CROWN CASTLE INC. - Annual Report: 2019 (Form 10-K)

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Over the last two decades, we have assembled a leading portfolio of towers predominately through acquisitions from large wireless carriers or their predecessors. More recently, both through acquisitions (see note 4 to our consolidated financial statements) and new construction of small cells and fiber, we have extended our communications infrastructure presence by investing significantly in our Fiber segment. Through our product offerings of towers and small cells, we seek to provide a comprehensive solution to enable our wireless tenants to expand coverage and capacity for wireless networks. Furthermore, within our Fiber segment, we seek to generate cash flow growth and stockholder return by deploying our fiber for both small cells' and fiber solutions' tenants.

•	Below is certain information regarding our Towers segment:

◦	Approximately 56% and 71% of our towers are located in the 50 and 100 largest U.S. basic trading areas ("BTAs"), respectively. Our towers have a significant presence in each of the top 100 BTAs.

◦	We derive approximately 40% of our Towers site rental gross margin from towers residing on land and other property interests (collectively, "land") that we own, including through fee interests and perpetual easements, and we derive approximately 60% of our Towers site rental gross margin from towers residing on land that we lease, sublease, manage or license.

◦	The contracts for the land under our towers have an average total remaining life of approximately 35 years (including all renewal terms exercisable at our option), weighted based on Towers site rental gross margin.

•	Below is certain information regarding our Fiber segment:

◦	The majority of our small cells and fiber are located in major metropolitan areas, including a presence within every major U.S. market.

◦	The vast majority of our small cells and fiber assets is located on public rights-of-way.

•	We operate as a REIT for U.S. federal income tax purposes. See "Item 1. Business—2019 Industry Highlights and Company Developments—REIT Status" and note 11 to our consolidated financial statements.

•	Our largest tenants are T-Mobile, AT&T, Verizon Wireless and Sprint, which collectively accounted for approximately 75% of our 2019 consolidated site rental revenues.

•	Site rental revenues represented 88% of our 2019 consolidated net revenues, of which approximately 67% and 33% were from our Towers segment and our Fiber segment, respectively.

•	The vast majority of our site rental revenues are of a recurring nature and are pursuant to long-term tenant contracts with our tenants.

•	Our site rental revenues derived from wireless tenants typically result from long-term tenant contracts with (1) initial terms of five to 15 years, (2) multiple renewal periods of five to 10 years each, exercisable at the option of the tenant, (3) limited termination rights for our tenants and (4) contractual escalations of the rental price and, in some cases, an additional upfront payment.

•	Our site rental revenues derived from our fiber solutions tenants (including from organizations with high-bandwidth and multi-location demands), typically result from tenant contracts with (1) initial terms that generally vary between three to 20 years and (2) a fixed monthly recurring fee and, in some cases, an additional upfront payment.

•	Exclusive of renewals exercisable at the tenants' option, our tenant contracts have a weighted-average remaining life of approximately five years and represent $24 billion of expected future cash inflows.

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Grow cash flows from our existing communications infrastructure. We are focused on maximizing the recurring site rental cash flows generated from providing our tenants with long-term access to our shared infrastructure assets, which we believe is the core driver of value for our stockholders. Tenant additions or modifications of existing tenant equipment (collectively, "tenant additions") enable our tenants to expand coverage and capacity in order to meet increasing demand for data while generating high incremental returns for our business. We believe our product offerings of towers and small cells provide a comprehensive solution to our wireless tenants' growing network needs through our shared communications infrastructure model, which is an efficient and cost-effective way to serve our tenants. Additionally, we believe our ability to share our fiber assets across multiple tenants to deploy both small cells and offer fiber solutions allows us to generate cash flows and increase stockholder return.

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Return cash generated by operating activities to common stockholders in the form of dividends. We believe that distributing a meaningful portion of our cash generated by operating activities appropriately provides common stockholders with increased certainty for a portion of expected long-term stockholder value while still allowing us to retain sufficient flexibility to invest in our business and deliver growth. We believe this decision reflects the translation of the high-quality, long-term contractual cash flows of our business into stable capital returns to common stockholders.

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Invest capital efficiently to grow cash flows and long-term dividends per share. In addition to adding tenants to existing communications infrastructure, we seek to invest our available capital, including the net cash generated by our operating activities and external financing sources, in a manner that will increase long-term stockholder value on a risk-adjusted basis. These investments include constructing and acquiring new communications infrastructure that we expect will generate future cash flow growth and attractive long-term returns by adding tenants to those assets over time. Our historical investments have included the following (in no particular order):

◦	construction of towers, fiber and small cells;

◦	acquisitions of towers, fiber and small cells;

◦	acquisitions of land interests (which primarily relate to land assets under towers);

◦	improvements and structural enhancements to our existing communications infrastructure;

◦	purchases of shares of our common stock from time to time; and

◦	purchases, repayments or redemptions of our debt.

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•	Consumers' growing wireless data consumption likely resulting in major wireless carriers continuing to upgrade and enhance their networks, including through the use of both towers and small cells, in an effort to improve network quality and capacity and customer retention or satisfaction;

•	Prior and future potential spectrum auctioned, licensed or made available by the Federal Communications Commission ("FCC") enabling additional wireless carrier network development;

•	Next-generation technologies and new uses for wireless communications may potentially result in new entrants or increased demand in the wireless industry, which may include companies involved in the continued evolution and deployment of the Internet of Things (such as connected cars, smart cities and virtual reality); and

•	The continued adoption of bandwidth-intensive applications could result in demand for high-capacity, multi-location, fiber-based network solutions.

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•	Our small cells offload data traffic from towers and bolster our tenants' network capacity where data demand is the greatest, and are typically attached to public right-of-way infrastructure, including utility poles and street lights.

•	We offer certain fiber solutions to organizations with high-bandwidth and multi-location demands. Our fiber solutions provide essential connectivity resources needed to create integrated networks and support organizations.

