SEC Filing | Crown Castle

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As filed with the Securities and Exchange Commission on April 21, 1999
Registration No. 333-71715
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 3
TO

FORM S-4
REGISTRATION STATEMENT
Under
The Securities Act of 1933

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CROWN CASTLE INTERNATIONAL CORP.
(Exact name of Registrant as specified in its charter)
Delaware 4899 76-0470458
(State or other (Primary Standard Industrial (I.R.S. Employer
jurisdiction of Classification Number) Identification Number)
incorporation or
organization)

---------------

Mr. Charles C. Green, III
510 Bering Drive
Suite 500
Houston, Texas 77057
(713) 570-3000
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)

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Copies to:
Stephen L. Burns, Esq.
Cravath, Swaine & Moore
825 Eighth Avenue
New York, New York 10019

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Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.

If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [_]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_]

If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]

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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine. Information contained herein is
subject to completion or amendment. A Registration Statement relating to these
securities has been filed with the Securities and Exchange Commission. These
securities may not be sold nor may offers to buy be accepted prior to the time
the Registration Statement becomes effective. This prospectus shall not
constitute an offer to sell or the solicitation of an offer to buy nor shall
there be any sale of these securities in any state in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such state.
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++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statements filed with the +
+Securities and Exchange Commission relating to these securities is effective. +
+This prospectus is not an offer to sell these securities and it is not +
+soliciting an offer to buy these securities in any state where the offer or +
+sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion

April 21, 1999

Prospectus

[LOGO] CROWN
CASTLE
INTERNATIONAL

CROWN CASTLE INTERNATIONAL CORP.

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EXCHANGE OFFER FOR

12 3/4% SENIOR EXCHANGEABLE PREFERRED STOCK DUE 2010

This is an offer to exchange the outstanding, unregistered CCIC 12 3/4%
Senior Exchangeable Preferred Stock you now hold for new, substantially
identical 12 3/4% Senior Exchangeable Preferred Stock that will be free of the
transfer restrictions that apply to the old preferred stock. This offer will
expire at 5:00 p.m., New York City time, on , 1999, unless we extend it.
You must tender your old, unregistered preferred stock by the deadline to
obtain new, registered preferred stock and the liquidity they offer.

We agreed with the initial purchasers of the old preferred stock to make this
offer and register the issuance of the old preferred stock following the
closing. This offer applies to any and all old preferred stock tendered by the
deadline.

The new preferred stock will not trade on any established exchange. The new
preferred stock have the same financial terms and covenants as the old
preferred stock.

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Please see "Risk Factors" beginning on page 16 for a discussion of certain
factors you should consider in connection with the exchange offer.

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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of the new preferred stock or determined
if this prospectus is truthful or complete. Any representation to the contrary
is a criminal offense.

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The date of this prospectus is , 1999.

TABLE OF CONTENTS

Page
----

Prospectus Summary................. 1
Risk Factors....................... 16
Use of Proceeds.................... 28
Dividend Policy.................... 28
Capitalization..................... 29
Unaudited Pro Forma Condensed
Consolidated Financial
Statements........................ 30
Selected Financial and Other Data
of CCIC........................... 37
Selected Financial and Other Data
of CTSH........................... 39
Management's Discussion
and Analysis of
Financial Condition and Results of
Operations........................ 41
The Exchange Offer................. 56
Industry Background................ 64
Business........................... 72
Recent and Proposed Transactions... 97

Page
----

The Proposed Offerings............. 107
Management......................... 108
Certain Relationships and Related
Transactions...................... 120
Principal Stockholders............. 129
Description of Securities.......... 132
Book-Entry, Delivery and Form...... 176
Description of Capital Stock....... 181
Description of Certain
Indebtedness...................... 188
Certain U.S. Federal Income Tax
Considerations................... 195
Plan of Distribution............... 195
Legal Matters...................... 196
Independent Auditors............... 196
Certain Currency Translations...... 196
Available Information.............. 196
Index to Financial Statements...... F-1

PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this prospectus.
It may not contain all the information that is important to you. We encourage
you to read this entire prospectus carefully.

The Company

We are a leading owner and operator of towers and transmission networks for
wireless communications and broadcast companies. After giving effect to the
completion of the recent and proposed transactions we describe in this
prospectus, as of December 31, 1998, we owned or managed 6,136 towers,
including 4,450 towers in the United States and Puerto Rico and 1,686 towers in
the United Kingdom. Our customers currently include many of the world's major
wireless communications and broadcast companies, including Bell Atlantic
Mobile, BellSouth Mobility, AT&T Wireless, Nextel and the British Broadcasting
Corporation.

