CC HOLDINGS GS V LLC INDEX TO FINANCIAL STATEMENTS. Consolidated Financial Statements Years Ended December 31, 2011, 2010 and 2009

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1 INDEX TO FINANCIAL STATEMENTS Consolidated Financial Statements Years Ended December 31, 2011, 2010 and 2009 Report of PricewaterhouseCoopers LLP, Independent Auditors F-2 Report of KPMG LLP, Independent Auditors F-3 Consolidated Balance Sheets as of December 31, 2011 and F-5 Consolidated Statements of Operations for the years ended December 31, 2011, 2010 and F-6 Consolidated Statements of Cash Flows for the years ended December 31, 2011, 2010 and F-7 Consolidated Statements of Changes in Member s Equity for the years ended December 31, 2011, 2010 and F-8 Notes to Consolidated Financial Statements F-9 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS (UNAUDITED) As of and for the years ended December 31, 2011, 2010 and F-24 Page Page F-1

2 To the Board of Directors and Member of CC Holdings GS V LLC: Report of Independent Auditors 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, 2011, and the results of their operations and cash flows for the year 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-23 for the year ended 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 audit. We conducted our audit of these statements in accordance with generally accepted auditing standards as established by the Auditing Standards Board (United States) and in accordance with the auditing 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 audit provides a reasonable basis for our opinion. /s/ PricewaterhouseCoopers, LLP Pittsburgh, Pennsylvania March 30, 2012 F-2

3 Independent Auditors Report The Board of Directors and Member of CC Holdings GS V LLC: We have audited the accompanying consolidated balance sheet of CC Holdings GS V LLC and subsidiaries (the Company) as of December 31, 2010, and the related consolidated statements of operations, changes in member s equity, and cash flows for each of the years in the two-year period ended December 31, In connection with our audits of the consolidated financial statements, we also have audited financial statement schedule II for each of the years in the two-year period ended December 31, These consolidated financial statements and the financial statement schedule are 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 audits. We conducted our audits in accordance with generally accepted auditing standards as established by the Auditing Standards Board (United States) and in accordance with the auditing 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. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion. An audit also 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, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of CC Holdings GS V LLC and subsidiaries as of December 31, 2010 and the results of their operations and their cash flows for each of the years in the two-year period ended December 31, 2010 in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedule for each of the years in the two-year period 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 December 10, 2012 F-3

4 Consolidated Financial Statements Years Ended December 31,2011,2010 and2009 F-4

5 Consolidated Balance Sheets December 31, 2011 and 2010 (In thousands of dollars) Assets Current assets: Restricted cash... $ 83,383 $ 75,593 Receivables net of allowance of $1,605 and $2,032, respectively... 3,799 6,957 Prepaid expenses... 21,852 19,748 Deferred income tax assets... 13,843 13,740 Deferred site rental receivables and other current assets, net... 3,274 3,991 Total current assets , ,029 Deferred site rental receivables, net ,759 93,280 Property and equipment, net... 1,177,259 1,232,557 Goodwill... 1,338,730 1,337,985 Site rental contracts and customer relationships, net... 1,575,113 1,680,507 Other intangible assets, net... 36,367 44,451 Long-term prepaid rent, deferred financing costs and other assets, net... 41,478 40,518 Total assets... $4,440,857 $4,549,327 Liabilities and Member s Equity Current liabilities: Accrued expenses and payables... $ 8,681 $ 6,944 Accrued interest... 15,500 15,500 Deferred revenues... 20,203 36,539 Total current liabilities... 44,384 58,983 Debt... 1,174,302 1,170,618 Deferred income tax liabilities , ,987 Deferred ground lease payable, above-market leases and other liabilities , ,707 Total liabilities... 1,730,931 1,748,295 Commitments and contingencies (note 7) Member s equity: Member s equity... 2,849,147 2,958,517 Accumulated earnings (deficit)... (139,221) (157,485) Total member s equity... 2,709,926 2,801,032 Total liabilities and equity... $4,440,857 $4,549,327 See accompanying notes to consolidated financial statements. F-5

