SEC Info - Tower Technology Co of Jacksonville LLC, et al.

F-2

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Member of

CC Holdings GS V LLC:

In our opinion, the accompanying consolidated balance sheet and the related consolidated statements of operations, cash flows, and changes in member’s equity present fairly, in all material respects, the financial position of CC Holdings GS V LLC and subsidiaries (the “Company”) at December 31, 2012 and December 31, 2011, and the results of their operations and cash flows for each of the two years then ended in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule on page F-27 for the years ended December 31, 2012 and December 31, 2011 presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

Pittsburgh, Pennsylvania

March 28, 2013

F-3

Report of Independent Registered Public Accounting Firm

The Board of Directors and Member of

CC Holdings GS V LLC:

We have audited the accompanying consolidated statements of operations, changes in member’s equity, and cash flows for the year ended December 31, 2010 of CC Holdings GS V LLC and subsidiaries (the Company). In connection with our audit of the consolidated financial statements, we also have audited financial statement schedule II for the year ended December 31, 2010. These consolidated financial statements and the financial statement schedule is the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and the financial statement schedule based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the results of operations and cash flows of CC Holdings GS V LLC and subsidiaries for the year ended December 31, 2010, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedule for the year ended December 31, 2010, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

/s/ KPMG LLP

Pittsburgh, Pennsylvania

December 10, 2012, except for Note 1 as to which the date is March 28, 2013

F-4

CC HOLDINGS GS V LLC

CONSOLIDATED BALANCE SHEET

(In thousands of dollars)


	December 31,
	2012			2011
ASSETS
Current assets:
Restricted cash	$	400,493		$	83,383
Receivables, net of allowance of $1,507 and $1,605, respectively		2,590			3,799
Prepaid expenses		20,752			20,443
Deferred income tax assets		15,060			13,843
Deferred site rental receivables and other current assets		8,089			4,683

Total current assets		446,984			126,151
Deferred site rental receivables		221,315			145,759
Property and equipment, net		1,146,008			1,177,259
Goodwill		1,338,730			1,338,730
Site rental contracts and customer relationships, net		1,468,493			1,575,113
Other intangible assets, net		33,211			36,367
Long-term prepaid rent, deferred financing costs and other assets, net		48,995			41,478

Total assets	$	4,703,736		$	4,440,857


LIABILITIES AND EQUITY
Current liabilities:
Accrued expenses and payables	$	10,661		$	8,681
Accrued interest		4,922			15,500
Deferred revenues		13,751			20,203
Current maturities of debt and other obligations		291,428			—

Total current liabilities		320,762			44,384
Debt		1,500,161			1,174,302
Deferred income tax liabilities		397,240			396,692
Deferred ground lease payable, above-market leases and other liabilities		122,008			115,553

Total liabilities		2,340,171			1,730,931

Commitments and contingencies (note 8)
Member’s equity:
Member’s equity		2,495,641			2,849,147
Accumulated earnings (deficit)		(132,076	)		(139,221	)

Total member’s equity		2,363,565			2,709,926

Total liabilities and equity	$	4,703,736		$	4,440,857

See accompanying notes to consolidated financial statements.

F-5

CC HOLDINGS GS V LLC

CONSOLIDATED STATEMENT OF OPERATIONS

(In thousands of dollars)


	Years Ended December 31,
	2012			2011			2010
Net revenues:
Site rental revenues	$	594,903		$	540,052		$	500,690
Operating expenses:
Site rental cost of operations—third parties^(a)		151,129			154,236			152,629
Site rental cost of operations—related parties^(a)		24,379			18,298			15,759

Site rental cost of operations—total^(a)		175,508			172,534			168,388
Management fee		38,693			36,606			34,918
Asset write-down charges		3,459			11,715			7,366
Depreciation, amortization and accretion		189,238			191,032			193,578

Total operating expenses		406,898			411,887			404,250

Operating income (loss)		188,005			128,165			96,440
Interest expense and amortization of deferred financing costs—third parties		(87,010	)		(83,075	)		(83,720	)
Interest expense and amortization of deferred financing costs—related parties		(17,188	)		(15,880	)		(14,778	)

Interest expense and amortization of deferred financing costs—total		(104,198	)		(98,955	)		(98,498	)
Gains (losses) on retirement of long-term obligations		(67,210	)		—			—
Other income (expense)		84			(20	)		(144	)

Income (loss) before income taxes		16,681			29,190			(2,202	)
Benefit (provision) for income taxes		(9,536	)		(10,926	)		(2,338	)

Net income (loss)	$	7,145		$	18,264		$	(4,540	)

(a)	Exclusive of depreciation, amortization and accretion shown separately and certain indirect costs included in the management fee.

See accompanying notes to consolidated financial statements.

F-6

CC HOLDINGS GS V LLC

CONSOLIDATED STATEMENT OF CASH FLOWS

(In thousands of dollars)


	Years Ended December 31,
	2012			2011			2010
Cash flows from operating activities:
Net income (loss)	$	7,145		$	18,264		$	(4,540	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, amortization and accretion		189,238			191,032			193,578
Amortization of deferred financing costs and other non-cash interest on long-term debt		12,317			5,955			5,498
Asset write-down charges		3,459			11,715			7,366
Gains (losses) on retirement of long-term obligations		67,210			—			—
Deferred income tax benefit (provision)		8,189			9,506			2,028
Changes in assets and liabilities:
Increase (decrease) in accrued interest		(10,578	)		—			—
Increase (decrease) in accounts payable		554			266			(1,411	)
Increase (decrease) in deferred revenues, deferred ground lease payable and other liabilities		1,085			(10,611	)		10,114
Decrease (increase) in receivables		1,209			(764	)		(871	)
Decrease (increase) in other current assets, deferred site rental receivable, long-term prepaid rent and other assets		(87,465	)		(59,513	)		(34,360	)

Net cash provided by (used for) operating activities		192,363			165,850			177,402

Cash flows from investing activities:
Capital expenditures		(52,442	)		(33,641	)		(36,875	)
Other investing activities		7			85			989
Payments for acquisitions of businesses, net of cash acquired		—			(2,410	)		—

Net cash provided by (used for) investing activities		(52,435	)		(35,966	)		(35,886	)

Cash flows from financing activities:
Proceeds from issuance of long-term debt		1,500,000			—			—
Purchases of long-term debt		(713,305	)		—			—
Payments for financing costs		(17,707	)		—			—
Net (increase) decrease in amount due from affiliates		(597,445	)		(127,087	)		(139,459	)
Net (increase) decrease in restricted cash		(311,471	)		(2,797	)		(2,057	)

Net cash provided by (used for) financing activities		(139,928	)		(129,884	)		(141,516	)

Net increase (decrease) in cash and cash equivalents		—			—			—
Cash and cash equivalents at beginning of year		—			—			—

Cash and cash equivalents at end of year	$	—		$	—		$	—

See accompanying notes to consolidated financial statements.

F-7

CC HOLDINGS GS V LLC

CONSOLIDATED STATEMENT OF CHANGES IN MEMBER’S EQUITY

(In thousands of dollars)


	Member’s Equity			Accumulated Earnings (Deficit)			Total
Balance at December 31, 2009	$	3,060,989		$	(152,945	)	$	2,908,044
Equity contribution—income taxes (note 7)		19,541			—			19,541
Equity distribution (note 6)		(127,200	)		—			(127,200	)
Net income (loss)		—			(4,540	)		(4,540	)

Balance at December 31, 2010	$	2,953,330		$	(157,485	)	$	2,795,845

Equity contribution—income taxes (note 7)		22,904			—			22,904
Equity distribution (note 6)		(127,087	)		—			(127,087	)
Net income (loss)		—			18,264			18,264

Balance at December 31, 2011	$	2,849,147		$	(139,221	)	$	2,709,926

Equity contribution—income taxes (note 7)		8,858			—			8,858
Equity contribution—7.75% Secured Notes from affiliate (note 6)		235,081			—			235,081
Equity distribution (note 6)		(597,445	)		—			(597,445	)
Net income (loss)		—			7,145			7,145

Balance at December 31, 2012	$	2,495,641		$	(132,076	)	$	2,363,565

See accompanying notes to consolidated financial statements.

F-8

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

1. Basis of Presentation

The accompanying consolidated financial statements reflect the consolidated financial position, results of operations, and cash flows of CC Holdings GS V LLC (“CCL”) and its consolidated wholly owned subsidiaries (collectively, the “Company”). The Company is a wholly owned subsidiary of Global Signal Operating Partnership, L.P. (“GSOP”), which is an indirect subsidiary of Crown Castle International Corp., a Delaware corporation (“CCIC” or “Crown Castle”). CCL is a Delaware limited liability company that is a holding company and an issuer of the Company’s debt. All significant inter-company accounts, transactions, and profits have been eliminated.

The Company is organized specifically to own, lease and manage approximately 7,800 communications towers and other structures, such as rooftops and interests in land under third party and related party towers in various forms (collectively, “towers,” “sites” or “wireless infrastructure”) to wireless communications companies. The Company’s core business is providing access, including space or capacity, to its sites via long-term contracts in various forms, including licenses, subleases and lease agreements (collectively, “contracts”). The Company’s sites are geographically dispersed across the United States.

Approximately 5,300 of the Company’s towers are leased or operated for an initial period of 32 years (through May 2037) under master lease and sublease agreements, including the master lease and sublease agreements with Sprint Nextel (“Sprint”). CCIC, through its subsidiaries (including the Company) has the option to purchase in 2037 all (but not less than all) of the Sprint towers from Sprint for approximately $2.3 billion. Management services related to communications towers and other communication sites are performed by Crown Castle USA Inc. (“CCUSA”), an affiliate of the Company, under a management agreement, as the Company has no employees.

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and use assumptions that affect the reported amounts of assets and liabilities and the disclosure for contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

In preparing the consolidated financial statements for the year ended December 31, 2012, the Company’s management identified an immaterial error in the previously issued consolidated financial statements related to recording an equity contribution from a transaction between the Company and a CCIC subsidiary. The Company has revised these prior periods by (1) decreasing cash flow from operations by $5.2 million and increasing cash flow from financing activities by the same amount, for the year ended December 31, 2011 and (2) decreasing members’ equity by $5.2 million as of December 31, 2010 and 2009.

2. Summary of Significant Accounting Policies

Restricted Cash

Restricted cash represents the cash held in reserve by the indenture trustees or otherwise restricted pursuant to the indenture governing certain of the 7.75% Secured Notes (as defined in note 5). The Company has classified the increases and decreases in restricted cash as (1) cash provided by financing activities for cash held by the indenture trustee based on consideration of the terms of the 7.75% Secured Notes, which is a critical feature of the 7.75% Secured Notes based on the indenture trustee’s ability to utilize the restricted cash for payment of various expenses including debt service, although the cash flows have aspects of both financing activities and operating activities and (2) cash provided by operating activities for the other remaining restricted cash. Restricted cash decreased cash flow from operating activities by $5.6 million, and $5.0 million for the years

F-9

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

ending December 31, 2012 and 2011, respectively, and increased $1.0 million for the year ending December 31, 2010. As of December 31, 2012, restricted cash included $316.6 million comprised of the cash held by the trustee to redeem all of the then outstanding 7.75% Secured Notes as discussed in note 5. See also note 13.

Receivables Allowance

An allowance for doubtful accounts is recorded as an offset to accounts receivable in order to present a net balance that the Company believes will be collected. An allowance for uncollectible amounts is recorded to offset the deferred site rental receivables that arise from site rental revenues recognized in excess of amounts currently due under the contract. The Company uses judgment in estimating these allowances and considers historical collections, current credit status and contractual provisions. Additions to the allowance for doubtful accounts are charged to “costs of operations” and deductions from the allowance are recorded when specific accounts receivable are written off as uncollectible. Additions or reversals to the allowance for uncollectible deferred site rental receivables are charged to “site rental revenues,” and deductions from the allowance are recorded as contracts terminate.

Lease Accounting

General. The Company classifies its leases at inception as either operating leases or capital leases. A lease is classified as a capital lease if at least one of the following criteria are met, subject to certain exceptions noted below: (1) the lease transfers ownership of the leased assets to the lessee, (2) there is a bargain purchase option, (3) the lease term is equal to 75% or more of the economic life of the leased assets or (4) the present value of the minimum lease payments equals or exceeds 90% of the fair value of the leased assets.

Lessee. Leases for land are evaluated for capital lease treatment if at least one of the first two criteria mentioned in the immediately preceding paragraph is present relating to the leased assets. When the Company, as lessee, classifies a lease as a capital lease, it records an asset in an amount equal to the present value of the minimum lease payments under the lease at the beginning of the lease term. Applicable operating leases are recognized on a straight-line basis as discussed under “Costs of Operations” below.

Lessor. If the Company is the lessor of leased property that is part of a larger whole (including with respect to a portion of space on a tower) and for which fair value is not objectively determinable, then such lease is accounted for as an operating lease. As applicable, operating leases are recognized on a straight-line basis as discussed under “Revenue Recognition”.

Property and Equipment

Property and equipment is stated at cost, net of accumulated depreciation. Property and equipment includes land owned in fee and perpetual easements for land which have no definite life. Land owned in fee and perpetual easements for land are recorded as “property and equipment, net”. When the Company purchases fee ownership or perpetual easements for the land previously subject to ground lease, the Company reduces the value recorded as land by the amount of the deferred ground lease payable and unamortized above-market leases. Depreciation is computed utilizing the straight-line method at rates based upon the estimated useful lives of the various classes of assets. Depreciation of wireless infrastructure is generally computed with a useful life equal to the shorter of 20 years or the term of the underlying ground lease (including optional renewal periods). Additions, renewals, and improvements are capitalized, while maintenance and repairs are expensed. Upon the sale or retirement of an asset, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is recognized. The carrying value of property and equipment will be reviewed for impairment whenever events or

F-10

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

changes in circumstances indicate that the carrying amount of the assets may not be recoverable. If the sum of the estimated future cash flows (undiscounted) expected to result from the use and eventual disposition of the asset group is less than the carrying amount of the asset group, an impairment loss is recognized. Measurement of an impairment loss is based on the fair value of the asset. Construction in process is impaired when projects are abandoned or terminated.