Our strategy is to use our leading domestic and international position to
capture the growing opportunities to consolidate ownership of existing towers
and to build new towers created by:

. the transfer to third parties, or outsourcing, of tower ownership and
management by major wireless carriers;

. the need for existing wireless carriers to expand coverage and improve
capacity;

. the additional demand for towers created by new entrants into the
wireless communications industry;

. the privatization of state-run broadcast transmission networks; and

. the introduction of new digital broadcast transmission technology and
wireless technologies.

Our two main businesses are leasing antenna space on wireless and broadcast
towers that can accommodate multiple tenants and operating networks that
transmit analog and digital broadcast signals, or broadcast transmission
networks. We also provide related services to our customers. We believe that
our full service capabilities are a key competitive advantage in forming
strategic partnerships to acquire large concentrations of towers, or tower
clusters, and in winning contracts for new tower construction.

Our primary business in the United Kingdom is the operation of television and
radio broadcast transmission networks. We also lease antenna space to wireless
operators in the United Kingdom on the towers we acquired from the BBC and from
various wireless carriers. After completion of the One2One transaction
described in this prospectus, we will have nationwide broadcast and wireless
coverage in the United Kingdom.

----------------

Our principal executive offices are located at 510 Bering Drive, Suite 500,
Houston, Texas 77057, and our telephone number is (713) 570-3000.

Growth Strategy

Our objective is to become the premier global owner and operator of towers
and transmission networks for wireless communications and broadcast companies.
Our experience in expanding and marketing our tower clusters, as well as our
experience in operating analog and digital broadcast transmission networks,
positions us to accomplish this objective. The key elements of our growth
strategy are to:

.Maximize utilization of our tower capacity.

.Utilize the expertise of our U.S. and U.K. personnel to capture global
growth opportunities.

.Partner with wireless carriers to assume ownership of their existing
towers.

.Build new towers for wireless carriers and broadcasters.

.Acquire existing broadcast transmission networks.

.Continue to decentralize our management functions.

Recent and Proposed Transactions

We have recently completed or entered into agreements to complete the
transactions described below. Completion of these transactions will result in a
significant increase in the size of our operations and the number of towers
that we own and manage. In addition, we are issuing a significant number of
shares of our common stock to partially fund some of these transactions. The
agreements governing the transactions that have not yet been closed include a
number of important conditions. Therefore, we cannot guarantee that we will
close any of the proposed transactions on the terms described in this
prospectus or at all. See "Recent and Proposed Transactions".

Bell Atlantic Joint Venture

On March 31, 1999, we completed the formation of a joint venture with Bell
Atlantic Mobile to own and operate approximately 1,458 towers. These towers
represent substantially all the towers in Bell Atlantic's wireless network in
the eastern and southwestern United States, including markets such as New York,
Philadelphia, Boston, Washington, D.C. and Phoenix. The joint venture will also
build and own the next 500 towers to be built for Bell Atlantic's wireless
communications business. Bell Atlantic leases antenna space on the 1,458 towers
transferred to the joint venture and will lease antenna space on the towers
that the joint venture builds for Bell Atlantic.

Proposed BellSouth Transaction

On March 8, 1999, we entered into a preliminary agreement with BellSouth to
control and operate approximately 1,850 towers. These towers represent
substantially all the towers in BellSouth's wireless network in the
southeastern and midwestern United States, including markets such as Miami,
Atlanta, Tampa, Nashville and Indianapolis. We will be responsible for managing
and leasing the available space on BellSouth's towers. We will have the right
to build, control and operate the next 500 towers to be built for BellSouth's
wireless communications business. BellSouth will lease antenna space on the
1,850 towers, as well as on the towers we build for BellSouth.

Proposed Powertel Acquisition

On March 15, 1999, we entered into an agreement with Powertel Inc. to
purchase approximately 650 towers. These towers represent substantially all of
Powertel's owned towers in its wireless network in the southeastern and
midwestern United States, including such markets as Atlanta, Birmingham,
Jacksonville, Memphis and Louisville, and a number of major connecting highway
corridors in the southeast. These towers are complementary to BellSouth's
towers in the southeast and have minimal coverage overlap. Powertel will lease
antenna space on the 650 towers we acquire in the acquisition.

