CC Holdings GS V LLC f/k/a Global Signal Holdings V LLC. Management s Discussion and Analysis. Condensed Consolidated Financial Statements

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1 CC Holdings GS V LLC f/k/a Global Signal Holdings V LLC Management s Discussion and Analysis Condensed Consolidated Financial Statements For the Six Months Ended June 30, 2012 and 2011 (Unaudited)

2 Assets CC HOLDINGS GS V LLC Condensed Consolidated Balance Sheets (In thousands of dollars) June 30, December 31, (Unaudited) Current assets: Restricted cash $ 75,441 83,383 Receivables net of allowance of $1, ,799 Deferred income tax assets 9,860 13,843 Deferred site rental receivables and other current assets, net 27,788 25,126 Total current assets 113, ,151 Deferred site rental receivables, net 182, ,759 Property and equipment, net 1,156,288 1,177,259 Goodwill 1,338,730 1,338,730 Site rental contracts and customer relationships, net 1,521,802 1,575,113 Other intangible assets, net 34,637 36,367 Long-term prepaid rent, deferred financing costs and other assets, net 41,858 41,478 Total assets $ 4,389,542 4,440,857 Liabilities and Member s Equity Current liabilities: Accounts payable and other accrued expenses $ 3,791 8,681 Accrued interest 15,500 15,500 Deferred revenues 13,195 20,203 Total current liabilities 32,486 44,384 Long-term debt 1,176,260 1,174,302 Deferred income tax liabilities 393, ,692 Deferred ground lease payable and other liabilities 118, ,553 Total liabilities 1,720,277 1,730,931 Commitments and contingencies (note 8) Member s equity: Member s equity 2,783,297 2,849,147 Accumulated earnings (deficit) (114,032) (139,221) Total member s equity 2,669,265 2,709,926 $ 4,389,542 4,440,857 See accompanying notes to condensed consolidated financial statements. 2

3 CC HOLDINGS GS V LLC Condensed Consolidated Statements of Operations (Unaudited) (In thousands of dollars) Six Months Ended June 30, Net revenues: Site rental revenues $ 292, , , ,824 Operating expenses: Cost of operations (excluding depreciation, amortization and accretion) 87,683 85,301 Management fee 19,051 18,108 Asset write-down charges 1,054 5,573 Depreciation, amortization and accretion 94,563 95,699 Total operating expenses 202, ,681 Operating income 90,469 60,143 Other income (expense): Interest income 2 21 Other income (expense) 39 (76) Interest expense and amortization of deferred financing costs (49,666) (49,416) Income (loss) before income taxes 40,844 10,672 Benefit (provision) for income taxes (15,655) (7,462) Net income (loss) $ 25,189 3,210 See accompanying notes to condensed consolidated financial statements. 3

4 CC HOLDINGS GS V LLC Condensed Consolidated Statements of Cash Flows (Unaudited) (In thousands of dollars) Six Months Ended June 30, Cash flow from operating activities: Net income (loss) $ 25,189 3,210 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation, amortization and accretion 94,563 95,699 Amortization of deferred financing costs and other non-cash interest 2,556 2,916 Asset write-down charges 1,054 5,573 Deferred tax provision (benefit) 15,463 5,292 Changes in assets and liabilities: Increase (decrease) in accounts payable and other accrued expenses (4,890) (5,024) Increase (decrease) in deferred revenues, deferred ground lease payable and other liabilities (3,740) (10,882) Decrease (increase) in receivables 3,590 3,421 Decrease (increase) in other current assets, deferred site rental receivable, long-term prepaid rent and other assets (41,173) (18,529) Net cash provided by operating activities 92,612 81,676 Cash flows from investing activities: Capital expenditures (20,224) (16,294) Net proceeds from disposition of property 7 74 Net cash (used for) investing activities (20,217) (16,220) Cash flows from financing activities: (Increase) decrease in amount due from parent (80,535) (69,810) Net (increase) decrease in restricted cash 8,140 4,354 Net cash (used for) financing activities (72,395) (65,456) 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 $ 46,500 46,500 Income taxes paid Equity contribution (distribution) - income taxes $ 14,685 8,313 Equity contribution (distribution) of amount due to parent (80,535) (71,811) See accompanying notes to condensed consolidated financial statements. 4