Asset Retirement Obligations

Pursuant to its ground lease and easement agreements, the Company records obligations to perform asset retirement activities, including requirements to remove wireless infrastructure or remediate the land upon which the Company’s wireless infrastructure resides. With respect to the Sprint towers, the Company does not have retirement obligations to the extent such retirement would occur beyond the period for which it has a lease term. The fair value of the liability for asset retirement obligations, which represents the net present value of the estimated expected future cash outlay, is recognized in the period in which it is incurred and the fair value of the liability can reasonably be estimated. Changes subsequent to initial measurement resulting from revisions to the timing or amount of the original estimate of undiscounted cash flows are recognized as an increase or decrease in the carrying amount of the liability and related carrying amount of the capitalized asset. Asset retirement obligations are included in “deferred ground lease payable, above-market leases and other liabilities” on the Company’s consolidated balance sheet. The liability accretes as a result of the passage of time and the related accretion expense is included in “depreciation, amortization, and accretion” expense on the Company’s consolidated statement of operations. The associated asset retirement costs are capitalized as an additional carrying amount of the related long-lived asset and depreciated over the useful life of such asset.

Goodwill

Goodwill represents the excess of the purchase price for an acquired business over the allocated value of the related net assets. The Company tests goodwill for impairment on an annual basis, regardless of whether adverse events or changes in circumstances have occurred. The annual test begins with goodwill and all intangible assets being allocated to applicable reporting units. The Company then performs a qualitative assessment to determine whether it is “more likely than not” that the fair value of the reporting units is less than its carrying amount. If it is concluded that it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount, it is necessary to perform the two-step goodwill impairment test. The two-step goodwill impairment test begins with an estimation of fair value of the reporting unit using an income approach, which looks to the present value of expected future cash flows. The first step, commonly referred to as a “step-one impairment test,” is a screen for potential impairment while the second step measures the amount of any impairment if there is an indication from the first step that one exists. The Company’s measurement of the fair value for goodwill is based on an estimate of discounted future cash flows of the reporting unit. The Company performed its most recent annual goodwill impairment test as of October 1, 2012, which resulted in no impairments.

Other Intangible Assets

Intangible assets are included in “site rental contracts and customer relationship, net” and “other intangible assets, net” on the Company’s consolidated balance sheet and predominately consist of the estimated fair value of the following items recorded in conjunction with acquisitions: (1) site rental contracts and customer relationships and (2) below-market leases for land interests under the acquired wireless infrastructure classified as “other intangible assets, net”. The site rental contracts and customer relationships intangible assets are comprised of (1) current term of the existing contracts, (2) the expected exercise of the renewal provisions contained within the existing contracts, which automatically occur under contractual provisions, and (3) any

F-11

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

associated relationships that are expected to generate value following the expiration of all renewal periods under existing contracts.

The useful lives of intangible assets are estimated based on the period over which the intangible asset is expected to benefit the Company, which is calculated on an individual customer basis, considering, among other things, the contractual provisions with the customer and gives consideration to the expected useful life of other assets to which the useful life may relate. Amortization expense for intangible assets is computed using the straight-line method over the estimated useful life of each of the intangible assets. The useful life of the site rental contracts and customer relationships intangible asset is limited by the maximum depreciable life of the tower (20 years), as a result of the interdependency of the tower and site rental contracts and customer relationships. In contrast, the site rental contracts and customer relationships are estimated to provide economic benefits for several decades because of the low rate of customer cancellations and high rate of renewals experienced to date. Thus, while site rental contracts and customer relationships are valued based upon the fair value, which includes assumptions regarding both (1) customers’ exercise of optional renewals contained in the acquired contracts and (2) renewals of the acquired contracts past the contractual term including exercisable options, the site rental contracts and customer relationships are amortized over a period not to exceed 20 years as a result of the useful life being limited by the depreciable life of the wireless infrastructure.

The carrying value of other intangible assets with finite useful lives will be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. The Company has a dual grouping policy for purposes of determining the unit of account for testing impairment of the site rental contracts and customer relationships intangible assets. First, the Company pools the site rental contracts and customer relationships with the related tower assets into portfolio groups for purposes of determining the unit of account for impairment testing. Second and separately, the Company evaluates the site rental contracts and customer relationships by significant customer or by customer grouping for individually insignificant customers, as appropriate. If the sum of the estimated future cash flows (undiscounted) expected to result from the use and eventual disposition of an asset is less than the carrying amount of the asset, an impairment loss is recognized. Measurement of an impairment loss is based on the fair value of the asset.

Deferred Credits

Deferred credits are included in “deferred ground lease payable, above-market leases and other liabilities” on the Company’s consolidated balance sheet and consist of the estimated fair value of above-market leases for land interests under the Company’s towers. Above-market leases for land interests are amortized to costs of operations over their respective estimated remaining lease term at the acquisition date.

Deferred Financing Costs

Costs incurred to obtain financing are deferred and amortized over the estimated term of the related borrowing using the effective yield method. Deferred financing costs are included in “long-term prepaid rent, deferred financing costs and other assets, net” on the Company’s consolidated balance sheet.

Accrued Estimated Property Taxes

The accrual for estimated property tax obligations is based on assessments currently in effect and estimates of additional taxes. The Company recognizes the benefit of tax appeals upon ultimate resolution of the appeal. The Company’s liability for accrued property taxes is included in “accrued expenses and payables” on the Company’s consolidated balance sheet.

F-12

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

Revenue Recognition

Site rental revenues are recognized on a monthly basis over the fixed, non-cancelable term of the relevant contract (generally ranging from five to 15 years), regardless of whether the payments from the customer are received in equal monthly amounts. The Company’s contracts contain fixed escalation clauses (such as fixed dollar or fixed percentage increases) or inflation-based escalation clauses (such as those tied to the consumer price index (“CPI”)). If the payment terms call for fixed escalations or rent free periods, the effect is recognized on a straight-line basis over the fixed, non-cancelable term of the agreement. When calculating straight-line rental revenues, the Company considers all fixed elements of tenant contractual escalation provisions, even if such escalation provisions also include a variable element in addition to a fixed minimum. The Company’s assets related to straight-line site rental revenues are included in “deferred site rental receivables and other current assets” and “deferred site rental receivables,” and amounts received in advance are recorded as “deferred revenues” on the Company’s consolidated balance sheet.

Costs of Operations

Approximately three-fourths of the Company’s site rental costs of operations consist of ground lease expenses, and the remainder includes repairs and maintenance expenses, utilities, property taxes and insurance.

Generally, the ground lease agreements are specific to each site and are for an initial term of five years and are renewable for pre-determined periods. The Company also enters into term easements and ground leases in which it prepays the entire term in advance. Ground lease expense is recognized on a monthly basis, regardless of whether the lease agreement payment terms require the Company to make payments annually, quarterly, monthly or for the entire term in advance. The Company’s ground leases contain fixed escalation clauses (such as fixed dollar or fixed percentage increases) or inflation-based escalation clauses (such as those tied to the CPI). If the payment terms include fixed escalation provisions, the effect of such increases is recognized on a straight-line basis. The Company calculates the straight-line ground lease expense using a time period that equals or exceeds the remaining depreciable life of the wireless infrastructure asset. Further, when a tenant has exercisable renewal options that would compel the Company to exercise existing ground lease renewal options, the Company has straight-lined the ground lease expense over a sufficient portion of such ground lease renewals to coincide with the final termination of the tenant’s renewal options. The Company’s liability related to straight-line ground lease expense is included in “deferred ground lease payable, above-market leases and other liabilities” on the Company’s consolidated balance sheet. The Company’s asset related to prepaid ground leases is included in “prepaid expenses” and “long-term prepaid rent, deferred financing costs and other assets, net” on the Company’s consolidated balance sheet.

Management Fee

The Company is charged a management fee by CCUSA, a wholly owned indirect subsidiary of CCIC, relating to management services which include those functions reasonably necessary to maintain, market, operate, manage and administer the towers. The management fee is equal to 7.5% of the Company’s Operating Revenues, as defined in the Management Agreement discussed in notes 5 and 6 below, which are based on the Company’s reported revenues adjusted to exclude certain items including revenues related to the accounting for leases with fixed escalators (the “Management Agreement Operating Revenues”). See note 6.

Income Taxes

CCL is a limited liability company (“LLC”). Under federal and state income tax laws, regulations, and administrative rulings, single member LLCs are treated as disregarded entities for income tax return filing

F-13

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

purposes (unless elected otherwise). Single member LLCs are flow through entities which do not pay income tax at the LLC level. The Company is included in the consolidated CCIC U.S. federal tax return. The Company’s provision for income taxes is recorded using a method materially consistent with the separate return method.

The Company accounts for income taxes using an asset and liability approach, which requires the recognition of deferred income tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s financial statements or tax returns. Deferred income tax assets and liabilities are determined based on the temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates. A valuation allowance is provided on deferred tax asset if it is determined that it is more likely than not that the assets will not be realized.

The Company records a valuation allowance against deferred tax assets when it is “more likely than not that some portion or all of the deferred tax asset will not be realized”. The Company reviews the recoverability of deferred tax assets each quarter and based upon projections of future taxable income, reversing deferred tax liabilities and other known events that are expected to affect future taxable income, records a valuation allowance for assets that do not meet the “more likely than not” realization threshold. Valuation allowances may be reversed if related deferred tax assets are deemed realizable based upon changes in facts and circumstances that impact the recoverability of the asset.

The Company does not currently maintain a formal tax sharing agreement with CCIC. Net operating losses used by the Company to reduce current taxes payable have resulted in member contributions from CCIC to the extent such attributes were generated by CCIC or other members of the consolidated group. Similarly, net operating losses of the Company used by CCIC or other members of the consolidated group to reduce current taxes payable have been treated as distributions from the Company to CCIC.

The Company recognizes a tax position if it is more likely than not that it will be sustained upon examination. The tax position is measured at the largest amount that is greater than 50 percent likely of being realized upon ultimate settlement. The Company records penalties and tax-related interest expense as components of the benefit (provision) for income taxes. As of December 31, 2012 the Company has not recorded any penalties or tax-related interest expenses related to income taxes.

Fair Values

The Company’s assets and liabilities recorded at fair value are categorized based upon a fair value hierarchy that ranks the quality and reliability of the information used to determine fair value. The three levels of the fair value hierarchy are (1) Level 1 - quoted prices (unadjusted) in active and accessible markets, (2) Level 2 - observable prices that are based on inputs not quoted in active markets but corroborated by market data, and (3) Level 3 - unobservable inputs and are not corroborated by market data. The Company evaluates level classifications quarterly, and transfers between levels are effective at the end of the quarterly period.

The fair value of restricted cash approximates the carrying value. The Company determines fair value of its debt securities based on indicative quotes (that is non-binding quotes) from brokers that require judgment to interpret market information including implied credit spreads for similar borrowings on recent trades or bid/ask prices or quotes from active markets if applicable. There were no changes since December 31, 2011 in the

F-14

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

Company’s valuation techniques used to measure fair values. The estimated fair values of the Company’s financial instruments, along with the carrying amounts of the related assets and liabilities, are as follows:


			December 31,
	Level in Fair Value Hierarchy		2012				2011
	Level in Fair Value Hierarchy		Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets:
Restricted cash		1	$	400,493	$	400,493	$	83,383	$	83,383
Liabilities:
Debt and other obligations		2		1,791,589		1,840,352		1,174,302		1,293,000

Reporting Segments

The Company’s operations consist of one operating segment.

Recent Accounting Pronouncements

In September 2011, the FASB issued amended guidance on goodwill impairment testing. The amended guidance permits an entity to first perform a qualitative assessment to determine whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount. If it is concluded that it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount, it is then necessary to perform the two-step goodwill impairment test. Otherwise, the two-step goodwill impairment test is not required. The Company adopted this amended guidance during 2011. See “Goodwill” above.

3. Property and Equipment

The major classes of property and equipment are as follows:


	Estimated Useful Lives		December 31,
	Estimated Useful Lives		2012			2011
Land owned in fee and perpetual easements		—	$	75,588		$	75,296
Wireless infrastructure		1-20 years		1,519,540			1,491,740
Construction in progress		—		41,519			22,711

Total gross property and equipment				1,636,647			1,589,747
Less accumulated depreciation				(490,639	)		(412,488	)

Total property and equipment, net			$	1,146,008		$	1,177,259

Depreciation expense for the years ended December 31, 2012, 2011 and 2010 was $80.7 million, $81.1 million and $82.6 million, respectively. As discussed in notes 1 and 2, the Company has certain prepaid capital leases with Sprint, which have related gross property and equipment and accumulated depreciation of $1.0 billion and $324.0 million, respectively, as of December 31, 2012.

F-15

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

4. Intangible Assets and Deferred Credits

The following is a summary of the Company’s intangible assets.


