings
(losses) of
unconsolidated
affiliate............. -- (1,138) 2,055 -- -- -- --
Interest and other
income (expense)(c)... 193 1,951 4,220 17,731 33,761 5,704 3,092
Interest expense and
amortization of
deferred financing
costs................. (1,803) (9,254) (29,089) (110,908) (241,294) (41,761) (66,655)
------- -------- -------- --------- --------- -------- --------
Loss before income
taxes, minority
interests,
extraordinary item and
cumulative effect of
change in accounting
principle.............. (947) (11,893) (35,747) (91,316) (202,324) (30,508) (68,639)
Provision for income
taxes.................. (10) (49) (374) (275) (246) (11) (60)
Minority interests...... -- -- (1,654) (2,756) (721) (1,541) 644
------- -------- -------- --------- --------- -------- --------
Loss before
extraordinary item and
cumulative effect of
change in accounting
principle.............. (957) (11,942) (37,775) (94,347) (203,291) (32,060) (68,055)
Extraordinary item--loss
on early extinguishment
of debt................ -- -- -- -- (1,495) (1,495) --
Cumulative effect of
change in accounting
principle for costs of
start-up activities.... -- -- -- (2,414) -- -- --
------- -------- -------- --------- --------- -------- --------
Net loss................ (957) (11,942) (37,775) (96,761) (204,786) (33,555) (68,055)
Dividends on preferred
stock.................. -- (2,199) (5,411) (28,881) (59,469) (11,493) (19,505)
------- -------- -------- --------- --------- -------- --------
Net loss after deduction
of dividends on
preferred stock........ $ (957) $(14,141) $(43,186) $(125,642) $(264,255) $(45,048) $(87,560)
======= ======== ======== ========= ========= ======== ========
18
Three Months Ended
Years Ended December 31, March 31,
---------------------------------------------------- -------------------
1996 1997 1998 1999 2000 2000 2001
------- -------- --------- ---------- ---------- -------- ---------
(Dollars in thousands, except per share amounts)
Per common share--basic
and diluted:
Loss before
extraordinary item and
cumulative effect of
change in accounting
principle............. $ (0.27) $ (2.27) $ (1.02) $ (0.94) $ (1.47) $ (0.27) $ (0.41)
Extraordinary item..... -- -- -- -- (0.01) (0.01) --
Cumulative effect of
change in accounting
principle............. -- -- -- (0.02) -- -- --
------- -------- --------- ---------- ---------- -------- ---------
Net loss............... $ (0.27) $ (2.27) $ (1.02) $ (0.96) $ (1.48) $ (0.28) $ (0.41)
======= ======== ========= ========== ========== ======== =========
Common shares
outstanding--basic and
diluted (in
thousands)............ 3,503 6,238 42,518 131,466 178,588 158,566 211,195
======= ======== ========= ========== ========== ======== =========
Other Data:
Site data (at period
end)(d):
Towers owned........... 155 240 1,344 7,326 12,280 8,497 13,069
Towers managed......... 7 133 129 13 480 13 240
Rooftop sites managed
(revenue producing)... 52 80 135 149 158 149 158
------- -------- --------- ---------- ---------- -------- ---------
Total sites owned and
managed............... 214 453 1,608 7,488 12,918 8,659 13,467
======= ======== ========= ========== ========== ======== =========
EBITDA(e):
Site rental............ $ 3,555 $ 7,682 $ 44,661 $ 139,966 $ 221,237 $ 48,528 $ 67,388
Network services and
other................. (326) 1,549 (2,972) 5,222 36,384 4,675 6,475
Corporate development
expenses(a)........... (1,324) (5,731) (4,625) (5,403) (10,489) (2,071) (3,453)
------- -------- --------- ---------- ---------- -------- ---------
Total EBITDA........... $ 1,905 $ 3,500 $ 37,064 $ 139,785 $ 247,132 $ 51,132 $ 70,410
======= ======== ========= ========== ========== ======== =========
Capital expenditures.... $ 890 $ 18,035 $ 138,759 $ 293,801 $ 636,506 $110,427 $ 251,860
Summary cash flow
information:
New cash provided by
(used for) operating
activities............ (530) (624) 44,976 92,608 165,495 36,934 44,889
Net cash used for
investing activities.. (13,916) (111,484) (149,248) (1,509,146) (1,957,687) (399,288) (224,928)
Net cash provided by
financing activities.. 21,193 159,843 345,248 1,670,402 1,707,091 324,915 443,706
Ratio of earnings to
fixed charges(f)....... -- -- -- -- -- -- --
Balance Sheet Data (at
period end):
Cash and cash
equivalents............ $ 7,343 $ 55,078 $ 296,450 $ 549,328 $ 453,833 $ 716,941
Property and equipment,
net.................... 26,753 81,968 592,594 2,468,101 4,303,037 4,450,622
Total assets............ 41,226 371,391 1,523,230 3,836,650 6,439,841 6,868,546
Total debt.............. 22,052 156,293 429,710 1,542,343 2,602,687 2,701,175
Redeemable preferred
stock(g)............... 15,550 160,749 201,063 422,923 842,718 851,351
Total stockholders'
equity (deficit)....... (210) 41,792 737,562 1,617,747 2,420,862 2,666,757
--------
(a) Corporate development expenses represent costs incurred in connection with
acquisitions and development of new business initiatives. These expenses
consist primarily of allocated compensation, benefits and overhead costs
that are not directly related to the administration or management of
existing towers. For the year ended December 31, 1997, such expenses
include (1) nonrecurring cash bonuses of $0.9 million paid to certain
executive officers in connection with our initial investment in CCUK and
(2) a nonrecurring cash charge of $1.3 million related to our purchase of
shares of our common stock from our former chief executive officer in
connection with our initial CCUK investment.
(b) Represents charges related to the issuance of stock options to certain
employees and executives, and the issuance of common stock and stock
options in connection with certain acquisitions.
(c) Includes a $1.2 million fee received in March 1997 as compensation for
leading an investment consortium which provided the equity financing in
connection with our initial CCUK investment.
(d) Represents our aggregate number of sites as of the end of each period.
(e) EBITDA is defined as operating income (loss) plus depreciation and
amortization, non-cash general and administrative compensation charges and
restructuring charges. EBITDA is presented as additional information
because management believes it to be a useful indicator of our ability to
meet debt service and capital expenditure requirements. It is not, however,
intended as an alternative measure of operating results or cash flow from
operations, as determined in accordance with generally accepted accounting
principles. Furthermore, our measure of EBITDA may not be comparable to
similarly titled measures of other companies.
19
(f) For purposes of computing the ratio of earnings to fixed charges, earnings
represent income (loss) before income taxes, minority interests,
extraordinary item, cumulative effect of change in accounting principle,
fixed charges and equity in earnings (losses) of unconsolidated affiliate.
Fixed charges consist of interest expense, the interest component of
operating leases and amortization of deferred financing costs. For the
years ended December 31, 1996, 1997, 1998, 1999 and 2000, earnings were
insufficient to cover fixed charges by $0.9 million, $10.8 million, $37.8
million, $91.3 million and $202.3 million, respectively. For the three
months ended March 31, 2000 and 2001, earnings were insufficient to cover
fixed charges by $30.5 million and $68.6 million, respectively.
(g) The 1996 and 1997 amounts represent (1) the senior convertible preferred
stock we privately placed in August 1997 and October 1997, all of which has
been converted into shares of common stock, and (2) Series A convertible
preferred stock, Series B convertible preferred stock and Series C
convertible preferred stock we privately placed in April 1995, July 1996
and February 1997, respectively, all of which has been converted into
shares of common stock in connection with the completion of our initial
public offering in August 1998. The 1998, 1999, 2000 and 2001 amounts
represent (1) our exchangeable preferred stock we privately placed in
December 1998, (2) our convertible preferred stock we privately placed in
November 1999 and (3) our convertible preferred stock we sold in an
underwritten public offering in July 2000.
20
The selected quarterly historical consolidated financial data for CCIC set
forth below have been derived from the consolidated financial statements of
CCIC.
Three Months Ended
--------------------------------------------
March 31 June 30 September 30 December 31
-------- -------- ------------ -----------
(Dollars in thousands, except per share
amounts)
1999:
Net revenues.................... $ 55,109 $ 77,527 $ 98,927 $114,196
Gross profit(1)................. 29,600 42,795 54,281 62,335
Loss before cumulative effect of
change in accounting
principle...................... (13,473) (20,850) (27,067) (32,957)
Cumulative effect of change in
accounting principle........... (2,414) -- -- --
Net loss........................ (15,887) (20,850) (27,067) (32,957)
Per common share--basic and
diluted:
Loss before cumulative effect
of change in accounting
principle.................... (0.21) (0.22) (0.23) (0.27)
Cumulative effect of change in
accounting principle......... (0.03) -- -- --
Net Loss...................... (0.24) (0.22) (0.23) (0.27)
2000:
Net revenues.................... $124,244 $148,359 $174,589 $201,973
Gross profit(1)................. 68,056 79,789 89,213 97,507
Loss before extraordinary item.. (32,060) (59,230) (52,965) (59,036)
Extraordinary item.............. (1,495) -- -- --
Net loss........................ (33,555) (59,230) (52,965) (59,036)
Per common share--basic and
diluted:
Loss before extraordinary
item......................... (0.27) (0.43) (0.36) (0.40)
Extraordinary item............ (0.01) -- -- --
Net Loss...................... (0.28) (0.43) (0.36) (0.40)
2001:
Net revenues.................... $212,953
Gross profit(1)................. 99,758
Net loss........................ (68,055)
Loss per common share--basic and
diluted:....................... (0.41)
--------
(1)Represents net revenues less costs of operations.
21
THE EXCHANGE OFFER
Purpose of the Exchange Offer
In connection with the sale of the old notes, we entered into a
registration rights agreement with the initial purchasers, under which we
agreed to use our best efforts to file and have declared effective an exchange
offer registration statement under the Securities Act of 1933.
We are making the exchange offer in reliance on the position of the SEC as
set forth in certain no-action letters. However, we have not sought our own no-
action letter. Based upon these interpretations by the SEC, we believe that a
holder of new notes, but not a holder who is our "affiliate" within the meaning
of Rule 405 of the Securities Act of 1933, who exchanges old notes for new
notes in the exchange offer, generally may offer the new notes for resale, sell
the new notes and otherwise transfer the new notes without further registration
under the Securities Act of 1933 and without delivery of a prospectus that
satisfies the requirements of Section 10 of the Securities Act of 1933. This
does not apply, however, to a holder who is our "affiliate" within the meaning
of Rule 405 of the Securities Act of 1933. We also believe that a holder may
offer, sell or transfer the new notes only if the holder acquires the new notes
in the ordinary course of its business and is not participating, does not
intend to participate and has no arrangement or understanding with any person
to participate in a distribution of the new notes.
Any holder of the old notes using the exchange offer to participate in a
distribution of new notes cannot rely on the no-action letters referred to
above. This includes a broker-dealer that acquired old notes directly from us,
but not as a result of market-making activities or other trading activities.
Consequently, the holder must comply with the registration and prospectus
delivery requirements of the Securities Act of 1933 in the absence of an
exemption from such requirements.
Each broker-dealer that receives new notes for its own account in exchange
for old notes, as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such new notes. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of new notes received in exchange for old notes where such old
notes were acquired by such broker-dealer as a result of market-making
activities or other trading activities. The letter of transmittal states that
by acknowledging and delivering a prospectus, a broker-dealer will not be
considered to admit that it is an "underwriter" within the meaning of the
Securities Act of 1933. We have agreed that for a period of 180 days after the
expiration date, we will make this prospectus available to broker-dealers for
use in connection with any such resale. See "Plan of Distribution".
Except as described above, this prospectus may not be used for an offer to
resell, resale or other transfer of new notes.
The exchange offer is not being made to, nor will we accept tenders for
exchange from, holders of old notes in any jurisdiction in which the exchange
offer or the acceptance of it would not be in compliance with the securities or
blue sky laws of such jurisdiction.
Terms of the Exchange
Upon the terms and subject to the conditions of the exchange offer, we will
accept any and all old notes validly tendered prior to 5:00 p.m., New York
time, on the expiration date. The date of acceptance for exchange of the old
notes, and completion of the exchange offer, is the exchange date, which will
be the first business day following the expiration date (unless extended as
described
22
in this document). We will issue, on or promptly after the exchange date, an
aggregate principal amount of up to $450,000,000 new notes for a like principal
amount of outstanding old notes tendered and accepted in connection with the
exchange offer. The new notes issued in connection with the exchange offer will
be delivered on the earliest practicable date following the exchange date.
Holders may tender some or all of their old notes in connection with the
exchange offer, but only in $1,000 increments of principal amount at maturity.
The terms of the new notes are identical in all material respects to the
terms of the old notes, except that the new notes have been registered under
the Securities Act of 1933 and are issued free from any covenant regarding
registration, including the payment of additional interest upon a failure to
file or have declared effective an exchange offer registration statement or to
complete the exchange offer by certain dates. The new notes will evidence the
same debt as the old notes and will be issued under the same indenture and
entitled to the same benefits under that indenture as the old notes being
exchanged. As of the date of this prospectus, $450,000,000 in aggregate
principal amount of the old notes is outstanding.
In connection with the issuance of the old notes, we arranged for the old
notes originally purchased by qualified institutional buyers and those sold in
reliance on Regulation S under the Securities Act of 1933 to be issued and
transferable in book-entry form through the facilities of The Depository Trust
Company, acting as depositary. Except as described under "Description of
Notes--Book-Entry, Delivery and Form," the new notes will be issued in the form
of a global note registered in the name of DTC or its nominee and each
beneficial owner's interest in it will be transferable in book-entry form
through DTC. See "Description of Notes--Book-Entry, Delivery and Form".
Holders of old notes do not have any appraisal or dissenters' rights in
connection with the exchange offer. Old notes which are not tendered for
exchange or are tendered but not accepted in connection with the exchange offer
will remain outstanding and be entitled to the benefits of the indenture under
which they were issued, but will not be entitled to any registration rights
under the registration rights agreement.
We shall be considered to have accepted validly tendered old notes if and
when we have given oral or written notice to the exchange agent. The exchange
agent will act as agent for the tendering holders for the purposes of receiving
the new notes from us.
If any tendered old notes are not accepted for exchange because of an
invalid tender, the occurrence of certain other events described in this
prospectus or otherwise, we will return the old notes, without expense, to the
tendering holder as quickly as possible after the expiration date.
Holders who tender old notes will not be required to pay brokerage
commissions or fees or, subject to the instructions in the letter of
transmittal, transfer taxes on exchange of old notes in connection with the
exchange offer. We will pay all charges and expenses, other than certain
applicable taxes described below, in connection with the exchange offer. See
"--Fees and Expenses".
Expiration Date; Extensions; Amendments
The expiration date for the exchange offer is 5:00 p.m., New York City
time, on , 2001, unless extended by us in our sole discretion (but in no
event to a date later than , 2001), in which case the term "expiration
date" shall mean the latest date and time to which the exchange offer is
extended.
We reserve the right, in our sole discretion:
. to delay accepting any old notes, to extend the offer or to terminate
the exchange offer if, in our reasonable judgment, any of the conditions
described below shall not have been
23
satisfied, by giving oral or written notice of the delay, extension or
termination to the exchange agent, or
. to amend the terms of the exchange offer in any manner.
If we amend the exchange offer in a manner that we consider material, we
will disclose such amendment by means of a prospectus supplement, and we will
extend the exchange offer for a period of five to ten business days.
If we determine to make a public announcement of any delay, extension,
amendment or termination of the exchange offer, we will do so by making a
timely release through an appropriate news agency.
Interest on the New Notes
Interest on the new notes will accrue at the rate of 9 3/8% per annum from
the most recent date to which interest on the new notes has been paid or, if no
interest has been paid, from the date of the indenture governing the notes.
Interest will be payable semiannually in arrears on February 1 and August 1,
commencing on August 1, 2001.
Conditions to the Exchange Offer
Despite any other term of the exchange offer, we will not be required to
accept for exchange, or exchange new notes for, any old notes and may terminate
the exchange offer as provided in this prospectus before the acceptance of the
old notes, if:
. any action or proceeding is instituted or threatened in any court or by
or before any governmental agency relating to the exchange offer which,
in our reasonable judgment, might materially impair our ability to
proceed with the exchange offer or materially impair the contemplated
benefits of the exchange offer to us, or any material adverse
development has occurred in any existing action or proceeding relating
to us or any of our subsidiaries;
. any change, or any development involving a prospectus change, in our
business or financial affairs or any of our subsidiaries has occurred
which, in our reasonable judgment, might materially impair our ability
to proceed with the exchange offer or materially impair the contemplated
benefits of the exchange offer to us;
. any law, statue, rule or regulation is proposed, adopted or enacted,
which in our reasonable judgment, might materially impair our ability to
proceed with the exchange offer or materially impair the contemplated
benefits of the exchange offer to us; or
. any governmental approval has not been obtained, which approval we, in
our reasonable discretion, consider necessary for the completion of the
exchange offer as contemplated by this prospectus.
The conditions listed above are for our sole benefit and may be asserted by
us regardless of the circumstances giving rise to any of these conditions. We
may waive these conditions in our reasonable discretion in whole or in part at
any time and from time to time. The failure by us at any time to exercise any
of the above rights shall not be considered a waiver of such right, and such
right shall be considered on ongoing right which may be asserted at any time
and from time to time.
If we determine in our reasonable discretion that any of the conditions are
not satisfied, we may:
. refuse to accept any old notes and return all tendered old notes to the
tendering holders;
24
. extend the exchange offer and retain all old notes tendered before the
expiration of the exchange offer, subject, however, to the rights of
holders to withdraw these old notes (See "--Withdrawal of Tenders"
below); or
. waive unsatisfied conditions relating to the exchange offer and accept
all properly tendered old notes which have not been withdrawn.
Procedures for Tendering
Unless the tender is being make in book-entry form, to tender in the
exchange offer, a holder must
. complete, sign and date the letter of transmittal, or a facsimile of
it,
. have the signatures guaranteed if required by the letter of
transmittal, and
. mail or otherwise deliver the letter of transmittal or the facsimile,
the old notes and any other required documents to the exchange agent
prior to 5:00 p.m., New York City time, on the expiration date.
Any financial institution that is a participant in DTC's Book-Entry
Transfer Facility system may make book-entry delivery of the old notes by
causing DTC to transfer the old notes into the exchange agent's account.
Although delivery of old notes may be effected through book-entry transfer into
the exchange agent's account at DTC, the letter of transmittal (or facsimile),
with any required signature guarantees and any other required documents, must,
in any case, be transmitted to and received or confirmed by the exchange agent
at its addresses set forth under the caption "exchange agent" below, prior to
5:00 p.m., New York City time, on the expiration date. Delivery of documents to
DTC in accordance with its procedures does not constitute delivery to the
exchange agent.
The tender by a holder of old notes will constitute an agreement between us
and the holder in accordance with the terms and subject to the conditions set
forth in this prospectus and in the letter of transmittal.
The method of delivery of old notes and the letter of transmittal and all
other required documents to the exchange agent is at the election and risk of
the holders. Instead of delivery by mail, we recommend that holders use an
overnight or hand delivery service. In all cases, holders should allow
sufficient time to assure delivery to the exchange agent before the expiration
date. No letter of transmittal of old notes should be sent to us. Holders may
request their respective brokers, dealers, commercial banks, trust companies or
nominees to effect the tenders for such holders.
Any beneficial owner whose old notes are registered in the name of a
broker, dealer, commercial bank, trust company or other nominee and who wishes
to tender should contact the registered holder promptly and instruct such
registered holder to tender on behalf of the beneficial owner. If the
beneficial owner wishes to tender on that owner's own behalf, the owner must,
prior to completing and executing the letter of transmittal and delivery of
such owner's old notes, either make appropriate arrangements to register
ownership of the old notes in the owners's name or obtain a properly completed
bond power from the registered holder. The transfer of registered ownership may
take considerable time.