6 Consolidated Statements of Operations Years ended December 31, 2011, 2010 and 2009 (In thousands of dollars) Net revenues: Site rental revenues $540,052 $500,690 $ 460,981 Operating expenses: Site rent cost of operations third parties (a) , , ,988 Site rent cost of operations related parties (a) ,298 15,759 14,281 Site rent cost of operations total (a) , , ,269 Management fee ,606 34,918 32,938 Asset write-down charges ,688 7,366 8,585 Acquisition and integration costs Depreciation, amortization and accretion , , ,656 Total operating expenses , , ,448 Operating income (loss) ,165 96,440 60,533 Other income (expense): Interest expense and amortization of deferred financing costs third parties (83,075) (83,720) (94,608) Interest expense and amortization of deferred financing costs related parties (15,880) (14,778) (773) Interest expense and amortization of deferred financing costs total... (98,955) (98,498) (95,381) Gain (loss) on retirement of long-term obligations third parties (93,368) Gain (loss) on retirement of long-term obligations related parties.... (14,350) Gain (loss) on retirement of long-term obligations total (107,718) Other income (expense) (20) (144) 108 Income (loss) before income taxes ,190 (2,202) (142,458) Benefit (provision) for income taxes (10,926) (2,338) 58,588 Net income (loss) $ 18,264 $ (4,540) $ (83,870) (a) Excluding depreciation, amortization and accretion. See accompanying notes to consolidated financial statements. F-6

7 Consolidated Statements of Cash Flows Years ended December 31, 2011, 2010 and 2009 (In thousands of dollars) Cash flow from operating activities: Net income (loss) $ 18,264 $ (4,540) $ (83,870) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation, amortization and accretion , , ,656 Amortization of deferred financing costs and other non-cash interest on long-term debt ,955 5,498 3,608 Asset write-down charges ,688 7,366 8,585 (Gain) loss on retirement of long-term obligations ,718 Deferred income tax provision (benefit) ,506 2,028 (57,965) Other adjustments (64) Changes in assets and liabilities: Increase (decrease) in accounts payable and other accrued expenses ,737 (1,118) 10,293 Increase (decrease) in deferred revenues, deferred ground lease payable and other liabilities (10,817) 8,556 10,818 Decrease (increase) in receivables , Decrease (increase) in other current assets, deferred site rental receivable, long-term prepaid rent and other assets (59,486) (34,360) (32,909) F Net cash provided by (used for) operating activities , , ,491 Cash flows from investing activities: Capital expenditures (33,641) (36,875) (55,741) Other investing activities Payments for acquisitions of businesses, net of cash acquired (2,410) Net cash provided by (used for) investing activities... (35,966) (35,886) (54,918) Cash flows from financing activities: Proceeds from the issuance of long-term debt ,165,104 Principal payment on debt (1,656,255) Payments for financing costs (22,026) (Distributions) contributions to member (132,274) (139,459) 446,058 Net (increase) decrease in restricted cash (2,797) (2,057) (36,454) Net cash provided by (used for) financing activities... (135,071) (141,516) (103,573) Net increase (decrease) in cash and cash equivalents... Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year $ $ $ Supplemental disclosure of cash flow information: Interest paid (inclusive of payments to related parties) $ 93,000 $ 93,000 $ 83,671 Income taxes paid Non-cash equity contribution (distribution) income taxes ,904 19,541 (10,373) Equity contribution (distribution) of amount due to related parties.... (132,274) (127,200) 226,716 See accompanying notes to consolidated financial statements.

8 Consolidated Statements of Changes in Member s Equity Years ended December 31, 2011, 2010 and 2009 (In thousands of dollars) Member s equity Accumulated earnings (deficit) Balance at December 31, $2,849,833 $ (69,075) $2,780,758 Equity distribution income taxes (note 6) (10,373) (10,373) Equity contribution (note 5) , ,716 Net income (loss) (83,870) (83,870) Balance at December 31, $3,066,176 $(152,945) $2,913,231 Equity contribution income taxes (note 6) ,541 19,541 Equity distribution (note 5) (127,200) (127,200) Net income (loss) (4,540) (4,540) Balance at December 31, $2,958,517 $(157,485) $2,801,032 Equity contribution income taxes (note 6) ,904 22,904 Equity distribution (note 5) (132,274) (132,274) Net income (loss) ,264 18,264 Balance at December 31, $2,849,147 $(139,221) $2,709,926 Total See accompanying notes to consolidated financial statements. F-8