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•	availability or capacity of our communications infrastructure or associated land interests;

•	location of our communications infrastructure;

•	financial condition of our tenants, including their profitability and availability or cost of capital;

•	willingness of our tenants to maintain or increase their network investment or changes in their capital allocation strategy;

•	need for integrated networks and organizations;

•	availability and cost of spectrum for commercial use;

•	increased use of network sharing, roaming, joint development, or resale agreements by our tenants;

•	mergers or consolidations by and among our tenants;

•	changes in, or success of, our tenants' business models;

•	governmental regulations and initiatives, including local or state restrictions on the proliferation of communications infrastructure;

•	cost of constructing communications infrastructure;

•	our market competition, including tenants that may elect to self-perform;

•	technological changes, including those (1) affecting the number or type of communications infrastructure needed to provide data to a given geographic area or which may otherwise serve as a substitute or alternative to our communications infrastructure or (2) resulting in the obsolescence or decommissioning of certain existing wireless networks; and

•	our ability to efficiently satisfy our tenants' service requirements.

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•	disrupt our business relationships with our tenants, depending on the nature of or counterparty to such transactions and activities;

•	divert the time or attention of management away from other business operations, including as a result of post-transaction integration activities;

•	fail to achieve revenue or margin targets, operational synergies or other benefits contemplated;

•	increase operational risk or volatility in our business;

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•	not result in the benefits management had expected to realize from such expansion and development activities, or those benefits may take longer to realize than expected;

•	impact our cost structure and result in the need to hire additional employees;

•	increase demands on current employees or result in current or prospective employees experiencing uncertainty about their future roles with us, which might adversely affect our ability to retain or attract key employees; or

•	result in the need for additional TRSs or contributions of certain assets to TRSs, which are subject to federal and state corporate income taxes.

•	the use of public rights-of-way and franchise agreements;

•	the use of poles and conduits owned solely by, or jointly with, third parties;

•	risks relating to overbuilding;

•	risks relating to the specific markets that we choose to operate in or plan to operate in;

•	risks relating to construction hazards, construction management and construction-related billings to tenants;

•	risks relating to wireless carriers building their own small cell networks, or tenants utilizing their own or alternative fiber assets;

•	the risk of failing to optimize the use of our finite supply of fiber strands;

•	damage to our assets and the need to maintain, repair, upgrade and periodically replace our assets;

•	the risk of failing to properly maintain or operate highly specialized hardware and software;

•	network data security risks;

•	the risk of new technologies that could enable tenants to realize the same benefits with less utilization of our fiber;

•	potential damage to our overall reputation as a communications infrastructure provider; and

•	the use of CLEC status.

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•	we may be more vulnerable to general adverse economic or industry conditions;

•	we may find it more difficult to obtain additional financing to fund discretionary investments or other general corporate requirements or to refinance our existing indebtedness;

•	we are or will be required to dedicate a substantial portion of our cash flows from operations to the payment of principal or interest on our debt, thereby reducing the available cash flows to fund other projects, including the discretionary investments discussed in "Item 1. Business" and "Item 7. MD&A—Liquidity and Capital Resources";

•	we may have limited flexibility in planning for, or reacting to, changes in our business or in the industry;

•	we may have a competitive disadvantage relative to other companies in our industry with less debt;

•	we may be adversely impacted by changes in interest rates;

•	we may be adversely impacted by changes to credit ratings related to our debt instruments;

•	we may be required to issue equity securities or securities convertible into equity or sell some of our assets, possibly on unfavorable terms, in order to meet payment obligations;

•	we may be limited in our ability to take advantage of strategic business opportunities, including communications infrastructure development or mergers and acquisitions; and

•	we could fail to remain qualified for taxation as a REIT due to limitations on our ability to declare and pay dividends to stockholders as a result of restrictive covenants in our debt instruments or the terms of our 6.875% Mandatory Convertible Preferred Stock, Series A, par value $0.01 per share ("6.875% Convertible Preferred Stock").

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22% of our towers are leased or subleased or operated and managed under a master prepaid lease or other related agreements with AT&T for a weighted-average initial term of approximately 28 years, weighted on Towers site rental gross margin. We have the option to purchase the leased and subleased towers from AT&T at the end of the respective lease or sublease terms for aggregate option payments of approximately $4.2 billion, which payments, if such option is exercised, would be due between 2032 and 2048.

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•	16% of our towers are leased or subleased or operated and managed for an initial period of 32 years (through May 2037) under master leases, subleases or other agreements with Sprint. We have the option to purchase in 2037 all (but not less than all) of the leased and subleased Sprint towers from Sprint for approximately $2.3 billion.

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15% of our towers are leased or subleased or operated and managed under a master prepaid lease or other related agreements with T-Mobile for a weighted-average initial term of approximately 28 years, weighted on Towers site rental gross margin. We have the option to purchase the leased and subleased towers from T-Mobile at the end of the respective lease or sublease terms for aggregate option payments of approximately $2.0 billion, which payments, if such option is exercised, would be due between 2035 and 2049. In addition, through the T-Mobile Acquisition, another 1% of our towers are subject to a lease and sublease or other related arrangements with AT&T. We have the option to purchase these towers that we do not otherwise already own at the end of their respective lease terms for aggregate option payments of up to approximately $405 million, which payments, if such option is exercised, would be due prior to 2032 (less than $10 million would be due before 2025).

•	competition;

•	the timing, mix and amount of tenant network investments;

•	the rate and volume of tenant deployment plans;

•	unforeseen delays or challenges relating to work performed;

•	economic weakness or uncertainty;

•	our market share; or

•	changes in the size, scope, or volume of work performed.

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•	the authority of the board of directors to issue preferred stock without approval of the holders of our common stock;

•	advance notice requirements for director nominations or actions to be taken at annual meetings; and

•	a provision that the state courts or, in certain circumstances, the federal courts, in Delaware shall be the sole and exclusive forum for certain actions involving us, our directors, officers, employees and stockholders.

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•	we will not be allowed a deduction for dividends paid to stockholders in computing our taxable income;

•	we will be subject to federal and state income tax, including, for applicable years beginning before January 1, 2018, any applicable alternative minimum tax, on our taxable income at regular corporate rates; and

•	we would be disqualified from re-electing REIT status for the four taxable years following the year during which we were so disqualified.