Signature on a letter of transmittal or a notice of withdrawal must be
guaranteed by an eligible guarantor institution within the meaning of Rule
17Ad-15 under the Securities Exchange Act of 1934, unless the old notes
tendered pursuant thereto are tendered:
. by a registered holder who has not completed the box entitled "Special
Payment Instructions" or "Special Delivery Instructions" on the letter
of transmittal, or
25
.for the account of an eligible guarantor institution.
In the event that signatures on a letter or transmittal or a notice of
withdrawal are required to be guaranteed, such guarantee must be by:
. a member firm of a registered national securities exchange or of the
National Association of Securities Dealers, Inc.,
. a commercial bank or trust company having an office or correspondent in
the United States, or
. an "eligible guarantor institution".
If the letter of transmittal is signed by a person other than the
registered holder of any old notes, the old notes must be endorsed by the
registered holder or accompanied by a properly completed bond power, in each
case signed or endorsed in blank by the registered holder.
If the letter of transmittal or any old notes or bond powers are signed or
endorsed by trustees, executors, administrators, guardians, attorney-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing and, unless waived by
us, submit evidence satisfactory to us of their authority to act in that
capacity with the letter of transmittal.
We will determine all questions as to the validity, form, eligibility
(including time of receipt) and acceptance and withdrawal of tendered old notes
in our sole discretion. We reserve the absolute right to reject any and all old
notes not properly tendered or any old notes whose acceptance by us would, in
the opinion of our U.S. counsel, be unlawful. We also reserve the right to
waive any defects, irregularities or conditions of tender as to any particular
old notes either before or after the expiration date. Our interpretation of the
terms and conditions of the exchange offer (including the instructions in the
letter of transmittal) will be final and binding on all parties. Unless waived,
any defects or irregularities in connection with tenders of old notes must be
cured within a time period we will determine. Although we intend to request the
exchange agent to notify holders of defects or irregularities relating to
tenders of old notes, neither we, the exchange agent nor any other person will
have any duty or incur any liability for failure to give such notification.
Tenders of old notes will not be considered to have been made until such
defects or irregularities have been cured or waived. Any old notes received by
the exchange agent that are not properly tendered and as to which the defects
or irregularities have not been cured or waived will be returned by the
exchange agent to the tendering holders, unless otherwise provided in the
letter of transmittal, as soon as practicable following the expiration date.
In addition, we reserve the right, as set forth above under the caption
"Conditions to the Exchange Offer", to terminate the exchange offer.
By tendering, each holder represents to us, among other things, that:
. the new notes acquired in connection with the exchange offer are being
obtained in the ordinary course of business of the person receiving the
new notes, whether or not such person is the holder;
. neither the holder nor any such other person has an arrangement or
understanding with any person to participate in the distribution of such
new notes; and
. neither the holder nor any such other person is our "affiliate" (as
defined in Rule 405 under the Securities Act of 1933).
if the holder is a broker-dealer which will receive new notes for its own
account in exchange for old notes, it will acknowledge that it acquired such
old notes as the result of market-making activities
26
or other trading activities and it will deliver a prospectus in connection with
any resale of such new notes. See "Plan of Distribution".
Guaranteed Delivery Procedures
A holder who wishes to tender its old notes and:
. whose old notes are not immediately available;
. who cannot deliver the holder's old notes, the letter of transmittal
or any other required documents to the exchange agent prior to the
expiration date; or
. who cannot complete the procedures for book-entry transfer before
the expiration date
may effect a tender if:
. the tender is made through an eligible guarantor institution;
. before the expiration date, the exchange agent receives from the
eligible guarantor institution:
. a properly completed and duly executed notice of guaranteed
delivery by facsimile transmission, mail or hand delivery,
. the name and address of the holder,
. the certificate number(s) of the old notes and the principal
amount at maturity of old notes tendered, stating that the tender
is being made and guaranteeing that, within three New York Stock
Exchange trading days after the expiration date, the letter of
transmittal and the certificate(s) representing the old notes (or
a confirmation of book-entry transfer), and any other documents
required by the letter of transmittal will be deposited by the
eligible guarantor institution with the exchange agent; and
. the exchange agent receives, within three New York Stock Exchange
trading days after the expiration date, a properly completed and
executed letter of transmittal or facsimile, as well as the
certificate(s) representing all tendered old notes in proper form
for transfer or a confirmation of book-entry transfer, and all other
documents required by the letter of transmittal.
Withdrawal of Tenders
Except as otherwise provided herein, tenders of old notes may be withdrawn
at any time prior to 5:00 p.m., New York City time, on the expiration date.
To withdraw a tender of old notes in connection with the exchange offer, a
written facsimile transmission notice of withdrawal must be received by the
exchange agent at its address set forth herein prior to 5:00 p.m., New York
City time, on the expiration date. Any such notice of withdrawal must:
. specify the name of the person who deposited the old notes to be
withdrawn,
. identify the old notes to be withdrawn (including the certificate number
or numbers and principal amount at maturity of such old notes),
. be signed by the depositor in the same manner as the original signature
on the letter of transmittal by which such old notes were tendered
(including any required signature guarantees) or be accompanied by
documents or transfer sufficient to have the trustee register the
transfer of such old notes into the name of the person withdrawing the
tender, and
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. specify the name in which any such old notes are to be registered, if
different from that of the depositor.
We will determine all questions as to the validity, form and eligibility
(including time of receipt) of such withdrawal notices. Any old notes so
withdrawn will be considered not to have been validly tendered for purposes of
the exchange offer, and no new notes will be issued unless the old notes
withdrawn are validly re-tendered. Any old notes which have been tendered but
which are not accepted for exchange or which are withdrawn will be returned to
the holder without cost to such holder as soon as practicable after withdrawal,
rejection of tender or termination of the exchange offer. Properly withdrawn
old notes may be re-tendered by following one of the procedures described above
under the caption "Procedures for Tendering" at any time prior to the
expiration date.
Exchange Agent
The Bank of New York has been appointed as exchange agent in connection
with the exchange offer. Questions and requests for assistance, requests for
additional copies of this prospectus or of the letter of transmittal should be
directed to the exchange agent, at its offices at One Wall Street, New York,
N.Y. 10286. The exchange agent's telephone number is (212) 495-1784 and
facsimile number is (212) 815-5915.
Fees and Expenses
We will not make any payment to brokers, dealers or others soliciting
acceptances of the exchange offer. We will pay certain other expenses to be
incurred in connection with the exchange offer, including the fees and expenses
of the exchange agent, accounting and certain legal fees.
Holders who tender their old notes for exchange will not be obligated to
pay transfer taxes. If, however:
. new notes are to be delivered to, or issued in the name of, any person
other than the registered holder of the old notes tendered, or
. if tendered old notes are registered in the name of any person other
than the person signing the letter of transmittal, or
. if a transfer tax is imposed for any reason other than the exchange of
old notes in connection with the exchange offer,
then the amount of any such transfer taxes (whether imposed on the registered
holder or any other persons) will be payable by the tendering holder. If
satisfactory evidence of payment of such taxes or exemption from them is not
submitted with the letter of transmittal, the amount of such transfer taxes
will be billed directly to the tendering holder.
Accounting Treatment
The new notes will be recorded at the same carrying value as the old notes
as reflected in our accounting records on the date of the exchange.
Accordingly, we will not recognize any gain or loss for accounting purposes
upon the completion of the exchange offer. The expenses of the exchange offer
that we pay will increase our deferred financing costs in accordance with
generally accepted accounting principles.
Consequences of Failures to Properly Tender Old Notes in the Exchange
Issuance of the new notes in exchange for the old notes under the exchange
offer will be made only after timely receipt by the exchange agent of such old
notes, a properly completed and duly
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executed letter of transmittal and all other required documents. Therefore,
holders of the old notes desiring to tender such old notes in exchange for new
notes should allow sufficient time to ensure timely delivery. We are under no
duty to give notification of defects or irregularities of tenders of old notes
for exchange. Old notes that are not tendered or that are tendered but not
accepted by us will, following completion of the exchange offer, continue to be
subject to the existing restrictions upon transfer thereof under the Securities
Act of 1933, and, upon completion of the exchange offer, certain registered
rights under the registration rights agreement will terminate.
In the event the exchange offer is completed, we will not be required to
register the remaining old notes. Remaining old notes will continue to be
subject to the following restrictions on transfer:
. the remaining old notes may be resold only if registered pursuant to the
Securities Act of 1933, if any exemption from registration is available,
or if neither such registration nor such exemption is required by law,
and
. the remaining old notes will bear a legend restricting transfer in the
absence of registration or an exemption.
We do not currently anticipate that we will register the remaining old
notes under the Securities Act of 1933. To the extent that old notes are
tendered and accepted in connection with the exchange offer, any trading market
for remaining old notes could be adversely affected.
29
DESCRIPTION OF NOTES
General
You can find the definitions of certain terms used in the following summary
under the subheading "Certain Definitions". In this summary, the word "CCIC"
refers only to Crown Castle International Corp. and not to any of its
Subsidiaries.
The old notes were issued under separate indenture and the new notes will
be issued under the same indenture, in each case between CCIC and The Bank of
New York, as trustee. The terms of the notes include those stated in the
indenture and those made part of that indenture by reference to the Trust
Indenture Act of 1939, as amended. The new and old notes will, be identical in
all material respects, except that the new notes have been registered under the
Securities Act of 1933 and are free of any obligation regarding registration,
including the payment of additional interest upon failure to file or have
declared effective an exchange offer registration statement or to consummate an
exchange offer by certain dates.
The following description is a summary of the material provisions of the
indenture and the registration rights agreement. It does not restate the
indenture or the registration rights agreement in their entirety. We urge you
to read the indenture and the registration rights agreement, because they, and
not this description, define your rights as Holders of the notes. A copy of the
indenture and the registration rights agreement is available as set forth below
under "--Additional Information".
Brief Description of the Notes
The notes:
. are general obligations of CCIC;
. rank equally with all existing and future senior debt of CCIC;
. accrue interest from the date they are issued at a rate of 9 3/8% which
is payable semi-annually; and
. mature on August 1, 2011.
CCIC has covenanted that it will offer to repurchase notes under the
circumstances described in the indenture upon:
. a Change of Control of CCIC; or
. an Asset Sale by CCIC or any of its Restricted Subsidiaries.
The indenture also contains the following covenants:
. Restricted Payments;
. incurrence of Indebtedness and issuance of preferred stock;
. Liens;
. dividend and other payment restrictions affecting Subsidiaries;
. merger, consolidation or sale of assets;
. transactions with Affiliates;
. sale and leaseback transactions;
. limitation on issuances and sales of Capital Stock of Restricted
Subsidiaries;
30
. limitation on issuances of Guarantees of Indebtedness;
. Business Activities; and
. Reports.
The operations of CCIC are conducted through its Subsidiaries and,
therefore, CCIC depends on the cash flow of its Subsidiaries to meet its
obligations, including its obligations under the notes. CCIC's Subsidiaries
will not be guarantors of the notes and the notes will be effectively
subordinated to all Indebtedness, including all borrowings under our senior
credit facility, the Bell Atlantic joint venture credit facility, Crown Castle
UK Limited, or "CCUK", credit facility, the (Pounds)125,000,000 9% Guaranteed
Bonds Due 2007 issued by Crown Castle UK Finance PLC and other liabilities and
commitments, including trade payables and lease obligations, of CCIC's
Subsidiaries. Any right of CCIC to receive assets of any of its Subsidiaries
upon the liquidation or reorganization of the Subsidiaries, and the consequent
right of the Holders of the notes to participate in those assets, will be
effectively subordinated to the claims of that Subsidiary's creditors, except
to the extent that CCIC is itself recognized as a creditor of such Subsidiary.
If CCIC is recognized as a creditor of such Subsidiary, the claims of CCIC
would still be subordinate in right of payment to any security in the assets of
that Subsidiary and any indebtedness of that Subsidiary senior to that held by
CCIC. As of March 31, 2001, after giving pro forma effect to the recent
issuance of the old notes, CCIC's Subsidiaries would have had $1,138.8 million
of indebtedness outstanding, and would have had $544.0 million, $75.0 million
and $63.9 million of unused borrowing availability, respectively, under the
2000 Credit Facility, the Bell Atlantic joint venture credit facility and the
CCUK credit facility. The provisions of the Senior Credit Facility, the Bell
Atlantic joint venture credit facility, the CCUK credit facility and the CCUK
bonds contain substantial restrictions on the ability of those Subsidiaries to
dividend or distribute cash flow or assets to CCIC. See "Risk Factors--As a
Holding Company, We Require Dividends from Subsidiaries to Meet Cash
Requirements or Pay Dividends".
As of the date of the indenture, all of CCIC's Subsidiaries will be
Restricted Subsidiaries other than:
(1) CCUK and its subsidiaries; and
(2) Crown Castle Investment Corp. and Crown Castle Investment Corp. II
and their subsidiaries, through which CCIC holds, among other things, its
interest in the Bell Atlantic joint venture.
However, under certain circumstances, CCIC will be able to designate
current or future Subsidiaries as Unrestricted Subsidiaries. Unrestricted
Subsidiaries will not be subject to many of the restrictive covenants set forth
in the indenture.
Principal, Maturity and Interest
The notes initially will be limited in aggregate principal amount to $450
million and will mature on August 1, 2011. The indenture governing the notes
allows CCIC to issue up to $100 million in aggregate principal amount of notes
in addition to that initial amount. The issuance of any of those additional
notes will be subject to CCIC's ability to incur indebtedness under the
covenant "Incurrence of Indebtedness and Issuance of Preferred Stock" and
similar restrictions in the instruments governing CCIC's other Indebtedness.
Any such additional notes will be treated as part of the same class and series
as the notes issued in this exchange offer for purposes of voting under the
indenture. CCIC will issue the notes in denominations of $1,000 and integral
multiples of $1,000.
Interest on the notes will accrue at the rate of 9 3/8% per annum and will
be payable in U.S. Dollars semiannually in arrears on February 1 and August 1,
commencing on August 1, 2001. CCIC will make each interest payment to Holders
of record on the immediately preceding January 15 and July 15.
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Interest on the notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of the
indenture. Interest will be computed on the basis of a 360-day year comprised
of twelve 30-day months.
Methods of Receiving Payments on the Notes
If a Holder has given wire transfer instructions to CCIC, CCIC will make
all payments of principal, premium if any, and interest and Special Interest,
if any, on that Holder's notes in accordance with those instructions. All other
payments on the notes will be made at the office or agency of the paying agent
and registrar for the notes within the City and State of New York unless CCIC
elects to make interest payments by check mailed to the Holders at their
address set forth in the register of Holders.
Paying Agent and Registrar for the Notes
The trustee under the indenture will initially act as the paying agent and
registrar for the notes. CCIC may change the paying agent or registrar under
the indenture without prior notice to the Holders of the notes, and CCIC or any
of its Subsidiaries may act as paying agent or registrar under the indenture.
Transfer and Exchange
A Holder may transfer or exchange notes in accordance with the indenture.
The registrar and the trustee may require a Holder to furnish appropriate
endorsements and transfer documents in connection with a transfer of notes.
Holders will be required to pay all taxes due on transfer. CCIC is not required
to transfer or exchange any notes selected for redemption. Also, CCIC is not
required to transfer or exchange any notes for a period of 15 days before a
selection of notes to be redeemed.
Optional Redemption
During the period after the date of original issuance of the old notes
until August 1, 2004, CCIC may on any one or more occasions redeem up to 35% of
the aggregate principal amount of notes originally issued at a redemption price
of 109.375% of the principal amount of the notes to be redeemed on the
redemption date with the net cash proceeds of one or more Public Equity
Offerings and/or Strategic Equity Investments; provided that:
. at least 65% of the aggregate principal amount of notes originally
issued remains outstanding immediately after the occurrence of such
redemption, excluding notes held by CCIC or any of its Subsidiaries; and
. the redemption occurs within 60 days of the date of the closing of the
Public Equity Offering or Strategic Equity Investment.
Except pursuant to the preceding paragraph, the notes will not be
redeemable at CCIC's option prior to August 1, 2006. On or after August 1,
2006, CCIC may redeem all or a part of the notes upon not less than 30 nor more
than 60 days' notice, at the redemption prices expressed as percentages of
principal amount set forth below plus accrued and unpaid interest if any, on
the notes redeemed to the applicable redemption date, subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date, if redeemed during the twelve-month period
beginning on August 1, of the years indicated below:
Year Percentage
---- ----------
2006.......................................................... 104.688%
2007.......................................................... 103.125%
2008.......................................................... 101.563%
2009 and thereafter........................................... 100.000%
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Selection and Notice
If less than all of the notes are to be redeemed at any time, the trustee
under the indenture will select notes for redemption as follows:
(1) if the notes are listed on any national securities exchange, in
compliance with the requirements of the principal national securities
exchange, if any, on which the notes are listed; or
(2) if the notes are not listed on any national securities exchange,
on a pro rata basis, by lot or by such method as the trustee shall deem
fair and appropriate.
No notes of $1,000 of principal amount at maturity or less will be redeemed
in part. Notices of redemption will be mailed by first class mail at least 30
but not more than 60 days before the redemption date to each Holder of notes to
be redeemed at its registered address. Notices of redemption may not be
conditional.
If any note is to be redeemed in part only, the notice of redemption that
relates to such note shall state the portion of the principal amount of that
note to be redeemed. A new note in principal amount equal to the unredeemed
portion of the original note presented for redemption will be issued in the
name of the Holder thereof upon cancellation of the original note. Notes called
for redemption become due on the date fixed for redemption. On and after the
redemption date, interest ceases to accrue on notes or portions of them called
for redemption.
Mandatory Redemption
CCIC is not required to make mandatory redemption or sinking fund payments
with respect to the notes.
Repurchase at the Option of Holders
Change of Control
If a Change of Control occurs, each Holder of notes will have the right to
require CCIC to repurchase all or any part, equal to $1,000 or an integral
multiple of $1,000, of such Holder's notes pursuant to the offer described
below (the "Change of Control Offer"). The offer price in any Change of Control
Offer will be payable in cash and will be 101% of the aggregate principal
amount of any notes repurchased plus accrued and unpaid interest on the notes,
if any (subject to the right of Holders of record on the relevant record date
to receive interest due on the relevant interest payment date), to the date of
purchase (the "Change of Control Payment"). Within 30 days following any Change
of Control, CCIC will mail a notice to each Holder describing the transaction
or transactions that constitute the Change of Control and offering to
repurchase notes on the date specified in the notice (the "Change of Control
Payment Date"). The Change of Control Payment Date will be no earlier than 30
days and no later than 60 days from the date the notice is mailed, pursuant to
the procedures required by the indenture and described in such notice.
On the Change of Control Payment Date, CCIC will, to the extent lawful:
(1) accept for payment all notes or portions of the notes properly
tendered pursuant to the Change of Control Offer;
(2) deposit with the paying agent an amount equal to the Change of
Control Payment in respect of all notes or portions of notes properly
tendered; and
(3) deliver or cause to be delivered to the trustee the notes so
accepted together with an officers' certificate stating the aggregate
principal amount of notes or portions of the notes being purchased by
CCIC.
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The paying agent will promptly mail to each Holder of notes properly
tendered the Change of Control Payment for such notes, and the trustee will
promptly authenticate and mail, or cause to be transferred by book entry, to
each Holder a new note equal in principal amount to any unpurchased portion of
the notes surrendered, if any; provided that the new note will be in a
principal amount of $1,000 or an integral multiple of $1,000.