Proposed One2One Transaction

On March 5, 1999, we entered into an agreement with One2One, under which
Castle Transmission, our U.K. operating subsidiary, has agreed to manage,
develop and, at its option, acquire up to 821 towers. These towers represent
substantially all the towers in One2One's nationwide wireless network in the
United Kingdom. We will be responsible for managing and leasing available space
on the towers and will receive all the income from any such third party leases.

Corporate Structure

We operate our business through our subsidiaries. Crown Communication and the
Bell Atlantic joint venture are our principal U.S. operating subsidiaries and
Castle Transmission is our principal U.K. operating subsidiary. We will also
use subsidiaries to hold the assets we will acquire or control in the proposed
transactions we describe in this prospectus. The subsidiaries through which we
conduct our U.K. operations and our Bell Atlantic joint venture are not
restricted by the covenants in our high yield debt instruments. The following
chart illustrates our organizational structure assuming the proposed
transactions described in this prospectus are completed. See "Capitalization"
and "Recent and Proposed Transactions".

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Crown Castle International Corp.
("CCIC")

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| | |
|100% |100% |80%(a)
| | |
- ----------------------------------------- ---------- ------------------
Crown CCA Castle
Communication Inc. Investment Transmission
("Crown Corp. Services
Communication") (Holdings) Ltd

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- -
| | | |
|100% |100% |61.5%(b) |100%
| | | |
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Proposed Proposed Castle
Powertel BellSouth Bell Atlantic Transmission
Subsidiary Subsidiary Joint Venture International Ltd
("CTI")
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________________________________________
(a) The remaining 20% equity interest in Castle Transmission Services (Holdings)
Ltd, our U.K. holding company, is held by affiliates of France Telecom.
Under agreements that we have entered into with such affiliates, in certain
instances, this 20% equity interest may be exchanged for shares of our Class
A common stock at a specified exchange ratio.
(b) Bell Atlantic will hold the remaining 38.5% interest in the joint venture
along with a nominal interest in the joint venture's operating subsidiary.

The Offering

Summary of Terms of the Exchange Offer

The Exchange Offer.......... We are offering to exchange for each $1,000
liquidation preference of our outstanding 12 3/4%
Senior Exchangeable Preferred Stock due 2010,
$1,000 liquidation preference of our 12 3/4%
Senior Exchangeable Preferred Stock due 2010,
which has been registered under the Securities
Act of 1933.

As of the date of this document, $200,000,000 in
aggregate liquidation preference of old preferred
stock is outstanding. The old preferred stock was
originally issued in a private placement.

Resale...................... We believe that new preferred stock issued
pursuant to the exchange offer in exchange for
old preferred stock may be offered for resale,
resold and otherwise transferred by you without
compliance with the registration and prospectus
delivery provisions of the Securities Act of
1933, provided that:

. you are acquiring the new preferred stock in
the ordinary course of your business;

. you have not engaged in, do not intend to
engage in, and have no arrangement or
understanding with any person to participate in
the distribution of the new preferred stock;
and

. you are not our "affiliate" as defined under
Rule 405 of the Securities Act.

Each participating broker-dealer that receives
shares of new preferred stock for its own account
pursuant to the exchange offer in exchange for
shares of old preferred stock that were acquired
as a result of market-making or other trading
activity must acknowledge that it will deliver a
prospectus in connection with any resale of the
shares of new preferred stock. See "Plan of
Distribution".

Any holder of old preferred stock who:

(1) is our affiliate,

(2) does not acquire new preferred stock in the
ordinary course of its business,

(3) tenders in the exchange offer with the
intention to participate, or for the purpose
of participating, in a distribution of new
preferred stock or

(4) is a broker-dealer that acquired the old
preferred stock directly from us, must
comply with the registration and prospectus
delivery requirements of the Securities Act
of 1933 in connection with the resale of the
new preferred stock.

Expiration Date............. 5:00 p.m., New York City time, on , 1999,
unless we extend the exchange offer.

Certain Conditions to the
Exchange Offer............. The exchange offer is subject to certain
customary conditions, which we may waive.