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•	"Item 7. MD&A—Liquidity and Capital Resources—Contractual Cash Obligations" for a tabular presentation of the remaining contractual obligations related to our business as of December 31, 2019, including our lease and access agreement obligations.

•	"Schedule III - Schedule of Real Estate and Accumulated Depreciation" for further information on our productive properties.

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Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

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(a)	Inclusive of the impact of acquisitions. See note 4 to our consolidated financial statements for a discussion of our 2017 Acquisitions. In 2016, we acquired Tower Development Corporation, a portfolio of approximately 330 towers ("TDC Acquisition"). In 2015, we acquired rights to approximately 10,000 route miles of fiber through the Sunesys Acquisition.

(b)	Exclusive of depreciation, amortization and accretion, which are shown separately.

(c)	See note 11 to our consolidated financial statements regarding our income taxes, including our REIT status.

(d)

Basic net income (loss) attributable to CCIC common stockholders, per common share, excludes dilution and is computed by dividing net income (loss) attributable to CCIC common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net income (loss) attributable to CCIC common stockholders, per common share, is computed by dividing net income (loss) attributable to CCIC common stockholders by the weighted-average number of common shares outstanding during the period plus any potential dilutive common share equivalents, including shares issuable (1) upon the vesting of restricted stock awards and restricted stock units as determined under the treasury stock method and (2) upon conversion of convertible preferred stock securities (including, as applicable, the currently outstanding 6.875% Convertible Preferred Stock, which was issued in 2017 and will automatically convert to shares of common stock in August 2020, and the previously outstanding 4.50% Mandatory Convertible Preferred Stock, Series A, par value $0.01 per share ("4.50% Convertible Preferred Stock") which was issued in 2013 and automatically converted to shares of common stock in 2016), as determined under the if-converted method. See note 3 to our consolidated financial statements.

(e)	Amounts reflect the impact of all applicable adopted accounting pronouncements during the periods presented. See note 3 to our consolidated financial statements.

(f)

See note 12 to our consolidated financial statements for a discussion of our equity offerings during 2018 and 2017. During 2016, we issued shares of our common stock in connection with (1) our then outstanding 2015 ATM Program (as defined below), the proceeds of which we utilized to partially fund our TDC Acquisition in April 2016, (2) the conversion of our then outstanding 4.50% Convertible Preferred Stock to common stock and (3) our November 2016 issuance of 11.4 million shares of common stock, which generated net proceeds of $1.0 billion ("November 2016 Common Stock Offering") to partially fund the FiberNet Acquisition.

(g)

See "Explanatory Note" immediately preceding Item 1 of this Annual Report on Form 10-K for further information regarding the restatement. See note 2 to our consolidated financial statements for the impacts of the Historical Adjustments on the years ended December 31, 2018 and 2017. For the year ended December 31, 2016, the impact of the Historical Adjustments was an increase to site rental revenues of $51 million and a decrease to services and other revenues of $124 million. For the year ended December 31, 2015, the impact of the Historical Adjustments was an increase to site rental revenues of $40 million and a decrease to services and other revenues of $115 million.

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•	We operate as a REIT for U.S. federal income tax purposes (see "Item 1. Business—Company Developments, REIT Status and Industry Overview—REIT Status" and note 11 to our consolidated financial statements).

•	Potential growth resulting from the increasing demand for data

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We expect existing and potential new tenant demand for our communications infrastructure will result from (1) new technologies, (2) increased usage of mobile entertainment, mobile internet, and machine-to-machine applications, (3) adoption of other emerging and embedded wireless devices (including smartphones, laptops, tablets, wearables and other devices), (4) increasing smartphone penetration, (5) wireless carrier focus on expanding both network quality and capacity, including the use of both towers and small cells, (6) the adoption of other bandwidth-intensive applications (such as cloud services and video communications) and (7) the availability of additional spectrum.

◦	We expect U.S. wireless carriers will continue to focus on improving network quality and expanding capacity (including through 5G initiatives) by utilizing a combination of towers and small cells. We believe our product offerings of towers and small cells provide a comprehensive solution to our wireless tenants' growing communications infrastructure needs.

◦	We expect organizations will continue to increase the usage of high-bandwidth applications that will require the utilization of more fiber infrastructure and fiber solutions, such as those we provide.

◦	Within our Fiber segment, we are able to generate growth and returns for our stockholders by deploying our fiber for both small cells and fiber solutions tenants.

◦	Tenant additions on our existing communications infrastructure are achieved at a low incremental operating cost, delivering high incremental returns.

◦	Substantially all of our communications infrastructure can accommodate additional tenancy, either as currently constructed or with appropriate modifications.

•	Returning cash flows provided by operations to stockholders in the form of dividends (see also "Item 1. Business—Strategy")

◦	During 2019, we paid common stock dividends totaling approximately $1.9 billion. See "Item 7. MD&A—General Overview—Common Stock Dividend" for a discussion of the increase to our quarterly dividend in the fourth quarter of 2019.

◦	Investing capital efficiently to grow long-term dividends per share

•	Discretionary capital expenditures of $1.9 billion, predominately resulting from the construction of new communications infrastructure and improvements to existing communications infrastructure in order to support additional tenants.

•	We expect to continue to construct and acquire new communications infrastructure based on our tenants' needs and generate attractive long-term returns by adding additional tenants over time.

•	Site rental revenues under long-term tenant contracts

◦	Initial terms of five to 15 years for site rental revenues derived from wireless tenants, with contractual escalations and multiple renewal periods of five to 10 years each, exercisable at the option of the tenant.

◦	Initial terms that generally vary between three to 20 years for site rental revenues derived from our fiber solutions tenants (including from organizations with high-bandwidth and multi-location demands).

◦	Weighted-average remaining term of approximately five years, exclusive of renewals exercisable at the tenants' option, currently representing approximately $24 billion of expected future cash inflows.

•	Majority of our revenues from large wireless carriers

◦	Approximately 75% of our site rental revenues were derived from T-Mobile, AT&T, Verizon Wireless and Sprint. See also "Item 1A. Risk Factors" and note 16 to our consolidated financial statements for a further discussion of our largest customers.