The Change of Control provisions described above will be applicable whether
or not any other provisions of the indenture are applicable. CCIC will comply
with the requirements of Section 14(e) of the Exchange Act and any other
securities laws or regulations to the extent those laws and regulations are
applicable to any Change of Control Offer. If the provisions of any of the
applicable securities laws or securities regulations conflict with the
provisions of the covenant described above, CCIC will comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under the covenant described above by virtue of the
compliance.
The Change of Control purchase feature is a result of negotiations between
CCIC and the initial purchasers of the old notes. Management has no present
intention to engage in a transaction involving a Change of Control, although it
is possible that CCIC would decide to do so in the future. Subject to the
limitations discussed below, CCIC could, in the future, enter into certain
transactions, including acquisitions, refinancings or other recapitalizations,
that would not constitute a Change of Control under the indenture, but that
could increase the amount of Indebtedness outstanding at such time or otherwise
affect CCIC's capital structure. Restrictions on the ability of CCIC to incur
additional Indebtedness are contained in the covenants described under "--
Certain Covenants--Incurrence of Indebtedness and Issuance of Preferred Stock,"
"--Certain Covenants--Liens" and "--Certain Covenants--Sale and Leaseback
Transactions". Such restrictions can only be waived with the consent of the
Holders of a majority in principal amount of the notes then outstanding. Except
for the limitations contained in the covenants, however, the indenture will not
contain any covenants or provisions that may afford Holders of the notes
protection in the event of certain highly leveraged transactions.
The credit facilities of CCIC's Subsidiaries limit CCIC's access to the
cash flow of those Subsidiaries and will, therefore, restrict CCIC's ability to
purchase any notes. Each of these credit facilities also provides that the
occurrence of certain change of control events with respect to CCIC constitutes
a default under that credit facility. In the event that a Change of Control
occurs at a time when CCIC's Subsidiaries are prohibited from making
distributions to CCIC to purchase notes, CCIC could cause its Subsidiaries to
seek the consent of the lenders under the credit facilities to allow the
distributions or could attempt to refinance the borrowings that contain the
prohibition. If CCIC does not obtain a consent or repay such borrowings, CCIC
will remain prohibited from purchasing notes. In this case, CCIC's failure to
purchase tendered notes would constitute an Event of Default under the
indenture which would, in turn, constitute a default under the credit
facilities. Future indebtedness of CCIC and its Subsidiaries may contain
prohibitions on the occurrence of certain events that would constitute a Change
of Control or require the indebtedness to be repurchased if a Change of Control
occurs. Moreover, the exercise by the Holders of their right to require CCIC to
repurchase the notes could cause a default under such indebtedness, even if the
Change of Control itself does not, due to the financial effect of such
repurchase on CCIC. Finally, CCIC's ability to pay cash to the Holders of notes
following the occurrence of a Change of Control may be limited by CCIC's then
existing financial resources, including its ability to access the cash flow of
its Subsidiaries. See "Risk Factors--As a Holding Company, We Require Dividends
from Subsidiaries to Meet Cash Requirements or Pay Dividends". There can be no
assurance that sufficient funds will be available when necessary to make any
required repurchases.
CCIC will not be required to make a Change of Control Offer upon a Change
of Control if a third party makes the Change of Control Offer in the manner, at
the times and otherwise in compliance with the requirements set forth in the
indenture applicable to a Change of Control Offer
34
made by CCIC and purchases all notes properly tendered and not withdrawn under
such Change of Control Offer. The provisions under the indenture relating to
CCIC's obligation to make an offer to repurchase the notes as a result of a
Change of Control may be waived or modified with the written consent of the
Holders of a majority in principal amount of the notes then outstanding.
The definition of Change of Control includes a phrase relating to the sale,
lease, transfer, conveyance or other disposition of "all or substantially all"
of the assets of CCIC and its Restricted Subsidiaries taken as a whole.
Although there is a developing body of case law interpreting the phrase
"substantially all", there is no precise established definition of the phrase
under applicable law. Accordingly, the ability of a Holder of notes to require
CCIC to repurchase the notes as a result of a sale, lease, transfer, conveyance
or other disposition of less than all of the assets of CCIC and its
Subsidiaries taken as a whole to another Person or group may be uncertain.
Asset Sales
CCIC will not, and will not permit any of its Restricted Subsidiaries to,
consummate an Asset Sale unless:
(1) CCIC (or the Restricted Subsidiary, as the case may be) receives
consideration at the time of the Asset Sale at least equal to the fair
market value of the assets or Equity Interests issued or sold or otherwise
disposed of;
(2) fair market value is determined by CCIC's board of directors and
evidenced by a resolution of its board of directors set forth in an
officers' certificate delivered to the trustee under the indenture; and
(3) except in the case of a Tower Asset Exchange, at least 75% of the
consideration received in such Asset Sale by CCIC or such Restricted
Subsidiary is in the form of cash or Cash Equivalents.
For purposes of this provision, each of the following shall be deemed to be
cash:
(a) any liabilities, as shown on CCIC's or such Restricted
Subsidiary's most recent balance sheet, of CCIC or any Restricted
Subsidiary (other than contingent liabilities and liabilities that are by
their terms subordinated to the notes or any guarantee of the notes) that
are assumed by the transferee of any assets pursuant to a customary
novation agreement that releases CCIC or the Restricted Subsidiary from
further liability; and
(b) any securities, notes or other obligations received by CCIC or any
Restricted Subsidiary from the transferee that are converted by CCIC or
the Restricted Subsidiary into cash within 20 days of the applicable Asset
Sale, to the extent of the cash received in that conversion.
Within 365 days after the receipt of any Net Proceeds from an Asset Sale,
CCIC or the Restricted Subsidiary may apply those Net Proceeds to:
(1) reduce Indebtedness under a Credit Facility;
(2) reduce other Indebtedness of any of CCIC's Restricted
Subsidiaries;
(3) the acquisition of all or substantially all the assets of a
Permitted Business;
(4) the acquisition of Voting Stock of a Permitted Business from a
Person that is not a Subsidiary of CCIC; provided, that, after giving
effect to the acquisition, CCIC or its Restricted Subsidiary owns a
majority of the Voting Stock of that business; or
(5) the making of a capital expenditure or the acquisition of other
long-term assets that are used or useful in a Permitted Business.
35
Pending the final application of any Net Proceeds, CCIC may temporarily reduce
revolving credit borrowings or otherwise invest the Net Proceeds in any manner
that is not prohibited by the indenture.
Any Net Proceeds from Asset Sales that are not applied or invested as
provided in the preceding paragraph will be deemed to constitute "Excess
Proceeds". When the aggregate amount of Excess Proceeds exceeds $10.0 million,
CCIC will be required to make an offer to all Holders of notes, and all holders
of other senior Indebtedness of CCIC containing provisions similar to those set
forth in the indenture relating to the notes with respect to offers to purchase
or redeem with the proceeds of sales of assets, to purchase the maximum
principal amount of notes and such other senior Indebtedness of CCIC that may
be purchased out of the Excess Proceeds (an "Asset Sale Offer"). The offer
price in any Asset Sale Offer will be payable in cash and will be 100% of the
principal amount of any notes, plus accrued and unpaid interest to the date of
purchase. In the case of any other senior Indebtedness, the offer price will be
100% of the principal amount (or accreted value, as applicable) of the
Indebtedness plus accrued and unpaid interest thereon, if any, to the date of
purchase. Each Asset Sale Offer will be made in accordance with the procedures
set forth in the indenture and the other senior Indebtedness of CCIC. If any
Excess Proceeds remain after consummation of an Asset Sale Offer, CCIC may use
the remaining Excess Proceeds for any purpose not otherwise prohibited by the
indenture. If the aggregate principal amount of notes and the other senior
indebtedness of CCIC tendered into the Asset Sale Offer exceeds the amount of
Excess Proceeds, the trustee will select the notes and such other senior
Indebtedness to be purchased on a pro rata basis. Upon completion of the Asset
Sale Offer, the amount of Excess Proceeds will be reset at zero.
Certain Covenants
Restricted Payments
CCIC will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly:
(1) declare or pay any dividend or make any other payment or
distribution on account of CCIC's or any of its Restricted Subsidiaries'
Equity Interests (including, without limitation, any payment in
connection with any merger or consolidation involving CCIC or any of its
Restricted Subsidiaries) or to the direct or indirect holders of CCIC's
or any of its Restricted Subsidiaries' Equity Interests in their
capacity as such (other than dividends or distributions payable in
Equity Interests (other than Disqualified Stock) of CCIC or to CCIC or a
Restricted Subsidiary of CCIC);
(2) purchase, redeem or otherwise acquire or retire for value
(including without limitation, in connection with any merger or
consolidation involving CCIC) any Equity Interests of CCIC or any direct
or indirect parent of CCIC (other than any such Equity Interests owned
by CCIC or any of its Restricted Subsidiaries);
(3) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness that
is subordinated to the notes, except a payment of interest or principal
at Stated Maturity; or
(4) make any Restricted Investment (all such payments and other
actions set forth in these clauses (1) through (4) above, including
those occurring since the date of the May 1999 Senior Discount Note
Indenture, being collectively referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted Payment:
(1) no Default has occurred and is continuing or would occur as a
consequence of the Restricted Payment; and
36
(2) CCIC would have been permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Debt to Adjusted Consolidated
Cash Flow Ratio test set forth in the first paragraph of the covenant
described below under the caption "--Incurrence of Indebtedness and
Issuance of Preferred Stock"; provided that CCIC and its Restricted
Subsidiaries will not be required to comply with this clause (2) in
order to make any Restricted Investment; and
(3) such Restricted Payment, together with the aggregate amount of
all other Restricted Payments made by CCIC and its Restricted
Subsidiaries after the date of the May 1999 Senior Discount Note
Indenture (excluding Restricted Payments permitted by clauses (2), (3)
and (4) of the paragraph of exceptions below), is less than the sum,
without duplication, of:
(a) 100% of the Consolidated Cash Flow of CCIC for the period
(taken as one accounting period) from the beginning of the fiscal
quarter during which the May 1999 Senior Discount Note Indenture was
executed to the end of CCIC's most recently ended fiscal quarter for
which internal financial statements are available at the time of
such Restricted Payment (or, if the Consolidated Cash Flow for such
period is a deficit, less 100% of the deficit), less 1.75 times the
Consolidated Interest Expense of CCIC since the beginning of the
fiscal quarter during which the May 1999 Senior Discount Note
Indenture was executed; plus
(b) 100% of the aggregate net cash proceeds received by CCIC
since the beginning of the fiscal quarter during which the May 1999
Senior Discount Note Indenture was executed as a contribution to its
common equity capital or from the issue or sale of Equity Interests
of CCIC (other than Disqualified Stock and except to the extent such
net cash proceeds are used to incur new Indebtedness outstanding
pursuant to clause (11) of the second paragraph of the covenant
described below under the caption "Incurrence of Indebtedness and
Issuance of Preferred Stock") or from the issue or sale of
Disqualified Stock or debt securities of CCIC that have been
converted into Equity Interests (other than Equity Interests (or
Disqualified Stock or convertible debt securities) sold to a
Subsidiary of CCIC and other than Disqualified Stock or convertible
debt securities that have been converted into Disqualified Stock);
plus
(c) to the extent that any Restricted Investment that was made
after the date of the May 1999 Senior Discount Note Indenture is
sold for cash or otherwise liquidated or repaid for cash, the lesser
of:
(A) the cash return of capital with respect to the
Restricted Investment (less the cost of disposition, if any);
and
(B) the initial amount of the Restricted Investment; plus
(d) to the extent that any Unrestricted Subsidiary of CCIC and
all of its Subsidiaries are designated as Restricted Subsidiaries
after the date of the May 1999 Senior Discount Note Indenture, the
lesser of:
(A) the fair market value of CCIC's Investments in such
Subsidiaries as of the date of such designation; or
(B) the sum of:
(x) the fair market value of CCIC's Investments in such
Subsidiaries as of the date on which such Subsidiaries were
originally designated as Unrestricted Subsidiaries; and
37
(y) the amount of any Investments made in such
Subsidiaries subsequent to such designation (and treated as
Restricted Payments) by CCIC or any Restricted Subsidiary;
provided that:
(1) in the event the Unrestricted Subsidiaries
designated as Restricted Subsidiaries are CCUK and its
Subsidiaries, the references in clauses (A) and (B) of
this clause (d) to fair market value of CCIC's
Investments in such Subsidiaries shall mean the amount
by which the fair market value of all such Investments
exceeds 34.3% of the fair market value of CCUK and its
Subsidiaries as a whole; and
(2) in the event the Unrestricted Subsidiaries
designated as Restricted Subsidiaries are CCA
Investment Corp. and its Subsidiaries, the references
in clauses (A) and (B) of this clause (d) to fair
market value of CCIC's Investments in such Subsidiaries
shall mean the amount by which the fair market value of
all such Investments exceeds $250.0 million; plus
(e) 50% of any dividends received by CCIC or a Restricted
Subsidiary after the date of the May 1999 Senior Discount Note
Indenture from an Unrestricted Subsidiary of CCIC, to the extent
that such dividends were not otherwise included in Consolidated Net
Income of CCIC for such period.
The preceding provisions will not prohibit:
(1) the payment of any dividend within 60 days after the date of
declaration of that dividend, if at said date of declaration such payment
would have complied with the provisions of the indenture;
(2) the making of any Investment or the redemption, repurchase,
retirement, defeasance or other acquisition of any subordinated
Indebtedness or Equity Interests of CCIC in exchange for, or out of the
net cash proceeds from the sale since the beginning of the fiscal quarter
during which the May 1999 Senior Discount Note Indenture was executed
(other than to a Subsidiary of CCIC) of Equity Interests of CCIC (other
than any Disqualified Stock); provided that the net cash proceeds are not
used to incur new Indebtedness pursuant to clause (11) of the second
paragraph of the covenant described below under the caption "--Incurrence
of Indebtedness and Issuance of Preferred Stock"); and provided further
that, in each case, the amount of any net cash proceeds that are so
utilized will be excluded from clause (3)(b) of the preceding paragraph;
(3) the defeasance, redemption, repurchase or other acquisition of
subordinated Indebtedness with the net cash proceeds from an incurrence of
Permitted Refinancing Indebtedness;
(4) the payment of any dividend by a Restricted Subsidiary of CCIC to
the Holders of its Equity Interests on a pro rata basis;
(5) the repurchase, redemption or other acquisition or retirement for
value of any Equity Interests of CCIC or any Restricted Subsidiary of CCIC
held by any member of CCIC's (or any of its Restricted Subsidiaries')
management pursuant to any management equity subscription agreement or
stock option agreement in effect as of the date of the May 1999 Senior
Discount Note Indenture; provided that the aggregate price paid for all of
the repurchased, redeemed, acquired or retired Equity Interests may not
exceed:
(a) $500,000 in any twelve-month period; and
(b) $5.0 million in the aggregate since the date of the August
1999 Senior Note Indenture; or
38
(6) the payment of scheduled dividends on CCIC's 12 3/4% Senior
Exchangeable Preferred Stock due 2010, whether paid in cash or in kind
through the issuance of additional shares of such preferred stock, all in
accordance with the certificate of designations governing such preferred
stock as in effect on the date of the May 1999 Senior Discount Note
Indenture.
The board of directors of CCIC may designate any Restricted Subsidiary to
be an Unrestricted Subsidiary if such designation would not cause a Default.
For purposes of making such determination, all outstanding Investments by CCIC
and its Restricted Subsidiaries (except to the extent repaid in cash) in the
Subsidiary so designated will be deemed to be Restricted Payments at the time
of the designation and will reduce the amount available for Restricted
Payments under the first paragraph of this covenant. All of those outstanding
Investments will be deemed to constitute Investments in an amount equal to the
fair market value of the Investments at the time of such designation. Such
designation will only be permitted if the Restricted Payment would be
permitted at the time and if the Restricted Subsidiary otherwise meets the
definition of an Unrestricted Subsidiary. The board of directors of CCIC may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary if the
designation would not cause a Default.
The amount of all Restricted Payments (other than cash) will be the fair
market value on the date of the Restricted Payment of the assets or securities
proposed to be transferred or issued by CCIC or the applicable Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any property, assets or Investments required by this covenant
to be valued will be valued by the board of directors of CCIC whose resolution
with respect to the determination will be delivered to the trustee.
Incurrence of Indebtedness and Issuance of Preferred Stock
CCIC will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable, contingently or otherwise, with respect
to (collectively, "incur") any Indebtedness (including Acquired Debt) and CCIC
will not issue any Disqualified Stock and will not permit any of its
Restricted Subsidiaries to issue any shares of preferred stock; provided that
CCIC may incur Indebtedness (including Acquired Debt) or issue shares of
Disqualified Stock and CCIC's Restricted Subsidiaries may incur Indebtedness
(including Acquired Debt) or issue preferred stock if, in each case, CCIC's
Debt to Adjusted Consolidated Cash Flow Ratio at the time of incurrence of the
Indebtedness or the issuance of the preferred stock, after giving pro forma
effect to such incurrence or issuance as of such date and to the use of
proceeds from such incurrence or issuance as if the same had occurred at the
beginning of the most recently ended four full fiscal quarter period of CCIC
for which internal financial statements are available, would have been no
greater than 7.5 to 1.