5 CC HOLDINGS GS V LLC Condensed Consolidated Statements of Changes in Member s Equity (Unaudited) (In thousands of dollars) Accumulated Member s earnings equity (deficit) Total Balance at January 1, 2011 $ 2,958,517 (157,485) 2,801,032 Equity contribution income taxes (note 6) 8,313 8,313 Equity distribution (note 5) (71,811) (71,811) Net income (loss) 3,210 3,210 Balance at June 30, 2011 $ 2,895,019 (154,275) 2,740,744 Accumulated Member s earnings equity (deficit) Total Balance at January 1, 2012 $ 2,849,147 (139,221) 2,709,926 Equity contribution income taxes (note 6) 14,685 14,685 Equity distribution (note 5) (80,535) (80,535) Net income (loss) 25,189 25,189 Balance at June 30, 2012 $ 2,783,297 (114,032) 2,669,265 See accompanying notes to condensed consolidated financial statements. 5

6 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Unaudited (Continued) (Tabular dollars in thousands) 1. General The information contained in the following notes to the consolidated financial statements is condensed from that which would appear in the audited annual consolidated financial statements; accordingly, the consolidated financial statements included herein should be reviewed in conjunction with the consolidated financial statements for the fiscal year ended December 31, 2011, and related notes thereto. 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, f/k/a Global Signal Holdings V LLC ). On April , the Company was renamed CC Holdings GS V LLC. The Company is a wholly-owned subsidiary of Global Signal Operating Partnership, L.P., 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 owns, operates and leases communications towers and other communications sites to providers of wireless communications and broadcast services, such as wireless telephony services, paging, mobile radio, wireless data transmission and radio and television broadcasting, and to operators of private networks such as federal, state, and local government agencies. The Company s towers and sites are geographically dispersed across the United States. 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. Basis of Presentation The condensed consolidated financial statements included herein are unaudited; however, they include all adjustments (consisting only of normal recurring adjustments) which, in the opinion of management, are necessary to present fairly the consolidated financial position of the Company at June 30, 2012, and the consolidated results of operations and the consolidated cash flows for the six months ended June 30, 2012 and Accounting measurements at interim dates inherently involve greater reliance on estimates than at year end. The results of operations for the interim periods presented are not necessarily indicative of results to be expected for the entire year. The preparation of financial statements in conformity with GAAP 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 those estimates. 2. Summary of Significant Accounting Policies The summary of significant accounting policies used in the preparation of the Company s consolidated financial statements is disclosed in the Company s audited annual consolidated financial statements. New Accounting Pronouncements No accounting pronouncements adopted during the six months ended June 30, 2012 had a material impact on the Company s consolidated financial statements. No new accounting pronouncements issued during the six months ended June 30, 2012 but not yet adopted are expected to have a material impact on the Company s consolidated financial statements. 3. Debt The Company s outstanding debt as of June 30, 2012 consists entirely of the 7.75% Senior Secured Notes due 2017 of $1.2 billion described below. The 7.75% Senior Secured Notes due 2017 have a fixed interest rate of 7.75%. 6

7 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Unaudited (Continued) (Tabular dollars in thousands) Quarterly interest only payments began August 1, 2009 and continue to the contractual maturity date of May 1, % Senior Secured Notes due 2017 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. 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 June 30, 2012, the Consolidated Fixed Charge Coverage Ratio was 3.2. If, at the end of any fiscal quarter, (i) the aggregate amount of funds deposited in the Cash Trap Reserve Sub- Account exceeds $100.0 million and (ii) 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, 2009, with Crown Castle USA Inc. ( Manager ). The Manager is a wholly-owned indirect subsidiary of CCIC. Pursuant to the Management Agreement, the Manager will perform, on behalf of the Guarantors, those functions reasonably necessary to maintain, market, operate, manage and administer the assets of the Guarantors. 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 will 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: 7