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•	Majority of land interests under our towers under long-term control

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Approximately 90% of our Towers site rental gross margin and approximately 80% of our Towers site rental gross margin is derived from towers that reside on land that we own or control for greater than 10 and 20 years, respectively. The aforementioned percentages include towers that reside on land interests that are owned, including through fee interests and perpetual easements, which represent approximately 40% of our Towers site rental gross margin.

•	Majority of our fiber assets are located in major metropolitan areas and are on public rights-of-way.

•	Minimal sustaining capital expenditure requirements

◦	Sustaining capital expenditures represented approximately 2% of net revenues.

•	Debt portfolio with long-dated maturities extended over multiple years, with the vast majority of such debt having a fixed rate (see "Item 7A. Quantitative and Qualitative Disclosures About Market Risk" for a further discussion of our debt)

•	During 2019, we completed several debt transactions to refinance and extend the maturities of certain of our debt. See "Item 7. MD&A—Liquidity and Capital Resources—Financing Activities" for further discussion of our debt transactions.

◦	As of December 31, 2019, our outstanding debt has a weighted average interest rate of 3.8% and weighted average maturity of approximately six years (assuming anticipated repayment dates where applicable).

◦	83% of our debt has fixed rate coupons.

◦	Our debt service coverage and leverage ratios are comfortably within their respective financial maintenance covenants. See "Item 7. MD&A—Liquidity and Capital Resources—Debt Covenants" for a further discussion of our debt covenants.

•	Significant cash flows from operations

◦	Net cash provided by operating activities was $2.7 billion.

◦	In addition to the positive impact of contractual escalators, we expect to grow our core business of providing access to our communications infrastructure as a result of future anticipated additional demand for our communications infrastructure.

•	We expect that, when compared to full year 2019, our full year 2020 site rental revenue growth will be positively impacted by higher tenant additions, as large wireless carriers and fiber solutions tenants attempt to meet the increasing demand for data. See note 5 to our consolidated financial statements.

•	We expect discretionary capital expenditures for 2020 to remain relatively consistent with 2019 levels as we continue to construct new small cells and fiber as a result of the anticipated returns on such discretionary investments. We also expect sustaining capital expenditures of approximately 2% of net revenues for full year 2020.

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(a)	See note 16 to our consolidated financial statements for our definitions of segment site rental gross margin, segment services and other gross margin and segment operating profit.

(b)	See reconciliation of this non-GAAP financial measure to net income (loss) and definition included in "Item 7. MD&A—Accounting and Reporting Matters—Non-GAAP and Segment Financial Measures."

(c)	See "Explanatory Note" immediately preceding Item 1 of this Annual Report on Form 10-K and note 2 to our consolidated financial statements for further information regarding the restatement.

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(a)	As restated.

(b)	Includes amortization of upfront payments received from long-term tenants and other deferred credits (commonly referred to as prepaid rent).

(c)	The components in this chart may not sum to the total due to rounding.

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(a)	As restated.

(b)	Includes amortization of upfront payments received from long-term tenants and other deferred credits (commonly referred to as prepaid rent).

(c)	Represents the contribution from recent acquisitions until the one-year anniversary of the acquisition.

(d)	The components in this chart may not sum to the total due to rounding.

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(a)	Inclusive of $5 million included within long-term prepaid rent and other assets, net on our consolidated balance sheet.

(b)

Availability at any point in time is subject to certain restrictions based on the maintenance of financial covenants contained in the 2016 Credit Facility. At any point in time, we intend to maintain available commitments under our 2016 Revolver in an amount at least equal to the amount of Commercial Paper Notes outstanding. See "Item 7. MD&A—Liquidity and Capital Resources—Financing Activities" and "Item 7. MD&A—Liquidity and Capital Resources—Debt Covenants."

(c)	See "Item 7. MD&A—Liquidity and Capital Resources—Financing Activities" and note 9 to our consolidated financial statements for further information regarding the CP Program.

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Our liquidity sources may include (1) cash on hand, (2) net cash generated by our operating activities, (3) undrawn availability under our 2016 Revolver, (4) issuances under our CP Program, and (5) issuances of equity pursuant to our 2018 ATM Program. Our liquidity uses over the next 12 months are expected to include (1) debt service obligations of $100 million (principal payments), (2) cumulative common stock dividend payments expected to be at least $4.80 per share, or an aggregate amount of approximately $2.0 billion (see "Item 7. MD&A—General Overview—Common Stock Dividend"), (3) prior to the automatic conversion of our 6.875% Convertible Preferred Stock in August 2020, dividend

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•	We have no scheduled contractual debt maturities other than principal payments on amortizing debt. See "Item 7A. Quantitative and Qualitative Disclosures About Market Risk" for a tabular presentation of our debt maturities and a discussion of anticipated repayment dates.

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Discretionary capital expenditures are made with respect to activities which we believe exhibit sufficient potential to enhance long-term stockholder value. They primarily consist of expansion or development of communications infrastructure (including capital expenditures related to (1) enhancing communications infrastructure in order to add new tenants for the first time or support subsequent tenant equipment augmentations or (2) modifying the structure of a communications infrastructure asset to accommodate additional tenants) and construction of new communications infrastructure. Discretionary capital expenditures also include purchases of land interests (which primarily relates to land assets under towers as we seek to manage our interests in the land beneath our towers), certain technology-related investments necessary to support and scale future customer demand for our communications infrastructure, and other capital projects. The expansion or development of existing communications infrastructure to accommodate new leasing typically varies based on, among other factors: (1) the type of communications infrastructure, (2) the scope, volume, and mix of work performed on the communications infrastructure, (3) existing capacity prior to installation, or (4) changes in structural engineering regulations and standards. Currently, construction of new communications infrastructure is predominately comprised of the construction of small cells and fiber. Our decisions regarding discretionary capital expenditures are influenced by the availability and cost of capital and expected returns on alternative uses of cash, such as payments of dividends and investments.

•	Integration capital expenditures consist of those capital expenditures made as a result of integrating acquired companies into our business.