The first paragraph of this covenant will not prohibit the incurrence of
any of the following items of Indebtedness or the issuance of any of the
following items of Disqualified Stock or preferred stock (collectively,
"Permitted Debt"):
(1) the incurrence by CCIC or any of its Restricted Subsidiaries of
Indebtedness under Credit Facilities since the date of the August 1999
Senior Note Indenture in an aggregate principal amount (with letters of
credit being deemed to have a principal amount equal to the maximum
potential liability of CCIC and its Restricted Subsidiaries thereunder) at
any one time outstanding not to exceed the product of $150,000 times the
number of Completed Towers on the date of such incurrence;
(2) the incurrence by CCIC and its Restricted Subsidiaries of the
Existing Indebtedness;
(3) the incurrence by CCIC of the Indebtedness represented by the
notes issued on the date of the May 1999 Senior Discount Note Indenture;
39
(4) the issuance by CCIC of additional shares of its 12 3/4% Senior
Exchangeable Preferred Stock due 2010 solely for the purpose of paying
dividends thereon and the incurrence by CCIC of Indebtedness represented
by CCIC's 12 3/4% Senior Subordinated Exchange Debentures due 2010;
(5) the incurrence by CCIC or any of its Restricted Subsidiaries of
Indebtedness since the date of the August 1999 Senior Note Indenture
represented by Capital Lease Obligations, mortgage financings or purchase
money obligations, in each case incurred for the purpose of financing all
or any part of the purchase price or cost of construction or improvement
of property, plant or equipment used in the business of CCIC or such
Restricted Subsidiary, in an aggregate principal amount, including all
Permitted Refinancing Indebtedness incurred to refund, refinance or
replace any other Indebtedness incurred pursuant to this clause (5), not
to exceed $10.0 million at any one time outstanding;
(6) the incurrence by CCIC or any of its Restricted Subsidiaries of
Permitted Refinancing Indebtedness in exchange for, or the net proceeds of
which are used to extend, refinance, renew, replace, defease or refund
Indebtedness of CCIC or any of its Restricted Subsidiaries or Disqualified
Stock of CCIC (other than intercompany Indebtedness) that was permitted by
the indenture to be incurred under the first paragraph of this covenant or
clauses (2), (3), (4), (5) or this clause (6) of this paragraph;
(7) the incurrence by CCIC or any of its Restricted Subsidiaries of
intercompany Indebtedness between or among CCIC and any of its Restricted
Subsidiaries; provided, however, that:
(i) if CCIC is the obligor on such Indebtedness, such Indebtedness
is expressly subordinated to the prior payment in full in cash of all
Obligations with respect to the notes and that:
(A) any subsequent issuance or transfer of Equity Interests
that results in any such Indebtedness being held by a Person other
than CCIC or a Restricted Subsidiary; and
(B) any sale or other transfer of any such Indebtedness to a
Person that is not either CCIC or a Restricted Subsidiary shall be
deemed, in each case, to constitute an incurrence of the
Indebtedness by CCIC or the Restricted Subsidiary, as the case may
be;
(8) the incurrence by CCIC or any of its Restricted Subsidiaries of
Hedging Obligations that are incurred for the purpose of fixing or hedging
interest rate risk with respect to any floating rate Indebtedness that is
permitted by the terms of the indenture to be outstanding or currency
exchange risk;
(9) the guarantee by CCIC or any of its Restricted Subsidiaries of
Indebtedness of CCIC or a Restricted Subsidiary of CCIC that was permitted
to be incurred by another provision of the indenture;
(10) the incurrence by CCIC or any of its Restricted Subsidiaries of
Acquired Debt in connection with the acquisition of assets or a new
Subsidiary and the incurrence by CCIC's Restricted Subsidiaries of
Indebtedness as a result of the designation of an Unrestricted Subsidiary
as a Restricted Subsidiary; provided that, in the case of any such
incurrence of Acquired Debt, such Acquired Debt was incurred by the prior
owner of such assets or such Restricted Subsidiary prior to such
acquisition by CCIC or one of its Restricted Subsidiaries and was not
incurred in connection with, or in contemplation of, the acquisition by
CCIC or one of its Restricted Subsidiaries; and provided further that, in
the case of any incurrence pursuant to this clause (10), as a result of
such acquisition by CCIC or one of its Restricted Subsidiaries,
40
CCIC's Debt to Adjusted Consolidated Cash Flow Ratio at the time of
incurrence of such Acquired Debt, after giving pro forma effect to such
incurrence as if the same had occurred at the beginning of the most
recently ended four full fiscal quarter period of CCIC for which internal
financial statements are available, would have been less than CCIC's Debt
to Adjusted Consolidated Cash Flow Ratio for the same period without
giving pro forma effect to such incurrence;
(11) the incurrence by CCIC or any of its Restricted Subsidiaries of
Indebtedness or Disqualified Stock not to exceed, at any one time
outstanding, the sum of:
(i) 2.0 times the aggregate net cash proceeds; plus
(ii) 1.0 times the fair market value of non-cash proceeds
(evidenced by a resolution of the board of directors of CCIC set forth
in an officers' certificate delivered to the trustee);
in each case, from the issuance and sale, other than to a Subsidiary,
of Equity Interests (other than Disqualified Stock) of CCIC since the
beginning of the fiscal quarter during which the May 1999 Senior
Discount Note Indenture was executed (less the amount of such proceeds
used to make Restricted Payments as provided in clause (3)(b) of the
first paragraph or clause (2) of the second paragraph of the covenant
described above under the caption "--Restricted Payments"); and
(12) the incurrence by CCIC or any of its Restricted Subsidiaries
since the date of the August 1999 Senior Note Indenture of additional
Indebtedness and/or the issuance by CCIC of Disqualified Stock in an
aggregate principal amount, accreted value or liquidation preference, as
applicable, at any time outstanding, not to exceed $25.0 million.
The indenture provides that:
(1) CCIC will not incur any Indebtedness that is contractually
subordinated in right of payment to any other Indebtedness of CCIC unless
such Indebtedness is also contractually subordinated in right of payment
to the notes on substantially identical terms; provided, however, that no
Indebtedness of CCIC will be deemed to be contractually subordinated in
right of payment to any other Indebtedness of CCIC solely by virtue of
being unsecured; and
(2) CCIC will not permit any of its Unrestricted Subsidiaries to incur
any Indebtedness other than Non-Recourse Debt.
For purposes of determining compliance with this covenant, in the event
that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (1) through (12) above or is
entitled to be incurred pursuant to the first paragraph of this covenant, CCIC
will, in its sole discretion, classify (or later reclassify in whole or in
part) such item of Indebtedness in any manner that complies with this covenant.
Accrual of interest, accretion or amortization of original issue discount and
the payment of interest in the form of additional Indebtedness will not be
deemed to be an incurrence of Indebtedness for purposes of this covenant.
Indebtedness under Credit Facilities outstanding on the date of the indenture
shall be deemed to have been incurred on such date in reliance on the exception
provided by clause (1) of the definition of Permitted Debt. The debt
represented by the notes issued on the date of the indenture shall be deemed to
have been incurred on such date in reliance on the exception provided by clause
(11) of the definition of Permitted Debt.
Liens
CCIC will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, create, incur, assume or suffer to exist any Lien
securing Indebtedness or trade payables on any
41
asset now owned or hereafter acquired, or any income or profits therefrom or
assign or convey any right to receive income therefrom, except Permitted
Liens.
Dividend and Other Payment Restrictions Affecting Subsidiaries
CCIC will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, create or otherwise cause or suffer to exist or become
effective any encumbrance or restriction on the ability of any Restricted
Subsidiary to:
(1) pay dividends or make any other distributions to CCIC or any of
its Restricted Subsidiaries on its Capital Stock or with respect to any
other interest or participation in, or measured by, its profits;
(2) pay any indebtedness owed to CCIC or any of its Restricted
Subsidiaries;
(3) make loans or advances to CCIC or any of its Restricted
Subsidiaries; or
(4) transfer any of its properties or assets to CCIC or any of its
Restricted Subsidiaries.
However, the preceding restrictions will not apply to encumbrances or
restrictions existing under or by reason of:
(1) Existing Indebtedness as in effect on the date of the indenture,
and any amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings thereof; provided
that such amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings are no more
restrictive, taken as a whole, with respect to such dividend and other
payment restrictions than those contained in the applicable series of
Existing Indebtedness as in effect on the date of the indenture;
(2) Indebtedness of any Restricted Subsidiary under any Credit
Facility that is permitted to be incurred pursuant to the covenant under
the caption "Incurrence of Indebtedness and Issuance of Preferred Stock";
provided that such Credit Facility and Indebtedness contain only such
encumbrances and restrictions on such Restricted Subsidiary's ability to
engage in the activities set forth in clauses (1) through (4) of the
preceding paragraph as are, at the time such Credit Facility is entered
into or amended, modified, restated, renewed, increased, supplemented,
refunded, replaced or refinanced, ordinary and customary for a Credit
Facility of that type as determined in the good faith judgment of CCIC's
board of directors (and evidenced in a board resolution), which
determination shall be conclusively binding;
(3) encumbrances and restrictions applicable to any Unrestricted
Subsidiary, as the same are in effect as of the date on which the
Subsidiary becomes a Restricted Subsidiary, and as the same may be
amended, modified, restated, renewed, increased, supplemented, refunded,
replaced or refinanced; provided that such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacement or
refinancings are no more restrictive, taken as a whole, with respect to
the dividend and other payment restrictions than those contained in the
applicable series of Indebtedness of such Subsidiary as in effect on the
date on which such Subsidiary becomes a Restricted Subsidiary;
(4) any Indebtedness incurred in compliance with the covenant under
the heading "--Incurrence of Indebtedness and Issuance of Preferred Stock"
or any agreement pursuant to which such Indebtedness is issued if the
encumbrance or restriction applies only in the event of a payment default
or default with respect to a financial covenant contained in the
Indebtedness or agreement and the encumbrance or restriction is not
materially more disadvantageous to the Holders of the notes than is
customary in comparable financings (as determined by CCIC) and CCIC
determines that any such encumbrance or restriction will not materially
affect CCIC's ability to pay interest or principal on the notes;
(5) the indenture governing the notes;
42
(6) applicable law;
(7) any instrument governing Indebtedness or Capital Stock of a Person
acquired by CCIC or any of its Restricted Subsidiaries as in effect at the
time that Person is acquired by CCIC (except to the extent the
Indebtedness was incurred in connection with or in contemplation of the
acquisition), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the Person,
or the property or assets of the Person, so acquired, provided that, in
the case of Indebtedness, the Indebtedness was permitted by the terms of
the indenture to be incurred;
(8) customary non-assignment provisions in leases or licenses entered
into in the ordinary course of business;
(9) purchase money obligations for property acquired in the ordinary
course of business of the nature described in clause (5) in the second
paragraph of the covenant described above under the caption "Incurrence of
Indebtedness and Issuance of Preferred Stock" on the property so acquired;
(10) the provisions of agreements governing Indebtedness incurred
pursuant to clause (4) of the second paragraph of the covenant described
above under the caption "--Incurrence of Indebtedness and Issuance of
Preferred Stock";
(11) any agreement for the sale of a Restricted Subsidiary that
restricts that Restricted Subsidiary pending its sale;
(12) Permitted Refinancing Indebtedness, provided that the
restrictions contained in the agreements governing the Permitted
Refinancing Indebtedness are no more restrictive, taken as a whole, than
those contained in the agreements governing the Indebtedness being
refinanced;
(13) Liens permitted to be incurred pursuant to the provisions of the
covenant described under the caption "Liens" that limit the right of the
debtor to transfer the assets subject to such Liens;
(14) provisions with respect to the disposition or distribution of
assets or property in joint venture agreements and other similar
agreements; and
(15) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business.
Merger, Consolidation or Sale of Assets
CCIC may not:
(1) consolidate or merge with or into (whether or not CCIC is the
surviving corporation); or
(2) sell, assign, transfer, lease, convey or otherwise dispose of
all or substantially all of its properties or assets in one or more
related transactions, to another corporation, Person or entity, unless:
(a) either:
(A) CCIC is the surviving corporation; or
(B) the entity or the Person formed by or surviving any such
consolidation or merger (if other than CCIC) or to which the
sale, assignment, transfer, lease, conveyance or other
disposition shall have been made is a corporation organized or
existing under the laws of the United States, any state thereof
or the District of Columbia;
43
(b) the entity or Person formed by or surviving any such
consolidation or merger (if other than CCIC) or the entity or Person
to which the sale, assignment, transfer, lease, conveyance or other
disposition shall have been made assumes all the obligations of CCIC
under the notes and the indenture pursuant to a supplemental
indenture in a form reasonably satisfactory to the trustee;
(c) immediately after such transaction no Default exists; and
(d) except in the case of:
(A) a merger of CCIC with or into a Wholly Owned Restricted
Subsidiary of CCIC; and
(B) a merger entered into solely for the purpose of
reincorporating CCIC in another jurisdiction:
(x) in the case of a merger or consolidation in which
CCIC is the surviving corporation, CCIC's Debt to Adjusted
Consolidated Cash Flow Ratio at the time of the transaction,
after giving pro forma effect to the transaction as of such
date for balance sheet purposes and as if the transaction
had occurred at the beginning of the most recently ended
four full fiscal quarter period of CCIC for which internal
financial statements are available for income statement
purposes, would have been less than CCIC's Debt to Adjusted
Consolidated Cash Flow Ratio for the same period without
giving pro forma effect to such transaction; or
(y) in the case of any other such transaction, the Debt
to Adjusted Consolidated Cash Flow of the entity or Person
formed by or surviving any such consolidation or merger (if
other than CCIC), or to which the sale, assignment,
transfer, lease, conveyance or other disposition shall have
been made, at the time of the transaction, after giving pro
forma effect to the transaction as of such date for balance
sheet purposes and as if such transaction had occurred at
the beginning of the most recently ended four full fiscal
quarter period of such entity or Person for which internal
financial statements are available for income statement
purposes, would have been less than CCIC's Debt to Adjusted
Consolidated Cash Flow Ratio for the same period without
giving pro forma effect to such transaction; provided that
for purposes of determining the Debt to Adjusted
Consolidated Cash Flow Ratio of any entity or Person for
purposes of this clause (y) the entity or Person will be
substituted for CCIC in the definition of Debt to Adjusted
Consolidated Cash Flow Ratio and the defined terms included
therein under the caption "--Certain Definitions".
Transactions with Affiliates
CCIC will not, and will not permit any of its Restricted Subsidiaries to,
make any payment to, or sell, lease, transfer or otherwise dispose of any of
its properties or assets to, or purchase any property or assets from, or enter
into or make or amend any transaction, contract, agreement, understanding,
loan, advance or guarantee with, or for the benefit of, any Affiliate (each of
the foregoing, an "Affiliate Transaction"), unless:
(1) such Affiliate Transaction is on terms that are no less favorable
to CCIC or the relevant Restricted Subsidiary than those that would have
been obtained in a comparable transaction by CCIC or such Restricted
Subsidiary with an unrelated Person; and
(2) CCIC delivers to the trustee:
44
(a) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$1.0 million, a resolution of the board of directors of CCIC set forth
in an officers' certificate certifying that the Affiliate Transaction
complies with clause (1) above and that the Affiliate Transaction has
been approved by a majority of the disinterested members of the board
of directors of CCIC; and
(b) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$10.0 million, an opinion as to the fairness to the Holders of the
Affiliate Transaction from a financial point of view issued by an
accounting, appraisal or investment banking firm of national standing.
Notwithstanding the foregoing, the following items will not be deemed to
be Affiliate Transactions:
(1) any employment arrangements with any executive officer of CCIC or
a Restricted Subsidiary that is entered into by CCIC or any of its
Restricted Subsidiaries in the ordinary course of business and consistent
with compensation arrangements of similarly situated executive officers at
comparable companies engaged in Permitted Businesses;
(2) transactions between or among CCIC and/or its Restricted
Subsidiaries;
(3) payment of directors fees in an aggregate annual amount not to
exceed $25,000 per Person;
(4) Restricted Payments that are permitted by the provisions of the
indenture described above under the caption "--Restricted Payments";
(5) the issuance or sale of Equity Interests (other than Disqualified
Stock) of CCIC; and
(6) transactions pursuant to the provisions of the governance
agreement and the stockholders agreement, as the same were in effect on
the date of the indenture.
Sale and Leaseback Transactions
CCIC will not, and will not permit any of its Restricted Subsidiaries to,
enter into any sale and leaseback transaction; provided that CCIC or any of
its Restricted Subsidiaries may enter into a sale and leaseback transaction
if:
(1) CCIC or such Restricted Subsidiary, as applicable, could have:
(a) incurred Indebtedness in an amount equal to the Attributable
Debt relating to such sale and leaseback transaction pursuant to the
Debt to Adjusted Consolidated Cash Flow Ratio test set forth in the
first paragraph of the covenant described above under the caption "--
Incurrence of Indebtedness and Issuance of Preferred Stock";
(b) incurred a Lien to secure such Indebtedness pursuant to the
covenant described above under the caption "--Liens";
(2) the gross cash proceeds of such sale and leaseback transaction are
at least equal to the fair market value (as determined in good faith by
the board of directors) of the property that is the subject of the sale
and leaseback transaction; and
(3) the transfer of assets in the sale and leaseback transaction is
permitted by, and CCIC applies the proceeds of such transaction in
compliance with, the covenant described above under the caption "--
Repurchase at the Option of Holders--Asset Sales."
45
Limitation on Issuances and Sales of Capital Stock of Restricted Subsidiaries
CCIC:
(1) will not, and will not permit any of its Restricted Subsidiaries
to, transfer, convey, sell, lease or otherwise dispose of any Equity
Interests in any Restricted Subsidiary of CCIC to any Person (other than
CCIC or a Wholly Owned Restricted Subsidiary of CCIC); and
(2) will not permit any of its Restricted Subsidiaries to issue any of
its Equity Interests (other than, if necessary, shares of its Capital
Stock constituting directors' qualifying shares) to any Person other than
to CCIC or a Wholly Owned Restricted Subsidiary of CCIC, unless, in each
such case:
(a) as a result of such transfer, conveyance, sale, lease or other
disposition or issuance such Restricted Subsidiary no longer
constitutes a Subsidiary; and
(b) the cash Net Proceeds from such transfer, conveyance, sale,
lease or other disposition or issuance are applied in accordance with
the covenant described above under the caption "--Repurchase at the
Option of Holders--Asset Sales."
Notwithstanding the foregoing, the issuance or sale of shares of Capital Stock
of any Restricted Subsidiary of CCIC will not violate the provisions of the
immediately preceding sentence if such shares are issued or sold in connection
with:
(x) the formation or capitalization of a Restricted Subsidiary, or
(y) a single transaction or a series of substantially contemporaneous
transactions whereby such Restricted Subsidiary becomes a Restricted
Subsidiary of CCIC by reason of the acquisition of securities or assets
from another Person.
Limitation on Issuances of Guarantees of Indebtedness
CCIC will not permit any Restricted Subsidiary, directly or indirectly, to
Guarantee or pledge any assets to secure the payment of any other Indebtedness
of CCIC unless such Subsidiary simultaneously executes and delivers a
supplemental indenture to the indenture governing the notes providing for the
Guarantee of the payment of the notes by such Subsidiary, which Guarantee shall
be senior to or pari passu with such Subsidiary's Guarantee of or pledge to
secure such other Indebtedness. Notwithstanding the foregoing, any Guarantee by
a Subsidiary of the notes shall provide by its terms that it shall be
automatically and unconditionally released and discharged upon any sale,
exchange or transfer, to any Person other than a Subsidiary of CCIC, of all of
CCIC's stock in, or all or substantially all the assets of, such Subsidiary,
which sale, exchange or transfer is made in compliance with the applicable
provisions of the indenture governing the notes. The form of a Guarantee will
be attached as an exhibit to the indenture.
Business Activities
CCIC will not, and will not permit any Subsidiary to, engage in any
business other than Permitted Businesses, except to the extent as would not be
material to CCIC and its Subsidiaries taken as a whole.
Reports
Whether or not required by the Commission, so long as any notes are
outstanding, CCIC will furnish to the Holders of notes:
(1) all quarterly and annual financial information that would be
required to be contained in a filing with the Commission on Forms 10-Q and
10-K if CCIC were required to file such Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of
46
Operations" that describes the financial condition and results of
operations of CCIC and its consolidated Subsidiaries showing in reasonable
detail in the footnotes to the financial statements and in "Management's
Discussion and Analysis of Financial Condition and Results of Operations,"
in each case to the extent not prohibited by the Commission's rules and
regulations:
(a) the financial condition and results of operations of CCIC and
its Restricted Subsidiaries separate from the financial condition and
results of operations of the Unrestricted Subsidiaries of CCIC; and
(b) the Tower Cash Flow for the most recently completed fiscal
quarter and the Adjusted Consolidated Cash Flow for the most recently
completed four-quarter period and, with respect to the annual
information only, a report thereon by CCIC's certified independent
accountants; and
(2) all current reports that would be required to be filed with the
Commission on Form 8-K if CCIC were required to file such reports, in each
case within the time periods specified in the Commission's rules and
regulations.
In addition, whether or not required by the rules and regulations of the
Commission, CCIC will file a copy of all such information and reports with the
Commission for public availability within the time periods specified in the
Commission's rules and regulations, unless the Commission will not accept such
a filing, and make such information available to securities analysts and
prospective investors upon request.
Events of Default and Remedies
Each of the following constitutes an Event of Default under the indenture:
(1) default for 30 days in the payment when due of interest on the
notes;
(2) default in payment when due of the principal of or premium, if
any, on the notes;
(3) failure by CCIC or any of its Subsidiaries to comply with the
provisions described under the caption "--Certain Covenants--Merger,
Consolidation or Sale of Assets" or failure by CCIC to consummate a Change
of Control Offer or Asset Sale Offer in accordance with the provisions of
the indenture applicable to the offers;
(4) failure by CCIC or any of its Subsidiaries for 30 days after
notice to comply with any of its other agreements in the indenture or the
notes;
(5) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by CCIC or any of its Significant
Subsidiaries, or the payment of which is guaranteed by CCIC or any of its
Significant Subsidiaries, whether such Indebtedness or guarantee now
exists, or is created after the date of the indenture, which default:
(a) is caused by a failure to pay principal of or premium, if any,
or interest on the Indebtedness prior to the expiration of the grace
period provided in such Indebtedness on the date of the default (a
"Payment Default"); or
(b) results in the acceleration of the Indebtedness prior to its
express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $20.0 million or
more;
(6) failure by CCIC or any of its Significant Subsidiaries to pay
final judgments aggregating in excess of $20.0 million, which judgments
are not paid, discharged or stayed for a period of 60 days; or
(7) certain events of bankruptcy or insolvency described in the
indenture with respect to CCIC or any of its Restricted Subsidiaries.