9 Notes to Consolidated Financial Statements (Dollars in thousands) (1) Basis of Presentation and Summary of Significant Accounting Policies (a) 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 and its consolidated wholly owned subsidiaries (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. ( CCIC or Crown Castle, a Delaware corporation). 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 (collectively towers sites or wireless infrastructure ) to wireless communications companies. The Company s core business is providing access to our 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. Our sites can accommodate multiple customers for antennas and other equipment necessary for the transmission of signal for wireless communication devices. Certain 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 for approximately 5,300 Sprint towers. In 2037, the Company has the option to purchase all (but not less than all) of the Sprint towers that it does not already own after the initial term expires. Management services related to communications towers and other communications 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. (b) Summary of Significant Accounting Policies Restricted Cash Restricted cash represents (1) the cash held in reserve by the indenture trustees pursuant to the indenture governing certain of the Company s debt instruments and (2) other cash whose use is limited by contractual provisions. The restriction of all rental cash receipts is a critical feature of the Company s debt instruments, due to the applicable indenture trustee s ability to utilize the restricted cash for the payment of (1) debt service costs, (2) ground rents, (3) real estate and personal property taxes, (4) insurance premiums related to towers, (5) other assessments by governmental authorities and potential environmental remediation costs, and (6) a portion of advance rents from customers to the Company. The restricted cash in excess of required reserve balances is subsequently released to the Company in accordance with the terms of the indentures. The Company has classified the increases and decreases in restricted cash as (1) cash provided by financing activities for cash held by indenture trustees based on consideration of the terms of the related indebtedness, 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 $5.0 million, $1.0 million and $2.5 million for the years ending December 31, 2011, 2010 and 2009, respectively. F-9

10 Receivables Allowance CC HOLDINGS GS V LLC Notes to Consolidated Financial Statements (Dollars in thousands) 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 site rental 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. The allowance for uncollectible deferred site rental receivables was $-0- and $0.8 million as of December 31, 2011 and 2010, respectively. 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 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 F-10

11 Notes to Consolidated Financial Statements (Dollars in thousands) 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. Starting in 2011, 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 performs its annual tests of goodwill as of October 1 st. In 2011, the Company utilized the qualitative assessment and determined that the more likely than not threshold was achieved and no further testing of goodwill was required. In the 2010 and 2009, goodwill tests, the Company completed the step-one impairment test and determined goodwill was not impaired. Other Intangible Assets Intangible assets are included in 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, (2) below-market leases for land interests under the acquired wireless infrastructure, (3) term easement rights for land interests under the acquired wireless infrastructure, and (4) trademarks. The site rental contracts and customer relationships intangible assets are comprised of (1) the 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 related to above-market leases for land interests under the Company s wireless infrastructure recorded in conjunction with acquisitions are recorded at the estimated fair value and are included in deferred ground lease payable and other liabilities on the Company s consolidated balance sheet. The useful lives of intangible assets are estimated based on the period over which the intangible asset is expected to benefit the Company 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 F-11

12 Notes to Consolidated Financial Statements (Dollars in thousands) 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 wireless infrastructure 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 Financing Costs Costs incurred to obtain financing are deferred and amortized over the 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 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. 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 contain a variable element in addition to a minimum. The Company s assets related to straight-line site rental revenues are included in deferred site rental receivable and other current assets, net and amounts received in advance are recorded as deferred revenue on the Company s consolidated balance sheet. F-12

13 Costs of Operations CC HOLDINGS GS V LLC Notes to Consolidated Financial Statements (Dollars in thousands) 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, insurance, and monitoring costs. 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 deferred site rental receivables and other current 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 revenue excluding the revenues related to the accounting for leases with fixed escalators as required. The management fee charged from CCUSA for the years ended December 31, 2011, 2010 and 2009 totaled $36.6 million, $34.9 million and $32.9 million, respectively. See note 5. Income Taxes The Company is a limited liability company ( LLC ). Under the federal and state income tax laws, regulations, and administrative rulings, single member LLC s are treated as disregarded entities for income tax return filing purposes (unless elected otherwise). Single member LLC s 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. F-13