8 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Unaudited (Continued) (Tabular dollars in thousands) Six Months Ended June 30,, Interest expense on debt obligations... $ 46,500 $ 46,500 Amortization of deferred financing costs... 1,208 1,112 Amortization of adjustments on long-term debt... 1,958 1,804 Total... $ 49,666 $ 49, Fair Value Disclosures The fair value of cash and cash equivalents and restricted cash approximates the carrying value. The Company determines fair value of its debt securities based on indicative, non-binding quotes from brokers. Quotes from brokers require judgment and are based on the broker s interpretation of market information including implied credit spreads for similar borrowings on recent trades or bid/ask prices. 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 (liabilities), are as follows: Carrying Amount June 30, 2012 December 31, 2011 Fair Value Carrying Amount Restricted cash... $ 75,441 $ 75,441 $ 83,383 $ 83,383 Long-term debt... (1,176,260) (1,274,772) (1,174,302) (1,243,000) As of June 30, 2012, the fair value of the Company s restricted cash is measured on a recurring basis and are classified as Level 1 fair value measurements. 5. Related Party Transaction The Company recorded equity distributions of $80.5 million and $71.8 million for the six months ended June 30, 2012 and 2011, respectively, reflecting the transfer of the Company s net intercompany receivable to its parent company. Similar future intercompany transactions will be recorded as equity contributions from or distributions to the Company s parent, as appropriate. See note Income Taxes For the six months ended June 30, 2012, the Company recorded a tax provision of $15.7 million. The effective tax rate for the second quarter of 2012 differs from the federal statutory rate predominately due to state taxes and differences in the book and tax basis of fixed assets. During the six months ended June 30, 2012 and 2011, the Company recorded equity contributions of $14.7 million and $8.3 million, respectively, related to the use of net operating losses from members in its federal consolidated group that are not members of the Company s group of companies. 7. Commitments and Contingencies The Company is involved in various claims, lawsuits and proceedings arising in the ordinary course of business. While there are uncertainties inherent in the ultimate outcome of such matters, and it is impossible to presently determine the ultimate costs or losses that may be incurred, if any, management believes the resolution of such uncertainties and the incurrence of such costs should not have a material adverse effect on the Company s consolidated financial position or results of operations. Fair Value 8