47
If any Event of Default occurs and is continuing, the trustee under the
indenture or the Holders of at least 25% in principal amount at maturity of the
then outstanding notes may declare all the notes to be due and payable
immediately. Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, with respect to CCIC,
all outstanding notes will become due and payable without further action or
notice. Holders of the notes may not enforce the indenture or the notes except
as provided in the indenture. Subject to certain limitations, Holders of a
majority in principal amount at maturity of the then outstanding notes may
direct the trustee under the indenture in its exercise of any trust or power.
The Holders of a majority in aggregate principal amount at maturity of the
notes then outstanding by notice to the trustee under the indenture may on
behalf of the Holders of all notes waive any existing Default or Event of
Default and its consequences under the indenture except a continuing Default or
Event of Default in the payment of interest on, or the principal of, the notes.
The indenture provides that if a Default occurs and is continuing and is
known to the trustee, the trustee must mail to each Holder of the notes notice
of the Default within 90 days after it occurs. Except in the case of a Default
in the payment of principal of or interest on any note, the trustee may
withhold notice if and so long as a committee of its trust officers determines
that withholding notice is not opposed to the interest of the Holders of the
notes. In addition, CCIC is required to deliver to the trustee, within 90 days
after the end of each fiscal year, a certificate indicating whether the signers
thereof know of any Default that occurred during the previous year. CCIC is
also required to deliver to the trustee, promptly after the occurrence thereof,
written notice of any event that would constitute a Default, the status thereof
and what action CCIC is taking or proposes to take in respect thereof.
No Personal Liability of Directors, Officers, Employees and Stockholders
No director, officer, employee, incorporator or stockholder of CCIC, as
such, shall have any liability for any obligations of CCIC under the notes, the
indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of notes by accepting a note waives
and releases all such liability. The waiver and release are part of the
consideration for issuance of the notes. The waiver may not be effective to
waive liabilities under the federal securities laws and it is the view of the
Commission that such a waiver is against public policy.
Legal Defeasance and Covenant Defeasance
CCIC may, at its option and at any time, elect to have all of its
obligations discharged with respect to the notes outstanding ("Legal
Defeasance") except for:
(1) the rights of Holders of outstanding notes to receive payments in
respect of the principal of, premium, if any, and interest on the notes
when such payments are due from the trust referred to below;
(2) CCIC's obligations with respect to the notes concerning issuing
temporary notes, registration of notes, mutilated, destroyed, lost or
stolen notes and the maintenance of an office or agency for payment and
money for security payments held in trust;
(3) the rights, powers, trusts, duties and immunities of the trustee,
and CCIC's obligations in connection therewith; and
(4) the Legal Defeasance provisions of the indenture.
In addition, CCIC may, at its option and at any time, elect to have the
obligations of CCIC released with respect to certain covenants that are
described in the indenture ("Covenant Defeasance") and thereafter any omission
to comply with such obligations shall not constitute a Default or Event of
Default with respect to the notes. In the event Covenant Defeasance occurs,
48
certain events described under "--Events of Default and Remedies", but not
including non-payment and bankruptcy, receivership, rehabilitation and
insolvency events with respect to CCIC, will no longer constitute an Event of
Default with respect to the notes.
In order to exercise either Legal Defeasance or Covenant Defeasance:
(1) CCIC must irrevocably deposit with the trustee, in trust, for the
benefit of the Holders of the notes, cash in United States Dollars, non-
callable Government Securities, or a combination thereof, in such amounts
as will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium, if any,
and interest on the outstanding notes on the stated maturity or on the
redemption date, as the case may be, and CCIC must specify whether the
notes are being defeased to maturity or to a particular redemption date;
(2) in the case of Legal Defeasance, CCIC shall have delivered to the
trustee under the indenture an opinion of counsel in the United States
reasonably acceptable to the trustee confirming that:
(A) CCIC has received from, or there has been published by, the
Internal Revenue Service a ruling; or
(B) since the date of the indenture, there has been a change in
the applicable federal income tax law, in either case to the effect
that, and based thereon such opinion of counsel shall confirm that,
the Holders of the outstanding notes will not recognize income, gain
or loss for federal income tax purposes as a result of such Legal
Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been
the case if such Legal Defeasance had not occurred;
(3) in the case of Covenant Defeasance, CCIC shall have delivered to
the trustee under the indenture an opinion of counsel in the United States
reasonably acceptable to the trustee confirming that the Holders of the
outstanding notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such Covenant Defeasance
had not occurred;
(4) no Default or Event of Default shall have occurred and be
continuing either:
(a) on the date of such deposit, other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such
deposit; or
(b) insofar as Events of Default from bankruptcy or insolvency
events with respect to CCIC are concerned, at any time in the period
ending on the 91st day after the date of deposit;
(5) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under any material
agreement or instrument, other than the indenture, to which CCIC or any of
its Restricted Subsidiaries is a party or by which CCIC or any of its
Restricted Subsidiaries is bound;
(6) CCIC must have delivered to the trustee an opinion of counsel to
the effect that after the 91st day following the deposit, the trust funds
will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally;
(7) CCIC must deliver to the trustee under the indenture an officers'
certificate stating that the deposit was not made by CCIC with the intent
of preferring the Holders of the notes over the other creditors of CCIC
with the intent of defeating, hindering, delaying or defrauding creditors
of CCIC or others; and
49
(8) CCIC must deliver to the trustee under the indenture an officers'
certificate and an opinion of counsel, each stating that all conditions
precedent provided for relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
Amendment, Supplement and Waiver
Except as described in the two paragraphs below, the Holders of a majority
in principal amount at maturity of the notes outstanding can, with respect to
the notes:
(1) consent to any amendment or supplement to the indenture or the
notes; and
(2) waive any existing default under, or the compliance with any
provisions of, the indenture or the notes.
Consents and waivers obtained in connection with a purchase of, or tender
offer or exchange offer for, the notes shall be included for purposes of the
previous sentence.
Without the consent of each Holder affected, an amendment or waiver with
respect to any notes held by a non-consenting Holder may not:
(1) reduce the principal amount of notes whose Holders must consent to
an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of any note
or alter the provisions with respect to the redemption, but not any
required repurchase in connection with an Asset Sale Offer or Change of
Control Offer, of the notes;
(3) reduce the rate of or change the time for payment of interest on
any note;
(4) waive a Default or Event of Default in the payment of principal of
or premium, if any, or interest on the notes, excluding a rescission of
acceleration of the notes by the Holders of at least a majority in
aggregate principal amount of the notes and a waiver of the payment
default that resulted from such acceleration;
(5) make any note payable in money other than that stated in the
notes;
(6) make any change in the provisions of the indenture relating to
waivers of past Defaults or the rights of Holders of notes to receive
payments of principal of or premium, if any, or interest on the notes;
(7) waive a redemption payment, but not any payment upon a required
repurchase in connection with an Asset Sale Offer or Change of Control
Offer, with respect to any note;
(8) except as provided under the caption "--Legal Defeasance and
Covenant Defeasance" or in accordance with the terms of any Subsidiary
Guarantee, release a Subsidiary Guarantor from its obligations under its
Subsidiary Guarantee or make any change in a Subsidiary Guarantee that
would adversely affect the Holders of the notes; or
(9) make any change in the foregoing amendment and waiver provisions.
Notwithstanding the foregoing, without the consent of any Holder of notes,
CCIC and the trustee may amend or supplement the indenture or the notes to:
(1) cure any ambiguity, defect or inconsistency;
(2) provide for uncertificated notes in addition to or in place of
certificated notes;
(3) provide for the assumption of CCIC's obligations to Holders of
notes in the case of a merger or consolidation;
(4) make any change that would provide any additional rights or
benefits to the Holders of notes or that does not adversely affect the
legal rights under the indenture of any such Holder; or
50
(5) comply with requirements of Commission in order to effect or
maintain the qualification of the indenture under the Trust Indenture Act.
Concerning the Trustee
The indenture contains certain limitations on the rights of the trustee,
should it become a creditor of CCIC, to obtain payment of claims in certain
cases, or to realize on certain property received in respect of any such claim
as security or otherwise. The trustee will be permitted to engage in other
transactions; however, if it acquires any conflicting interest it must
eliminate such conflict within 90 days, apply to the Commission for permission
to continue or resign.
The Holders of a majority in principal amount at maturity of the notes then
outstanding will have the right to direct the time, method and place of
conducting any proceeding for exercising any remedy available to the trustee
under the indenture, subject to certain exceptions. The indenture provides that
if an Event of Default occurs and is not cured, the trustee will be required,
in the exercise of its power, to use the degree of care of a prudent man in the
conduct of his own affairs. Subject to these provisions, the trustee will be
under no obligation to exercise any of its rights or powers under the indenture
at the request of any Holder of notes, unless that Holder shall have offered to
the trustee security and indemnity satisfactory to it against any loss,
liability or expense.
Additional Information
Anyone who receives this prospectus may obtain a copy of the indenture and
the registration rights agreement without charge by writing to Crown Castle
International Corp., 510 Bering Drive, Suite 500, Houston, Texas 77057,
Attention: Corporate Secretary.
Book-Entry, Delivery and Form
The new notes will be represented by one or more notes in registered,
global form without interest coupons (collectively, the "Global notes"). The
Global notes will be deposited upon issuance with the trustee as custodian for
The Depository Trust Company ("DTC"), in New York, New York, and registered in
the name of DTC or its nominee, in each case for credit to an account of a
direct or indirect participant in DTC as described below.
Except to set forth below, the Global notes may be transferred, in whole
and not in part, only to another nominee of DTC or to a successor of DTC or its
nominee. Beneficial interests in the Global notes may not be exchanged for
notes in certificated form except in the limited circumstances described below.
See "--Exchange of Global Notes for Certificated Notes". Except in the limited
circumstances described below, owners of beneficial interests in the Global
notes will not be entitled to receive physical delivery of notes in
certificated form. Transfers of beneficial interests in the Global notes will
be subject to the applicable rules and procedures of DTC and its direct or
indirect participants, which may change from time to time.
Depository Procedures
The following description of the operations and procedures of DTC is
provided solely as a matter of convenience. These operations and procedures are
solely within the control of DTC and are subject to changed by DTC from time to
time. CCIC takes no responsibility for these operations and procedures and
urges investors to contact DTC or its participants directly to discuss these
matters.
DTC has advised CCIC that DTC is a limited-purpose trust company created to
hold securities for its participating organizations (collectively, the
"Participants") and to facilitate the clearance and settlement of transactions
in those securities between Participants through electronic book-entry changes
in accounts of its Participants. The Participants include securities brokers
and dealers (including the initial purchasers of the old notes (the "Initial
Purchasers")), banks, trust companies
51
clearing corporations and certain other organizations. Access to DTC's system
is also available to other entities such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a
Participant, either directly or indirectly (collectively, the "Indirect
Participants"). Persons who are not Participants may beneficially own
securities held by or on behalf of DTC only through the Participants or the
Indirect Participants. The ownership interests in, and transfers of ownership
interests in, each security held by or on behalf of DTC are recorded on the
records of the Participants and Indirect Participants.
DTC has also advised CCIC that, pursuant to procedures established by it:
(1) upon deposit of the Global notes, DTC will credit the accounts of
Participants with portions of the principal amount of the Global notes;
and
(2) ownership of these interests in the Global notes will be shown on,
and the transfer of ownership thereof will be effected only through,
records maintained by DTC (with respect to the Participants) or by the
Participants and the Indirect Participants (with respect to other owners
of beneficial interest in the Global notes).
Except as described below, owners of an interest in the Global notes will
not have notes registered in their names, will not receive physical delivery of
notes in certificated form and will not be considered the registered owners or
"Holders" thereof under the applicable indenture for any purpose.
Payments in respect of the principal of, and interest and premium and
Special Interest, if any, on a Global note registered in the name of DTC or its
nominee will be payable to DTC in its capacity as the registered Holder under
the indenture. Under the terms of the indenture, CCIC and the trustee will
treat the Persons in whose names the notes, including the Global notes, are
registered as the owners thereof for the purpose of receiving payments and for
all other purposes. Consequently, neither CCIC, the trustee nor any agent of
CCIC or the trustee has or will have any responsibility or liability for:
(1) any aspect of DTC's records or any Participant's or Indirect
Participant's records relating to or payments made on account of
beneficial ownership interest in the Global notes or for maintaining,
supervising or reviewing any of DTC's records or any Participant's or
Indirect Participant's records relating to the beneficial ownership
interests in the Global notes; or
(2) any other matter relating to the actions and practices of DTC or
any of its Participants or Indirect Participants.
DTC has advised CCIC that its current practice, upon receipt of any payment
in respect of securities such as the notes (including principal and interest),
is to credit the accounts of the relevant Participants with the payment on the
payment date unless DTC has reason to believe it will not receive payment on
such payment date. Each relevant Participant is credited with an amount
proportionate to its beneficial ownership of an interest in the principal
amount of the relevant security as shown on the records of DTC. Payments by the
Participants and the Indirect Participants to the beneficial owners of notes
will be governed by standing instructions and customary practices and will be
the responsibility of the Participants or the Indirect Participants and will
not be the responsibility of DTC, the trustee or CCIC. Neither CCIC nor the
trustee will be liable for any delay by DTC or any of its Participants in
identifying the beneficial owners of the notes, and CCIC and the trustee may
conclusively rely on and will be protected in relying on instructions from DTC
or its nominee for all purposes.
Transfers between Participants in DTC will be effected in accordance with
DTC's procedures, and will be settled in same-day funds.
52
DTC has advised CCIC that it will take any action permitted to be taken by
a Holder of notes only at the direction of one or more Participants to whose
account DTC has credited the interests in the Global notes and only in respect
of such portion of the aggregate principal amount of the notes as to which such
Participant or Participants has or have given such direction. However, if there
is an Event of Default under the notes, DTC reserves the right to exchange the
Global notes for legended notes in certificated form, and to distribute such
notes to its Participants.
Although DTC has agreed to the foregoing procedures to facilitate transfers
of interests in the Global notes among participants in DTC, it is under no
obligation to perform or to continue to perform such procedures and may
discontinue such procedures at any time. Neither CCIC nor the trustee nor any
of their respective agents will have any responsibility for the performance by
DTC or its participants or indirect participants of its obligations under the
rules and procedures governing its operations.
Exchange of Global Notes for Certificated Notes
A Global note is exchangeable for definitive new notes in registered
certificated form ("Certificated notes") if:
(1) DTC (a) notifies CCIC that it is unwilling or unable to continue
as depositary for the Global notes and CCIC then fails to appoint a
successor depositary or (b) has ceased to be a clearing agency registered
under the Securities Exchange Act of 1934;
(2) CCIC, at its option, notifies the trustee in writing that it
elects to cause the issuance of the Certificated notes; or
(3) there shall have occurred and be continuing a Default or Event of
Default with respect to the notes.
In addition, beneficial interests in a Global note may be exchanged for
Certificated notes upon prior written notice given to the trustee by or on
behalf of DTC in accordance with the indenture. In all cases, Certificated
notes delivered in exchange for any Global note or beneficial interests in
Global notes will be registered in the names, and issued in any approved
denominations, requested by or on behalf of the depositary (in accordance with
its customary procedures).
Exchange of Certificated Notes for Global Notes
New notes in certificated form may not be exchanged for beneficial
interests in any Global note unless the transferor first delivers to the
trustee a written certificate (in the form provided in the indenture) to the
effect that such transfer will comply with the appropriate transfer
restrictions applicable to such new notes.
Same Day Settlement and Payment
CCIC will make payments in respect of the notes represented by the Global
notes (including principal, premium, if any, interest and Special Interest, if
any) by wire transfer of immediately available funds to the accounts specified
by the Global note Holder. CCIC will make all payments of principal, interest
and premium and Special Interest, if any, with respect to Certificated notes by
wire transfer of immediately available funds to the accounts specified by the
Holders thereof or, if no such account is specified, by mailing a check to each
such Holder's registered address. The notes represented by the Global notes are
expected to trade in DTC's Same-day Funds Settlement System, and any permitted
secondary market trading activity in such notes will, therefore, be required by
DTC to be settled in immediately available funds. CCIC expects that secondary
trading in any Certificated notes will also be settled in immediately available
funds.
53
Registration Rights; Special Interest
Holders of the new notes are not entitled to any registration rights with
respect to the new notes.
The following description is a summary of the material provisions of the
registration rights agreement. It does not restate that agreement in its
entirety. We urge you to read the registration rights agreement in its
entirety because it, and not this description, defines your registration
rights as holders of these notes. See "--Additional Information".
CCIC and the Initial Purchasers entered into the registration rights
agreement on the closing date of initial purchase of the old notes by the
Initial Purchasers. Pursuant to the registration rights agreement, CCIC agreed
to file with the Commission the exchange offer registration statement on the
appropriate form under the Securities Act with respect to the exchange notes.
Upon the effectiveness of the exchange offer registration statement, CCIC will
offer to the holders of Registrable Securities pursuant to the exchange offer
who are able to make certain representations the opportunity to exchange their
Registrable Securities for exchange notes.
The registration agreement provides that if:
(1) on or prior to the time the exchange offer is completed existing
Commission interpretations are changed such that the exchange notes
received by Holders in the exchange offer for Registrable Securities are
not or would not be, upon receipt, transferable by each such holder
without restriction under the Securities Act;
(2) the exchange offer has not been completed within 225 days
following the closing date;
or
(3) the exchange offer is not available to any holder of the old
notes;
CCIC will file with the Commission a shelf registration statement to cover
resales of the old notes by the holders thereof who satisfy certain conditions
relating to the provision of information in connection with the shelf
registration statement.
CCIC will use all commercially reasonable efforts to cause the applicable
registration statement to be declared effective by the Commission within the
periods specified in the registration rights agreement.
For purposes of the preceding, "Registrable Securities" means each old
note until:
(1) the old note has been exchanged for a new note in an exchange
offer;
(2) a shelf registration statement registering such old note under the
Securities Act has been declared or becomes effective and such old note
has been sold or otherwise transferred by the holder thereof in accordance
with the shelf registration statement;
(3) such old note is distributed to the public pursuant to Rule 144
under circumstances in which any legend borne by such note relating to
restrictions on transferability thereof, under the Securities Act, is
removed by the Company or pursuant to the applicable Indenture;
(4) such old note is eligible to be sold pursuant to Rule 144(k); or
(5) such old note shall cease to be outstanding.
The registration rights agreement provides:
(1) CCIC will file an exchange offer registration statement with the
Commission not later than 60 days after the closing of the initial
purchase of the old notes by the Initial Purchasers;
54
(2) CCIC will use all commercially reasonable efforts to cause the
exchange offer registration statement to be declared effective by the
Commission not later than 180 days after the closing of the initial
purchase of the old notes by the Initial Purchaser;
(3) unless the exchange offer would not be permitted by applicable law
or Commission policy, CCIC will:
(a) use its best efforts to commence the exchange offer not later
than 30 business days after the date on which the exchange offer
registration statement was declared effective; and
(b) issue on or prior to 20 business days, or longer, if required
by the federal securities laws, after the commencement of the exchange
offer, new notes in exchange for all notes tendered prior thereto in
the exchange offer; and
(4) If obligated to file the shelf registration statement, CCIC will
file the shelf registration statement with the Commission on or prior to
45 days after such filing obligation arises and will use all commercially
reasonable efforts to cause the shelf registration statement to be
declared effective by the Commission on or prior to 90 days after the
filing of the shelf registration statement.