14 Notes to Consolidated Financial Statements (Dollars in thousands) 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 upon assets that will more likely than not not be realized. 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% likely of being realized upon ultimate settlement. The Company records interest or penalties related to income taxes as components of the benefit (provision) for income taxes in its consolidated financial statements. As of December 31, 2011, the Company has not recorded any penalties 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, 2010 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 (liabilities), are as follows: Level in Fair Value Hierarchy Carrying Amount December 31, Fair Value Carrying Amount Fair Value Restricted cash (a)... 1 $ 83,383 $ 83,383 $ 75,593 $ 75,593 Long-term debt... 2 (1,174,302) (1,293,000) (1,170,618) (1,311,000) (a) Restricted cash is measured at fair value on a recurring basis as of December 31, Reporting Segments The Company determined its operations consist of one operating segment. F-14

15 Recent Accounting Pronouncements CC HOLDINGS GS V LLC Notes to Consolidated Financial Statements (Dollars in thousands) 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 The Company performed the qualitative assessment as of October 1, 2011 and determined that no additional testing of goodwill was required. (2) Property and Equipment The major classes of property and equipment are as follows: Estimated December 31, useful lives Land owned in fee and perpetual easements $ 75,296 $ 76,441 Wireless infrastructure years 1,491,740 1,465,941 Construction in progress ,711 25,595 Total gross property and equipment ,589,747 1,567,977 Less accumulated depreciation (412,488) (335,420) Total property and equipment, net $1,177,259 $1,232,557 Depreciation expense for the years ended December 31, 2011, 2010 and 2009 was $81.1 million, $82.6 million and $82.8 million, respectively. See note 1. (3) Intangible Assets and Deferred Credits For the years ended December 31, 2011 and 2010, the Company recorded $1.2 million and $0, respectively, of site rental contracts and customer relationships. The following is a summary of the Company s intangible assets. Year ended December 31, 2011 Year ended December 31, 2010 Gross carrying amount Accumulated amortization Net book value Gross carrying amount Accumulated amortization Net book value Site rental contracts and customer relationships..... $2,100,699 $(525,586) $1,575,113 $2,099,517 $(419,010) $1,680,507 Below-market leases ,445 (13,413) 33,032 51,308 (11,935) 39,373 Other intangible assets ,170 (8,835) 3,335 12,131 (7,053) 5,078 Total $2,159,314 $(547,834) $1,611,480 $2,162,956 $(437,998) $1,724,958 F-15

16 Notes to Consolidated Financial Statements (Dollars in thousands) Amortization expense related to intangible assets is classified as follows on the Company s consolidated statement of operations: For Years Ended December 31, Depreciation, amortization and accretion $108,359 $109,499 $107,501 Site rental cost of operations ,823 2,835 3,121 Total amortization expense $111,182 $112,334 $110,622 The estimated annual amortization expense related to intangible assets (inclusive of those recorded to site rental cost of operations ) for the years ending December 31, 2012 to 2016 are as follows: Years ending December 31, Estimated annual amortization $109,228 $109,155 $107,259 $107,233 $107,225 See note 1 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, 2011, 2010 and 2009, the Company recorded $2.6 million, $3.1 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. Gross Carrying Value As of December 31, 2011 As of December 31, 2010 Accumulated Amortization Net Book Value Gross Carrying Value Accumulated Amortization Net Book Value Above-market leases $47,975 $(14,310) $33,665 $50,157 $(12,432) $37,725 The estimated annual amortization expense related to above-market leases for land interests under the Company s towers for the years ending December 31, 2012 to 2016 is as follows: Years Ending December 31, Estimated annual amortization $2,219 $2,184 $2,176 $2,154 $2,192 (4) Debt Original Issue Date Bonds fixed rate: 7.75% Senior Secured Notes April 2009 May 2017 $1,174,302 $1,170, % (a) F-16 Contractual Maturity Date (a) The effective yield is approximately 8.2%, inclusive of the discount. Outstanding Balance as of December 31, 2011 Outstanding Balance as of December 31, 2010 Stated Interest Rate as of December 31, 2011 The Company s debt obligations as of December 31, 2011 and 2010 consist entirely of the $1.2 billion 7.75% Senior Secured Notes due 2017 described below, of which $195.3 million and $194.7 million, respectively, are due to CCIC. The 7.75% Senior Secured Notes due 2017 have a fixed interest rate of 7.75%. Quarterly interest-only payments began August 1, 2009 and continue to the contractual maturity date of May 1, The $3.7 million change in the carrying value during 2011 related entirely to the accretion of the original issue discount.