	As of December 31, 2012							As of December 31, 2011
	Gross Carrying Value		Accumulated Amortization			Net Book Value		Gross Carrying Value		Accumulated Amortization			Net Book Value
Site rental contracts and customer relationships	$	2,100,699	$	(632,206	)	$	1,468,493	$	2,100,699	$	(525,586	)	$	1,575,113
Other intangible assets		57,499		(24,288	)		33,211		58,615		(22,248	)		36,367

Total	$	2,158,198	$	(656,494	)	$	1,501,704	$	2,159,314	$	(547,834	)	$	1,611,480

Amortization expense related to intangible assets is classified as follows on the Company’s consolidated statement of operations:


	For Years Ended December 31,
	2012		2011		2010
Depreciation, amortization and accretion	$	106,791	$	108,359	$	109,499
Site rental costs of operations		2,242		2,823		2,835

Total amortization expense	$	109,033	$	111,182	$	112,334

The estimated annual amortization expense related to intangible assets (inclusive of those recorded to “site rental costs of operations”) for the years ended December 31, 2013 to 2017 is as follows:


	Years Ending December 31,
	2013		2014		2015		2016		2017
Estimated annual amortization	$	108,873	$	108,860	$	108,833	$	108,806	$	108,780

See note 2 for a further discussion of deferred credits related to above-market leases for land interests under the Company’s towers recorded in connection with acquisitions. For the years ended December 31, 2012, 2011 and 2010, the Company recorded $2.2 million, $2.6 million and $3.1 million, respectively, as a decrease to “site rental cost of operations”. The following is a summary of the Company’s above-market leases.


	As of December 31, 2012							As of December 31, 2011
	Gross Carrying Value		Accumulated Amortization			Net Book Value		Gross Carrying Value		Accumulated Amortization			Net Book Value
Above-market leases	$	44,675	$	(15,379	)	$	29,296	$	47,975	$	(14,310	)	$	33,665

The estimated annual amortization expense related to above-market leases for land interests under the Company’s towers for the years ended December 31, 2013 to 2017 is as follows:


	Years Ending December 31,
	2013		2014		2015		2016		2017
Estimated annual amortization	$	2,060	$	2,051	$	2,037	$	2,002	$	1,987

F-16

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

5. Debt and Other Obligations


	Original Issue Date		Contractual Maturity Date		Outstanding Balance as of December 31, 2012			Outstanding Balance as of December 31, 2011		Stated Interest Rate as of December 31, 2012^(a)
Bonds - fixed rate:
7.75% Secured Notes		Apr. 2009		May 2017	$	291,394		$	1,174,302		7.8	%^(b)
2012 Secured Notes		Dec. 2012		2017/2023		1,500,000			—		3.4	%

Total Bonds						1,791,394			1,174,302

Other:
Capital leases and other obligations						195			—

Total debt and other obligations						1,791,589			1,174,302

Less: current maturities						291,428	^(c)		—

Non-current portion of long-term debt					$	1,500,161		$	1,174,302

(a)	Represents the weighted-average stated rate.

(b)	The effective yield is approximately 8.2%, inclusive of the discount.

(c)	Inclusive of the 7.75% Secured Notes outstanding as of December 31, 2012, the redemption of which was completed in January 2013. See note 13.

7.75% Senior Secured Notes

On April 30, 2009, CCL and Crown Castle GS III Corp. issued $1.2 billion aggregate principal amount of 7.75% senior secured notes due 2017 (“7.75% Secured Notes”), pursuant to an indenture dated as of April 30, 2009, by and among CCL and Crown Castle GS III Corp., the guarantors party thereto and The Bank of New York Mellon Trust Company, N.A., as trustee. The 7.75% Secured Notes are guaranteed by the direct and indirect wholly owned subsidiaries of the Issuer Entity, other than the Crown Castle GS III Corp. The 7.75% Secured Notes are secured on a first priority basis by a pledge of the equity interests of the guarantors and by certain other assets of the guarantors.

The net proceeds of the offering were $1.15 billion, inclusive of the $34.9 million original issue discount and $18.0 million of fees. The proceeds, as well as an advance from an indirect subsidiary of CCIC, were used by the Company to repay in full a previously outstanding mortgage loan and the related prepayment considerations.

In 2010 and 2011, CCIC had acquired certain of the 7.75% Secured Notes through market purchases. In December 2012, in anticipation of the repurchase and redemption of the 7.75% Secured Notes, the 7.75% Secured Notes held by CCIC were contributed to the Company. Following this non-cash equity contribution, the Company retired these notes. See note 6.

On December 11, 2012, the Company commenced a cash tender offer for any and all of the then outstanding 7.75% Secured Notes. In accordance with the terms of the tender offer, the total consideration for the principal amount of notes validly tendered on or prior to the expiration date was $1,063.45 (plus accrued and unpaid interest up to, but not including, the settlement date). On December 26, 2012, the Company accepted for purchase approximately $670.6 million aggregate principal amount of the 7.75% Secured Notes validly tendered on or prior to the expiration date. All of the remaining then outstanding 7.75% Secured Notes (approximately $294.4 million aggregate principal amount) were redeemed on January 10, 2013. The repurchase and redemption of the 7.75% Secured Notes was funded by the issuance of the 2012 Secured Notes (as defined below). See note 13.

F-17

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

2012 Secured Notes

On December 24, 2012, CCL and Crown Castle GS III Corp. (“Co-Issuer” and, together with CCL, “Issuers”) issued (1) $500.0 million aggregate principal amount of 2.381% senior secured notes due December 2017 (“2.381% Secured Notes”) and (2) $1.0 billion aggregate principal amount of 3.849% senior secured notes due April 2023 (“3.849% Secured Notes” and together with the 2.381% Secured Notes, the “2012 Secured Notes”). The 2012 Secured Notes were issued pursuant to an indenture dated as of December 24, 2012 (“Indenture”), by and among the Issuers, the Guarantors (as defined below) and The Bank of New York Mellon Trust Company, N.A., as trustee (“Trustee”). The Issuers and the Guarantors are indirect wholly owned indirect subsidiaries of CCIC. The 2012 Secured Notes have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The Company used the net proceeds from the issuance of the 2012 Secured Notes to (1) repurchase and redeem a portion of the then outstanding 7.75% Secured Notes and (2) distribute cash to CCIC to fund the repurchase and redemption of a portion of CCIC’s senior notes.

The 2.381% Secured Notes are payable semi-annually in cash in arrears on June 15 and December 15 of each year, beginning on June 15, 2013. The 3.849% Secured Notes are payable semi-annually in cash in arrears on April 15 and October 15 of each year, beginning on April 15, 2013. CCL, at its option, may redeem the 2012 Secured Notes of either series in whole or in part at any time by paying 100% of the principal amount of such series of 2012 Secured Notes, together with accrued and unpaid interest, if any, plus a “make-whole” premium (as defined in the Indenture).

The 2012 Secured Notes are guaranteed by the direct and indirect wholly owned subsidiaries of CCL, other than the Co-Issuer (collectively, “Guarantors”). The 2012 Secured Notes will be paid solely from the cash flows generated from operation of the towers held directly and indirectly by CCL and the Guarantors.

Concurrently with the issuance of the 2012 Secured Notes, CCL and certain of its subsidiaries entered into a pledge and security agreement with the Trustee. Pursuant to the terms of such pledge and security agreement, the 2012 Secured Notes are secured on a first-priority basis by a pledge of the equity interests of the Guarantors.

The Indenture limits, among other things, the ability of CCL and its subsidiaries to incur indebtedness, incur liens, enter into certain mergers or certain change of control transactions and enter into related party transactions, in each case subject to a number of exceptions and qualifications set forth in the Indenture.

Management Agreement. On December 24, 2012, CCL and the Guarantors entered into a management agreement (“Management Agreement”) with CCUSA, an indirect wholly owned subsidiary of CCIC (“Manager”). The Management Agreement replaced the previous management agreement that existed among the parties. Pursuant to the Management Agreement, the Manager continues to perform, on behalf of CCL and the Guarantors, those functions reasonably necessary to maintain, market, operate, manage and administer their respective sites. The Management Agreement requires that the Company maintain cash sufficient to operate the business, including sufficient cash to pay expenses for the following month (including any interest payment due during the next month pursuant to the Indenture).

Registration Rights Agreement. On December 24, 2012, the Issuers entered into a registration rights agreement relating to the 2012 Secured Notes, by and among the Issuers, the Guarantors and Merrill Lynch, Pierce, Fenner & Smith Incorporated, Barclays Capital Inc., J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC, as representatives of the initial purchasers of the Notes (“Registration Rights Agreement”). The Registration Rights Agreement requires the Issuers and the Guarantors, at their cost, to use their commercially

F-18

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

reasonable efforts to, among other things: (1) file a registration statement with respect to the 2012 Secured Notes to be used in connection with the exchange of each series of 2012 Secured Notes for publicly registered notes with identical terms in all material respects (except for the transfer restrictions relating to the 2012 Secured Notes); (2) cause the applicable registration statement to become effective under the Securities Act of 1933, as amended; and (3) upon the effectiveness of the applicable registration statement, commence an exchange offer. In addition, under certain circumstances, the Issuers may be required to file a shelf registration statement to cover resales of the 2012 Secured Notes.

If (1) the exchange offer has not been completed for each series of 2012 Secured Notes on or prior to the day that is 365 days after the date of the original issuance of the 2012 Secured Notes; (2) if applicable, a shelf registration statement covering resales of each series of 2012 Secured Notes has not been filed or declared effective within the time periods set forth in the Registration Rights Agreement; or (3) if applicable, after a shelf registration statement is filed and declared effective, such shelf registration statement thereafter ceases to be effective or fails to be usable for its intended purpose at any time during the shelf registration period (subject to certain conditions and exceptions) (each such event referred to in clauses (1) through (2) above, a “Registration Default”), then the Issuers will be obligated to pay additional interest to each holder of the 2012 Secured Notes of a particular series that is subject to transfer restrictions, with respect to the first 90-day period immediately following the occurrence of a Registration Default relating to such series of 2012 Secured Notes, at a rate equal to 0.25% per annum on the principal amount of the 2012 Secured Notes of such series that are subject to transfer restrictions held by such holder. The amount of additional interest will increase by an additional 0.25% per annum with respect to each subsequent 90-day period in which the Registration Default is continuing with regard to such series of 2012 Secured Notes, up to a maximum amount of additional interest for all Registration Defaults of 1.00% per annum on the principal amount of the 2012 Secured Notes of a series that are subject to transfer restrictions, until all such Registration Defaults relating to such series of 2012 Secured Notes have been cured.

Debt Restrictions. The 2012 Secured Notes do not contain financial maintenance covenants but they do contain restrictive covenants, subject to certain exceptions, related to the Company’s ability to incur indebtedness, incur liens, enter into certain mergers or change of control transactions, sell or issue equity interests and enter into related party transactions. With respect to the restriction regarding the issuance of debt, the Company may not issue debt other than (1) certain permitted refinancings of the 2012 Secured Notes, (2) unsecured trade payables in the ordinary course of business and financing of equipment, land or other property up to an aggregate of $100.0 million, and (3) unsecured debt or additional notes under the 2012 Secured Notes indenture provided that the Debt to Adjusted Consolidated Cash Flow Ratio (as defined in the 2012 Secured Notes Indenture) at the time of incurrence, and after giving effect to such incurrence, would have been no greater than 3.5 to 1. As of December 31, 2012, after giving effect to the January 2013 Redemption of all of the then outstanding 7.75% Secured Notes, our Debt to Adjusted Consolidated Cash Flow Ratio is 3.8 to 1, which the Company expects would currently restrict the Company’s ability to incur unsecured debt or additional notes. The Company is not restricted in its ability to distribute cash to affiliates or issue dividends to its parent.

F-19

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

Contractual Maturities

The following are the scheduled contractual maturities of the total debt and other long-term obligations outstanding at December 31, 2012.


	Years Ending December 31,															Net Unamortized Discounts			Total Debt and Other Obligations Outstanding
	2013			2014		2015		2016		2017		Thereafter		Total Cash Obligations		Net Unamortized Discounts			Total Debt and Other Obligations Outstanding
Scheduled contractual maturities	$	294,396	^(a)	$	19	$	19	$	19	$	500,020	$	1,000,084	$	1,794,557		(2,968	)		1,791,589

(a)	Inclusive of the redemption in January 2013 of all of the then outstanding 7.75% Secured Notes. See note 13.

Debt Purchases and Contributions

The following is a summary of the purchases of debt during the year ended December 31, 2012. In addition, in December 2012, the portion of the 7.75% Secured Notes owned by CCIC with a face value of $235.1 million was contributed to the Company. See note 6.


	Year Ending December 31, 2012
	Principal Amount		Cash Paid^(a)		Gains (losses)
7.75% Secured Notes	$	670,557	$	713,305	$	(67,210	)^(b)

(a)	Exclusive of accrued interest.

(b)	Inclusive of $24.5 million related to the write-off of deferred financing costs and discounts. The remainder relative to cash losses including with respect to make whole payments.

Interest Expense and Amortization of Deferred Financing Costs

The components of “interest expense and amortization of deferred financing costs” are as follows:


	2012		2011		2010
Interest expense on debt obligations	$	91,881	$	93,000	$	93,000
Amortization of deferred financing costs		4,730		2,271		2,105
Amortization of adjustments on long-term debt		7,587		3,684		3,393

Total	$	104,198	$	98,955	$	98,498

6. Related Party Transactions

As discussed in note 5, the Company and other subsidiaries of CCL entered into a management agreement with CCUSA, which replaced a previous management agreement among the same parties. Pursuant to these management agreements, CCUSA has agreed to employ, supervise, and pay at all times a sufficient number of capable employees as may be necessary to perform services in accordance with the operation standards defined in the Management Agreement. CCUSA currently acts as the manager of the majority of the towers held by subsidiaries of CCIC. The management fee is equal to 7.5% of the Company’s Management Agreement Operating Revenues. The fee is compensation for those functions reasonably necessary to maintain, market, operate, manage and administer the towers, other than the operating expenses, which includes but is not limited to real estate and personal property taxes, ground lease and easement payments, and insurance premiums. The management fee charged by CCUSA for the years ended December 31, 2012, 2011 and 2010 totaled $38.7 million, $36.6 million and $34.9 million, respectively. See note 5.