9 Management s Discussion and Analysis of Financial Condition and Results of Operations The following management s discussion and analysis ( MD&A ) of the consolidated financial condition and results of operations of CC Holdings GS V LLC and its consolidated wholly owned subsidiaries ( GSL V ) is provided as a convenience to the reader in understanding GSL V s financial condition, changes in financial condition and results of operations as of and for the six months ended June 30, GSL V is a wholly owned subsidiary of Global Signal Operating Partnership, L.P., which is an indirect subsidiary of Crown Castle International Corp. ( CCIC or Crown Castle, a Delaware Corporation). The following should be read in conjunction with the (i) audited consolidated financial statements of GSL V for the years ended December 31, 2011 and 2010 and (ii) CCIC s Annual Report on Form 10-K ( Crown Castle 10-K ) for the year ended December 31, Unless indicated otherwise, reference to GSL V s consolidated financial statements refers to those financial statements for the years ended December 31, 2011 and Any capitalized terms used but not defined herein have the same meaning given to them in GSL V s consolidated financial statements. Unless this report indicates otherwise or the context requires, the terms we, our, our company, the company, or us as used in this report refers to CC Holdings GS V LLC and its consolidated wholly-owned subsidiaries. GSL V is not separately subject to the periodic reporting requirements of the Securities Exchange Act of 1934 and the information provided herein does purport to comply with such reporting requirements. Cautionary Language Regarding Forward-Looking Statements This quarterly report contains forward-looking statements that are based on management s expectations as of the filing date of this report. Statements that are not historical facts are hereby identified as forward-looking statements. In addition, words such as estimate, anticipate, project, plan, intend, believe, expect, likely, predicted, forms of these words and similar expressions are intended to identify forward-looking statements. Such statements include plans, projections and estimates contained in Management s Discussion and Analysis of Financial Condition and Results of Operations herein. Such forward-looking statements are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. These risks and uncertainties include, prevailing market conditions, the risk factors described in Item 1A. Risk Factors of the Crown Castle 10-K, as well as the following risk factors that are in addition to those included in the Crown Castle 10-K. A substantial portion of GSL V s revenues are derived from a small number of customers, and the loss, consolidation or financial instability of, or network sharing among, any of our limited number of customer may materially decrease revenues. Customers may choose not to renew their tenant leases. The bankruptcy of certain subsidiaries of Sprint which are sublessors to one of GSL V s subsidiaries could result in GSL V s subsidiaries sublease interests being rejected by the bankruptcy court. The failure of one of GSL V s subsidiaries to comply with its covenants in Sprint master leases including its obligation to timely pay ground lease rent, could result in an event of default under the applicable Sprint master leases, which could adversely impact GSL V s business. GSL V has no employees of its own and hence is dependent on Crown Castle USA Inc. ( CCUSA ), an affiliate of GSL V who provides management services for the conduct of GSL V s operations. Any failure of CCUSA to continue to perform in its role as manager of the towers could have a material adverse impact on GSL V s business. CCUSA may experience conflicts of interest in the management of the towers and in the management of towers of affiliates carried out pursuant to other management agreements. 9

10 General Overview Overview GSL V owns, operates and leases communications towers and other communication sites to providers of wireless communications and broadcast, such as wireless telephony services, paging, mobile radio, wireless data transmission and radio and television broadcasting, and to operators of private networks such as federal, state, and local government agencies. GSL V s business is renting space on its towers via long-term contracts in various forms, including license, sublease and lease agreements. Generally, GSL V s towers can accommodate multiple customers for antennas and other equipment necessary for the transmission of wireless signals for mobile telephones and other devices. Information concerning GSL V s tower portfolio as of June 30, 2012 is as follows: GSL V owned, leased or managed approximately 7,800 towers located across the United States. GSL V s customers include many of the world s major wireless communications companies. For the six months ended June 30, 2012, Sprint, AT&T, T-Mobile and Verizon Wireless accounted for 36%, 16%, 11% and 9%, respectively, of GSL V s revenues. GSL V owned in fee or had perpetual or long-term easements in the land and other properties (collectively land ) on which approximately 1,000 of GSL V s towers reside, and GSL V leased, subleased or licensed the land on which approximately 6,500 of GSL V s towers reside. In addition, GSL V managed approximately 300 towers owned by third parties where GSL V had the right to market space on the tower or where GSL V had sublease agreements with the tower owner. Management services are performed by CCUSA. The management fee is equal to 7.5% of GSL V s revenue excluding the revenues related to the accounting for leases with fixed escalators as required by the applicable accounting standard. GSL V is an indirect subsidiary of Crown Castle and is a limited liability corporation that is treated as a disregarded entity for income tax return filing purposes. The following are certain highlights of our business fundamentals, which mirror CCIC s and which are further discussed in the Crown Castle Form 10-K, included in Item 1. Business and this MD&A as of and for the six months ended June 30, 2012: Potential growth resulting from wireless network expansion and new entrants (see also the discussion of wireless industry reports) o We expect wireless carriers will continue their focus on improving network quality and expanding capacity by adding additional antennas and other equipment on our towers. o We expect existing and potential new wireless carrier demand for our towers will result from (1) next generation technologies, (2) continued development of mobile internet applications, (3) adoption of other emerging and embedded wireless devices, (4) increasing smart phone penetration, and (5) wireless carrier focus on improving coverage and capacity. o Substantially all of our towers can accommodate another tenant, either as currently constructed or with appropriate modifications to the structure. o U.S. wireless carriers continue to invest in their networks. o We expect our site rental revenues will grow approximately 10% - 13% from the full year 2011 to full year 2012, inclusive of the impacts of all of the major U.S wireless carriers deploying network enhancements. We expect our new tenant additions will contribute in excess of 6% to the year over year growth in site rental revenues from full year 2011 to full year Our 2012 site rental revenue growth expectations assumes less than 1% net contribution to growth from the existing base of business (which has historically contributed approximately 2% to 4% per annum to our site rental revenue growth) as the increase attributable to lease escalations and straight-line impact of renewals is expected to be offset by higher levels of expected cancellation of customer contracts due to prior wireless carrier consolidation. Site rental revenues under long-term contracts with contractual escalations o Initial terms of five to 15 years with multiple renewal periods at the option of the tenant of five to ten years each. o Weighted-average remaining term in excess of 8 years, exclusive of renewals at the customer's option, representing approximately $5.1 billion of expected future cash inflows. Revenues predominately from large wireless carriers 10