17 (a) 7.750% Senior Secured Notes due 2017 CC HOLDINGS GS V LLC Notes to Consolidated Financial Statements (Dollars in thousands) On April 30, 2009, CC Holdings GS V LLC ( Issuer Entity ) and Crown Castle GS III Corp. ( Co- Issuer Entity and together with the Issuer Entity, Issuers ) issued $1.2 billion aggregate principal amount of 7.75% Senior Secured Notes due 2017 ( 7.75% Secured Notes ), pursuant to an indenture ( Indenture ) dated as of April 30, 2009, by and among the Issuers, the Guarantors (as defined below) and The Bank of New York Mellon Trust Company, N.A., as trustee ( Indenture Trustee ). The 7.75% Secured Notes are guaranteed by the direct and indirect wholly owned subsidiaries of the Issuer Entity, other than the Co-Issuer Entity (collectively, Guarantors ). The 7.75% Secured Notes are not guaranteed by and will not constitute obligations of CCIC or any of its subsidiaries, other than the Issuers and the Guarantors. The 7.75% Secured Notes will be paid solely from the cash flows generated from operation of the towers held directly and indirectly by the Issuer Entity and the Guarantors. The 7.75% Secured Notes are secured on a first priority basis by a pledge of the equity interests of the Guarantors holding such towers 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 were used by the Guarantors, as well as an advance from an indirect subsidiary of CCIC, to repay in full the February 2006 Mortgage Loan and the related prepayment considerations. The repayment of the February 2006 Mortgage Loan resulted in a loss of $107.7 million in April The proceeds of such repayment were deposited with the trustee for the certificates and distributed to the holders of such certificates in accordance with the terms of the Trust (as defined in the Indenture). The repayment was inclusive of $256.7 million that was ultimately paid to CCIC for the portion of the February 2006 Mortgage Loan owned by CCIC (see note 5). Some or all of the 7.75% Secured Notes, at the Issuer Entity s option, may be redeemed at any time prior to May 1, 2013 at a price equal to 100% of the principal amount of the 7.75% Secured Notes plus a make-whole premium. In addition, some or all of the 7.75% Secured Notes, at the Issuer Entity s option, may be redeemed at any time on or after May 1, 2013 at the redemption prices set forth in the Indenture. In addition, under certain circumstances, the Issuers may also be required to commence an offer to purchase 7.75% Secured Notes at par as a result of the sale of assets or the receipt of casualty and condemnation proceeds. The Cash Management Agreement (as defined in the 7.75% Senior Notes Indenture) provides that for so long as any Cash Trap Event (as described below) is continuing, all Excess Cash Flow will be deposited in a Cash Trap Reserve Sub-Account. A Cash Trap Event will occur as of the last day of any calendar quarter when the Consolidated Fixed Charge Coverage Ratio of the Issuer Entity is equal to or less than 1.35 to 1 and will continue to exist until such time as the Consolidated Fixed Charge Coverage Ratio exceeds 1.35 to 1 for two consecutive calendar quarters. At December 31, 2011, the Consolidated Fixed Charge Coverage Ratio was 3.1 to 1. If, at the end of any fiscal quarter, (1) the aggregate amount of funds deposited in the Cash Trap Reserve Sub-Account exceeds $100.0 million and (2) a Repayment Period (as described below) is in effect, the Issuers will be required to commence within 30 days following the end of such quarter an offer to purchase the maximum principal amount of 7.75% Secured Notes that may be purchased out of the aggregate amount of funds deposited in the Cash Trap Reserve Sub-Account. A Repayment Period will commence as of the last day of any calendar quarter if the Consolidated Fixed Charge Coverage Ratio is equal to or less than 1.20 to 1 and will continue to exist until the Consolidated Fixed Charge Coverage Ratio exceeds 1.20 to 1 as of the last day of any calendar quarter. In connection with the issuance and sale of the 7.75% Secured Notes, the Issuer Entity and the Guarantors entered into a management agreement ( Management Agreement ) dated as of April 30, F-17