Special Procedures for
Beneficial Holders......... If you beneficially own shares of old preferred
stock which are registered in the name of a
broker, dealer, commercial bank, trust company or
other nominee and you wish to tender in the
exchange offer, you should contact such
registered holder promptly and instruct such
person to tender on your behalf. If you wish to
tender in the exchange offer on your own behalf,
you must, prior to completing and executing the
letter of transmittal and delivering your shares
of old preferred stock, either arrange to have
the shares of old preferred stock registered in
your name or obtain a properly completed bond
power from the registered holder. The transfer of
registered ownership may take considerable time.

Withdrawal Rights........... You may withdraw your tender of old preferred
stock at any time before the offer expires.

Certain Tax Consequences.... The exchange pursuant to the exchange offer will
generally not be a taxable event for United
States federal income tax purposes.

Use of Proceeds............. We will not receive any proceeds from the
exchange pursuant to the exchange offer.

Exchange Agent.............. ChaseMellon Shareholder Services, L.L.C. is
serving as exchange agent in connection with the
exchange offer.

Summary Description of the Securities to be Registered

The New Preferred Stock:

The new preferred stock have the same financial terms and covenants as the
old preferred stock, which are as follows:

Securities Offered.......... 200,000 shares of 12 3/4% Senior Exchangeable
Preferred Stock due 2010 with a liquidation
preference of $1,000 per share.

We have the option to exchange the exchangeable
preferred stock, in whole but not in part, for 12
3/4% Senior Subordinated Exchange Debentures due
2010.

Dividends................... Annual fixed rate of 12 3/4%.

We will declare and pay dividends on March 15,
June 15, September 15 and December 15 of each
year, beginning on March 15, 1999.

On or before December 15, 2003, we have the
option to pay dividends in cash or in additional
fully paid and non-assessable shares of new
preferred stock with an aggregate liquidation
preference equal to the amount of such dividends.
After December 15, 2003, we will pay dividends
only in cash.

Mandatory Redemption........ We will be required to redeem all of the shares
of new preferred stock outstanding on December
15, 2010 at a redemption price equal to 100% of
the liquidation preference of such shares, plus
accumulated and unpaid dividends to the date of
redemption.

Optional Redemption.........
On or after December 15, 2003, we may redeem some
or all of the shares of new preferred stock at
any time at the redemption prices listed in the
section "Description of Securities--Description
of Senior Exchangeable Preferred Stock" under the
heading "Optional Redemption". If we redeem
shares, we also will pay accumulated and unpaid
dividends, if any, to the date of redemption.

In addition, before December 15, 2001, we may
redeem up to 35% of the outstanding shares of new
preferred stock with the proceeds of certain
public equity offerings or strategic equity
investments at a redemption price equal to
112.750% of the liquidation preference of the new
preferred stock, together with accumulated and
unpaid dividends, if any, to the date of
redemption.

Change of Control........... If we experience specific kinds of changes in
control, we must make an offer to purchase any
and all shares of new preferred stock for cash at
a purchase price of 101% of the liquidation
preference of such shares, together with all
accumulated and unpaid dividends to the date of
purchase. However, our repurchase of new
preferred stock under these circumstances must
comply with certain provisions of the indenture
governing our outstanding senior notes. If we
were unable to comply with those provisions and
fail to repurchase new preferred stock, then
holders of the new preferred stock would be
entitled to certain voting rights. In addition,
there can be no assurance that we will have
sufficient funds to repurchase the new preferred
stock in the event of a change of control or that
our creditors will otherwise allow us to make the
repurchase. See "Risk Factors--We May Not Have
Sufficient Funds to Repurchase the Exchangeable
Preferred Stock or the Exchange Debentures Upon a
Change of Control".

The certificate of designations governing the new
preferred stock contains certain covenants for
Certain Covenants........... your benefit which, among other things, limit our
ability and the ability of certain of our
subsidiaries to:

. borrow money;

. pay dividends on stock or purchase our capital
stock;

. make investments; and

. sell assets or merge with or into other
companies.

These covenants are subject to important
exceptions and qualifications which are described
in "Description of Securities-- Description of
Senior Exchangeable Preferred Stock" under the
heading "Certain Covenants."

Voting Rights...............
The new preferred stock will have no voting
rights except as required by law and as specified
in the certificate of designations. If we fail to
meet our obligations under the covenants
contained in the certificate of designations, the
holders of the new preferred stock will be
entitled to elect two additional members of our
board of directors.