11 o Sprint, AT&T, T-Mobile and Verizon Wireless accounted for 72% of consolidated revenues. Majority of land under our towers under long-term control o Approximately 91% and 54% of our site rental gross margin is derived from towers that we own or control for greater than ten and 20 years, respectively. The aforementioned percentages include towers that reside on land interests that are owned in fee or where we have perpetual or long-term easements in the land and other property interests, which represent approximately 21% of our site rental gross margin. Relatively fixed tower operating costs with high incremental margins and cash flows on organic revenue growth o Our tower operating costs tend to increase at approximately the rate of inflation and are not typically influenced by new tenant additions. o Our incremental margin on additional site rental revenues represents 91% of the related increase in site rental revenues. Minimal sustaining capital expenditure requirements o Sustaining capital expenditures were $2.5 million, which represented less than 1% of net revenues. o Our debt service coverage and leverage ratios were comfortably within their respective covenant requirements. Significant cash flows from operations o Net cash provided by operating activities was $92.6 million. o We believe our site rental business can be characterized as a stable cash flow stream, which we expect to grow as a result of future demand for our towers. The following is a discussion of certain recent events and growth trends which may impact our business and strategy or the U.S. wireless communications industry: Consumers have increased their use of wireless data services according to recent U.S. wireless industry reports (a). o U.S. mobile data traffic grew 172% during 2011; o The number of smartphones in the U.S. grew 59% during 2011, reaching 128 million, and is expected to grow to 232 million by 2016; o Smartphones accounted for 24% of total mobile data traffic in the U.S. at the end of 2011 and are o expected to account for 60% in 2016; and While 4G connections represent only 0.2% of mobile connections, they account for 6% of mobile data traffic. In 2011, a 4G connection generated 28 times more mobile data traffic on average than a non- 4G connection. (a) Source: Cisco 11