F-20

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

In addition, CCUSA may perform the installation services on the Company’s towers, for which the Company is not a party to any such agreements and for which no operating results are reflected herein.

As part of the CCIC strategy to obtain long-term control of the land under its towers, affiliates of the Company have acquired rights to land interests under the Company’s towers. These affiliates then lease the land to the Company. Under such circumstances, the Company’s obligation typically continues with the same or similar economic terms as the lease agreement for the land that existed prior to the purchase of such land by the affiliate. As of December 31, 2012, there are approximately 1,600 towers where the land under the tower is owned by an affiliate. Rent expense to affiliates totaled $24.4 million, $18.3 million and $15.8 million for the years ended December 31, 2012, 2011 and 2010, respectively. Also, the Company receives rent revenue from affiliates for land owned by the Company that affiliates have towers on and pays ground rent expense to affiliates for land owned by affiliates that the Company has towers on. For the years ended December 31, 2012, 2011 and 2010, rent revenue from affiliates totaled $0.6 million, $0.3 million and $0.3 million, respectively.

In 2010 and 2012, CCIC acquired through market purchases $199.6 million and $35.5 million, respectively, of principal amount of the 7.75% Secured Notes. In December 2012, the 7.75% Secured Notes held by CCIC were contributed to the Company with a face value of $235.1 million. Prior to this non cash contribution of the 7.75% Secured Notes in December 2012, the 7.75% Secured Notes acquired by CCIC remained outstanding on the Company’s consolidated balance sheet. For the years ended December 31, 2012, 2011 and 2010, the Company recorded interest expense and amortization of deferred financing costs of approximately $17.2 million, $15.9 million and $14.8 million, respectively, on the amount due to CCIC.

The Company recorded net equity distributions of $353.5 million, $104.2 million and $107.7 million for the years ended December 31, 2012, 2011, and 2010, respectively, reflecting net distributions to its parent company, including the contribution of the 7.75% Secured Notes held by CCIC and the distribution of excess cash from the refinancing of the 7.75% Secured Notes. Cash on-hand above the amount that is required by the Management Agreement has and is expected to continue to be distributed to the Company’s parent company. See note 7 for a discussion of the equity contribution related to income taxes.

7. Income Taxes

CCL is an LLC. Under the federal and state income tax laws, regulations, and administrative rulings, single member LLCs are treated as disregarded entities for income tax return filing purposes (unless elected otherwise). Single member LLCs are flow through entities which do not pay income tax at the LLC level. The Company is included in the consolidated CCIC U.S. federal tax return.

The benefit (provision) for income taxes consists of the following:


	Years Ended December 31,
	2012			2011			2010
Current:
Federal	$	—		$	—		$	—
State		(1,347	)		(1,420	)		(310	)
Deferred:
Federal		(3,487	)		(9,704	)		2,570
State		(4,702	)		198			(4,598	)

Total tax benefit (provision)	$	(9,536	)	$	(10,926	)	$	(2,338	)

F-21

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

A reconciliation between the benefit (provision) for income taxes and the amount computed by applying the federal statutory income tax rate to the loss before income taxes is as follows:


	Years Ended December 31,
	2012			2011			2010
Benefit (provision) for income taxes at statutory rate	$	(5,838	)	$	(10,217	)	$	771
Nondeductible expenses and other		(4	)		(3	)		(4	)
State tax benefit (provision), net of federal		(3,932	)		(794	)		(3,190	)
Other		238			88			85

	$	(9,536	)	$	(10,926	)	$	(2,338	)

The components of the net deferred income tax assets and liabilities are as follows:


	December 31,
	2012			2011			2010
Deferred income tax liabilities:
Intangible assets	$	511,649		$	548,941		$	586,634
Property and equipment		237,630			231,688			234,735
Deferred site rental receivables		88,351			55,575			37,648

Total deferred income tax liabilities		837,630			836,204			859,017

Deferred income tax assets:
Net operating loss carryforwards		88,665			87,664			88,312
Deferred ground lease payable		27,751			23,140			20,345
Accrued liabilities		5,881			15,203			10,827
Receivables allowance		585			600			790
Prepaid lease		332,568			326,748			346,520
Valuation allowances		—			—			(4,024	)

Total deferred income tax assets, net		455,450			453,355			462,770

Net deferred income tax asset (liabilities)	$	(382,180	)	$	(382,849	)	$	(396,247	)

During 2012, 2011, and 2010, the Company recorded noncash equity contributions from CCIC of $8.9 million, $22.9 million and $19.5 million, respectively, primarily related to the use by the Company of net operating losses from other members of CCIC’s federal consolidated group.

Valuation allowance of $4.0 million was recognized to offset net state deferred income tax assets as of December 31, 2010. During 2011, the Company reversed this $4.0 million valuation to benefit (provision) for income taxes as it was determined that the Company is more likely than not to realize these deferred tax assets.

At December 31, 2012, the Company had U.S. federal and state net operating loss carryforwards of approximately $249.3 million and $26.3 million, respectively, which are available to offset future taxable income. The federal loss carryforwards will expire in 2022 through 2030. The state net operating loss carryforwards generally expire in 2013 through 2029. The utilization of the loss carryforwards is subject to certain limitations.

As of December 31, 2012, the total amount of unrecognized tax benefits that would impact the effective tax rate, if recognized, was $5.0 million; with respect to such amount, $1.0 million, $1.1 million and $2.9 million were recorded in 2012, 2011 and 2010, respectively.

F-22

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

From time to time, the Company is subject to examinations by various tax authorities in jurisdictions in which the Company has business operations. The Company regularly assesses the likelihood of additional assessments in each of the tax jurisdictions resulting from these examinations. During 2011, the Internal Revenue Service completed an examination of CCIC’s U.S. federal tax return for the 2009 tax year with no material adjustments.

8. Commitments and Contingencies

Asset Retirement Obligations

Pursuant to its ground lease and easement agreements, the Company has the obligation to perform certain asset retirement activities, including requirements upon lease and easement termination to remove wireless infrastructure or remediate the land upon which its wireless infrastructure resides. Accretion expense related to liabilities for retirement obligations amounted to $1.7 million, $1.6 million and $1.5 million for the years ended December 31, 2012, 2011 and 2010, respectively. As of December 31, 2012 and 2011, liabilities for retirement obligations amounted to $21.5 million and $19.6 million, respectively, representing the net present value of the estimated expected future cash outlay. As of December 31, 2012, the estimated undiscounted future cash outlay for asset retirement obligations was approximately $126.0 million. See note 2.

Property Tax Commitments

The Company is obligated to pay, or reimburse others for, property taxes related to the Company’s wireless infrastructure pursuant to operating leases with landlords and other contractual agreements. The property taxes for the year ended December 31, 2012 and future periods are contingent upon new assessments of the wireless infrastructure and the Company’s appeals of assessments.

The Company has an obligation to reimburse Sprint for property taxes Sprint pays on the Company’s behalf related to certain towers the Company leases from Sprint. The Company paid $12.8 million, $12.4 million and $11.9 million for the years ended December 31, 2012, 2011 and 2010, respectively. The amount per tower to be paid to Sprint increases by 3% each successive year through 2037, the expiration of the lease term.

Operating Lease Commitments

See note 9 for a discussion of operating lease commitments.

9. Leases

Tenant Contracts

F-23

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

limited termination rights at the applicable tenant’s option through the current term. As of December 31, 2012, the weighted-average remaining term (calculated by weighting the remaining term for each lease by the related site rental revenue) of tenant contracts is approximately eight years, exclusive of renewals at the tenant’s option. The tenants’ rental payments included in the table below are through the current terms with a maximum current term of 20 years and do not assume exercise of tenant renewal options.


	Years Ending December 31,
	2013		2014		2015		2016		2017		Thereafter		Total
Tenant contracts	$	521,590	$	486,072	$	496,949	$	486,911	$	474,236	$	2,618,796	$	5,084,554

Operating Leases

The following table is a summary of rental cash payments owed by the Company, as lessee, to landlords pursuant to contractual agreements in effect as of December 31, 2012. The Company is obligated under non-cancelable operating contracts for land interests under 91% of its towers. The majority of these operating lease agreements have certain termination rights that provide for cancellation after a notice period. The majority of the land interests and managed tower leases have multiple renewal options at the Company’s option and annual escalations. Lease agreements may also contain provisions for a contingent payment based on revenues or the gross margin derived from the tower located on the leased land interest. Approximately 89% and 51% of the Company’s site rental gross margins for the year ended December 31, 2012 are derived from towers where the land interest under the tower is owned or leased with final expiration dates of greater than ten and 20 years, respectively, including renewals at the Company’s option. The operating lease payments included in the table below include payments for certain renewal periods at the Company’s option up to the estimated tower useful life of 20 years and an estimate of contingent payments based on revenues and gross margins derived from existing tenant leases. See also note 6.


	Years Ending December 31,
	2013		2014		2015		2016		2017		Thereafter		Total
Operating leases	$	124,391	$	124,065	$	125,341	$	126,698	$	127,962	$	1,597,547	$	2,226,004

Rental expense from operating leases was $136.7 million, $133.7 million and $129.3 million for the years ended December 31, 2012, 2011 and 2010, respectively. The rental expense was inclusive of contingent payments based on revenues or gross margin derived from the tower located on the leased land of $28.4 million, $28.8 million and $28.6 million for the years ended December 31, 2012, 2011 and 2010, respectively.

10. Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk are primarily restricted cash and trade receivables. The Company mitigates its risk with respect to restricted cash by maintaining such deposits at high credit quality financial institutions and monitoring the credit ratings of those institutions. The Company’s restricted cash was held and directed by the trustee for the 7.75% Secured Notes. See notes 2, 5 and 13.

The Company derives all of its revenues from customers in the wireless telecommunications industry. The Company also has a concentration in its volume of business with Sprint, AT&T, T-Mobile and Verizon that accounts for a significant portion of the Company’s revenues, receivables and deferred site rental receivables. The Company mitigates its concentrations of credit risk with respect to trade receivables by actively monitoring the creditworthiness of its customers, the use of customer contracts with contractually determinable payment terms and proactive management of past due balances.

F-24

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

Major Customers

The following table summarizes the percentage of the Company’s revenue for those customers accounting for more than 10% of the Company’s revenues.


	Years Ended December 31,
	2012			2011			2010
Sprint		38	%		34	%		34	%
AT&T		16	%		18	%		16	%
T-Mobile		12	%		12	%		12	%
Verizon Wireless		9	%		10	%		11	%

Total		75	%		74	%		73	%

11. Supplemental Cash Flow Information

The following table is a summary of the supplemental cash flow information during the years ended December 31, 2012, 2011 and 2010.


	For Years Ended December 31,
	2012			2011			2010
Supplemental disclosure of cash flow information:
Interest paid (inclusive of payments to related parties)	$	102,459		$	93,000		$	93,000
Income taxes paid		—			—			—
Supplemental disclosure of non-cash investing and financing activities:
Non-cash equity contribution (distribution)—income taxes		8,858			22,904			19,541
Contribution of 7.75% Secured Notes from affiliate (note 6)		235,081			—			—
Equity contribution (distribution) of amount due to affiliates (note 6)		(597,445	)		(127,087	)		(127,200	)

12. Guarantor Subsidiaries

CCL has no independent assets or operations. The 2012 Secured Notes are guaranteed by all subsidiaries of CCL other than Crown Castle GS III Corp., which is a co-issuer of the 2012 Secured Notes. Such guarantees are full and unconditional and joint and several. Subject to the provisions of the indenture governing the 2012 Secured Notes, a guarantor may be released and relieved of its obligations under its guarantee under certain circumstances including: (i) in the event of any sale or other disposition of all or substantially all of the assets of any guarantor, by way of merger, consolidation or otherwise to a person that is not (either before or after giving effect to such transaction) CCL or a subsidiary of CCL, (ii) in the event of any sale or other disposition of all of the capital stock of any guarantor, to a person that is not (either before or after giving effect to such transaction) CCL or a subsidiary of CCL, (iii) upon the Issuers’ exercise of legal defeasance in accordance with the relevant provisions of the indenture governing the 2012 Secured Notes and (iv) upon the discharge of the indenture governing the 2012 Secured Notes in accordance with its terms.

F-25

CC HOLDINGS GS V LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollars in thousands)

13. Subsequent Events

7.75% Secured Notes

In January 2013, the Company completed the redemption of all of the then outstanding 7.75% Secured Notes, utilizing $316.6 million of restricted cash which resulted in a loss of $18.0 million. See note 5.

Restricted Cash & Equity

Following the redemption of the 7.75% Secured Notes in January 2013, the remaining restricted cash was released to the Company. In February 2013, $75.0 million of restricted cash was distributed to CCIC. This cash disbursement to a related party was recorded as an equity distribution.