Exchange Feature............
On any scheduled dividend payment date, we have
the option to exchange all (but not less than
all) of the shares of new preferred stock then
outstanding for our 12 3/4% Senior Subordinated
Exchange Debentures due 2010. If we exercise our
option to exchange, we will issue exchange
debentures in an aggregate principal amount equal
to the aggregate liquidation preference of the
outstanding new preferred stock.

The indenture governing our outstanding senior
notes contains substantial restrictions on our
ability to exchange new preferred stock for
exchange debentures. See "Description of
Securities--Description of Senior Exchangeable
Preferred Stock--Exchange".

Registration Rights.........
Holders of new preferred stock are not entitled
to any registration rights for the new preferred
stock.

The Exchange Debentures:

Securities Offered.......... 12 3/4% Senior Subordinated Exchange Debentures
due 2010 in an aggregate principal amount equal
to the aggregate liquidation preference of the
new preferred stock outstanding on the date of
the exchange, plus such principal amount of
additional exchange debentures as may be issued
in lieu of cash interest.

Maturity.................... December 15, 2010.

Interest.................... At an annual fixed rate of 12 3/4%.

We will pay interest on each June 15 and December
15 of each year, commencing on the first of these
dates that occurs after the date of the exchange.

On or before December 15, 2003, we have the
option to pay interest in cash or in additional
exchange debentures in an

aggregate principal amount equal to the amount of
such interest. After December 15, 2003, we will
pay interest only in cash.

Optional Redemption......... On or after December 15, 2003, we may redeem some
or all of the exchange debentures at any time at
the redemption prices listed in the section
"Description of Securities--Description of Senior
Subordinated Exchange Debentures" under the
heading "Optional Redemption". If we redeem
exchange debentures, we also will pay accrued and
unpaid interest, if any, to the date of
redemption.

In addition, before December 15, 2001, we may
redeem up to 35% of the exchange debentures with
the proceeds of certain public equity offerings
or strategic equity investments at the price
listed in the section "Description of
Securities--Description of Senior Subordinated
Exchange Debentures" under the heading "Optional
Redemption". If we choose this option, we must
redeem the exchange debentures within 60 days of
receiving the proceeds.

Mandatory Offer to
Repurchase................. If we sell certain assets or experience specific
kinds of changes of control, we must offer to
repurchase the exchange debentures at the prices
listed in the section "Description of
Securities--Description of Senior Subordinated
Exchange Debentures" under the heading
"Repurchase at the Option of Holders".

Basic Covenants of the
Exchange Indenture.........
If and when we issue the exchange debentures, we
will issue them under an indenture with United
States Trust Company of New York, as trustee. The
indenture will contain covenants substantially
identical to those contained in the certificate
of designations for the exchangeable preferred
stock.

Risk Factors

You should carefully consider all of the information in this prospectus. In
particular, you should evaluate the specific risk factors under "Risk Factors"
for a discussion of certain risks related to your participation in the exchange
offer.

Summary Unaudited Pro Forma Financial and Other Data

The unaudited pro forma financial and other data set forth below have been
derived from the pro forma financial statements included under "Unaudited Pro
Forma Condensed Consolidated Financial Statements". The pro forma statement of
operations data and other data for the year ended December 31, 1998, give
effect to the transactions detailed under "Unaudited Pro Forma Condensed
Consolidated Financial Statements" as if they had occurred on January 1, 1998.
The pro forma balance sheet data give effect to such transactions occurring in
1999 as if they had occurred on December 31, 1998. Where we present data for
the restricted group, we are presenting the data for CCIC and its subsidiaries
that are restricted by the covenants in our U.S. high yield debt instruments.
This restricted group data is not intended as an alternative measure of
operating results, financial position or cash flow from operations (as
determined in accordance with generally accepted accounting principles). The
information set forth below should be read in conjunction with "Unaudited Pro
Forma Condensed Consolidated Financial Statements", "Selected Financial and
Other Data of CCIC", "Selected Financial and Other Data of CTSH", "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
the consolidated financial statements and related notes included elsewhere in
this prospectus.