12 Results of Operations The following discussion of GSL V s results of operations should be read in conjunction with its audited consolidated financial statements. The following discussion of GSL V s results of operations is based on its condensed consolidated financial statements prepared in accordance with generally accepted accounting principles in the U.S. which requires us to make estimates and judgments that affect the reported amounts. (See note 1 to GSL V s consolidated financial statements.) Comparison of Consolidated Results The following is a comparison of GSL V s consolidated results of operations for the six months ended June 30, 2012: Six Months Ended June 30, Amount Percent of Net Revenues Amount Percent of Net Revenues Percent Change (In thousands of dollars) Site rental revenues $ 292, % $ 264, % 11% Operating expenses: Costs of operations (a) $ 87,683 30% $ 85,301 32% 3% Management fee 19,051 7% 18,108 7% 5% Asset write-down charges 1,054 0% 5,573 2% * Depreciation, amortization and accretion 94,563 32% 95,699 36% (1%) $ 202,351 69% $ 204,681 77% (1%) Operating income (loss) $ 90,469 31% $ 60,143 23% 50% Interest income 2 0% 21 0% * Other income (expense) 39 0% (76) 0% * Interest expense and amortization of deferred financing costs (49,666) (17%) (49,416) (19%) 1% Income (loss) before income taxes 40,844 14% 10,672 4% * Benefit (provision) for income taxes (15,655) (5%) (7,462) (3%) * Net income (loss) $ 25,189 9% $ 3,210 1% * * Percentage not meaningful (a) Exclusive of depreciation, amortization and accretion shown separately. First Half of 2012 and 2011 Site rental revenues for the first half of 2012 increased by $28.0 million, or 11% from the first half of This increase in site rental revenues was impacted by the following items, inclusive of straight-line accounting, in no particular order: new tenant additions across our entire portfolio, renewals or extensions of customer contracts, escalations, and cancellations of customer contracts. Tenant additions were influenced by the previously mentioned growth in the wireless communications industry. Site rental gross margins for the first half of 2012 increased by $25.6 million, or 14%, from the first half of The increase in the site rental gross margins was related to the previously mentioned 11% increase in site rental revenues. The $25.6 million incremental margin represents 91% of the related increase in site rental revenues. Management fee for the first half of 2012 increased by $0.9 million, or 5% from the first half of 2011, but remained 7% of total net revenues. The management fee is equal to 7.5% of GSL V s revenue excluding the revenues related to the accounting for leases with fixed escalators as required by the applicable accounting standard. 12

13 Depreciation, amortization and accretion for the first half of 2012 decreased by $1.1 million, or 1%, from the first half of The small decrease is consistent with the insignificant movement in our fixed assets and intangible assets between the first half of 2012 and The provision for income taxes for the first half of 2012 was a provision of $15.7 million compared to $7.5 million for the first half of The effective tax rate for the first half of 2012 differs from the federal statutory rate predominately due to state tax expense and differences in the book and tax basis of fixed assets. See note 6 to GSL V s consolidated financial statements. Net income for the first half of 2012 was $25.2 million, an improvement of $22.0 million from $3.2 million for the first half of Liquidity and Capital Resources Overview General. We believe our site rental business can be characterized as a stable cash flow stream generated under long-term contracts that should be recurring for the foreseeable future. Historically, GSL V s cash provided by operating activities has exceeded its cash interest payments and sustaining capital expenditures. For the foreseeable future, we expect to continue to generate cash provided by operating activities. GSL V seeks to allocate the cash produced by its operations in a manner that will enhance operating results, such as capital expenditures to accommodate additional tenants. Any excess cash remaining above those amounts allocated to enhance operating results are advanced to subsidiaries of Crown Castle, which typically invests the advanced cash into activities such as (in no particular order) purchases of common stock, strategic tower acquisitions, acquisitions of land on which towers are located, selectively constructing or acquiring towers and distributed antenna systems, improving and structurally enhancing its existing towers and purchases or redemptions of its debt or preferred stock. Long-term Strategy. Based on CCIC s long term strategy of targeted leverage of approximately five times Adjusted EBITDA and interest coverage of approximately three times Adjusted EBITDA, GSL V may increase its debt in nominal dollars, subject to the provisions of the 7.75% debt outstanding and various factors such as the state of the capital markets. From a cash management perspective, GSL V currently distributes all excess cash flow to its parent, Crown Castle. Beginning in 2009 these cash distributions are recorded as equity distributions to the parent, CCIC. If any future event would occur that would leave GSL V with a deficiency in its operating cash flow, while not required, the parent CCIC may contribute cash back to GSL V. See note 3 to GSL V s consolidated financial statements for additional information regarding its debt. Summary Cash Flows Information Six Months Ended June 30, Change (In thousands of dollars) Net cash provided by (used for) operating activities... $ 92,612 $ 81,676 $ 10,936 Net cash provided by (used for) investing activities... (20,217) (16,220) (3,997) Net cash provided by (used for) financing activities... (72,395) (65,456) (6,939) Net increase (decrease) in cash and cash equivalents... $ $ $ Operating Activities The increase in net cash provided by operating activities for the first six months of 2012 of $10.9 million from the first six months of 2011 was due primarily to growth in our site rental business. Changes in working capital, deferred rental revenues and prepaid ground leases can have a significant impact on GSL V s net cash from operating activities, largely due to the timing of payments and receipts. Investing Activities Capital Expenditures. We categorize our capital expenditures as sustaining or discretionary. Sustaining capital expenditures primarily include capitalized costs related to maintenance activities on our towers. Discretionary capital expenditures, which is commonly also referred to as revenue-generating capital expenditures, include 13