F-26

CC HOLDINGS GS V LLC

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS

YEARS ENDED DECEMBER 31, 2012, 2011 AND 2010

(In thousands of dollars)


			Additions		Deletions
	Balance at Beginning of Year		Charged to Operations		Credited to Operations		Written Off			Balance at End of Year
Allowance for Doubtful Accounts Receivable:
2012	$	1,605	$	413	$	—	$	(511	)	$	1,507

2011	$	2,032	$	697	$	—	$	(1,124	)	$	1,605

2010	$	2,088	$	966	$	—	$	(1,022	)	$	2,032


			Additions		Deletions
	Balance at Beginning of Year		Charged to Operations		Credited to Operations			Written Off		Balance at End of Year
Allowance for Deferred Site Rental Receivables:
2012	$	—	$	—	$	—		$	—	$	—

2011	$	771	$	—	$	(771	)	$	—	$	—

2010	$	612	$	783	$	(624	)	$	—	$	771


			Additions		Deductions
	Balance at Beginning of Year		Charged to Operations		Credited to Operations			Written Off		Balance at End of Year
Deferred Tax Valuation Allowance:
2012	$	—	$	—	$	—		$	—	$	—

2011	$	4,024	$	—	$	(4,024	)	$	—	$	—

2010	$	4,024	$	—	$	—		$	—	$	4,024

F-27

GLOBAL SIGNAL ACQUISITIONS LLC

Financial Statements

F-28

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Member of

CC Holdings GS V LLC:

In our opinion, the accompanying balance sheet and the related consolidated statements of operations, cash flows, and changes in member’s equity present fairly, in all material respects, the financial position of Global Signal Acquisitions LLC (the “Company”) at December 31, 2012 and December 31, 2011, and the results of its operations and cash flows for each of the two years then ended in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

Pittsburgh, Pennsylvania

F-29

Report of Independent Registered Public Accounting Firm

The Board of Directors and Member of

CC Holdings GS V LLC:

We have audited the accompanying statements of operations, changes in member’s equity, and cash flows for the year ended December 31, 2010 of Global Signal Acquisitions LLC (the Company). These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

In our opinion, the financial statements referred to above present fairly, in all material respects, the results of operations and cash flows of Global Signal Acquisitions LLC for the year ended December 31, 2010, in conformity with U.S. generally accepted accounting principles.

/s/ KPMG LLP

Pittsburgh, Pennsylvania

F-30

GLOBAL SIGNAL ACQUISITIONS LLC

BALANCE SHEET

(In thousands of dollars)


	December 31,
	2012			2011
ASSETS
Current assets:
Receivables, net of allowance of $29 and $206, respectively	$	49		$	418
Prepaid expenses		394			411
Deferred income tax assets		245			528
Deferred site rental receivables and other current assets		405			186

Total current assets		1,093			1,543
Deferred site rental receivables		10,694			7,356
Property and equipment, net		67,709			68,579
Goodwill		68,841			68,841
Site rental contracts and customer relationships, net		75,497			80,979
Other intangible assets, net		3,596			3,722
Long-term prepaid rent and other assets, net		1,017			713

Total assets	$	228,447		$	231,733


LIABILITIES AND EQUITY
Current liabilities:
Accrued expenses and payables	$	1,011		$	1,433
Deferred revenues		642			934

Total current liabilities		1,653			2,367
Deferred income tax liabilities		18,044			17,033
Deferred ground lease payable, above-market leases and other liabilities		5,267			5,014

Total liabilities		24,964			24,414

Commitments and contingencies (note 8)
Member’s equity:
Member’s equity		203,766			214,883
Accumulated earnings (deficit)		(283	)		(7,564	)

Total member’s equity		203,483			207,319

Total liabilities and equity	$	228,447		$	231,733

See accompanying notes to financial statements.

F-31

GLOBAL SIGNAL ACQUISITIONS LLC

STATEMENT OF OPERATIONS

(In thousands of dollars)


	Years Ended December 31,
	2012			2011			2010
Net revenues:
Site rental revenues—third parties	$	26,646		$	25,222		$	23,363
Site rental revenues—related parties		2,223			2,145			2,130

Site rental revenues—total		28,869			27,367			25,493

Operating expenses:
Site rental cost of operations—third parties^(a)		5,045			5,411			5,459
Site rental cost of operations—related parties^(a)		660			553			451

Site rental cost of operations—total^(a)		5,705			5,964			5,910
Management fee		1,899			1,852			1,755
Asset write-down charges		—			28			—
Depreciation, amortization and accretion		9,358			9,371			9,399

Total operating expenses		16,962			17,215			17,064

Operating income (loss)		11,907			10,152			8,429
Other income (expense)		9			9			14

Income (loss) before income taxes		11,916			10,161			8,443
Benefit (provision) for income taxes		(4,635	)		(3,957	)		(3,284	)

Net income (loss)	$	7,281		$	6,204		$	5,159

(a)	Exclusive of depreciation, amortization and accretion shown separately and certain indirect costs included in the management fee.

See accompanying notes to financial statements.

F-32

GLOBAL SIGNAL ACQUISITIONS LLC

STATEMENT OF CASH FLOWS

(In thousands of dollars)


	Years Ended December 31,
	2012			2011			2010
Cash flows from operating activities:
Net income (loss)	$	7,281		$	6,204		$	5,159
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, amortization and accretion		9,358			9,371			9,399
Asset write-down charges		—			28			—
Deferred income tax benefit (provision)		4,580			3,911			3,278
Changes in assets and liabilities:
Increase (decrease) in accounts payable		(11	)		32			(79	)
Increase (decrease) in deferred revenues, deferred ground lease payable and other liabilities		(492	)		(160	)		346
Decrease (increase) in receivables		369			(290	)		80
Decrease (increase) in other current assets, deferred site rental receivable, long-term prepaid rent and other assets		(3,821	)		(2,840	)		(1,881	)

Net cash provided by (used for) operating activities		17,264			16,256			16,302

Cash flows from investing activities:
Capital expenditures		(2,861	)		(1,020	)		(1,058	)

Net cash provided by (used for) investing activities		(2,861	)		(1,020	)		(1,058	)

Cash flows from financing activities:
Net (increase) decrease in amount due from affiliates		(14,403	)		(15,236	)		(15,244	)

Net cash provided by (used for) financing activities		(14,403	)		(15,236	)		(15,244	)

Net increase (decrease) in cash and cash equivalents		—			—			—
Cash and cash equivalents at beginning of year		—			—			—

Cash and cash equivalents at end of year	$	—		$	—		$	—

See accompanying notes to financial statements.

F-33

GLOBAL SIGNAL ACQUISITIONS LLC

STATEMENT OF CHANGES IN MEMBER’S EQUITY

(In thousands of dollars)


	Member’s Equity			Accumulated Earnings (Deficit)			Total
Balance at December 31, 2009	$	242,257		$	(18,927	)	$	223,330
Equity contribution—income taxes (note 7)		288			—			288
Equity distribution (note 6)		(15,244	)		—			(15,244	)
Net income (loss)		—			5,159			5,159

Balance at December 31, 2010	$	227,301		$	(13,768	)	$	213,533

Equity contribution—income taxes (note 7)		2,818			—			2,818
Equity distribution (note 6)		(15,236	)		—			(15,236	)
Net income (loss)		—			6,204			6,204

Balance at December 31, 2011	$	214,883		$	(7,564	)	$	207,319

Equity contribution—income taxes (note 7)		3,286			—			3,286
Equity distribution (note 6)		(14,403	)		—			(14,403	)
Net income (loss)		—			7,281			7,281

Balance at December 31, 2012	$	203,766		$	(283	)	$	203,483

See accompanying notes to financial statements.

F-34

1. Basis of Presentation

The accompanying financial statements reflect the financial position, results of operations and cash flows of Global Signal Acquisitions LLC (the “Company”). The Company is a wholly-owned subsidiary of CC Holdings GS V LLC (“CCL”), which is an indirect subsidiary of Crown Castle International Corp., a Delaware corporation (“CCIC” or “Crown Castle”).

The Company is organized specifically to own, lease and manage approximately 500 communications towers and other structures, such as rooftops and interests in land under third party and related party towers in various forms (collectively, “towers,” “sites” or “wireless infrastructure”) to wireless communications companies. The Company’s core business is providing access, including space or capacity, to its sites via long-term contracts in various forms, including licenses, subleases and lease agreements (collectively, “contracts”). The Company’s sites are geographically dispersed across the United States. Management services related to communications towers and other communication sites are performed by Crown Castle USA Inc. (“CCUSA”), an affiliate of the Company, under a management agreement, as the Company has no employees.

2. Summary of Significant Accounting Policies

Receivables Allowance

Lease Accounting

General. The Company classifies its leases at inception as either operating leases or capital leases. A lease is classified as a capital lease if at least one of the following criteria are met, subject to certain exceptions noted below: (1) the lease transfers ownership of the leased assets to the lessee, (2) there is a bargain purchase option, (3) the lease term is equal to 75% or more of the economic life of the leased assets, or (4) the present value of the minimum lease payments equals or exceeds 90% of the fair value of the leased assets.

F-35

Property and Equipment

Property and equipment is stated at cost, net of accumulated depreciation. Property and equipment includes land owned in fee and perpetual easements for land which have no definite life. Land owned in fee and perpetual easements for land are recorded as “property and equipment, net”. When the Company purchases fee ownership or perpetual easements for the land previously subject to ground lease, the Company reduces the value recorded as land by the amount of the deferred ground lease payable and unamortized above-market leases. Depreciation is computed utilizing the straight-line method at rates based upon the estimated useful lives of the various classes of assets. Depreciation of wireless infrastructure is generally computed with a useful life equal to the shorter of 20 years or the term of the underlying ground lease (including optional renewal periods). Additions, renewals and improvements are capitalized, while maintenance and repairs are expensed. Upon the sale or retirement of an asset, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is recognized. The carrying value of property and equipment will be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. If the sum of the estimated future cash flows (undiscounted) expected to result from the use and eventual disposition of the asset group is less than the carrying amount of the asset group, an impairment loss is recognized. Measurement of an impairment loss is based on the fair value of the asset. Construction in process is impaired when projects are abandoned or terminated.

Asset Retirement Obligations

Pursuant to its ground lease and easement agreements, the Company records obligations to perform asset retirement activities, including requirements to remove wireless infrastructure or remediate the land upon which the Company’s wireless infrastructure resides. The fair value of the liability for asset retirement obligations, which represents the net present value of the estimated expected future cash outlay, is recognized in the period in which it is incurred and the fair value of the liability can reasonably be estimated. Changes subsequent to initial measurement resulting from revisions to the timing or amount of the original estimate of undiscounted cash flows are recognized as an increase or decrease in the carrying amount of the liability and related carrying amount of the capitalized asset. Asset retirement obligations are included in “deferred ground lease payable, above-market leases and other liabilities” on the Company’s balance sheet. The liability accretes as a result of the passage of time and the related accretion expense is included in “depreciation, amortization and accretion” expense on the Company’s statement of operations. The associated asset retirement costs are capitalized as an additional carrying amount of the related long-lived asset and depreciated over the useful life of such asset.

Goodwill

Other Intangible Assets

F-36

contracts and customer relationships recorded in conjunction with acquisitions. The site rental contracts and customer relationships intangible assets are comprised of (1) current term of the existing contracts, (2) the expected exercise of the renewal provisions contained within the existing contracts, which automatically occur under contractual provisions, and (3) any associated relationships that are expected to generate value following the expiration of all renewal periods under existing contracts.

Deferred Credits

Deferred credits are included in “deferred ground lease payable, above-market leases and other liabilities” on the Company’s balance sheet and consist of the estimated fair value of above-market leases for land interests under the Company’s towers. Above-market leases for land interests are amortized to costs of operations over their respective estimated remaining lease term at the acquisition date.

Accrued Estimated Property Taxes

Revenue Recognition

F-37

on a straight-line basis over the fixed, non-cancelable term of the agreement. When calculating straight-line rental revenues, the Company considers all fixed elements of tenant contractual escalation provisions, even if such escalation provisions also include a variable element in addition to a fixed minimum. The Company’s assets related to straight-line site rental revenues are included in “deferred site rental receivables and other current assets” and “deferred site rental receivables,” and amounts received in advance are recorded as “deferred revenues” on the Company’s balance sheet.

Costs of Operations

Generally, the ground lease agreements are specific to each site and are for an initial term of five years and are renewable for pre-determined periods. The Company also enters into term easements and ground leases in which it prepays the entire term in advance. Ground lease expense is recognized on a monthly basis, regardless of whether the lease agreement payment terms require the Company to make payments annually, quarterly, monthly or for the entire term in advance. The Company’s ground leases contain fixed escalation clauses (such as fixed dollar or fixed percentage increases) or inflation-based escalation clauses (such as those tied to the CPI). If the payment terms include fixed escalation provisions, the effect of such increases is recognized on a straight-line basis. The Company calculates the straight-line ground lease expense using a time period that equals or exceeds the remaining depreciable life of the wireless infrastructure asset. Further, when a tenant has exercisable renewal options that would compel the Company to exercise existing ground lease renewal options, the Company has straight-lined the ground lease expense over a sufficient portion of such ground lease renewals to coincide with the final termination of the tenant’s renewal options. The Company’s liability related to straight-line ground lease expense is included in “deferred ground lease payable, above-market leases and other liabilities” on the Company’s balance sheet. The Company’s asset related to prepaid ground leases is included in “prepaid expenses” and “long-term prepaid rent and other assets, net” on the Company’s balance sheet.

Management Fee

The Company is charged a management fee by CCUSA, a wholly-owned indirect subsidiary of CCIC, relating to management services which include those functions reasonably necessary to maintain, market, operate, manage and administer the towers. The management fee is equal to 7.5% of the Company’s Operating Revenues, as defined in the Management Agreement discussed in note 6 below, which are based on the Company’s reported revenues adjusted to exclude certain items including revenues related to the accounting for leases with fixed escalators (the “Management Agreement Operating Revenues”). See note 6.