CCIC Restricted Group
Pro Forma Pro Forma
------------ ----------------
Year Ended Year Ended
December 31, December 31,
1998 1998
------------ ----------------
(Dollars in thousands)

Statement of Operations Data:
Net revenues:
Site rental and broadcast transmission........ $ 251,679 $ 72,286
Network services and other.................... 50,299 32,217
--------- ---------
Total net revenues.......................... 301,978 104,503
--------- ---------
Costs of operations:
Site rental and broadcast transmission........ 94,663 23,684
Network services and other.................... 29,480 17,329
--------- ---------
Total costs of operations................... 124,143 41,013
--------- ---------
Expected incremental operating expenses for
proposed transactions(a)....................... 21,054 15,917
General and administrative...................... 28,571 21,153
Corporate development(b)........................ 4,633 4,625
Non-cash compensation charges(c)................ 16,589 9,907
Depreciation and amortization................... 148,155 61,066
--------- ---------
Operating income (loss)......................... (41,167) (49,178)
Other income (expense):
Interest and other income (expense)........... 4,945 1,101
Interest expense and amortization of deferred
financing costs.............................. (104,783) (66,332)
--------- ---------
Income (loss) before income taxes and minority
interests...................................... (141,005) (114,409)
Provision for income taxes...................... (374) (374)
Minority interests.............................. 1,307 --
--------- ---------
Net income (loss)............................... (140,072) (114,783)
Dividends on preferred stock.................... (26,745) (26,745)
--------- ---------
Net income (loss) after deduction of dividends
on preferred stock............................. $(166,817) $(141,528)
========= =========
Other Data:
Site data(d):
Towers and revenue producing rooftop sites at
end of period................................ 6,270 3,073
========= =========

CCIC Restricted Group
Pro Forma Pro Forma
------------ ----------------
Year Ended Year Ended
December 31, December 31,
1998 1998
------------ ----------------
(Dollars in thousands)

EBITDA(e):
Site rental and broadcast transmission......... $ 148,581 $ 46,823
Network services and other..................... 683 (4,486)
Expected incremental operating expenses for
proposed transactions (a)..................... (21,054) (15,917)
Corporate development expenses(b).............. (4,633) (4,625)
---------- ----------
Total EBITDA................................. $ 123,577 $ 21,795
========== ==========
Adjusted EBITDA(e)............................... -- $ 23,073
Capital expenditures............................. $ 202,553 88,535
Summary cash flow information:
Net cash provided by (used for) operating
activities.................................... 98,203 (177)
Net cash used for investing activities......... (212,763) (88,535)
Net cash provided by financing activities...... 1,188,618 1,156,138
Ratio of earnings to fixed charges(f)............ -- --
Ratio of EBITDA to cash interest expense(g)...... 2.29x 1.27x

CCIC Pro Forma Restricted Group Pro Forma
As of December 31, 1998 As of December 31, 1998
------------------------------------- ----------------------------------------
Pro Forma for Pro Forma for
Proposed Proposed
Offerings and Offerings and
Pro Forma Recent and Pro Forma Recent and
Historical for Proposed Proposed Historical for Proposed Proposed
CCIC Offerings Transactions CCIC Offerings Transactions
---------- ------------ ------------- ---------- ------------ -------------
(Dollars in thousands)

Balance Sheet Data:
Cash and cash
equivalents............ $ 296,450 $1,108,450 $ 195,458 $ 41,785 $ 853,785 (h) $ 149,168 (h)
Property and equipment,
net.................... 592,594 592,594 2,067,969 165,205 165,205 1,048,100
Total assets............ 1,523,230 2,350,230 2,919,269 1,130,685 1,957,685 2,334,994
Total debt.............. 429,710 879,710 1,059,710 173,599 623,599 623,599
Net debt(i)............. 133,260 (228,740) 864,252 131,814 (230,186) 474,431
Redeemable preferred
stock.................. 201,063 201,063 201,063 201,063 201,063 201,063
Total stockholders'
equity 737,562 1,114,562 1,491,562 737,562 1,114,562 1,491,562

- --------

(a) We expect that we will incur incremental operating expenses as a result of
the Bell Atlantic joint venture and the proposed transactions described in
this prospectus. Such incremental expenses are currently estimated to
amount to approximately $5.2 million per year for the Bell Atlantic joint
venture and approximately $15.9 million per year for the BellSouth
transaction and the Powertel acquisition. We have included the effect of
these incremental expenses in the accompanying summary pro forma financial
data in order to more accurately present the effect of these transactions
on our consolidated results of operations. The effect of these incremental
expenses has not been reflected in the Unaudited Pro Forma Condensed
Consolidated Statement of Operations included elsewhere in this prospectus.
See "Notes to Unaudited Pro Forma Condensed Consolidated Statement of
Operations."
(b) Corporate development expenses represent costs incurred in connection with
acquisitions and development of new business initiatives. These expenses
consist primarily of allocated compensation, benefits and overhead costs
that are not directly related to the administration or management of
existing towers.
(c) Represents charges related to the issuance of stock options to employees
and executives.