•	Sustaining capital expenditures consist of those capital expenditures not otherwise categorized as discretionary or integration capital expenditures, such as (1) maintenance capital expenditures on our communications infrastructure assets that enable our tenants' ongoing quiet enjoyment of the communications infrastructure and (2) ordinary corporate capital expenditures.

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(a)	Includes $208 million, $128 million, and $124 million of capital expenditures incurred during the years ended December 31, 2019, 2018, and 2017, respectively, in connection with customer installations and upgrades on our towers.

(b)	Prior to January 1, 2018, integration capital expenditures were included within sustaining capital expenditures.

(c)	As restated.

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•	paying an aggregate of $1.9 billion in dividends on our common stock;

•	paying an aggregate of $113 million in dividends on our 6.875% Convertible Preferred Stock;

•	issuing $1.0 billion aggregate principal amount of senior unsecured notes in February 2019, the proceeds of which we used to repay a portion of the borrowings under the 2016 Revolver;

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establishing a CP Program in April 2019 pursuant to which we may issue short-term, unsecured commercial paper notes. Notes under the CP Program may be issued, repaid and re-issued from time to time, with an aggregate principal amount of Commercial Paper Notes outstanding under the CP Program at any time not to exceed $1.0 billion. The net proceeds of the Commercial Paper Notes are expected to be used for general corporate purposes;

•	entering into an amendment to the 2016 Credit Facility in June 2019 to (1) increase our commitments under the 2016 Revolver by $750 million for total commitments of $5.0 billion and (2) extend the maturity of the 2016 Credit Facility from June 2023 to June 2024; and

•	issuing $900 million aggregate principal amount of senior unsecured notes in August 2019, the proceeds of which we used to repay outstanding borrowings under the 2016 Revolver and CP Program.

•	paying an aggregate of $1.8 billion in dividends on our common stock;

•	paying an aggregate of $113 million in dividends on our 6.875% Convertible Preferred Stock;

•	issuing $1.75 billion aggregate principal amount of senior unsecured notes in January 2018, the proceeds of which we used to repay (1) in full the Senior Secured Tower Revenue Notes, Series 2010-3, Class C-2020 and pay related fees and expenses and (2) a portion of the outstanding borrowings under the 2016 Revolver;

•	completing an offering of 8 million shares of our common stock ("March 2018 Equity Financing"), the proceeds of which we used for general corporate purposes as well as repayment of outstanding indebtedness;

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terminating the previously outstanding "at-the-market" stock offering program through which we had the right to issue and sell shares of our common stock having an aggregate gross sales price of up to $500 million to or through sales agents ("2015 ATM Program") in March 2018, and in April 2018, establishing the 2018 ATM Program through which we may issue and sell shares of our common stock having an aggregate gross sales price of up to $750 million;

•	entering into an amendment to the 2016 Credit Facility in June 2018 to (1) increase our commitments under the 2016 Revolver by $750 million for total commitments of $4.25 billion and (2) extend the maturity of the 2016 Credit Facility from August 2022 to June 2023; and

•	issuing $1.0 billion aggregate principal amount of senior secured tower revenue notes in July 2018, the proceeds of which we used, together with cash on hand, to repay, in full, the Senior Secured Tower Revenue Notes, Series 2010-6, Class C-2020 and pay related fees and expenses.

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(a)	The following items are in addition to the obligations disclosed in the above table:

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We have a legal obligation to perform certain asset retirement activities, including requirements upon lease and easement terminations to remove communications infrastructure or remediate the land upon which our communications infrastructure resides. The cash obligations disclosed in the above table, as of December 31, 2019, are exclusive of estimated undiscounted future cash outlays for asset retirement obligations of approximately $1.0 billion. As of December 31, 2019, the net present value of these asset retirement obligations was approximately $227 million. See note 8 to our consolidated financial statements.

•	We are contractually obligated to pay or reimburse others for property taxes related to certain of our communications infrastructure.

•	We have the option to purchase approximately 53% of our towers that are leased or subleased or operated and managed under master leases, subleases and other agreements with AT&T, Sprint and T-Mobile at the end of their respective lease terms. We have no obligation to exercise such purchase options. See note 1 to our consolidated financial statements.

•	We have legal obligations for open purchase order commitments obtained in the ordinary course of business that have not yet been fulfilled.

(b)

The impact of principal payments that will commence following the anticipated repayment dates of our Tower Revenue Notes is not considered. The Tower Revenue Notes have principal amounts of $300 million, $250 million, $700 million and $750 million, with anticipated repayment dates in 2022, 2023, 2025 and 2028, respectively. See note 9 to our consolidated financial statements for our definition of and additional information regarding the Tower Revenue Notes.

(c)

If the Tower Revenue Notes are not repaid in full by the applicable anticipated repayment dates, the applicable interest rate increases by approximately 5% per annum and monthly principal payments commence using the Excess Cash Flow (as defined in the indenture governing the applicable Tower Revenue Notes) of the issuers of the Tower Revenue Notes. The Tower Revenue Notes are presented based on their contractual maturity dates ranging from 2042 to 2048 and include the impact of an assumed 5% increase in interest rate that would occur following the anticipated repayment dates but exclude the impact of monthly principal payments that would commence using Excess Cash Flow (as defined in the indenture governing the applicable Tower Revenue Notes) of the issuers of the Tower Revenue Notes. The full year 2019 Excess Cash Flow (as defined in the indenture governing the applicable Tower Revenue Notes) of the issuers of the Tower Revenue Notes was approximately $764 million. We currently expect to refinance these notes on or prior to the respective anticipated repayment dates.

(d)	Interest payments on the floating rate debt are based on estimated rates currently in effect.

(e)

Amounts relate primarily to lease obligations for the land interests on which our towers reside and are based on the assumption that payments will be made for certain renewal periods exercisable at our option that are reasonably certain to be exercised and excludes our contingent payments for operating leases (such as payments based on revenues derived from the communications infrastructure located on the leased asset) as such arrangements are excluded from our operating lease liability. See note 15 to our consolidated financial statements for further discussion of our operating lease obligations. See also the table below summarizing remaining terms to expiration.

(f)	Amounts relate primarily to access agreement obligations for rights-of-way, franchises, pole attachments and other agreements to operate our fiber assets and are based on the assumption that payments will be made for certain renewal periods exercisable at our option that are reasonably certain to be exercised and excludes our contingent payments for access agreements.