18 Notes to Consolidated Financial Statements (Dollars in thousands) 2009, with CCUSA. CCUSA is a wholly owned indirect subsidiary of CCIC. Pursuant to the Management Agreement, CCUSA performs, on behalf of the Guarantors, those functions reasonably necessary to maintain, market, operate, manage and administer the assets of the Guarantors. See note 5. Also in connection with the issuance and sale of the 7.75% Secured Notes, the Issuer Entity, the Guarantors, the Indenture Trustee and the Manager entered into the Cash Management Agreement. Pursuant to the Cash Management Agreement, the Manager and Indenture Trustee administer the reserve and allocation of funds. Interest Expense and Amortization of Deferred Financing Costs The components of interest expense and amortization of deferred financing costs are as follows: Years ended December 31, Interest expense on debt obligations... $93,000 $93,000 $91,773 Amortization of deferred financing costs... 2,271 2,105 1,472 Amortization of adjustments on long-term debt... 3,684 3,393 2,136 Total... $98,955 $98,498 $95,381 (5) Related Party Transactions 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. The management fee is equal to 7.5% of the Company s revenue excluding the revenues related to the accounting for leases with fixed escalators as required by the applicable accounting standards. 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, 2011, 2010 and 2009 totaled $36.6 million, $34.9 million and $32.9 million, 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, 2011, 2010 and 2009, rent revenue from affiliates totaled $0.3 million, $0.3 million and $0.5 million, respectively. Rent expense to affiliates totaled $18.3 million, $15.8 million and $14.3 million for the years ended December 31, 2011, 2010 and 2009, respectively. In January 2010, CCIC acquired through market purchases, $199.6 million of principal amount of the 7.75% Secured Notes. As a result, the 7.75% Secured Notes acquired by CCIC remain outstanding on the Company s consolidated balance sheet. During the year ended December 31, 2009, CCIC acquired through market purchases, $256.2 million of February 2006 Mortgage Loans, which were repaid in April 2009 (See note 4). For the years ended December 31, 2011, 2010 and 2009, the Company recorded interest expense of approximately $15.5 million, $14.4 million and $0.8 million, respectively, on the amount due to CCIC. The Company recorded equity distributions of $132.3 million and $127.2 million for the years ended December 31, 2011 and 2010, respectively, reflecting distributions to its parent company. See note 6. F-18

19 Notes to Consolidated Financial Statements (Dollars in thousands) (6) Income Taxes The Company is a limited liability company ( LLC ). Under the federal and state income tax laws, regulations, and administrative rulings, single member LLC s are treated as disregarded entities for income tax return filing purposes (unless elected otherwise). Single member LLC s 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, Current: Federal... $ $ $ 878 State... (1,420) (310) (255) Deferred: Federal... (9,704) 2,570 45,512 State (4,598) 12,453 Total tax benefit (provision)... $(10,926) $(2,338) $58,588 A reconciliation between the benefit (provision) for income taxes and the amount computed by applying the federal statutory income tax rate to the loss from continuing operations before income taxes is as follows: Years ended December 31, Benefit (provision) for income taxes at statutory rate... $(10,217) $ 771 $49,860 Nondeductible expenses and other... (3) (4) (25) State tax benefit (provision), net of federal... (794) (3,190) 7,929 Other The components of the net deferred income tax assets and liabilities are as follows: $(10,926) $(2,338) $58,588 Years ended December 31, Deferred income tax liabilities: Intangible assets... $548,941 $586,634 $624,142 Property and equipment , , ,498 Deferred site rental receivables... 55,575 37,648 24,362 Total deferred income tax liabilities , , ,002 Deferred income tax assets: Net operating loss carryforwards... 87,664 88,312 93,402 Deferred ground lease payable... 23,140 20,345 16,029 Accrued liabilities... 15,203 10,827 8,959 Receivables allowance Prepaid lease , , ,050 Valuation allowances... (4,024) (4,024) Total deferred income tax assets, net , , ,241 Net deferred income tax liabilities... $382,849 $396,247 $413,761 F-19