Income Taxes

The Company is a limited liability company (“LLC”). Under federal and state income tax laws, regulations, and administrative rulings, single member LLCs are treated as disregarded entities for income tax return filing purposes (unless elected otherwise). Single member LLCs are flow through entities which do not pay income tax at the LLC level. The Company is included in the consolidated CCIC U.S. federal tax return. The Company’s provision for income taxes is recorded using a method materially consistent with the separate return method.

F-38

deferred tax assets each quarter and based upon projections of future taxable income, reversing deferred tax liabilities and other known events that are expected to affect future taxable income, records a valuation allowance for assets that do not meet the “more likely than not” realization threshold. Valuation allowances may be reversed if related deferred tax assets are deemed realizable based upon changes in facts and circumstances that impact the recoverability of the asset.

Reporting Segments

The Company’s operations consist of one operating segment.

Recent Accounting Pronouncements

3. Property and Equipment

The major classes of property and equipment are as follows:


	Estimated Useful Lives		December 31,
	Estimated Useful Lives		2012			2011
Land owned in fee and perpetual easements		—	$	15,163		$	15,057
Wireless infrastructure		1-20 years		72,156			70,980
Construction in progress		—		2,422			907

Total gross property and equipment				89,741			86,944
Less accumulated depreciation				(22,032	)		(18,365	)

Total property and equipment, net			$	67,709		$	68,579

Depreciation expense for the years ended December 31, 2012, 2011 and 2010 was $3.7 million, $3.7 million and $3.7 million, respectively.

F-39

4. Intangible Assets and Deferred Credits

The following is a summary of the Company’s intangible assets.


	As of December 31, 2012							As of December 31, 2011
	Gross Carrying Value		Accumulated Amortization			Net Book Value		Gross Carrying Value		Accumulated Amortization			Net Book Value
Site rental contracts and customer relationships	$	108,021	$	(32,524	)	$	75,497	$	108,021	$	(27,042	)	$	80,979
Other intangible assets		4,349		(753	)		3,596		4,349		(627	)		3,722

Total	$	112,370	$	(33,277	)	$	79,093	$	112,370	$	(27,669	)	$	84,701

Amortization expense related to intangible assets is classified as follows on the Company’s statement of operations:


	For Years Ended December 31,
	2012		2011		2010
Depreciation, amortization and accretion	$	5,584	$	5,584	$	5,645
Site rental costs of operations		24		24		24

Total amortization expense	$	5,608	$	5,608	$	5,669


	Years Ending December 31,
	2013		2014		2015		2016		2017
Estimated annual amortization	$	5,609	$	5,609	$	5,609	$	5,609	$	5,609

See note 2 for a further discussion of deferred credits related to above-market leases for land interests under the Company’s towers recorded in connection with acquisitions. For the years ended December 31, 2012, 2011 and 2010, the Company recorded $0.1 million, $0.1 million and $0.1 million, respectively, as a decrease to “site rental cost of operations”. The following is a summary of the Company’s above-market leases.


	As of December 31, 2012							As of December 31, 2011
	Gross Carrying Value		Accumulated Amortization			Net Book Value		Gross Carrying Value		Accumulated Amortization			Net Book Value
Above-market leases	$	2,303	$	(774	)	$	1,529	$	2,303	$	(667	)	$	1,636

The estimated annual amortization expense related to above-market leases for land interests under the Company’s towers for the years ended December 31, 2013 to 2017 is as follows:


	Years Ending December 31,
	2013		2014		2015		2016		2017
Estimated annual amortization	$	106	$	106	$	106	$	106	$	106

5. Debt

In December 2012, CCL and Crown Castle GS III Corp. (a subsidiary of CCL) issued $1.5 billion aggregate principal amount of senior secured notes (“2012 Secured Notes”), which are guaranteed by certain subsidiaries of CCL, including the Company. In addition, the 2012 Secured Notes are secured on a first-priority basis by a pledge of the equity interests of certain subsidiaries of CCL, including the Company.

F-40

The 2012 Secured Notes do not contain financial maintenance covenants but they do contain restrictive covenants, subject to certain exceptions, related to the Company’s ability to incur indebtedness, incur liens, enter into certain mergers or change of control transactions, sell or issue equity interests and enter into related party transactions. With respect to the restriction regarding the issuance of debt, CCL and its subsidiaries including the Company may not issue debt other than (1) certain permitted refinancings of the 2012 Secured Notes, (2) unsecured trade payables in the ordinary course of business and financing of equipment, land or other property up to an aggregate of $100.0 million, and (3) unsecured debt or additional notes under the 2012 Secured Notes indenture provided that the Debt to Adjusted Consolidated Cash Flow Ratio (as defined in the indenture governing the 2012 Secured Notes) at the time of incurrence, and after giving effect to such incurrence, would have been no greater than 3.5 to 1. As of December 31, 2012, after giving effect to the January 2013 redemption of all of the then outstanding 7.75% Secured Notes due 2017, CCL’s Debt to Adjusted Consolidated Cash Flow Ratio was 3.8 to 1, which the Company expects would currently restrict its ability to incur unsecured debt or issue additional notes. The Company is not restricted in its ability to distribute cash to affiliates or issue dividends to its parent.

On December 24, 2012, CCL and its subsidiaries, including the Company, entered into a registration rights agreement relating to the 2012 Secured Notes, by and among CCL and its subsidiaries and Merrill Lynch, Pierce, Fenner & Smith Incorporated, Barclays Capital Inc., J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC, as representatives of the initial purchasers of the 2012 Secured Notes (“Registration Rights Agreement”). The Registration Rights Agreement requires CCL and its subsidiaries to use their commercially reasonable efforts to, among other things: (1) file a registration statement with respect to the 2012 Secured Notes to be used in connection with the exchange of the 2012 Secured Notes for publicly registered notes with substantially identical terms in all material respects (except for the transfer restrictions relating to the 2012 Secured Notes); (2) cause the applicable registration statement to become effective under the Securities Act, as amended; and (3) upon the effectiveness of the applicable registration statement, commence an exchange offer. In addition, under certain circumstances, CCL and its subsidiaries may be required to file a shelf registration statement to cover resales of the 2012 Secured Notes. If the exchange offer has not been completed on or prior to the day that is 365 days after the date of the original issuance of the 2012 Secured Notes or in certain other circumstances set forth in the Registration Rights Agreement, CCL and its subsidiaries will be required to pay additional interest as set forth in the Registration Rights Agreement.

6. Related Party Transactions

In December 2012, CCL, the Company and other subsidiaries of CCL entered into a management agreement (“Management Agreement”) with CCUSA, an indirect wholly-owned subsidiary of CCIC, which replaced a previous management agreement among the same parties. The Company is charged a management fee by CCUSA under the Management Agreement whereby CCUSA has agreed to employ, supervise, and pay at all times a sufficient number of capable employees as may be necessary to perform services in accordance with the operation standards defined in the Management Agreement. CCUSA currently acts as the manager of the majority of the towers held by subsidiaries of CCIC. The management fee is equal to 7.5% of the Company’s Management Agreement Operating Revenues. The fee is compensation for those functions reasonably necessary to maintain, market, operate, manage and administer the towers, other than the operating expenses, which includes but is not limited to real estate and personal property taxes, ground lease and easement payments, and insurance premiums. The management fee charged from CCUSA for the years ended December 31, 2012, 2011 and 2010 totaled $1.9 million, $1.9 million and $1.8 million, respectively.

F-41

similar economic terms as the lease agreement for the land that existed prior to the purchase of such land by the affiliate. As of December 31, 2012, there are approximately 50 towers where the land under the tower is owned by an affiliate. Rent expense to affiliates totaled $0.7 million, $0.6 million and $0.5 million for the years ended December 31, 2012, 2011 and 2010, respectively. The Company receives rent revenue from affiliates for land owned by the Company that affiliates have towers on and pays ground rent expense to affiliates for land owned by affiliates that the Company has towers on. For the years ended December 31, 2012, 2011 and 2010, rent revenue from affiliates totaled $2.2 million, $2.1 million and $2.1 million, respectively. As of December 31, 2012, the Company had approximately 150 land interests under towers owned by affiliates.

The Company recorded net equity distributions of $11.1 million, $12.4 million, and $15.0 million for the years ended December 31, 2012, 2011, and 2010, respectively, reflecting net distributions to its parent company. Cash on-hand above the amount that is required by the Management Agreement has and is expected to continue to be distributed to the Company’s parent company, CCL. See note 7 for a discussion of the equity contribution related to income taxes.

7. Income Taxes

The Company is a limited liability company (“LLC”). Under the federal and state income tax laws, regulations, and administrative rulings, single member LLCs are treated as disregarded entities for income tax return filing purposes (unless elected otherwise). Single member LLCs are flow through entities which do not pay income tax at the LLC level. The Company is included in the consolidated CCIC U.S. federal tax return.

The benefit (provision) for income taxes consists of the following:


	Years Ended December 31,
	2012			2011			2010
Current:
Federal	$	—		$	—		$	—
State		(55	)		(46	)		(6	)

Total current:		(55	)		(46	)		(6	)

Deferred:
Federal		(3,920	)		(3,341	)		(2,731	)
State		(660	)		(570	)		(547	)

Total deferred		(4,580	)		(3,911	)		(3,278	)

Total tax benefit (provision)	$	(4,635	)	$	(3,957	)	$	(3,284	)

A reconciliation between the benefit (provision) for income taxes and the amount computed by applying the federal statutory income tax rate to the loss before income taxes is as follows:


	Years Ended December 31,
	2012			2011			2010
Benefit (provision) for income taxes at statutory rate	$	(4,171	)	$	(3,556	)	$	(2,955	)
State tax benefit (provision), net of federal		(464	)		(401	)		(359	)
Other		—			—			30

	$	(4,635	)	$	(3,957	)	$	(3,284	)

F-42

The components of the net deferred income tax assets and liabilities are as follows:


	December 31,
	2012			2011
Deferred income tax liabilities:
Intangible assets	$	26,424		$	28,343
Deferred site rental receivables		4,332			2,942

Total deferred income tax liabilities		30,756			31,285

Deferred income tax assets:
Net operating loss carryforwards		5,126			5,073
Deferred ground lease payable		992			879
Accrued liabilities		434			492
Receivables allowance		11			79
Property and equipment		6,394			8,257

Total deferred income tax assets, net		12,957			14,780

Net deferred income tax asset (liabilities)	$	(17,799	)	$	(16,505	)

During 2012, 2011, and 2010, the Company recorded non-cash equity contributions of $3.3 million, $2.8 million, and $0.3 million, respectively, primarily related to the use by the Company of net operating losses from other members of CCIC’s federal consolidated group.

At December 31, 2012, the Company had U.S. federal and state net operating loss carryforwards of approximately $13.8 million and $6.1 million, respectively, which are available to offset future taxable income. The federal loss carryforwards will expire in 2022 through 2029. The state net operating loss carryforwards generally expire in 2013 through 2029. The utilization of the loss carryforwards is subject to certain limitations.

As of December 31, 2012, the total amount of unrecognized tax benefits that would impact the effective tax rate, if recognized, was $0.2 million.

8. Commitments and Contingencies

Asset Retirement Obligations

F-43

obligations amounted to $1.2 million and $1.2 million, respectively, representing the net present value of the estimated expected future cash outlay. As of December 31, 2012, the estimated undiscounted future cash outlay for asset retirement obligations was approximately $17.9 million. See note 2.

Property Tax Commitments

Operating Lease Commitments

See note 9 for a discussion of operating lease commitments.

9. Leases

Tenant Contracts

The following table is a summary of the rental cash payments owed to the Company, as a lessor, by tenants pursuant to contractual agreements in effect as of December 31, 2012. Generally, the Company’s contracts with its tenants provide for (1) annual escalations and multiple renewal periods at the tenant’s option and (2) only limited termination rights at the applicable tenant’s option through the current term. As of December 31, 2012, the weighted-average remaining term (calculated by weighting the remaining term for each lease by the related site rental revenue) of tenant contracts is approximately nine years, exclusive of renewals at the tenant’s option. The tenants’ rental payments included in the table below are through the current terms with a maximum current term of 20 years and do not assume exercise of tenant renewal options.


	Years Ending December 31,
	2013		2014		2015		2016		2017		Thereafter		Total
Tenant contracts	$	25,966	$	24,682	$	25,252	$	24,151	$	24,019	$	157,689	$	281,759

Operating Leases

The following table is a summary of rental cash payments owed by the Company, as lessee, to landlords pursuant to contractual agreements in effect as of December 31, 2012. The Company is obligated under non-cancelable operating contracts for land interests under 90% of its towers. The majority of these operating lease agreements have certain termination rights that provide for cancellation after a notice period. The majority of the land interests and managed tower leases have multiple renewal options at the Company’s option and annual escalations. Lease agreements may also contain provisions for a contingent payment based on revenues or the gross margin derived from the tower located on the leased land interest. Approximately 94% and 73% of the Company’s site rental gross margins for the year ended December 31, 2012 are derived from towers where the land interest under the tower is owned or leased by the Company with final expiration dates of greater than ten and 20 years, respectively, including renewals at the Company’s option. The operating lease payments included in the table below include payments for certain renewal periods at the Company’s option up to the estimated tower useful life of 20 years and an estimate of contingent payments based on revenues and gross margins derived from existing tenant leases. See also note 6.