(g)	Predominantly consists of outstanding indebtedness under our CP Program. Such amounts may be issued, repaid, or re-issued from time to time.

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(a)	Inclusive of fee interests and perpetual easements.

(b)	For the year ended December 31, 2019, without consideration of the term of the tenant contract.

(a)	Failure to comply with the financial maintenance covenants would, absent a waiver, result in an event of default under the Credit Agreement.

(b)	As defined in the Credit Agreement.

(c)	Applicable solely to the extent that the senior unsecured debt rating by any two of S&P, Moody's and Fitch is lower than BBB-, Baa3 or BBB-, respectively. If applicable, the consolidated interest coverage ratio must be greater than or equal to 2.50.

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(1)	discounted cash flow valuation methods (for estimating identifiable intangibles such as site rental contracts and tenant relationships or operating lease right-of-use assets and lease liabilities acquired); or

(2)	estimates of replacement costs (for tangible fixed assets such as communications infrastructure).

(1)	we pool site rental contracts and tenant relationships intangible assets and property and equipment into portfolio groups; and

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(2)	we separately pool site rental contracts and tenant relationships by significant tenant or by tenant grouping for individually insignificant tenants, as appropriate.

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(a)	The components in this table may not sum to the total due to rounding.

(b)	The above reconciliation excludes the items included in our Adjusted EBITDA definition which are not applicable to the periods shown.

(c)	See "Explanatory Note" immediately preceding Item 1 of this Annual Report on Form 10-K and note 2 to our consolidated financial statements for further information.

•	it is the primary measure used by our management (1) to evaluate the economic productivity of our operations and (2) for purposes of making decisions about allocating resources to, and assessing the performance of our operations;

•	although specific definitions may vary, it is widely used by investors or other interested parties in evaluation of the communications infrastructure sector and other REITs to measure financial performance without regard to items such as depreciation, amortization and accretion, which can vary depending upon accounting methods and the book value of assets;

•	we believe it helps investors and other interested parties meaningfully evaluate and compare the results of our operations (1) from period to period and (2) to our competitors by removing the impact of our capital structure (primarily interest charges from our outstanding debt) and asset base (primarily depreciation, amortization and accretion) from our financial results; and

•	it is similar to the measure of current financial performance generally used in our debt covenant calculations.

•	as a performance goal in employee annual incentive compensation;

•	as a measurement of financial performance because it assists us in comparing our financial performance on a consistent basis as it removes the impact of our capital structure (primarily interest charges from our outstanding debt) and asset base (primarily depreciation, amortization and accretion) from our operating results;

•	in presentations to our board of directors to enable it to have the same measurement of financial performance used by management;

•	for planning purposes, including preparation of our annual operating budget;

•	as a valuation measure in strategic analyses in connection with the purchase and sale of assets;

•	in determining self-imposed limits on our debt levels, including the evaluation of our leverage ratio and interest coverage ratio; and

•	with respect to compliance with our debt covenants, which require us to maintain certain financial ratios that incorporate concepts such as, or similar to, Adjusted EBITDA.

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•	the potential refinancing of our $18.1 billion in existing debt, compared to $16.7 billion in the prior year;

•	our $3.0 billion of floating rate debt representing approximately 17% of total debt, compared to 21% in the prior year; and

•	potential future borrowings of incremental debt, including borrowings under our 2016 Credit Facility and issuances under the CP Program.

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(a)	The fair value of our debt is 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 offers. These fair values are not necessarily indicative of the amount, which could be realized in a current market exchange.

(b)	The impact of principal payments that will commence following the anticipated repayment dates is not considered. The Tower Revenue Notes have principal amounts of $300 million, $250 million, $700 million and $750 million, with anticipated repayment dates in 2022, 2023, 2025 and 2028, respectively.

(c)	The average interest rate represents the weighted-average stated coupon rate (see also footnote (d)).

(d)

If the Tower Revenue Notes are not repaid in full by the applicable anticipated repayment dates, the applicable interest rate increases by approximately 5% per annum and monthly principal payments commence using the Excess Cash Flow (as defined in the indenture governing the applicable Tower Revenue Notes) of the issuers of the Tower Revenue Notes. The Tower Revenue Notes are presented based on their contractual maturity dates ranging from 2042 to 2048 and include the impact of an assumed 5% increase in interest rate that would occur following the anticipated repayment dates but exclude the impact of monthly principal payments that would commence using Excess Cash Flow of the issuers of the Tower Revenue Notes The full year 2019 Excess Cash Flow of the issuers of the Tower Revenue Notes was approximately $764 million. We currently expect to refinance these notes on or prior to the respective anticipated repayment dates.

(e)	Consists of (1) our senior unsecured term loan A facility ("2016 Term Loan A") and 2016 Revolver borrowings, each of which matures in 2024, and (2) our outstanding Commercial Paper Notes.

(f)	Predominantly consists of outstanding indebtedness under our CP Program. Such amounts may be issued, repaid, or re-issued from time to time.

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(a)	See "Recently Adopted Accounting Pronouncements" in note 3 to the consolidated financial statements for a discussion of the recently adopted new lease standard.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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(a)	See note 2 to the consolidated financial statements for the restatement impact to the opening balance as of December 31, 2016.

(b)	See the consolidated statement of operations and comprehensive income (loss) for the components of "total other comprehensive income (loss)."

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(a)	See the consolidated statement of operations and comprehensive income (loss) for the components of "total other comprehensive income (loss)."

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(a)	See the consolidated statement of operations and comprehensive income (loss) for the components of "total other comprehensive income (loss)."

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1.	Basis of Presentation

◦

22% of the Company's towers are leased or subleased or operated and managed under a master prepaid lease or other related agreements with AT&T for a weighted-average initial term of approximately 28 years, weighted on Towers site rental gross margin. The Company has the option to purchase the leased and subleased towers from AT&T at the end of the respective lease or sublease terms for aggregate option payments of approximately $4.2 billion, which payments, if such option is exercised, would be due between 2032 and 2048.

