8-KMaterial AgreementsFinancial EventsExhibits & Filings

CROWN CASTLE INC. 8-K Report, Material Agreement (May 6, 2016)

Filed May 6, 2016For Securities:CCI

Summary

Crown Castle International Corp. (CCI) filed an 8-K on May 6, 2016, to report the closing of a significant debt offering totaling $1 billion. This offering consisted of $250 million in 3.400% Senior Notes due 2021 and $750 million in 3.700% Senior Notes due 2026. The net proceeds from this issuance are earmarked for the repayment of specific subsidiary senior secured tower revenue notes and a portion of the outstanding borrowings under the company's senior unsecured revolving credit facility. This transaction is a key indicator of Crown Castle's ongoing capital management strategy, aiming to refinance existing debt with new, potentially more favorable terms and extend its debt maturity profile. Investors should note that these new notes are senior unsecured obligations, ranking equally with other senior indebtedness and junior to secured debt, and are structurally subordinated to the obligations of CCI's subsidiaries. The filing details the terms, interest rates, maturity dates, and certain covenants associated with these new notes, including provisions for change of control repurchases and optional redemption rights.

Key Highlights

  • 1Completed a $1 billion public offering of senior unsecured notes: $250 million of 3.400% Senior Notes due 2021 and $750 million of 3.700% Senior Notes due 2026.
  • 2Net proceeds will be used to repay outstanding Senior Secured Tower Revenue Notes (Series 2010-2 and 2010-5) and a portion of its senior unsecured revolving credit facility.
  • 3The new notes are senior unsecured obligations, ranking equally with existing senior indebtedness and senior to subordinated debt.
  • 4Notes will be structurally subordinated to liabilities of CCI's subsidiaries.
  • 5The 2021 Notes mature on February 15, 2021, and the 2026 Notes mature on June 15, 2026.
  • 6Indentures include covenants that limit the incurrence of certain liens and mergers, subject to exceptions.
  • 7Holders have the right to require repurchase at 101% of principal plus accrued interest in the event of a Change of Control Triggering Event.

Frequently Asked Questions

The primary purpose of this $1 billion debt offering was to refinance existing debt. Specifically, Crown Castle intends to use the net proceeds to repay outstanding Senior Secured Tower Revenue Notes (Series 2010-2 and 2010-5) issued by its subsidiaries and to reduce borrowings under its senior unsecured revolving credit facility.

The new notes are classified as senior unsecured obligations of Crown Castle International Corp. They rank equally with all existing and future senior indebtedness of the company and senior to any future subordinated indebtedness. However, they will effectively rank junior to any secured indebtedness to the extent of the collateral value, and they are structurally subordinated to all existing and future liabilities and obligations of Crown Castle's subsidiaries.

The offering includes $250 million of 3.400% Senior Notes due February 15, 2021, and $750 million of 3.700% Senior Notes due June 15, 2026. Interest on the 2021 Notes is payable semi-annually on February 15 and August 15, beginning August 15, 2016. Interest on the 2026 Notes is payable semi-annually on June 15 and December 15, beginning December 15, 2016.

Yes, the indentures for these notes include provisions for a Change of Control Triggering Event. In such an event, holders of the affected notes will have the right to require Crown Castle to repurchase all or any part of their notes at a price equal to 101% of the aggregate principal amount, plus any accrued and unpaid interest.