14 (1) tower improvements in order to support additional site rentals, (2) the construction of towers, and (3) purchases of land under towers. Other than sustaining capital expenditures, GSL V s capital expenditures are discretionary and are made with respect to activities it believes exhibit sufficient potential to improve its long-term results of operation. Such decisions are influenced by the availability and cost of capital and expected returns on alternative investments. Financing Activities Net cash flows used for financing activities were $72.4 million and $65.5 million for the first six months of 2012 and 2011, respectively. The net cash flows used for financing activities in the first six months of 2012 predominately consisted of the continued practice of distributing all excess cash to subsidiaries of Crown Castle. During the first six months of 2012, GSL V recorded equity distributions of $80.5 million related to the advancing excess cash to subsidiaries of Crown Castle. For the first six months of 2012, GSL V recorded an equity contribution of $14.7 million related to the usage by GSL V of net operating losses from members outside of the GSL V s group of companies. Factors Affecting Sources of Liquidity Compliance with Debt Covenants. The following is a summary of GSL V s covenants. The indenture also contains covenants with respect to the following: restricted payments, incurrence of indebtedness, liens, merger, consolidation of control, sales or issuances of equity interests of subsidiaries, transactions with affiliates, business activities of the issuers and subsidiaries, additional guarantees, reports, maintenance of properties, leases, contracts and insurance, management agreement. Covenant As of Debt Requirement(a) June 30, 2012 Consolidated Fixed Charge Coverage Ratio(b) % secured notes > (a) (b) If the Consolidated Fixed Charge Coverage Ratio is equal to or less than 1.20 and the aggregate amount of cash deposited in the reserve account exceeds $100.0 million, the issuing subsidiaries will be required to commence an offer to purchase the 7.75% secured notes using the cash in the reserve account. See note (b) for a discussion of the calculation of the Consolidated Fixed Charge Coverage Ratio. The Consolidated Fixed Charge Coverage Ratio is calculated as site rental revenue (in accordance with GAAP), less: (1) cost of operations (in accordance with GAAP), (2) straight-line revenues, (3) straight-line ground lease expenses, (4) management fees, and (5) maintenance capital expenditures, using the results for the previous 12 months then ended to the amount of interest to be paid over the succeeding 12 months per the terms of the debt agreement. Given the current level of indebtedness of GSL V, the primary risk of a debt covenant violation would be from a deterioration of its financial performance. GSL V currently does not have any financial covenant violations; based upon its current expectations, its operating results will be sufficient to comply with its debt covenants. See Item 1A. Risk Factors of the Crown Castle 10-K and Item 7. MD&A of the Crown Castle 10-K. Financial Performance. A factor affecting GSL V s continued generation of cash flows from operating activities is its ability to maintain its existing recurring site rental revenues and to convert those revenues into operating cash flows by efficiently managing its operating costs. GSL V s ability to service or refinance its current debt obligations and obtain additional debt will depend on its future financial performance, which, to a certain extent, is subject to various factors that are beyond its control as discussed further herein and in Item 1A. Risk Factors of the Crown Castle 10-K. Levels of Indebtedness and Debt Service Requirements. GSL V s ability to obtain cash financing in the form of debt instruments depends on, among other things, general economic conditions, conditions of the wireless industry, wireless carrier consolidation or network sharing, new technologies, its financial performance and the state of the capital markets. GSL V does not anticipate the need to refinance its debt before