◦	16% of the Company's towers are leased or subleased or operated and managed for an initial period of 32 years (through May 2037) under master leases, subleases, or other agreements with Sprint. The Company has the option to purchase in 2037 all (but not less than all) of the leased and subleased Sprint towers from Sprint for approximately $2.3 billion.

◦

15% of the Company's towers are leased or subleased or operated and managed under a master prepaid lease or other related agreements with T-Mobile for a weighted-average initial term of approximately 28 years, weighted on Towers site rental gross margin. The Company has the option to purchase the leased and subleased towers from T-Mobile at the end of the respective lease or sublease terms for aggregate option payments of approximately $2.0 billion, which payments, if such option is exercised, would be due between 2035 and 2049. In addition, through the acquisition of the rights to approximately 7,100 towers ("T-Mobile Acquisition"), there are another 1% of the Company's towers subject to a lease and sublease or other related arrangements with AT&T. The Company has the option to purchase these towers that it does not otherwise already own at the end of their respective lease terms for aggregate option payments of up to approximately $405 million, which payments, if such option is exercised, would be due prior to 2032 (less than $10 million would be due before 2025).

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2.	Restatement of Previously Issued Consolidated Financial Statements

(a)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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3.	Summary of Significant Accounting Policies

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4.	Acquisitions

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(a)	The final purchase price allocation for the FiberNet Acquisition resulted in the recognition of goodwill based on:

•	the Company's expectation to leverage the FiberNet fiber footprint to support new small cells and fiber solutions,

•	the complementary nature of the FiberNet fiber to the Company's existing fiber assets and its location in top metro markets where the Company expects to see wireless carrier network investments,

•	the Company's belief that the acquired fiber assets are well-positioned to benefit from the continued growth trends in the demand for data, and

•	other intangibles not qualified for separate recognition, including the assembled workforce.

(b)	Predominantly comprised of site rental contracts and tenant relationships.

(c)	The vast majority of the assets have been included in the Company's REIT. As such, no deferred taxes were recorded in connection with the FiberNet Acquisition.

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(a)	The final purchase price allocation for the Lightower Acquisition resulted in the recognition of goodwill based on:

•	the Company's expectation to leverage the Lightower fiber footprint to support new small cells and fiber solutions,

•	the complementary nature of the Lightower fiber to the Company's existing fiber assets and its location where the Company expects to see wireless carrier network investments,

•	the Company's belief that the acquired fiber assets are well-positioned to benefit from the continued growth trends in the demand for data, and

•	other intangibles not qualified for separate recognition, including the assembled workforce.

(b)	Predominantly comprised of site rental contracts and tenant relationships.

(c)	The vast majority of the assets have been included in the Company's REIT. As such, no deferred taxes were recorded in connection with the Lightower Acquisition.

(a)

For the year ended December 31, 2017, amounts are inclusive of pro forma adjustments to the benefit (provision) for income tax as a result of the Company's REIT status. The vast majority of the assets and related income from the FiberNet Acquisition, the Wilcon Acquisition, and the Lightower Acquisition are included in the Company's REIT. The remaining assets are included in the Company's TRS. For purposes of the unaudited pro forma financial results, an adjustment has been made to reflect the additional tax impact of the income related to the TRS assets.

(b)	For the year ended December 31, 2017, amounts are inclusive of pro forma adjustments to depreciation and amortization of $247 million, related to property and equipment and intangibles recorded as a result of the 2017 Acquisitions.

(c)	Pro forma amounts include the impact of the interest expense and common stock share issuances associated with the related debt and equity financings for the 2017 Acquisitions (see above and notes 9 and 12).

(d)	Pro forma amounts include the impact of the preferred stock dividends related to the Mandatory Convertible Preferred Stock Offering (as defined in note 12) for the Lightower Acquisition (see above and note 12).

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5.	Revenues

(a)	Based on the nature of the contract, tenant contracts are accounted for pursuant to relevant lease accounting (ASC 842) or revenue accounting (ASC 606) guidance. Excludes amounts related to services, as those contracts generally have a duration of one year or less.

6.	Property and Equipment

(a)	Includes land owned through fee interests and perpetual easements.

7.	Goodwill and Intangible Assets

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(a)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard, including with respect to below-market leases previously classified as intangible assets.

(a)

Amortization expense of intangible assets classified as "Site rental costs of operations" on the Company's consolidated statement of operations and comprehensive income (loss) for the years ended December 31, 2018 and 2017 represented amortization of below-market leases. Effective January 1, 2019, these below-market leases were de-recognized and reclassified from "Other intangible assets, net" to the "Operating lease right-of-use assets" on the Company's consolidated balance sheet. See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard.

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8.	Other Liabilities

(a)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard, including with respect to deferred ground lease payable and above-market leases previously classified as other long-term liabilities.

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9.	Debt and Other Obligations

(a)	Represents the weighted-average stated interest rate.

(b)	The Tower Revenue Notes, Series 2015-1 and 2015-2 ("May 2015 Tower Revenue Notes") and Tower Revenue Notes, Series 2018-1 and 2018-2 ("July 2018 Tower Revenue Notes") are collectively referred to herein as "Tower Revenue Notes."

(c)

If the respective series of Tower Revenue Notes are not paid in full on or prior to an applicable anticipated repayment date, then Excess Cash Flow (as defined in the indenture governing the terms of such notes) of the issuers of such notes will be used to repay principal of the applicable series and class of the Tower Revenue Notes, and additional interest (of an additional approximately 5% per annum) will accrue on the respective Tower Revenue Notes. As of December 31, 2019, the Tower Revenue Notes have principal amounts of $300 million, $250 million, $700 million and $750 million, with anticipated repayment dates in 2022, 2023, 2025 and 2028, respectively.

(d)	The Secured Notes, Series 2009-1, Class A-1 and Secured Notes, Series 2009-1, Class A-2 are collectively referred to herein as "2009 Securitized Notes."

(e)	The Company's finance leases and other obligations relate to land, fiber, vehicles, and other assets and bear interest rates ranging up to 10% and mature in periods ranging from less than one year to approximately 30 years.

