8-KMaterial AgreementsShareholder MattersRegulation FD+1

CROWN CASTLE INC. 8-K Report, Material Agreement (Jun 9, 2005)

Filed June 9, 2005For Securities:CCI

Summary

Crown Castle International Corp. (CCI) announced on June 8, 2005, the completion of a significant financing transaction through its indirect wholly owned subsidiaries, Crown Castle Towers LLC and other related entities (collectively, the "Issuers"). The company issued $1.9 billion in Senior Secured Tower Revenue Notes, Series 2005-1, structured into five classes with varying interest rates and credit ratings, including a floating rate class with an interest rate swap. These notes are non-recourse to the parent company, CCI, and are secured by the cash flows generated from over 10,600 tower sites held by the Issuers and their subsidiaries. The financing structure involves the creation of special purpose entities for the Issuers, which limits their assets to tower sites and related revenues, and restricts their ability to incur additional debt unless certain financial covenants are met. This move diversifies CCI's capital structure and provides substantial funding for its operations and potential growth initiatives.

Key Highlights

  • 1Completion of a $1.9 billion Senior Secured Tower Revenue Notes, Series 2005-1 issuance.
  • 2Notes are issued by special purpose subsidiaries (Crown Castle Towers LLC and others) and secured by tower site revenues.
  • 3Financing consists of five classes of notes (A-FX, A-FL, B, C, D) with different interest rates and credit ratings, ranging from Aaa/AAA to Baa2/BBB.
  • 4The notes have a maturity date of June 15, 2035, with no required principal payments until June 10, 2010.
  • 5A 'Cash Trap Condition' can be triggered if certain Debt Service Coverage Ratios fall below specified levels, diverting excess cash flow to a reserve account.
  • 6The parent company, Crown Castle International Corp., is not directly liable for these notes; obligations are solely of the Issuers.
  • 7The transaction is accompanied by management, cash management, and servicing agreements to oversee the tower site operations and note administration.

Frequently Asked Questions

This filing announces the completion of a significant financing transaction: the issuance of $1.9 billion in Senior Secured Tower Revenue Notes, Series 2005-1, by Crown Castle's subsidiaries. It also discloses material modifications to existing senior notes and provides updates on tender offers and redemptions.

No, the Senior Secured Tower Revenue Notes are obligations solely of the Issuers (Crown Castle Towers LLC and its subsidiaries). They are guaranteed only by CC Towers Guarantor LLC, an indirect subsidiary whose primary asset is its equity interest in the Issuer Entity. The parent company, Crown Castle International Corp., and its other affiliates do not guarantee these notes.

The notes are secured by a first priority security interest in all assignable personal property of the Issuers, the space licenses for their tower sites, and the revenues generated from those licenses. The equity interests in the Issuers are also pledged. Crucially, the cash flows from approximately 4,919 tower sites held by Crown Atlantic and Crown GT service the notes, but these specific entities' assets and cash flows are not directly pledged due to certain restrictions.

The Indenture includes provisions for triggers such as an 'Amortization Period' if the Debt Service Coverage Ratio falls below 1.45x, which would use excess cash flow for principal repayment. Additionally, a 'Cash Trap Condition' can be initiated if the Debt Service Coverage Ratio falls to 1.75x or below (or the Company's Consolidated Debt Service Coverage Ratio falls to 2.0x or below), leading to excess cash flow being held in a reserve account until certain conditions are met.