	Years Ending December 31,
	2013		2014		2015		2016		2017		Thereafter		Total
Operating leases	$	4,389	$	4,419	$	4,474	$	4,447	$	4,438	$	67,344	$	89,511

F-44

Rental expense from operating leases was $4.6 million, $4.5 million and $4.5 million for the years ended December 31, 2012, 2011 and 2010, respectively. The rental expense was inclusive of contingent payments based on revenues or gross margin derived from the tower located on the leased land of $1.1 million, $1.1 million and $1.0 million for the years ended December 31, 2012, 2011 and 2010, respectively.

10. Concentration of Credit Risk

The financial instrument that potentially subjects the Company to concentrations of credit risk is primarily trade receivables.

Major Customers

The following table summarizes the percentage of the Company’s revenue for those customers accounting for more than 10% of the Company’s revenues.


	Years Ended December 31,
	2012			2011			2010
T-Mobile		26	%		24	%		25	%
AT&T		19	%		20	%		18	%
Sprint		17	%		16	%		16	%
Verizon Wireless		10	%		11	%		11	%

Total		72	%		71	%		70	%

11. Supplemental Cash Flow Information

The following table is a summary of the supplemental cash flow information during the years ended December 31, 2012, 2011 and 2010.


	For Years Ended December 31,
	2012			2011			2010
Supplemental disclosure of cash flow information:
Income taxes paid	$	—		$	—		$	—
Supplemental disclosure of non-cash investing and financing activities:
Non-cash equity contribution (distribution)—income taxes		3,286			2,818			288
Equity contribution (distribution) of amount due to (from) affiliates (note 6)		(14,403	)		(15,236	)		(15,244	)

F-45

GLOBAL SIGNAL ACQUISITIONS II LLC

Financial Statements

F-46

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Member of

CC Holdings GS V LLC:

In our opinion, the accompanying balance sheet and the related statements of operations, cash flows, and changes in member’s equity present fairly, in all material respects, the financial position of Global Signal Acquisitions II LLC (the “Company”) at December 31, 2012 and December 31, 2011, and the results of its operations and cash flows for each of the two years then ended in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

Pittsburgh, Pennsylvania

F-47

Report of Independent Registered Public Accounting Firm

The Board of Directors and Member of

CC Holdings GS V LLC:

We have audited the accompanying statements of operations, changes in member’s equity, and cash flows for the year ended December 31, 2010 of Global Signal Acquisitions II LLC (the Company). These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

In our opinion, the financial statements referred to above present fairly, in all material respects, the results of operations and cash flows of Global Signal Acquisitions II LLC for the year ended December 31, 2010, in conformity with U.S. generally accepted accounting principles.

/s/ KPMG LLP

Pittsburgh, Pennsylvania

F-48

GLOBAL SIGNAL ACQUISITIONS II LLC

BALANCE SHEET

(In thousands of dollars)


	December 31,
	2012		2011
ASSETS
Current assets:
Restricted cash	$	400,493	$	83,383
Receivables, net of allowance of $224 and $52, respectively		306		266
Prepaid expenses		18,405		18,127
Deferred income tax assets		8,244		10,128
Deferred site rental receivables and other current assets		4,677		2,481

Total current assets		432,125		114,385
Deferred site rental receivables		161,297		103,829
Property and equipment, net		703,271		728,236
Goodwill		642,545		642,545
Site rental contracts and customer relationships, net		704,675		755,847
Other intangible assets, net		25,220		27,792
Long-term prepaid rent and other assets, net		23,036		20,274

Total assets	$	2,692,169	$	2,392,908

LIABILITIES AND EQUITY
Current liabilities:
Accrued expenses and payables	$	3,884	$	2,216
Deferred revenues		7,256		11,591

Total current liabilities		11,140		13,807
Deferred income tax liabilities		178,964		190,577
Deferred ground lease payable, above-market leases and other liabilities		98,719		93,095

Total liabilities		288,823		297,479

Commitments and contingencies (note 8)
Member’s equity:
Member’s equity		2,348,992		2,122,949
Accumulated earnings (deficit)		54,354		(27,520	)

Total member’s equity		2,403,346		2,095,429

Total liabilities and equity	$	2,692,169	$	2,392,908

See accompanying notes to financial statements.

F-49

GLOBAL SIGNAL ACQUISITIONS II LLC

STATEMENT OF OPERATIONS

(In thousands of dollars)


	Years Ended December 31,
	2012			2011			2010
Net revenues:
Site rental revenues	$	394,818		$	346,990		$	316,610
Operating expenses:
Site rental cost of operations-third parties^(a)		105,920			107,470			106,676
Site rental cost of operations-related parties^(a)		22,936			17,338			14,350

Site rental cost of operations-total^(a)		128,856			124,808			121,026
Management fee		25,138			23,369			21,976
Asset write-down charges		402			5,419			1,015
Depreciation, amortization and accretion		106,581			107,058			108,164

Total operating expenses		260,977			260,654			252,181

Operating income (loss)		133,841			86,336			64,429
Other income (expense)		(8	)		(13	)		116

Income (loss) before income taxes		133,833			86,323			64,545
Benefit (provision) for income taxes		(51,959	)		(31,728	)		(25,426	)

Net income (loss)	$	81,874		$	54,595		$	39,119

(a)	Exclusive of depreciation, amortization and accretion shown separately and certain indirect costs included in the management fee.

See accompanying notes to financial statements.

F-50

GLOBAL SIGNAL ACQUISITIONS II LLC

STATEMENT OF CASH FLOWS

(In thousands of dollars)


	Years Ended December 31,
	2012			2011			2010
Cash flows from operating activities:
Net income (loss)	$	81,874		$	54,595		$	39,119
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, amortization and accretion		106,581			107,058			108,164
Asset write-down charges		402			5,419			1,015
Deferred income tax benefit (provision)		51,023			30,430			25,196
Changes in assets and liabilities:
Increase (decrease) in accounts payable		59			109			(409	)
Increase (decrease) in deferred revenues, deferred ground lease payable and other liabilities		4,274			(7,846	)		9,680
Decrease (increase) in receivables		(40	)		(68	)		(126	)
Decrease (increase) in other current assets, deferred site rental receivable, long-term prepaid rent and other assets		(67,112	)		(43,484	)		(23,330	)

Net cash provided by (used for) operating activities		177,061			146,213			159,309

Cash flows from investing activities:
Capital expenditures		(30,882	)		(17,202	)		(22,030	)
Other investing activities		—			56			634

Net cash provided by (used for) investing activities		(30,882	)		(17,146	)		(21,396	)

Cash flows from financing activities:
Net (increase) decrease in amount due from affiliates		165,292			(126,271	)		(135,856	)
Net (increase) decrease in restricted cash		(311,471	)		(2,796	)		(2,057	)

Net cash provided by (used for) financing activities		(146,179	)		(129,067	)		(137,913	)

Net increase (decrease) in cash and cash equivalents		—			—			—
Cash and cash equivalents at beginning of year		—			—			—

Cash and cash equivalents at end of year	$	—		$	—		$	—

See accompanying notes to financial statements.

F-51

GLOBAL SIGNAL ACQUISITIONS II LLC

STATEMENT OF CHANGES IN MEMBER’S EQUITY

(In thousands of dollars)


	Member’s Equity			Accumulated Earnings (Deficit)			Total
Balance at December 31, 2009	$	2,285,213		$	(121,234	)	$	2,163,979
Equity contribution-income taxes (note 7)		49,648			—			49,648
Equity distribution (note 6)		(135,856	)		—			(135,856	)
Net income (loss)		—			39,119			39,119

Balance at December 31, 2010	$	2,199,005		$	(82,115	)	$	2,116,890

Equity contribution-income taxes (note 7)		50,215			—			50,215
Equity distribution (note 6)		(126,271	)		—			(126,271	)
Net income (loss)		—			54,595			54,595

Balance at December 31, 2011	$	2,122,949		$	(27,520	)	$	2,095,429

Equity contribution-income taxes (note 7)		60,751			—			60,751
Equity contribution (note 6)		165,292			—			165,292
Net income (loss)		—			81,874			81,874

Balance at December 31, 2012	$	2,348,992		$	54,354		$	2,403,346

See accompanying notes to financial statements.

F-52

1. Basis of Presentation

The accompanying financial statements reflect the financial position, results of operations, and cash flows of Global Signal Acquisitions II LLC (the “Company”). The Company is a wholly-owned subsidiary of CC Holdings GS V LLC (“CCL”), which is an indirect subsidiary of Crown Castle International Corp., a Delaware corporation (“CCIC” or “Crown Castle”).

The Company is organized specifically to own, lease and manage approximately 5,300 communications towers and other structures, such as rooftops and interests in land under third party and related party towers in various forms (collectively, “towers,” “sites” or “wireless infrastructure”) to wireless communications companies. The Company’s core business is providing access, including space or capacity, to its sites via long-term contracts in various forms, including licenses, subleases and lease agreements (collectively, “contracts”). The Company’s sites are geographically dispersed across the United States.

Virtually all of the Company’s towers are leased or operated for an initial period under master lease and sublease agreements, including the master lease and sublease agreements with Sprint Nextel (“Sprint”) on approximately 5,300 Sprint towers. In 2037, CCIC, through its subsidiaries (including the Company), has the option to purchase all (but not less than all) of the Sprint towers from Sprint for approximately $2.3 billion. Management services related to communications towers and other communication sites are performed by Crown Castle USA Inc. (“CCUSA”), an affiliate of the Company, under a management agreement, as the Company has no employees.

2. Summary of Significant Accounting Policies

Restricted Cash

Restricted cash represents the cash held in reserve by the indenture trustee or otherwise restricted pursuant to the indenture governing the senior secured notes issued by CCL and Crown Castle GS III Corp during 2009 (“7.75% Secured Notes”) and which were redeemed in January 2013. The Company has classified the increases and decreases in restricted cash as (1) cash provided by financing activities for cash held by the indenture trustee based on consideration of the terms of the 7.75% Secured Notes, which is a critical feature of the 7.75% Secured Notes based on the indenture trustee’s ability to utilize the restricted cash for payment of various expenses including debt service, although the cash flows have aspects of both financing activities and operating activities and (2) cash provided by operating activities for the other remaining restricted cash. Restricted cash decreased cash flow from operating activities by $5.6 million and $5.0 million for the years ending December 31, 2012 and 2011, respectively, and increased $1.0 million for the year ending December 31, 2010. As of December 31, 2012, restricted cash included $316.6 million comprised of the cash held by the trustee to redeem all of the then outstanding 7.75% Secured Notes. See also note 12.

Receivables Allowance

F-53

accounts receivable are written off as uncollectible. Additions or reversals to the allowance for uncollectible deferred site rental receivables are charged to “site rental revenues,” and deductions from the allowance are recorded as contracts terminate.

Lease Accounting

General. The Company classifies its leases at inception as either operating leases or capital leases. A lease is classified as a capital lease if at least one of the following criteria are met, subject to certain exceptions noted below: (1) the lease transfers ownership of the leased assets to the lessee, (2) there is a bargain purchase option, (3) the lease term is equal to 75% or more of the economic life of the leased assets, or (4) the present value of the minimum lease payments equals or exceeds 90% of the fair value of the leased assets.

Property and Equipment

Asset Retirement Obligations

F-54

the carrying amount of the liability and related carrying amount of the capitalized asset. Asset retirement obligations are included in “deferred ground lease payable, above-market leases and other liabilities” on the Company’s balance sheet. The liability accretes as a result of the passage of time and the related accretion expense is included in “depreciation, amortization and accretion” expense on the Company’s statement of operations. The associated asset retirement costs are capitalized as an additional carrying amount of the related long-lived asset and depreciated over the useful life of such asset.

Goodwill

Other Intangible Assets

Intangible assets are included in “site rental contracts and customer relationships, net” and “other intangible assets, net” on the Company’s balance sheet and predominately consist of the estimated fair value of the following items recorded in conjunction with acquisitions: (1) site rental contracts and customer relationships and (2) below-market leases for land interests under the acquired wireless infrastructure classified as “other intangible assets, net”. The site rental contracts and customer relationships intangible assets are comprised of (1) current term of the existing contracts, (2) the expected exercise of the renewal provisions contained within the existing contracts, which automatically occur under contractual provisions, and (3) any associated relationships that are expected to generate value following the expiration of all renewal periods under existing contracts.

F-55

impairment of the site rental contracts and customer relationships intangible assets. First, the Company pools the site rental contracts and customer relationships with the related tower assets into portfolio groups for purposes of determining the unit of account for impairment testing. Second and separately, the Company evaluates the site rental contracts and customer relationships by significant customer or by customer grouping for individually insignificant customers, as appropriate. If the sum of the estimated future cash flows (undiscounted) expected to result from the use and eventual disposition of an asset is less than the carrying amount of the asset, an impairment loss is recognized. Measurement of an impairment loss is based on the fair value of the asset.

Deferred Credits

Accrued Estimated Property Taxes

Revenue Recognition

Costs of Operations

F-56

the final termination of the tenant’s renewal options. The Company’s liability related to straight-line ground lease expense is included in “deferred ground lease payable, above-market leases and other liabilities” on the Company’s balance sheet. The Company’s asset related to prepaid ground leases is included in “prepaid expenses” and “long-term prepaid rent and other assets, net” on the Company’s balance sheet.

Management Fee

The Company is charged a management fee by CCUSA, a wholly-owned indirect subsidiary of CCIC, relating to management services which include those functions reasonably necessary to maintain, market, operate, manage and administer the towers. The management fee is equal to 7.5% of the Company’s Operating Revenues, as defined in the Management Agreement discussed in note 6 below, which are based on the Company’s reported revenues adjusted to exclude certain items including revenues related to the accounting for leases with fixed escalators. (the “Management Agreement Operating Revenues”). See note 6.