If:
(1) CCIC fails to file any of the registration statements required by
the registration rights agreement on or before the date specified for such
filing; or
(2) any of such registration statements is not declared effective by
the Commission on or prior to the date specified for such effectiveness;
or
(3) CCIC fails to consummate the exchange offer within 30 business
days of the effective date of any such registration statement with respect
to the exchange offer registration statement; or
(4) the shelf registration statement or the exchange offer
registration statement is declared effective but thereafter ceases to be
effective or usable in connection with resales of Registrable Securities
during the periods specified in the registration rights agreement (each
such event referred to in clauses (1) through (4) above, a "Registration
Default"),
then CCIC will pay special interest ("Special Interest") to each Holder of
notes with respect to the first 90-day period immediately following the
occurrence of the first Registration Default in an amount equal to $.05 per
week per $1,000 principal amount of notes held by such Holder.
The amount of the Special Interest will increase by an additional $.05 per
week per $1,000 principal amount of notes with respect to each subsequent 90-
day period until all Registration Defaults have been cured, up to a maximum
amount of Special Interest for all Registration Defaults of $.50 per week per
$1,000 principal amount of notes.
All accrued Special Interest will be paid by CCIC on each Special Interest
payment date to the Global note Holder by wire transfer of immediately
available funds or by federal funds check and to Holders of Certified notes by
wire transfer to the accounts specified by them or by mailing checks to their
registered addresses if no such accounts have been specified.
Following the cure of all Registration Defaults, the accrual of Special
Interest will cease.
Holders of the old notes are required to make certain representations to
CCIC (as described in the registration rights agreement) in order to
participate in the exchange offer and will be required to deliver certain
information to be used in connection with the shelf registration statement and
to
55
provide comments on the shelf registration statement within the time periods
set forth in the registration rights agreement in order to have their
Registrable Securities included in the shelf registration statement and benefit
from the provisions regarding Special Interest set forth above. By acquiring
Registrable Securities, a holder will be deemed to have agreed to indemnify
CCIC against certain losses arising out of information furnished by such holder
in writing for inclusion in any shelf registration statement. Holders of the
old notes will also be required to suspend their use of the prospectus included
in the shelf registration statement under certain circumstances upon receipt of
written notice to that effect from CCIC.
Certain Definitions
Set forth below are certain defined terms used in the indenture. Reference
is made to the indenture for a full disclosure of all such terms, as well as
any other capitalized terms used herein for which no definition is provided.
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such other
Person is merged with or into or became a Subsidiary of such specified
Person, including, without limitation, Indebtedness incurred in connection
with, or in contemplation of, such other Person merging with or into or
becoming a Subsidiary of such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset acquired by
such specified Person.
"Adjusted Consolidated Cash Flow" means, as of any date of determination,
the sum of:
(1) the Consolidated Cash Flow of CCIC for the four most recent full
fiscal quarters ending immediately prior to such date for which internal
financial statements are available, less CCIC's Tower Cash Flow for such
four-quarter period; plus
(2) the product of four times CCIC's Tower Cash Flow for the most
recent fiscal quarter for which internal financial statements are
available.
For purposes of making the computation referred to above:
(1) acquisitions that have been made by CCIC or any of its Restricted
Subsidiaries, including through mergers or consolidations and including
any related financing transactions, during the reference period or
subsequent to such reference period and on or prior to the calculation
date shall be deemed to have occurred on the first day of the reference
period and Consolidated Cash Flow for such reference period shall be
calculated without giving effect to clause (2) of the proviso set forth in
the definition of Consolidated Net Income;
(2) the Consolidated Cash Flow attributable to discontinued
operations, as determined in accordance with GAAP, and operations or
businesses disposed of prior to the calculation date, shall be excluded;
and
(3) the corporate development expense of CCIC and its Restricted
Subsidiaries calculated in a manner consistent with the audited financial
statements of CCIC included in this prospectus shall be added to
Consolidated Cash Flow to the extent it was included in computing
Consolidated Net Income.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling", "controlled by"
and "under common control with"), as used with respect to any Person, shall
mean the possession,
56
directly or indirectly, of the power to direct or cause the direction of the
management or policies of such Person, whether through the ownership of voting
securities, by agreement or otherwise; provided that beneficial ownership of
10% or more of the Voting Stock of a Person shall be deemed to be control.
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of any assets or
rights (including, without limitation, by way of a sale and leaseback);
provided that the sale, lease, conveyance or other disposition of all or
substantially all of the assets of CCIC and its Subsidiaries taken as a
whole will be governed by the provisions of the indenture described above
under the caption "--Repurchase at the Option of Holders--Change of
Control" and/or the provisions described above under the caption "--
Repurchase at the Option of Holders--Merger, Consolidation or Sale of
Assets" and not by the provisions of the Asset Sale covenant; and
(2) the issue or sale by CCIC or any of its Restricted Subsidiaries of
Equity Interests of any of CCIC's Subsidiaries (other than directors'
qualifying shares or shares required by applicable law to be held by a
Person other than CCIC or a Restricted Subsidiary), in the case of either
clause (1) or (2), whether in a single transaction or a series of related
transactions:
(a) that have a fair market value in excess of $1.0 million; or
(b) for net proceeds in excess of $1.0 million.
Notwithstanding the foregoing, the following items shall not be deemed to
be Asset Sales:
(1) a transfer of assets by CCIC to a Restricted Subsidiary or by a
Restricted Subsidiary to CCIC or to another Restricted Subsidiary;
(2) an issuance of Equity Interests by a Subsidiary to CCIC or to
another Restricted Subsidiary;
(3) a transfer or issuance of Equity Interests of an Unrestricted
Subsidiary to an Unrestricted Subsidiary; provided, however, that such
transfer or issuance does not result in a decrease in the percentage of
ownership of the voting securities of such transferee Unrestricted
Subsidiary that are collectively held by CCIC and its Subsidiaries;
(4) a Restricted Payment that is permitted by the covenant described
above under the caption "--Certain Covenants--Restricted Payments";
(5) grants of leases or licenses in the ordinary course of business;
and
(6) disposals of Cash Equivalents.
"August 1999 Senior Note Indenture" means that certain indenture dated as
of August 3, 1999 between the Company and United States Trust Company of New
York, as Trustee, governing the Company's 9 1/2% Senior Notes due 2011.
"Asset Sale Offer" has the meaning set forth above under the caption
"Repurchase at the Option of Holders--Asset Sales."
"Attributable Debt" in respect of a sale and leaseback transaction means,
at the time of determination, the present value (discounted at the rate of
interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Capital Lease Obligation" means, at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that
would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
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"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and
(4) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Cash Equivalents" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or insured by
the United States government, or any agency or instrumentality thereof
(provided that the full faith and credit of the United States is pledged
in support thereof) having maturities of not more than six months from the
date of acquisition;
(3) certificates of deposit and eurodollar time deposits with
maturities of six months or less from the date of acquisition, bankers'
acceptances with maturities not exceeding six months and overnight bank
deposits, in each case with any lender party to the Senior Credit Facility
or with any domestic commercial bank having capital and surplus in excess
of $500.0 million and a Thompson Bank Watch Rating of "B" or better;
(4) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (2) and (3) above
entered into with any financial institution meeting the qualifications
specified in clause (3) above;
(5) commercial paper having the highest rating obtainable from Moody's
Investors Service, Inc. or Standard & Poor's Ratings Group and in each
case maturing within six months after the date of acquisition; and
(6) money market funds at least 95% of the assets of which constitute
Cash Equivalents of the kinds described in clauses (1)-(5) of this
definition.
"Change of Control" means the occurrence of any of the following:
(1) the sale, lease, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of CCIC and its
Restricted Subsidiaries, taken as a whole to any "person" (as such term is
used in Section 13(d)(3) of the Exchange Act) other than a Principal or a
Related Party of a Principal;
(2) the adoption of a plan relating to the liquidation or dissolution
of CCIC;
(3) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as defined above), other than the Principals and their Related
Parties, becomes the "beneficial owner" (as such term is defined in Rule
13d-3 and Rule 13d-5 under the Exchange Act, except that a person shall be
deemed to have "beneficial ownership" of all securities that such person
has the right to acquire, whether such right is currently exercisable or
is exercisable only upon the occurrence of a subsequent condition),
directly or indirectly, of more than 50% of the Voting Stock of CCIC
(measured by voting power rather than number of shares); provided that
transfers of Equity Interests in CCIC between or among the beneficial
owners of CCIC's Equity Interests and/or Equity Interests in
58
CCUK, in each case as of the date of the indenture, will not be deemed to
cause a Change of Control under this clause (3) so long as no single
Person together with its Affiliates acquires a beneficial interest in more
of the Voting Stock of CCIC than is at the time collectively beneficially
owned by the Principals and their Related Parties;
(4) the first day on which a majority of the members of the board of
directors of CCIC are not Continuing Directors; or
(5) CCIC consolidates with, or merges with or into, any Person, or any
Person consolidates with, or merges with or into, CCIC, in any such event
pursuant to a transaction in which any of the outstanding Voting Stock of
CCIC is converted into or exchanged for cash, securities or other
property, other than any such transaction where:
(a) the Voting Stock of CCIC outstanding immediately prior to such
transaction is converted into or exchanged for Voting Stock (other
than Disqualified Stock) of the surviving or transferee Person
constituting a majority of the outstanding shares of such Voting Stock
of such surviving or transferee Person (immediately after giving
effect to such issuance); or
(b) the Principals and their Related Parties own a majority of
such outstanding shares after such transaction.
"Change of Control Offer" has the meaning set forth above under the caption
"Repurchase at the Option of Holders--Change of Control".
"Change of Control Payment" has the meaning set forth above under the
caption "Repurchase at the Option of Holders--Change of Control".
"Change of Control Payment Date" has the meaning set forth above under the
caption "Repurchase at the Option of Holders--Change of Control".
"Completed Tower" means any wireless transmission tower owned or managed by
CCIC or any of its Restricted Subsidiaries that, as of any date of
determination:
(1) has at least one wireless communications or broadcast tenant that
has executed a definitive lease with CCIC or any of its Restricted
Subsidiaries, which lease is producing revenue with respect to the tower
as of the date of determination; and
(2) has capacity for at least two tenants in addition to the tenant
referred to in clause (1) of this definition.
"Consolidated Cash Flow" means, with respect to any Person for any period,
the Consolidated Net Income of such Person for such period; plus:
(1) provision for taxes based on income or profits of such Person and
its Restricted Subsidiaries for such period, to the extent that such
provision for taxes was included in computing such Consolidated Net
Income; plus
(2) consolidated interest expense of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued and whether or not
capitalized (including, without limitation, amortization of debt issuance
costs and original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest
component of all payments associated with Capital Lease Obligations,
commissions, discounts and other fees and charges incurred in respect of
letters of credit or bankers' acceptance financings, and net payments (if
any) pursuant to Hedging Obligations), to the extent that any such expense
was deducted in computing such Consolidated Net Income; plus
59
(3) depreciation, amortization (including amortization of goodwill and
other intangibles) and other non-cash expenses (excluding any such non-
cash expense to the extent that it represents an accrual of or reserve for
cash expenses in any future period) of such Person and its Restricted
Subsidiaries for such period to the extent that such depreciation,
amortization and other non-cash expenses were deducted in computing such
Consolidated Net Income; minus
(4) non-cash items increasing such Consolidated Net Income for such
period (excluding any items that were accrued in the ordinary course of
business),
in each case on a consolidated basis and determined in accordance with GAAP.
"Consolidated Indebtedness" means, with respect to any Person as of any
date of determination, the sum, without duplication, of:
(1) the total amount of Indebtedness of such Person and its Restricted
Subsidiaries; plus
(2) the total amount of Indebtedness of any other Person, to the
extent that such Indebtedness has been Guaranteed by the referent Person
or one or more of its Restricted Subsidiaries; plus
(3) the aggregate liquidation value of all Disqualified Stock of such
Person and all preferred stock of Restricted Subsidiaries of such Person,
in each case, determined on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any Person for any
period:
(1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period determined in accordance with
GAAP, whether paid or accrued and whether or not capitalized (including,
without limitation, amortization of debt issuance costs and original issue
discount, non-cash interest payments, the interest component of any
deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, imputed interest with respect
to Attributable Debt, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance financings,
and net payments, if any, pursuant to Hedging Obligations); plus
(2) all preferred stock dividends paid or accrued in respect of CCIC's
and its Restricted Subsidiaries' preferred stock to Persons other than
CCIC or a Wholly Owned Restricted Subsidiary of CCIC other than preferred
stock dividends paid by CCIC in shares of preferred stock that is not
Disqualified Stock.
"Consolidated Net Income" means, with respect to any Person for any period,
the aggregate of the Net Income of such Person and its Restricted Subsidiaries
for such period, on a consolidated basis, determined in accordance with GAAP;
provided that:
(1) the Net Income (but not loss) of any Person other than CCIC that
is not a Restricted Subsidiary or that is accounted for by the equity
method of accounting shall be included only to the extent of the amount of
dividends or distributions paid in cash to the referent Person or a
Restricted Subsidiary thereof;
(2) the Net Income of any Person acquired in a pooling of interests
transaction for any period prior to the date of such acquisition shall be
excluded;
(3) the cumulative effect of a change in accounting principles shall
be excluded; and
(4) the Net Income (but not loss) of any Unrestricted Subsidiary shall
be excluded whether or not distributed to CCIC or one of its Restricted
Subsidiaries.
"Consolidated Tangible Assets" means, with respect to CCIC, the total
consolidated assets of CCIC and its Restricted Subsidiaries, less the total
intangible assets of CCIC and its Restricted
60
Subsidiaries, as shown on the most recent internal consolidated balance sheet
of CCIC and such Restricted Subsidiaries calculated on a consolidated basis in
accordance with GAAP.
"Continuing Directors" means, as of any date of determination, any member
of the board of directors of CCIC who:
(1) was a member of such board of directors on the date of the August
1999 Senior Note Indenture;
(2) was nominated for election or elected to such board of directors
with the approval of a majority of the Continuing Directors who were
members of such board of directors at the time of such nomination or
election; or
(3) is a designee of a Principal or was nominated by a Principal.
"Covenant Defeasance" has the meaning set forth above under the caption
"Legal Defeasance and Covenant Defeasance".
"Credit Facilities" means one or more debt facilities (including, without
limitation, the Senior Credit Facility) or commercial paper facilities with
banks or other institutional lenders providing for revolving credit loans, term
loans, receivables financing (including through the sale of receivables to such
lenders or to special purpose entities formed to borrow from such lenders
against such receivables) or letters of credit, in each case, as amended,
restated, modified, renewed, refunded, replaced or refinanced in whole or in
part from time to time.
"Debt to Adjusted Consolidated Cash Flow Ratio" means, as of any date of
determination, the ratio of:
(1) the Consolidated Indebtedness of CCIC as of such date to
(2) the Adjusted Consolidated Cash Flow of CCIC as of such date.
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable, in each case, at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
date on which the notes mature; provided, however, that any Capital Stock that
would constitute Disqualified Stock solely because the holders thereof have the
right to require CCIC to repurchase such Capital Stock upon the occurrence of a
Change of Control or an Asset Sale shall not constitute Disqualified Stock if
the terms of such Capital Stock provide that CCIC may not repurchase or redeem
any such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with the covenant described above the caption "--Certain
Covenants--Restricted Payments".
"Eligible Indebtedness" means any Indebtedness other than:
(1) Indebtedness in the form of, or represented by, bonds or other
securities or any guarantee thereof; and
(2) Indebtedness that is, or may be, quoted, listed or purchased and
sold on any stock exchange, automated trading system or over-the-counter
or other securities market (including, without prejudice to the generality
of the foregoing, the market for securities eligible for resale pursuant
to Rule 144A under the Securities Act).
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
61
"Excess Proceeds" has the meaning set forth above under the caption
"Repurchase at the Option of Holders--Asset Sales".
"Existing Indebtedness" means Indebtedness of CCIC and its Subsidiaries
(other than Indebtedness under the Senior Credit Facility) in existence on
August 3, 1999, until such amounts are repaid.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of the indenture.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof), of all or any part of any Indebtedness.
"Hedging Obligations" means, with respect to any Person, the obligations of
such Person under:
(1) interest rate swap agreements, interest rate cap agreements and
interest rate collar agreements; and
(2) other agreements or arrangements designed to protect such Person
against fluctuations in interest rates or currency exchange rates.
"Holder" means a Person in whose name a note is registered.
"Indebtedness" means, with respect to any Person, any indebtedness of such
Person, whether or not contingent, in respect of borrowed money or evidenced by
bonds, notes, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof) or banker's acceptances or
representing Capital Lease Obligations or the balance deferred and unpaid of
the purchase price of any property or representing any Hedging Obligations,
except any such balance that constitutes an accrued expense or trade payable,
if and to the extent any of the foregoing indebtedness (other than letters of
credit and Hedging Obligations) would appear as a liability upon a balance
sheet of such Person prepared in accordance with GAAP, as well as all
Indebtedness of others secured by a Lien on any asset of such Person whether or
not such Indebtedness is assumed by such Person (the amount of such
Indebtedness as of any date being deemed to be the lesser of the value of such
property or assets as of such date or the principal amount of such Indebtedness
of such other Person so secured) and, to the extent not otherwise included, the
Guarantee by such Person of any Indebtedness of any other Person. The amount of
any Indebtedness outstanding as of any date shall be:
(1) the accreted value thereof, in the case of any Indebtedness issued
with original issue discount; and
(2) the principal amount thereof, together with any interest thereon
that is more than 30 days past due, in the case of any other Indebtedness.
"Investments" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business),
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together
62
with all items that are or would be classified as investments on a balance
sheet prepared in accordance with GAAP. If CCIC or any Restricted Subsidiary of
CCIC sells or otherwise disposes of any Equity Interests of any direct or
indirect Subsidiary of CCIC or a Restricted Subsidiary of CCIC issues any of
its Equity Interests such that, in each case, after giving effect to any such
sale or disposition, such Person is no longer a Restricted Subsidiary of CCIC,
CCIC shall be deemed to have made an Investment on the date of any such sale or
disposition equal to the fair market value of the Equity Interests of such
Subsidiary not sold or disposed of in an amount determined as provided in the
final paragraph of the covenant described above under the caption "--Certain
Covenants--Restricted Payments".
"Legal Defeasance" has the meaning set forth above under the caption "Legal
Defeasance and Covenant Defeasance".
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease
in the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement
under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
"May 1999 Senior Discount Note Indenture" means that certain indenture,
dated as of May 15, 1999, between CCIC and United States Trust Company of New
York, as trustee, governing CCIC's 10 3/8% Senior Discount Notes due 2011.
"Net Income" means, with respect to any Person, the net income (loss) of
such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however:
(1) any gain or loss, together with any related provision for taxes on
such gain or loss, realized in connection with:
(a) any Asset Sale (including, without limitation, dispositions
pursuant to sale and leaseback transactions); or
(b) the disposition of any securities by such Person or any of its
Restricted Subsidiaries or the extinguishment of any Indebtedness of
such Person or any of its Restricted Subsidiaries; and
(2) any extraordinary gain or loss, together with any related
provision for taxes on such extraordinary gain or loss.