(f)	As of December 31, 2019, the undrawn availability under the 2016 Revolver was $4.5 billion.

(g)

Both the 2016 Revolver and senior unsecured term loan A facility ("2016 Term Loan A") bear interest at a rate per annum equal to LIBOR plus a credit spread ranging from 1.000% to 1.750%, based on the Company's senior unsecured debt rating. The Company pays a commitment fee ranging from 0.125% to 0.350%, based on the Company's senior unsecured debt rating, per annum on the undrawn available amount under the 2016 Revolver.

(h)	The maturities of the Commercial Paper Notes, as defined below, when outstanding, may vary but may not exceed 397 days from the date of issue.

(i)	The weighted-average interest rate for the outstanding commercial paper under the CP Program, as defined below, was 2.1%.

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(a)	Exclusive of accrued interest.

(b)	Inclusive of the write-off of the respective deferred financing costs.

(a)	Exclusive of accrued interest.

(b)	Inclusive of the write-off of the respective deferred financing costs.

(a)	The losses represent write-off of deferred financing costs.

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10.	Fair Value Disclosures

11.	Income Taxes

(a)	Inclusive of income (loss) before income taxes from Puerto Rico.

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(a)	Pursuant to the Tax Cuts and Jobs Act, which was signed into law in December 2017, the Company was required to write down its net federal deferred tax asset in the amount of $17 million as a result of the reduction in the federal corporate tax rate offset by a benefit of $2 million related to the refund of the Company's alternative minimum tax credit carryforward.

(a)	Balance results from the Company's foreign NOLs. Due to the Company's REIT status, no federal or state NOLs result in the Company recording a deferred income tax asset. See further discussion surrounding the Company's NOL balances below.

(b)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard.

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12.	Equity

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(a)	Inclusive of dividends accrued for holders of unvested RSUs, which will be paid when and if the RSUs vest.

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(a)	Qualified taxable dividend and section 199A dividend amounts are included in ordinary taxable dividend amounts.

13.	Stock-based Compensation

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14.	Commitments and Contingencies

15.	Leases

(a)	Represents the Company's operating lease expense related to its ROU assets for the twelve months ended December 31, 2019.

(b)	Represents the Company's expense related to contingent payments for operating leases (such as payments based on revenues derived from the communications infrastructure located on the leased asset) for the twelve months ended December 31, 2019. Such contingencies are recognized as expense in the period they are resolved.

(c)	Excludes those direct operating expenses accounted for pursuant to accounting guidance outside the scope of ASC 842.

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(a)	Excludes the Company's contingent payments for operating leases (such as payments based on revenues derived from the communications infrastructure located on the leased asset) as such arrangements are excluded from the Company's operating lease liability. Such contingencies are recognized as expense in the period they are resolved.

16.	Operating Segments and Concentrations of Credit Risk

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(a)	Exclusive of depreciation, amortization and accretion shown separately

(b)	Segment cost of operations for the year ended December 31, 2019 excludes (1) stock-based compensation expense of $26 million and (2) prepaid lease purchase price adjustments of $20 million. For the year ended December 31, 2019, segment selling, general and administrative expenses exclude stock-based compensation expense of $90 million.

(c)	See consolidated statement of operations for further information.

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(a)	Exclusive of depreciation, amortization and accretion shown separately

(b)	Segment cost of operations for the year ended December 31, 2018 excludes (1) stock-based compensation expense of $25 million and (2) prepaid lease purchase price adjustments of $20 million. For the year ended December 31, 2018, segment selling, general and administrative expenses exclude stock-based compensation expense of $83 million.

(c)	See consolidated statement of operations for further information.

(a)	Exclusive of depreciation, amortization and accretion shown separately

(b)	Segment cost of operations for the year ended December 31, 2017 excludes (1) stock-based compensation expense of $20 million and (2) prepaid lease purchase price adjustments of $20 million. For the year ended December 31, 2017, segment selling, general and administrative expenses exclude stock-based compensation expense of $76 million.

(c)	See consolidated statement of operations for further information.

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17.	Supplemental Cash Flow Information

(a)	Excludes the Company's contingent payments pursuant to operating leases, which are recorded as expense in the period such contingencies are resolved.

(b)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard.

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18.	Quarterly Financial Information (Unaudited)

(a)	The sum of quarterly information may not agree to year-to-date information due to rounding.

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(a)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard.

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(a)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard.

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(a)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard.

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(a)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard.

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(a)	See "Recently Adopted Accounting Pronouncements" in note 3 for a discussion of the recently adopted new lease standard.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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(a)	Exclusive of depreciation, amortization and accretion shown separately.

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19.	Subsequent Events

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•	pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

•	provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorization of management and directors of the Company; and

•	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition of the Company's assets that could have a material effect on the financial statements.

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(a)	See note 13 to the consolidated financial statements for more detailed information regarding the registrant's equity compensation plan.

(b)	Of these shares remaining available for future issuance, 3 million shares may be issued pursuant to outstanding RSUs granted under the LTI Plan.

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(a)	Represents the allowance for doubtful accounts reflected in the final purchase price allocations for the 2017 Acquisitions. See note 4.

(a)	Inclusive of the effects of acquisitions.

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(a)	Includes approximately 40,000 towers and 80,000 route miles of fiber. No single asset exceeds 5% of the aggregate gross amounts at which the assets were carried at the close of the period set forth in the table above.

(b)

Encumbrances are reported at face value, without contemplating the effect of deferred financing costs, discounts or premiums. Certain of the Company's debt is secured by (1) a security interest in substantially all of the applicable issuers' assignable personal property, (2) a pledge of the equity interests in each applicable issuer and (3) a security interest in the applicable issuers' leases with tenants to lease tower space (space licenses).

(c)	The Company has omitted this information, as it would be impracticable to compile such information on an asset-by-asset basis.

(a)	See note 2 to the Company's consolidated financial statements for further information regarding the restatement.

(b)	Includes acquisitions of communications infrastructure.

(c)	Predominately relates to the purchase of property and equipment under finance leases and installment land purchases.

(a)	See note 2 to the Company's consolidated financial statements for further information regarding the restatement.

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