(d) Represents our aggregate number of sites at the end of the period, assuming
we had completed the Bell Atlantic joint venture, the BellSouth transaction
and the Powertel acquisition. A revenue producing rooftop represents a
rooftop where we have arranged a lease and are receiving payments.

(e) EBITDA is defined as operating income (loss) plus depreciation and
amortization and non-cash compensation charges. Adjusted EBITDA is defined
as the sum of:

(1) annualized site rental and broadcast transmission EBITDA before
corporate development for the most recent calendar quarter and

(2) EBITDA, less site rental and broadcast transmission EBITDA before
corporate development, for the most recent four calendar quarters.
EBITDA and Adjusted EBITDA are presented as additional information
because management believes them to be useful indicators of our
ability to meet debt service and capital expenditure requirements.
They are not, however, intended as alternative measures of operating
results or cash flow from operations (as determined in accordance with
generally accepted accounting principles). Furthermore, our measure of
EBITDA may not be comparable to similarly titled measures of other
companies.

(f) For purposes of computing the ratio of earnings to fixed charges, earnings
represent income (loss) before income taxes, minority interests and fixed
charges. Fixed charges consist of interest expense, the interest component
of operating leases and amortization of deferred financing costs. For the
year ended December 31, 1998, our earnings were insufficient to cover our
fixed charges by $141.0 million. For the year ended December 31, 1998,
earnings were insufficient to cover fixed charges of the restricted group
by $114.4 million.

(g) Total interest expense for the year ended December 31, 1998 includes
amortization of deferred financing costs and discount of $49.1 million for
CCIC, $0.9 million for CTSH and $0.7 million for the Bell Atlantic joint
venture.

(h) Pro forma balances of cash and cash equivalents for the restricted group
exclude $248.1 million of proceeds from our initial public offering and our
offering of exchangeable preferred stock (along with interest earned on
such amounts since the completion of these transactions) that were
contributed to the Bell Atlantic joint venture.
(i) Net debt represents total debt less cash and cash equivalents.

Summary Financial and Other Data of CCIC

The summary historical consolidated financial and other data for CCIC set forth
below for each of the four years in the period ended December 31, 1998, and as
of December 31, 1995, 1996, 1997 and 1998, have been derived from the
consolidated financial statements of CCIC, which have been audited by KPMG LLP,
independent certified public accountants. The results of operations for the
year ended December 31, 1998 are not comparable to the year ended December 31,
1997, and the results for the year ended December 31, 1997 are not comparable
to the year ended December 31, 1996 as a result of business acquisitions
completed in 1997 and 1998. Results of operations of these acquired businesses
are included in CCIC's consolidated financial statements for the periods after
the respective dates of acquisition. The summary historical financial and other
data for the restricted group under our high yield debt instruments are not
intended as alternative measures of operating results or cash flows from
operations (as determined in accordance with generally accepted accounting
principles). The information set forth below should be read in conjunction with
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Results of Operations--CCIC" and the consolidated financial
statements and related notes of CCIC included elsewhere in this prospectus.

Years Ended December 31,
------------------------------------
1995 1996 1997 1998
------- ------- -------- --------
(Dollars in thousands)

Statement of Operations Data:
Net revenues:
Site rental and broadcast
transmission...................... $ 4,052 $ 5,615 $ 11,010 $ 75,028
Network services and other......... 6 592 20,395 38,050
------- ------- -------- --------
Total net revenues............... 4,058 6,207 31,405 113,078
------- ------- -------- --------
Costs of operations:
Site rental and broadcast
transmission...................... 1,226 1,292 2,213 26,254
Network services and other......... -- 8 13,137 21,564
------- ------- -------- --------
Total costs of operations........ 1,226 1,300 15,350 47,818
------- ------- -------- --------
General and administrative........... 729 1,678 6,824 23,571
Corporate development(a)............. 204 1,324 5,731 4,625
Non-cash compensation charges(b) .... -- -- -- 12,758
Depreciation and amortization........ 836 1,242 6,952 37,239
------- ------- -------- --------
Operating income (loss).............. 1,063 663 (3,452) (12,933)
Other income (expense):
Equity in earnings (losses) of
unconsolidated affiliate.......... -- -- (1,138) 2,055
Interest and other income
(expense)(c)...................... 53 193 1,951 4,220
Interest expense and amortization
of deferred financing costs....... (1,137) (1,803) (9,254) (29,089)
------- ------- -------- --------
Loss before income taxes and minority
interests........................... (21) (947) (11,893) (35,747)
Provision for income taxes........... -- (10) (49) (374)
Minority interests................... -- -- -- (1,654)
------- ------- -------- --------
Net loss............................. (21) (957) (11,942) (37,775)
Dividends on preferred stock......... -- -- (2,199) (5,411)
------- ------- -------- --------
Net loss after deduction of dividends
on preferred stock.................. $ (21) $ (957) $(14,141) $(43,186)
======= ======= ======== ========
Loss per common share--basic and di-
luted............................... $ (0.01) $ (0.27) $ (2.27) $ (1.02)
======= ======= ======== ========
Common shares outstanding--basic and
diluted
(in thousands)...................... 3,316 3,503 6,238 42,518
======= ======= ======== ========