"Net Proceeds" means the aggregate cash proceeds received by CCIC or any of
its Restricted Subsidiaries in respect of any Asset Sale (including, without
limitation, any cash received upon the sale or other disposition of any non-
cash consideration received in any Asset Sale), net of:
(1) the direct costs relating to such Asset Sale (including, without
limitation, legal, accounting and investment banking fees, and sales
commissions) and any relocation expenses incurred as a result thereof;
(2) taxes paid or payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing
arrangements);
(3) amounts required to be applied to the repayment of Indebtedness
(other than Indebtedness under a Credit Facility) secured by a Lien on the
asset or assets that were the subject of such Asset Sale;
(4) all distributions and other payments required to be made to
minority interest holders in Restricted Subsidiaries as a result of such
Asset Sale;
63
(5) the deduction of appropriate amounts provided by the seller as a
reserve in accordance with GAAP against any liabilities associated with
the assets disposed of in such Asset Sale and retained by CCIC or any
Restricted Subsidiary after such Asset Sale; and
(6) without duplication, any reserves that CCIC's board of directors
determines in good faith should be made in respect of the sale price of
such asset or assets for post closing adjustments;
provided that in the case of any reversal of any reserve referred to in clause
(5) or (6) above, the amount so reversed shall be deemed to be Net Proceeds
from an Asset Sale as of the date of such reversal.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither CCIC nor any of its Restricted Subsidiaries:
(a) provides credit support of any kind (including any
undertaking, agreement or instrument that would constitute
Indebtedness);
(b) is directly or indirectly liable (as a guarantor or
otherwise); or
(c) constitutes the lender;
(2) no default with respect to which (including any rights that the
holders thereof may have to take enforcement action against an
Unrestricted Subsidiary) would permit (upon notice, lapse of time or both)
any holder of any other Indebtedness of CCIC or any of its Restricted
Subsidiaries to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its stated maturity;
and
(3) as to which the lenders have been notified in writing that they
will not have any recourse to the stock or assets of CCIC or any of its
Restricted Subsidiaries (except that this clause (3) will not apply to any
indebtedness incurred by CCUK and its Subsidiaries prior to the date CCUK
became a Subsidiary).
"Payment Default" has the meaning set forth above under the caption "Events
of Default and Remedies".
"Permitted Business" means any business conducted by CCIC, its Restricted
Subsidiaries or CCUK and its Subsidiaries on the date of the indenture and any
other business related, ancillary or complementary to any such business.
"Permitted Investment" means:
(1) any Investment in CCIC or in a Restricted Subsidiary of CCIC;
(2) any Investment in Cash Equivalents;
(3) any Investment by CCIC or any Restricted Subsidiary of CCIC in a
Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary of CCIC; or
(b) such Person is merged, consolidated or amalgamated with or
into, or transfers or conveys substantially all of its assets to, or
is liquidated into, CCIC or a Restricted Subsidiary of CCIC;
(4) any Restricted Investment made as a result of the receipt of non-
cash consideration from an Asset Sale that was made pursuant to and in
compliance with the covenant described above under the caption "--
Repurchase at the Option of Holders--Asset Sales";
(5) any acquisition of assets solely in exchange for the issuance of
Equity Interests (other than Disqualified Stock) of CCIC;
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(6) receivables created in the ordinary course of business;
(7) loans or advances to employees made in the ordinary course of
business since the date of the August 1999 Senior Note Indenture not to
exceed $2.0 million at any one time outstanding;
(8) securities and other assets received in settlement of trade debts
or other claims arising in the ordinary course of business;
(9) purchase of additional Equity Interests in CCUK for cash pursuant
to the governance agreement as the same is in effect on the date of the
May 1999 Senior Discount Note Indenture for aggregate cash consideration
not to exceed $20.0 million since the beginning of the quarter during
which the May 1999 Senior Discount Note Indenture was executed;
(10) Investments since the date of the August 1999 Senior Note
Indenture of up to an aggregate of $100.0 million (each such Investment
being measured as of the date made and without giving effect to subsequent
changes in value); and
(11) other Investments in Permitted Businesses since the date of the
August 1999 Senior Note Indenture not to exceed an amount equal to $10.0
million plus 10% of CCIC's Consolidated Tangible Assets at any one time
outstanding (each such Investment being measured as of the date made and
without giving effect to subsequent changes in value).
"Permitted Liens" means:
(1) Liens securing Eligible Indebtedness of CCIC under one or more
Credit Facilities that was permitted by the terms of the indenture to be
incurred;
(2) Liens securing any Indebtedness of any of CCIC's Restricted
Subsidiaries that was permitted by the terms of the indenture to be
incurred;
(3) Liens in favor of CCIC;
(4) Liens existing on the date of the August 1999 Senior Note
Indenture;
(5) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded;
provided that any reserve or other appropriate provision as shall be
required in conformity with GAAP shall have been made therefor;
(6) Liens securing Indebtedness permitted to be incurred under clause
(5) of the second paragraph of the covenant described above under the
caption "--Certain Covenants--Incurrence of Indebtedness and Issuance of
Preferred Stock"; and
(7) Liens incurred in the ordinary course of business of CCIC or any
Restricted Subsidiary of CCIC since the date of the August 1999 Senior
Note Indenture with respect to obligations that do not exceed $5.0 million
at any one time outstanding and that:
(a) are not incurred in connection with the borrowing of money or
the obtaining of advances or credit (other than trade credit in the
ordinary course of business); and
(b) do not in the aggregate materially detract from the value of
the property or materially impair the use thereof in the operation of
business by CCIC or such Restricted Subsidiary.
"Permitted Refinancing Indebtedness" means any Indebtedness of CCIC or any
of its Restricted Subsidiaries issued in exchange for, or the net proceeds of
which are used to extend, refinance,
65
renew, replace, defease or refund other Indebtedness of CCIC or any of its
Restricted Subsidiaries (other than intercompany Indebtedness); provided that:
(1) the principal amount (or initial accreted value, if applicable) of
such Permitted Refinancing Indebtedness does not exceed the principal
amount of (or accreted value, if applicable), plus accrued interest on,
the Indebtedness so extended, refinanced, renewed, replaced, defeased or
refunded (plus the amount of expenses and prepayment premiums incurred in
connection therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity date
later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity
of, the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded;
(3) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated in right of payment to the notes,
such Permitted Refinancing Indebtedness is subordinated in right of
payment to, the notes on terms at least as favorable to the holders of
notes as those contained in the documentation governing the Indebtedness
being extended, refinanced, renewed, replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by CCIC or by the Restricted
Subsidiary who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or agency or political subdivision thereof (including any
subdivision or ongoing business of any such entity or substantially all of the
assets of any such entity, subdivision or business).
"Principals" means Berkshire Fund III, Limited Partnership; Berkshire Fund
IV, Limited Partnership; Berkshire Investors LLC; Berkshire Partners LLC;
Centennial Fund IV, L.P.; Centennial Fund V, L.P.; Centennial Entrepreneurs
Fund V, L.P.; Nassau Capital Partners II, L.P.; and NAS Partners I, L.L.C. and
any Related Party of the foregoing.
"Public Equity Offering" means an underwritten primary public offering of
common stock of CCIC pursuant to an effective registration statement under the
Securities Act.
"Related Party" with respect to any Principal means:
(1) any controlling stockholder, 80% (or more) owned Subsidiary of
such Principal; or
(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, members, partners, owners or Persons
beneficially holding an 80% or more controlling interest of which consist
of such Principal and/or such other Persons referred to in the immediately
preceding clause (1).
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary.
"Senior Credit Facility" means that certain Credit Agreement, dated as of
March 15, 2000, by and among The Chase Manhattan Bank, Key Corporate Capital,
Inc. and The Bank of Nova Scotia as agents for the several lenders and Crown
Castle Operating Company and CCIC, including any related notes, guarantees,
collateral documents, instruments and agreements executed in connection
therewith, and in each case as amended, modified, renewed, refunded, replaced
or refinanced from time to time.
66
"Significant Subsidiary" means, with respect to any Person, any Restricted
Subsidiary of such Person that would be a "significant subsidiary" of such
Person as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Act, as such Regulation is in effect on the date hereof, except
that all references to "10 percent" in Rule 1-02(w)(1), (2) and (3) shall mean
"5 percent" and that all Unrestricted Subsidiaries of CCIC shall be excluded
from all calculations under Rule 1-02(w).
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations
to repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Strategic Equity Investment" means a cash contribution to the common
equity capital of CCIC or a purchase from CCIC of common Equity Interests
(other than Disqualified Stock), in either case by or from a Strategic Equity
Investor and for aggregate cash consideration of at least $50.0 million.
"Strategic Equity Investor" means a Person engaged in a Permitted Business
whose Total Equity Market Capitalization exceeds $1.0 billion.
"Subsidiary" means, with respect to any Person:
(1) any corporation, association or other business entity of which
more than 50% of the total voting power of shares of Capital Stock
entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by such Person or one or more
of the other Subsidiaries of that Person (or a combination thereof); and
(2) any partnership:
(a) the sole general partner or the managing general partner of
which is such Person or a Subsidiary of such Person; or
(b) the only general partners of which are such Person or one or
more Subsidiaries of such Person (or any combination thereof).
"Total Equity Market Capitalization" of any Person means, as of any day of
determination, the sum of:
(1) the product of:
(a) the aggregate number of outstanding primary shares of common
stock of such Person on such day (which shall not include any options
or warrants on, or securities convertible or exchangeable into, shares
of common stock of such person); multiplied by
(b) the average closing price of such common stock listed on a
national securities exchange or the Nasdaq National Market System over
the 20 consecutive business days immediately preceding such day; plus
(2) the liquidation value of any outstanding shares of preferred stock
of such Person on such day.
"Tower Asset Exchange" means any transaction in which CCIC or one of its
Restricted Subsidiaries exchanges assets for Tower Assets and/or cash or Cash
Equivalents where the fair market value (evidenced by a resolution of the board
of directors set forth in an officers' certificate delivered to the trustee) of
the Tower Assets and cash or Cash Equivalents received by CCIC and its
Restricted Subsidiaries in such exchange is at least equal to the fair market
value of the assets disposed of in such exchange.
67
"Tower Assets" means wireless transmission towers and related assets that
are located on the site of a transmission tower.
"Tower Cash Flow" means, for any period, the Consolidated Cash Flow of CCIC
and its Restricted Subsidiaries for such period that is directly attributable
to site rental revenue or license fees paid to lease or sublease space on
communication sites owned or leased by CCIC, all determined on a consolidated
basis and in accordance with GAAP. Tower Cash Flow will not include revenue or
expenses attributable to non-site rental services provided by CCIC or any of
its Restricted Subsidiaries to lessees of communication sites or revenues
derived from the sale of assets.
"Unrestricted Subsidiary" means any Subsidiary of CCIC that is designated
by the board of directors as an Unrestricted Subsidiary pursuant to a board
resolution; but only to the extent that such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with CCIC or any Restricted Subsidiary of CCIC unless the
terms of any such agreement, contract, arrangement or understanding are no
less favorable to CCIC or such Restricted Subsidiary than those that might
be obtained at the time from Persons who are not Affiliates of CCIC;
(3) is a Person with respect to which neither CCIC nor any of its
Restricted Subsidiaries has any direct or indirect obligation:
(a) to subscribe for additional Equity Interests; or
(b) to maintain or preserve such Person's financial condition or
to cause such Person to achieve any specified levels of operating
results;
(4) has not guaranteed or otherwise directly or indirectly provided
credit support for any Indebtedness of CCIC or any of its Restricted
Subsidiaries; and
(5) has at least one director on its board of directors that is not a
director or executive officer of CCIC or any of its Restricted
Subsidiaries and has at least one executive officer that is not a director
or executive officer of CCIC or any of its Restricted Subsidiaries.
Any such designation by the board of directors shall be evidenced to the
trustee by filing with the trustee a certified copy of the board resolution
giving effect to such designation and an officers' certificate certifying that
such designation complied with the foregoing conditions and was permitted by
the covenant described above under the caption "--Certain Covenants--Restricted
Payments". If, at any time, any Unrestricted Subsidiary would fail to meet the
foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of the Indenture and any
Indebtedness of that Subsidiary shall be deemed to be incurred by a Restricted
Subsidiary of CCIC as of such date (and, if such Indebtedness is not permitted
to be incurred as of such date under the covenant described above under the
caption "--Certain Covenants--Incurrence of Indebtedness and Issuance of
Preferred Stock", CCIC shall be in default of such covenant). The board of
directors of CCIC may at any time designate any Unrestricted Subsidiary to be a
Restricted Subsidiary; provided that the designation shall be deemed to be an
incurrence of Indebtedness by a Restricted Subsidiary of CCIC of any
outstanding Indebtedness of such Unrestricted Subsidiary and the designation
shall only be permitted if:
(1) such Indebtedness is permitted under the covenant described above
under the caption "--Certain Covenants--Incurrence of Indebtedness and
Issuance of Preferred Stock", calculated on a pro forma basis as if such
designation had occurred at the beginning of the four-quarter reference
period; and
(2) no Default would occur or be in existence following such
designation.
68
"Voting Stock" of any Person as of any date means the Capital Stock of such
Person that is at the time entitled to vote in the election of the board of
directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying:
(a) the amount of each then remaining installment, sinking fund,
serial maturity or other required payments of principal, including
payment at final maturity, in respect thereof; by
(b) the number of years (calculated to the nearest one-twelfth)
that will elapse between such date and the making of such payment; by
(2) the then outstanding principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person and one or more Wholly Owned Restricted
Subsidiaries of such Person.
69
CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following discussion is a summary of certain U.S. Federal income tax
consequences of the exchange offer to holders of old notes, but is not a
complete analysis of all potential tax effects. The summary below is based upon
the Internal Revenue Code of 1986, as amended (the "Code"), regulations of the
Treasury Department, administrative rulings and pronouncements of the Internal
Revenue Service and judicial decisions, all of which are subject to change,
possibly with retroactive effect. This summary does not address all of the U.S.
Federal income tax consequences that may be applicable to particular holders,
including dealers in securities, financial institutions, insurance companies
and tax-exempt organizations. In addition, this summary does not consider the
effect of any foreign, state, local, gift, estate or other tax laws that may be
applicable to a particular holder. This summary applies only to a holder that
acquired old notes at original issue for cash and holds such old notes as a
capital asset within the meaning of Section 1221 of the Code. Holders of old
notes considering the exchange offer should consult their own tax advisors
concerning the U.S. federal income tax consequences in light of their
particular situations as well as any consequences arising under the laws of any
other taxing jurisdiction.
An exchange of old notes for new notes pursuant to the exchange offer will
not be treated as a taxable exchange or other taxable event for U.S. Federal
income tax purposes. Accordingly, there will be no U.S. Federal income tax
consequences to holders who exchange their old notes for new notes in
connection with the exchange offer and any such holder will have the same
adjusted tax basis and holding period in the new notes as it had in the old
notes immediately before the exchange.
The foregoing discussion of certain U.S. Federal income tax considerations
does not consider the facts and circumstances of any particular holder's
situation or status. Accordingly, each holder of old notes should consult its
own tax advisor regarding the tax consequences of the exchange offer to it,
including those under state, foreign and other tax laws.
PLAN OF DISTRIBUTION
Each broker-dealer that receives new notes for its own account in
connection with the exchange offer must acknowledge that it will deliver a
prospectus in connection with any resale of such new notes. This prospectus, as
it may be amended or supplemented from time to time, may be used by a broker-
dealer in connection with resales of new notes received in exchange for old
notes where such old notes were acquired as a result of market-making
activities or other trading activities. We have agreed that for a period of 180
days after the expiration date, we will make available a prospectus, as amended
or supplemented, meeting the requirements of the Securities Act of 1933 to any
broker-dealer for use in connection with any such resale. In addition, until
, 2001 (90 days after the date of this prospectus), all dealers effecting
transactions in the new notes may be required to deliver a prospectus.
We will not receive any proceeds from any sale of new notes by broker-
dealers. New notes received by broker-dealers for their own account pursuant to
the exchange offer may be sold from time to time in one or more transactions in
the over-the counter market, in negotiated transactions, through the writing of
options on the new notes or a combination of such methods of resale, at market
prices prevailing at the time of resale, at prices related to such prevailing
market prices or negotiated prices. Any such resale may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in
the form of commissions or concessions from any such broker-dealer or the
purchasers of any such new notes. Any broker-dealer that resells new notes that
were received by it for its own account pursuant to the exchange offer and any
broker or dealer that participates in a distribution of such new notes may be
deemed to be an "underwriter" within the meaning of the Securities Act of 1933,
and any profit on any such resale of new notes and any
70
commissions or concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act of 1933. The letter of
transmittal states that by acknowledging that it will deliver and by delivering
a prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act of 1933.
LEGAL MATTERS
The validity of the new notes offered hereby will be passed on by Cravath,
Swaine & Moore, New York, New York.
EXPERTS
The consolidated financial statements and schedules of CCIC as of December
31, 1999 and 2000, and for each of the three years in the period ended December
31, 2000, have been incorporated by reference in this prospectus and the
registration statement in reliance upon the reports of KPMG LLP, independent
certified public accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.
CERTAIN CURRENCY TRANSLATIONS
CCUK publishes its consolidated financial statements in pounds sterling.
For the convenience of the reader, this prospectus contains translations of
certain pound sterling amounts into U.S. dollars at specified rates or, if not
so specified, at the noon buying rate in New York City for cable transfers in
pounds sterling as certified for customs purposes by the Federal Reserve Bank
of New York on March 30, 2001, of (Pounds)1.00 = $1.4190. No representation is
made that the pound sterling amounts have been, could have been or could be
converted into U.S. dollars at the rates indicated or any other rates. On June
15, 2001, the noon buying rate was (Pounds)1.00 = $1.4056.
71
$450,000,000 9 3/8% Senior Notes Due 2011
[LOGO OF CROWN CASTLE INTERNATIONAL]
CROWN CASTLE INTERNATIONAL CORP.
Offer to Exchange
all Outstanding 9 3/8% Senior Notes Due 2011 for
9 3/8% Senior Notes Due 2011 which have been Registered under the Securities
Act of 1933
------------
Prospectus
, 2001
------------
Until , 2001, all dealers that effect transactions in these securities,
whether or not participating in this exchange offer, may be required to deliver
a prospectus. This is in addition to the dealers' obligation to deliver a
prospectus when acting as underwriters and with respect to their unsold
allotments or subscriptions.
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 20. Indemnification of Directors and Officers
Section 145 of the General Corporation Law of the State of Delaware
("DGCL") provides that a corporation has the power to indemnify any director or
officer, or former director or officer, who was or is a party or is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation) against the expenses
(including attorney's fees), judgments, fines or amounts paid in settlement
actually and reasonably incurred by them in connection with the defense of any
action by reason of being or having been directors or officers, if such person
shall have acted in good faith and in a manner reasonably believed to be in or
not opposed to the best interests of the corporation and with respect to any
criminal action or proceeding, provided that such person had no reasonable
cause to believe his conduct was unlawful, except that, if such action shall be
in the right of the corporation, no such indemnification shall be provided as
to any claim, issue or matter as to which such person shall have been judged to
have been liable to the corporation unless and to the extent that the Court of
Chancery of the State of Delaware (the "Court of Chancery") or any court in
which such suit or action was brought shall determine upon application that, in
view of all of the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses as such court shall deem
proper.
Accordingly, the Restated Certificate of Incorporation of the Company
provides that the Company shall, to the maximum extent permitted under the
DGCL, indemnify each person who is or was a director or officer of the Company.
The Company may, by action of the Board of Directors, indemnify other employees
and agents of the Corporation, directors, officers, employees or agents of a
subsidiary, and each person serving as a director, officer, partner, member,
employee or agent of another corporation, partnership, limited liability
company, joint venture, trust or other enterprise, at the request of the
Company, with the same scope and effect as the indemnification of directors and
officers of the Company. Notwithstanding the foregoing, the Company shall be
required to indemnify any person seeking indemnification in connection with a
proceeding (or part thereof) initiated by such person only if such proceeding
(or part thereof) was authorized by the Board of Directors or is a proceeding
to enforce such person's claim to indemnification pursuant to the rights
granted by the Restated Certificate of Incorporation or otherwise by the
Company. The Company may also enter into one or more agreements with any person
which provide for indemnification greater or different than that provided in
the Restated Certificate of Incorporation.