Income Taxes

Fair Values

F-57

value hierarchy are (1) Level 1 - quoted prices (unadjusted) in active and accessible markets, (2) Level 2 - observable prices that are based on inputs not quoted in active markets but corroborated by market data, and (3) Level 3 - unobservable inputs and are not corroborated by market data. The Company evaluates level classifications quarterly, and transfers between levels are effective at the end of the quarterly period.

The fair value of restricted cash approximates the carrying value. There were no changes since December 31, 2011 in the Company’s valuation techniques used to measure fair values. The estimated fair values of the Company’s financial instruments, along with the carrying amounts of the related assets, are as follows:


	Level in Fair Value Hierarchy		December 31,
			2012				2011
			Carrying Amount		Fair Value		Carrying Amount		Fair Value
Restricted cash		1	$	400,493	$	400,493	$	83,383	$	83,383

Reporting Segments

The Company’s operations consist of one operating segment.

Recent Accounting Pronouncements

3. Property and Equipment

The major classes of property and equipment are as follows:


	Estimated		December 31,
	Useful Lives		2012			2011
Land owned in fee and perpetual easements		—	$	2,183		$	1,986
Wireless infrastructure		1-20 years		1,005,213			991,683
Construction in progress		—		25,506			10,817

Total gross property and equipment				1,032,902			1,004,486
Less accumulated depreciation				(329,631	)		(276,250	)

Total property and equipment, net			$	703,271		$	728,236

Depreciation expense for the years ended December 31, 2012, 2011 and 2010 was $54.1 million, $54.6 million and $55.3 million, respectively. As discussed in notes 1 and 2, the Company has certain prepaid capital leases with Sprint, which have related gross property and equipment and accumulated depreciation of $1.0 billion and $324.0 million, respectively, as of December 31, 2012.

F-58

4. Intangible Assets and Deferred Credits

The following is a summary of the Company’s intangible assets.


	As of December 31, 2012							As of December 31, 2011
	Gross Carrying Value		Accumulated Amortization			Net Book Value		Gross Carrying Value		Accumulated Amortization			Net Book Value
Site rental contracts and customer relationships	$	1,008,243	$	(303,568	)	$	704,675	$	1,008,243	$	(252,396	)	$	755,847
Other intangible assets		37,424		(12,204	)		25,220		38,493		(10,701	)		27,792

Total	$	1,045,667	$	(315,772	)	$	729,895	$	1,046,736	$	(263,097	)	$	783,639

Amortization expense related to intangible assets is classified as follows on the Company’s statement of operations:


	For Years Ended December 31,
	2012		2011		2010
Depreciation, amortization and accretion	$	51,173	$	51,173	$	51,729
Site rental costs of operations		1,854		2,183		2,348

Total amortization expense	$	53,027	$	53,356	$	54,077


	Years Ended December 31,
	2013		2014		2015		2016		2017
Estimated annual amortization	$	52,942	$	52,940	$	52,933	$	52,921	$	52,914

See note 2 for a further discussion of deferred credits related to above-market leases for land interests under the Company’s towers recorded in connection with acquisitions. For the years ended December 31, 2012, 2011 and 2010, the Company recorded $1.7 million, $2.0 million and $2.2 million, respectively, as a decrease to “site rental cost of operations”. The following is a summary of the Company’s above-market leases.


	As of December 31, 2012							As of December 31, 2011
	Gross Carrying Value		Accumulated Amortization			Net Book Value		Gross Carrying Value		Accumulated Amortization			Net Book Value
Above-market leases	$	33,183	$	(11,479	)	$	21,704	$	36,385	$	(10,810	)	$	25,575

The estimated annual amortization expense related to above-market leases for land interests under the Company’s towers for the years ended December 31, 2013 to 2017 is as follows:


	Years Ended December 31,
	2013		2014		2015		2016		2017
Estimated annual amortization	$	1,561	$	1,561	$	1,551	$	1,520	$	1,505

5. Debt

F-59

6. Related Party Transactions

In December 2012, CCL, the Company and other subsidiaries of CCL entered into a management agreement (“Management Agreement”) with CCUSA, an indirect wholly-owned subsidiary of CCIC, which replaced a previous management agreement among the same parties. The Company is charged a management fee by CCUSA under the Management Agreement whereby CCUSA has agreed to employ, supervise, and pay at all times a sufficient number of capable employees as may be necessary to perform services in accordance with the operation standards defined in the Management Agreement. CCUSA currently acts as the manager of the majority of the towers held by subsidiaries of CCIC. The management fee is equal to 7.5% of the Company’s Management Agreement Operating Revenues. The fee is compensation for those functions reasonably necessary to maintain, market, operate, manage and administer the towers, other than the operating expenses, which includes but is not limited to real estate and personal property taxes, ground lease and easement payments, and insurance premiums. The management fee charged from CCUSA for the years ended December 31, 2012, 2011 and 2010 totaled $25.1 million, $23.4 million and $22.0 million, respectively.

F-60

affiliate. As of December 31, 2012, there are approximately 1,500 towers where the land under the tower is owned by an affiliate. The Company pays ground rent expense to affiliates for land owned by affiliates that the Company has towers on. Rent expense to affiliates totaled $22.9 million, $17.3 million and $14.4 million for the years ended December 31, 2012, 2011 and 2010, respectively.

The Company recorded a net equity contribution of $226.0 million for the year ended December 31, 2012, which is inclusive of the contribution of restricted cash of $316.6 million to repurchase or redeem the outstanding 7.75% Secured Notes. The Company recorded net equity distributions of $76.1 million, and $86.2 million for the years ended December 31, 2011 and 2010, respectively, reflecting net distributions to its parent company. Cash on-hand above the amount that is required by the Management Agreement has and is expected to continue to be distributed to the Company’s parent company. See note 7 for a discussion of the equity contribution related to income taxes, CCL. See also note 12.

7. Income Taxes

The benefit (provision) for income taxes consists of the following:


	Years Ended December 31,
	2012			2011			2010
Current:
Federal	$	—		$	—		$	—
State		(936	)		(1,298	)		(229	)

Total current		(936	)		(1,298	)		(229	)

Deferred:
Federal		(43,989	)		(29,425	)		(20,634	)
State		(7,034	)		(1,005	)		(4,562	)

Total deferred		(51,023	)		(30,430	)		(25,196	)

Total tax benefit (provision)		(51,959	)		(31,728	)		(25,425	)

A reconciliation between the benefit (provision) for income taxes and the amount computed by applying the federal statutory income tax rate to the loss before income taxes is as follows:


	Years Ended December 31,
	2012			2011			2010
Benefit (provision) for income taxes at statutory rate	$	(46,842	)	$	(30,213	)	$	(22,590	)
State tax benefit (provision), net of federal		(5,181	)		(1,497	)		(3,115	)
Other		64			(18	)		280

	$	(51,959	)	$	(31,728	)	$	(25,425	)

F-61

The components of the net deferred income tax assets and liabilities are as follows:


	December 31,
	2012			2011
Deferred income tax liabilities:
Intangible assets	$	246,636		$	264,547
Property and equipment		215,637			234,611
Deferred site rental receivables		63,919			40,642
Accrued liabilities		1,346			—

Total deferred income tax liabilities		527,538			539,800

Deferred income tax assets:
Net operating loss carryforwards		188			188
Deferred ground lease payable		23,975			20,605
Accrued liabilities		—			647
Receivables allowance		87			20
Prepaid lease		332,568			337,891
Valuation allowances		—			—

Total deferred income tax assets, net		356,818			359,351

Net deferred income tax asset (liabilities)	$	(170,720	)	$	(180,449	)

During 2012, 2011, and 2010, the Company recorded non-cash equity contributions of $60.8 million, $50.2 million and $49.6 million, respectively, primarily related to the use by the Company of net operating losses from other members of CCIC’s federal consolidated group.

At December 31, 2012, the Company had U.S. federal and state net operating loss carryforwards of approximately $0.5 million and $0.3 million, respectively, which are available to offset future taxable income. The federal loss carryforwards will expire in 2022 through 2029. The state net operating loss carryforwards generally expire in 2013 through 2029. The utilization of the loss carryforwards is subject to certain limitations.

As of December 31, 2012, the total amount of unrecognized tax benefits that would impact the effective tax rate, if recognized, was $4.5 million; with respect to such amounts, $0.7 million, $1.0 million and $2.8 million of which were recorded in 2012, 2011, and 2010, respectively.

8. Commitments and Contingencies

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Asset Retirement Obligations

Pursuant to its ground lease and easement agreements, the Company has the obligation to perform certain asset retirement activities, including requirements upon lease and easement termination to remove wireless infrastructure or remediate the land upon which its wireless infrastructure resides. Accretion expense related to liabilities for retirement obligations amounted to $1.3 million, $1.2 million and $1.2 million for the years ended December 31, 2012, 2011 and 2010, respectively. As of December 31, 2012 and 2011, liabilities for retirement obligations amounted to $15.5 million and $16.2 million, respectively, representing the net present value of the estimated expected future cash outlay. As of December 31, 2012, the estimated undiscounted future cash outlay for asset retirement obligations was approximately $36.1 million. See note 2.

Property Tax Commitments

The Company has an obligation to reimburse Sprint for property taxes Sprint pays on the Company’s behalf related to certain towers the Company leases from Sprint. The Company paid $12.8 million, $12.4 million and $11.9 million for the year ended December 31, 2012, 2011 and 2010, respectively. The amount per tower to be paid to Sprint increases by 3% each successive year through 2037, the expiration of the lease term.

Operating Lease Commitments

See note 9 for a discussion of operating lease commitments.

9. Leases

Tenant Contracts


	Years Ended December 31,
	2013		2014		2015		2016		2017		Thereafter		Total
Tenant Contracts	$	348,205	$	336,273	$	350,420	$	349,491	$	342,110	$	1,897,970	$	3,624,469

Operating Leases

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the gross margin derived from the tower located on the leased land interest. Approximately 87% and 40% of the Company’s site rental gross margins for the year ended December 31, 2012, are derived from towers where the land interest under the tower is owned or leased by the Company with final expiration dates of greater than ten and 20 years, respectively, including renewals at the Company’s option. The operating lease payments included in the table below include payments for certain renewal periods at the Company’s option up to the estimated tower useful life of 20 years and an estimate of contingent payments based on revenues and gross margins derived from existing tenant leases. See also note 6.


	Years Ended December 31,
	2013		2014		2015		2016		2017		Thereafter		Total
Operating Leases	$	97,817	$	98,614	$	100,236	$	102,072	$	103,713	$	1,310,422	$	1,812,874

Rental expense from operating leases was $108.0 million, $105.3 million and $101.6 million for the years ended December 31, 2012, 2011 and 2010, respectively. The rental expense was inclusive of contingent payments based on revenues or gross margin derived from the tower located on the leased land of $17.6 million, $18.1 million and $18.1 million for the years ended December 31, 2012, 2011 and 2010, respectively.

10. Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk are primarily restricted cash and trade receivables. The Company mitigates its risk with respect to restricted cash by maintaining such deposits at high credit quality financial institutions and monitoring the credit ratings of those institutions. The Company’s restricted cash is held and directed by the trustee for the 7.75% Secured Notes. See notes 2, 6 and 12.

Major Customers

The following table summarizes the percentage of the Company’s revenue for those customers accounting for more than 10% of the Company’s revenues.


	Years Ended December 31,
	2012			2011			2010
Sprint		48	%		43	%		43	%
AT&T		15	%		17	%		16	%
T-Mobile		12	%		12	%		12	%
Verizon Wireless		9	%		10	%		10	%

Total		84	%		82	%		81	%

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11. Supplemental Cash Flow Information

The following table is a summary of the supplemental cash flow information during the years ended December 31, 2012, 2011 and 2010.


	For Years Ended December 31,
	2012		2011			2010
Supplemental disclosure of cash flow information:
Income taxes paid	$	—	$	—		$	—
Supplemental disclosure of non-cash investing and financing activities:
Non-cash equity contribution (distribution)—income taxes		60,751		50,215			49,648
Equity contribution (distribution) of amount due to (from) affiliates (note 6)		165,292		(126,271	)		(135,856	)

12. Subsequent Events

Restricted Cash & Equity

In January 2013, CCL completed the redemption of all of the then outstanding 7.75% Secured Notes, utilizing $316.6 million in restricted cash held by the Company as of December 31, 2012. Following the redemption of the 7.75% Secured Notes in January 2013, the remaining restricted cash was released to the Company, and then substantially all of the restricted cash was transferred to CCIC. The distribution of the $316.6 million and the remaining restricted cash to CCL was recorded as an equity distribution.

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PINNACLE TOWERS LLC

Consolidated Financial Statements

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Report of Independent Registered Public Accounting Firm

To the Board of Directors and Member of

CC Holdings GS V LLC:

In our opinion, the accompanying consolidated balance sheet and the related consolidated statements of operations, cash flows, and changes in member’s equity present fairly, in all material respects, the financial position of Pinnacle Towers LLC and subsidiaries (the “Company”) at December 31, 2012 and December 31, 2011, and the results of their operations and cash flows for each of the two years then ended in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

Pittsburgh, Pennsylvania

F-67

Report of Independent Registered Public Accounting Firm

The Board of Directors and Member of

CC Holdings GS V LLC:

We have audited the accompanying consolidated statements of operations, changes in member’s equity, and cash flows for the year ended December 31, 2010 of Pinnacle Towers LLC and subsidiaries (the Company). These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the results of operations and cash flows of Pinnacle Towers LLC and subsidiaries for the year ended December 31, 2010, in conformity with U.S. generally accepted accounting principles.

/s/ KPMG LLP

Pittsburgh, Pennsylvania