Furthermore, a director of the Company shall not be liable to the Company
or its stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability (1) for any breach of the director's duty of
loyalty to the Company or its stockholders, (2) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (3) under Section 174 of the DGCL, or (4) for any transaction from which
the director derived an improper personal benefit.
The Company's By-laws provide that each person who was or is made a party
or is threatened to be made a party to or is involved in any manner in any
threatened, pending or completed action, suit, or proceeding, whether civil,
criminal, administrative or investigative ("Proceeding"), by reason of the fact
that he or she or a person of whom he or she is the legal representative is or
was a director or officer of the Company or, while a director or officer of the
Company, a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall be indemnified and
held harmless by the Company to the fullest extent permitted by the DGCL. Such
indemnification shall continue as to a person who has ceased to be a director
or officer and shall inure to the benefit of his or her heirs, executors and
administrators; provided, however, that the
II-1
Company shall indemnify any such person seeking indemnification in connection
with a Proceeding (or part thereof) initiated by such person only if such
Proceeding (or part thereof) was authorized by the Board of Directors or is a
Proceeding to enforce such person's claim to indemnification pursuant to the
rights granted by the Company's By-laws. The Company shall pay the expenses
incurred by any person described in the first two sentences of this paragraph
in defending any such Proceeding in advance of its final disposition upon, to
the extent such an undertaking is required by applicable law, receipt of an
undertaking by or on behalf of such person to repay such amount if it shall
ultimately be determined that such person is not entitled to be indemnified by
the Company as authorized in the Company's By-laws or otherwise.
The Company's By-laws further provide that the indemnification and the
advancement of expenses incurred in defending a Proceeding prior to its final
disposition provided by, or granted pursuant to, the Company's By-laws shall
not be exclusive of any other right which any person may have or hereafter
acquire under any statute, provision of the Restated Certificate of
Incorporation, other provision of the Company's By-laws or otherwise. The
Company may also maintain insurance, at its expense, to protect itself and any
person who is or was a director, officer, partner, member, employee or agent of
the Company or a subsidiary or of another corporation, partnership, limited
liability company, joint venture, trust or other enterprise against any
expense, liability or loss, whether or not the Company would have the power to
indemnify such person against such expense, liability or loss under the DGCL.
The Company's By-laws further provide that the Company may, to the extent
authorized from time to time by the Board of Directors, grant rights to
indemnification, and rights to be paid by the Company the expenses incurred in
defending any Proceeding in advance of its final disposition, to any person who
is or was an employee or agent (other than a director or officer) of the
Company or a subsidiary thereof and to any person who is or was serving at the
request of the Company or a subsidiary thereof as a director, officer, partner,
member, employee or agent of another corporation, partnership, limited
liability company, joint venture, trust or other enterprise, including service
with respect to employee benefit plans maintained or sponsored by the Company
or a subsidiary thereof, to the fullest extent of the provisions of the
Company's By-laws with respect to the indemnification and advancement of
expenses of directors and officers of the Company.
Item 21. Exhibits and Financial Statement Schedules
(a) Exhibits
EXHIBIT INDEX
Exhibit
No. Description of Exhibit
------- ----------------------
**2.1 Formation Agreement, dated December 8, 1998, relating to the formation
of Crown Atlantic Company LLC, Crown Atlantic Holding Sub LLC, and
Crown Atlantic Holding Company LLC
***2.2 Amendment Number 1 to Formation Agreement, dated March 31, 1999, among
Crown Castle International Corp., Cellco Partnership, doing business
as Bell Atlantic Mobile, certain Transferring Partnerships and CCA
Investment Corp.
***2.3 Crown Atlantic Company LLC Operating Agreement entered into as of
March 31, 1999 by and between Cellco Partnership, doing business as
Bell Atlantic Mobile, and Crown Atlantic Holding Sub LLC
****2.4 Amendment to Sublease, dated June 1, 1999, by and among BellSouth
Mobility Inc., BellSouth Telecommunications Inc., The Transferring
Entities, Crown Castle International Corp. and Crown Castle South Inc.
****2.5 Sublease dated June 1, 1999 by and among BellSouth Mobility Inc.,
Certain BMI Affiliates, Crown Castle International Corp. and Crown
Castle South Inc.
II-2
Exhibit
No. Description of Exhibit
-------- ----------------------
+2.6 Agreement to Sublease dated August 1, 1999 by and among BellSouth
Personal Communications, Inc., BellSouth Carolinas PCS, L.P., Crown
Castle International Corp. and Crown Castle South Inc.
+2.7 Sublease dated August 1, 1999 by and among BellSouth Personal
Communications, Inc., BellSouth Carolinas PCS, L.P., Crown Castle
International Corp. and Crown Castle South Inc.
++2.8 Formation Agreement dated November 7, 1999 relating to the formation
of Crown Castle GT Company LLC, Crown Castle GT Holding Sub LLC, and
Crown Castle GT Holding Company LLC
++2.9 Letter Agreement dated November 7, 1999 between GTE Wireless
Incorporated and Crown Castle International Corp.
+2.10 Operating Agreement, dated January 31, 2000, by and between Crown
Castle GT Corp. and affiliates of GTE Wireless Incorporated
#4.1 Trust Deed related to (Pounds) 125,000,000 9% Guaranteed Bonds Due
2007 among Castle Transmission (Finance) PLC, as Issuer, Castle
Transmission International Ltd. and Castle Transmission Services
(Holdings) Ltd., as Guarantors, and The Law Debenture Trust
Corporation p.l c., as Trustee, dated May 21, 1997
#4.2 First Supplemental Trust Deed related to (Pounds) 125,000,000 9%
Guaranteed Bonds Due 2007 among Castle Transmission (Finance) PLC, as
Issuer, Castle Transmission International Ltd. and Castle
Transmission Services (Holdings) Ltd., as Guarantors, and The Law
Debenture Trust Corporation p.l c., as Trustee, dated October 17,
1997
#4.3 Indenture, dated as of November 25, 1997, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 10 5/8% Senior Discount Notes Due 2007
(including exhibits)
#4.4 Article Fourth of Certificate of Incorporation of Castle Tower
Holding Corp. (included in Exhibit 3.1)
##4.5 Specimen Certificate of Common Stock
###4.6 Indenture, dated as of December 21, 1998, between Crown Castle
International Corp. and the United States Trust Company of New York,
as Trustee, relating to the 12 3/4% Senior Subordinated Exchange
Debentures Due 2010 (including exhibits)
####4.7 Indenture, dated as of May 17, 1999, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 9% Senior Notes Due 2011 (including
exhibits)
####4.8 Indenture, dated as of May 17, 1999, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 10 3/8% Senior Discount Notes Due 2011
(including exhibits)
****4.9 Registration Rights Agreement dated June 1, 1999, between BellSouth
Mobility Inc. and Crown Castle International Corp.
####4.10 Indenture, dated as of August 3, 1999, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 9 1/2% Senior Notes Due 2011 (including
exhibits)
####4.11 Indenture, dated as of August 3, 1999, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 11 1/4% Senior Discount Notes Due 2011
(including exhibits)
+++4.12 Deposit Agreement among Crown Castle International Corp. and the
United States Trust Company of New York dated November 19, 1999
II-3
Exhibit
No. Description of Exhibit
------- ----------------------
+++4.13 Registration Rights Agreement among Crown Castle International Corp.,
the United States Trust Company of New York and SFG-P INC. dated
November 19, 1999
+++4.14 Warrant Agreement between Crown Castle International Corp. and the
United States Trust Company of New York dated November 19, 1999
@4.15 Indenture, dated as of June 26, 2000, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 10 3/4% Senior Notes Due 2011 (including
exhibits)
4.16 Indenture, dated as of May 16, 2001, between Crown Castle
International Corp. and The Bank of New York, as Trustee, relating to
the 9 3/8% Senior Notes Due 2011 (including exhibits)
4.17 Registration Rights Agreement among Crown Castle International Corp.
and the Initial Purchasers, dated May 10, 2001
*5 Opinion of Cravath, Swaine & Moore
12 Computation of Ratios of Earnings to Fixed Charges and Earnings to
Combined Fixed Charges and Preferred Stock Dividends
23.1 Consent of KPMG LLP
*23.2 Consent of Cravath, Swaine & Moore (included in Exhibit 5)
24 Powers of Attorney (included in signature page)
25 Statement of Eligibility and Qualification under the Trust Indenture
Act of 1939 of The Bank of New York, as Trustee, on Form T-1, relating
to the 9 3/8% Senior Notes Due 2011
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
99.3 Form of Letters to Brokers, Dealers, Commercial Banks, Trust Companies
and Other Nominees
99.4 Form of Letter to Clients
99.5 Form of Tax Guidelines
--------
* To be filed by amendment
# Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-4 previously filed by the
Registrant (Registration No. 333-43873).
## Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-1 previously filed by the
Registrant (Registration No. 333-57283).
** Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated December 9, 1998.
*** Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated March 31, 1999.
### Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-4 previously filed by the
Registrant (Registration No. 333-71715).
**** Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated June 9, 1999.
Incorporated by reference to the exhibit previously filed by the
+ Registrant on Form 10-K (Registration No. 000-24737) dated March 30,
2000.
#### Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-4 previously filed by the
Registrant (Registration No. 333-87765).
++ Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated November 7, 1999.
+++ Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated November 19, 1999.
@ Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated June 26, 2000.
II-4
Item 22. Undertakings
The undersigned Registrant hereby undertakes that insofar as
indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions described under Item 20 above, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted against the
Registrant by such director, officer or controlling person in connection with
the securities being registered, the Registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act of 1933 and will
be governed by the final adjudication of such issue.
The undersigned Registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the Prospectus pursuant to
Items 4, 10(b), 11, or 13 of Form S-4, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This undertaking also includes documents filed
subsequent to the effective date of the Registration Statement through the date
of responding to the request.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference into the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes to supply by means of a post-
effective amendment all information concerning a transaction, and the company
being acquired involved therein, that was not the subject of and included in
the Registration Statement when it became effective.
The undersigned Registrant hereby undertakes as follows: that prior to any
public reoffering of the securities registered hereunder through use of a
prospectus which is a part of this Registration Statement, by any person or
party who is deemed to be an underwriter within the meaning of Rule 145(c), the
undersigned undertakes that such reoffering prospectus will contain the
information called for by the applicable registration form with respect to
reofferings by persons who may be deemed underwriters, in addition to the
information called for by the other Items of the applicable form.
The undersigned Registrant hereby undertakes that every prospectus: (i)
that is filed pursuant to the immediately preceding paragraph or (ii) that
purports to meet the requirements of Section 10(a)(3) of the Securities Act of
1933 and is used in connection with an offering of securities subject to Rule
415, will be filed as a part of an amendment to the registration statement and
will not be used until such amendment is effective, and that, for purposes of
determining any liability under the Securities Act of 1933, each such post-
effective amendment shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Houston, State of Texas,
on this 19th day of June, 2001.
Crown Castle International Corp.,
/s/ W. Benjamin Moreland
by: ________________________________________
Name: W. Benjamin Moreland
Title: Senior Vice President, Chief
Financial Officer and Treasurer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on this 19th day of June, 2001.
Signature Title
--------- -----
* Chief Executive Officer and Chairman of the
______________________________________ Board (Principal Executive Officer)
Ted B. Miller, Jr.
* President, Chief Operating Officer and Director
______________________________________
John P. Kelley
/s/ W. Benjamin Moreland Senior Vice President, Chief Financial Officer
______________________________________ and Treasurer (Principal Financial Officer)
W. Benjamin Moreland
* Senior Vice President, Chief Accounting Officer
______________________________________ and Corporate Controller (Principal Accounting
Wesley D. Cunningham Officer)
Director
______________________________________
Dale N. Hatfield
* Director
______________________________________
David L. Ivy
* Director
______________________________________
J. Landis Martin
II-6
Signature Title
--------- -----
* Director
______________________________________
Randall A. Hack
* Director
______________________________________
Edward C. Hutcheson, Jr.
* Director
______________________________________
Robert F. McKenzie
* Director
______________________________________
William D. Strittmatter
Director
______________________________________
Lee W. Hogan
/s/ W. Benjamin Moreland
*By: ____________________________
W. Benjamin Moreland
Attorney-in-Fact
II-7
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints W. Benjamin Moreland and Wesley D. Cunningham,
and each of them, his true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments to this
Registration Statement or any registration statement for this offering that is
to be effective upon the filing pursuant to rule 462(b) under the Securities
Act of 1933, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that each of said
attorney-in-fact or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on this 19th day of June, 2001.
Signature Title
--------- -----
/s/ Ted B. Miller, Jr. Chief Executive Officer and Chairman of the
______________________________________ Board (Principal Executive Officer)
Ted B. Miller, Jr.
/s/ John P. Kelly President, Chief Operating Officer and Director
______________________________________
John P. Kelly
/s/ W. Benjamin Moreland Senior Vice President and Chief Financial
______________________________________ Officer (Principal Financial Officer)
W. Benjamin Moreland
/s/ Wesley D. Cunningham Senior Vice President, Chief Accounting Officer
______________________________________ and Corporate Controller (Principal Accounting
Wesley D. Cunningham Officer)
Director
______________________________________
Dale N. Hatfield
/s/ David L. Ivy Director
______________________________________
David L. Ivy
/s/ J. Landis Martin Director
______________________________________
J. Landis Martin
/s/ Randall A. Hack Director
______________________________________
Randall A. Hack
II-8
/s/ Edward C. Hutcheson, Jr. Director
______________________________________
Edward C. Hutcheson, Jr.
/s/ Robert F. McKenzie Director
______________________________________
Robert F. McKenzie
/s/ William D. Strittmatter Director
______________________________________
William D. Strittmatter
Director
______________________________________
Lee W. Hogan
II-9
EXHIBIT INDEX
Exhibit
No. Description of Exhibit
-------- ----------------------
**2.1 Formation Agreement, dated December 8, 1998, relating to the
formation of Crown Atlantic Company LLC, Crown Atlantic Holding Sub
LLC, and Crown Atlantic Holding Company LLC
***2.2 Amendment Number 1 to Formation Agreement, dated March 31, 1999,
among Crown Castle International Corp., Cellco Partnership, doing
business as Bell Atlantic Mobile, certain Transferring Partnerships
and CCA Investment Corp.
***2.3 Crown Atlantic Company LLC Operating Agreement entered into as of
March 31, 1999 by and between Cellco Partnership, doing business as
Bell Atlantic Mobile, and Crown Atlantic Holding Sub LLC
****2.4 Amendment to Sublease, dated June 1, 1999, by and among BellSouth
Mobility Inc., BellSouth Telecommunications Inc., The Transferring
Entities, Crown Castle International Corp. and Crown Castle South
Inc.
****2.5 Sublease dated June 1, 1999 by and among BellSouth Mobility Inc.,
Certain BMI Affiliates, Crown Castle International Corp. and Crown
Castle South Inc.
+2.6 Agreement to Sublease dated August 1, 1999 by and among BellSouth
Personal Communications, Inc., BellSouth Carolinas PCS, L.P., Crown
Castle International Corp. and Crown Castle South Inc.
+2.7 Sublease dated August 1, 1999 by and among BellSouth Personal
Communications, Inc., BellSouth Carolinas PCS, L.P., Crown Castle
International Corp. and Crown Castle South Inc.
++2.8 Formation Agreement dated November 7, 1999 relating to the formation
of Crown Castle GT Company LLC, Crown Castle GT Holding Sub LLC, and
Crown Castle GT Holding Company LLC
++2.9 Letter Agreement dated November 7, 1999 between GTE Wireless
Incorporated and Crown Castle International Corp.
+2.10 Operating Agreement, dated January 31, 2000, by and between Crown
Castle GT Corp. and affiliates of GTE Wireless Incorporated
#4.1 Trust Deed related to (Pounds) 125,000,000 9% Guaranteed Bonds Due
2007 among Castle Transmission (Finance) PLC, as Issuer, Castle
Transmission International Ltd. and Castle Transmission Services
(Holdings) Ltd., as Guarantors, and The Law Debenture Trust
Corporation p.l c., as Trustee, dated May 21, 1997
#4.2 First Supplemental Trust Deed related to (Pounds) 125,000,000 9%
Guaranteed Bonds Due 2007 among Castle Transmission (Finance) PLC, as
Issuer, Castle Transmission International Ltd. and Castle
Transmission Services (Holdings) Ltd., as Guarantors, and The Law
Debenture Trust Corporation p.l c., as Trustee, dated October 17,
1997
#4.3 Indenture, dated as of November 25, 1997, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 10 5/8% Senior Discount Notes Due 2007
(including exhibits)
#4.4 Article Fourth of Certificate of Incorporation of Castle Tower
Holding Corp. (included in Exhibit 3.1 thereto)
##4.5 Specimen Certificate of Common Stock
###4.6 Indenture, dated as of December 21, 1998, between Crown Castle
International Corp. and the United States Trust Company of New York,
as Trustee, relating to the 12 3/4% Senior Subordinated Exchange
Debentures Due 2010 (including exhibits)
Exhibit
No. Description of Exhibit
-------- ----------------------
####4.7 Indenture, dated as of May 17, 1999, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 9% Senior Notes Due 2011 (including
exhibits)
####4.8 Indenture, dated as of May 17, 1999, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 10 3/8% Senior Discount Notes Due 2011
(including exhibits)
****4.9 Registration Rights Agreement dated June 1, 1999, between BellSouth
Mobility Inc. and Crown Castle International Corp.
####4.10 Indenture, dated as of August 3, 1999, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 9 1/2% Senior Notes Due 2011 (including
exhibits)
####4.11 Indenture, dated as of August 3, 1999, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 11 1/4% Senior Discount Notes Due 2011
(including exhibits)
+++4.12 Deposit Agreement among Crown Castle International Corp. and the
United States Trust Company of New York dated November 19, 1999
+++4.13 Registration Rights Agreement among Crown Castle International Corp.,
the United States Trust Company of New York and SFG-P INC. dated
November 19, 1999
+++4.14 Warrant Agreement between Crown Castle International Corp. and the
United States Trust Company of New York dated November 19, 1999
@4.15 Indenture, dated as of June 26, 2000, between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee, relating to the 10 3/4% Senior Notes Due 2011 (including
exhibits)
4.16 Indenture, dated as of May 16, 2001, between Crown Castle
International Corp. and The Bank of New York, as Trustee, relating to
the 9 3/8% Senior Notes Due 2011 (including exhibits)
4.17 Registration Rights Agreement among Crown Castle International Corp.
and the Initial Purchasers, dated May 16, 2001.
*5 Opinion of Cravath, Swaine & Moore
12 Computation of Ratios of Earnings to Fixed Charges and Earnings to
Combined Fixed Charges and Preferred Stock Dividends
23.1 Consent of KPMG LLP
*23.2 Consent of Cravath, Swaine & Moore (included in Exhibit 5)
24 Powers of Attorney (included in signature page)
25 Statement of Eligibility and Qualification under the Trust Indenture
Act of 1939 of The Bank of New York, as Trustee, on Form T-1,
relating to the 9 3/8% Senior Notes Due 2011
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
99.3 Form of Letters to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees
99.4 Form of Letter to Clients
99.5 Form of Tax Guidelines
--------
* To be filed by amendment
# Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-4 previously filed by the
Registrant (Registration No. 333-43873).
## Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-1 previously filed by the
Registrant (Registration No. 333-57283).
** Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated December 9, 1998.
*** Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated March 31, 1999.
### Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-4 previously filed by the
Registrant (Registration No. 333-71715).
**** Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated June 9, 1999.
+ Incorporated by reference to the exhibit previously filed by the Registrant
on Form 10-K (Registration No. 000-24737) dated March 30, 2000.
#### Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-4 previously filed by the
Registrant (Registration No. 333-87765).
++ Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated November 7, 1999.
+++ Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated November 19, 1999.
@ Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated June 26, 2000.