Years Ended December 31,
-----------------------------------------
1995 1996 1997 1998
-------- -------- --------- ----------
(Dollars in thousands)

Other Data:
Site data (at period end)(d):
Towers owned...................... 126 155 240 1,344
Towers managed.................... 7 7 133 129
Rooftop sites managed (revenue
producing)....................... 41 52 80 135
-------- -------- --------- ----------
Total sites owned and managed... 174 214 453 1,608
======== ======== ========= ==========
EBITDA(e):
Site rental....................... $ 2,697 $ 3,555 $ 7,682 $ 44,661
Network services and other........ (594) (326) 1,549 (2,972)
Corporate development
expenses(a)...................... (204) (1,324) (5,731) (4,625)
-------- -------- --------- ----------
Total EBITDA.................... $ 1,899 $ 1,905 $ 3,500 $ 37,064
======== ======== ========= ==========
Restricted Group EBITDA............. $ 1,899 $ 1,905 $ 3,500 $ 5,799
Capital expenditures................ 161 890 18,035 138,759
Summary cash flow information:
Net cash provided by (used for)
operating activities............. 1,672 (530) (624) 44,976
Net cash used for investing
activities....................... (16,673) (13,916) (111,484) (149,248)
Net cash provided by financing
activities....................... 15,597 21,193 159,843 345,248
Ratio of earnings to fixed
charges(f)......................... -- -- -- --
Balance Sheet Data (at period end):
Cash and cash equivalents........... $ 596 $ 7,343 $ 55,078 $ 296,450
Property and equipment, net......... 16,003 26,753 81,968 592,594
Total assets........................ 19,875 41,226 371,391 1,523,230
Total debt.......................... 11,182 22,052 156,293 429,710
Redeemable preferred stock(g)....... 5,175 15,550 160,749 201,063
Total stockholders' equity (defi-
cit)............................... 619 (210) 41,792 737,562

- --------

(a) Corporate development expenses represent costs incurred in connection with
acquisitions and development of new business initiatives. These expenses
consist primarily of allocated compensation, benefits and overhead costs
that are not directly related to the administration or management of
existing towers. For the year ended December 31, 1997, such expenses
include (1) nonrecurring cash bonuses of $0.9 million paid to certain
executive officers in connection with our initial investment in Castle
Transmission and (2) a nonrecurring cash charge of $1.3 million related to
our purchase of shares of our common stock from our former chief executive
officer in connection with our initial Castle Transmission investment. See
"Certain Relationships and Related Transactions".
(b) Represents charges related to the issuance of stock options to certain
employees and executives.

(c) Includes a $1.2 million fee received in March 1997 as compensation for
leading an investment consortium that provided the equity financing in
connection with our initial Castle Transmission investment.

(d) Represents our aggregate number of sites as of the end of each period.

(e) EBITDA is defined as operating income (loss) plus depreciation and
amortization and non-cash compensation changes. EBITDA is presented as
additional information because management believes it to be a useful
indicator of our ability to meet debt service and capital expenditure

requirements. It is not, however, intended as an alternative measure of
operating results or cash flow from operations (as determined in accordance
with generally accepted accounting principles). Furthermore, our measure of
EBITDA may not be comparable to similarly titled measures of other
companies.

(f) For purposes of computing the ratio of earnings to fixed charges, earnings
represent income (loss) before income taxes, fixed charges and equity in
earnings (losses) of unconsolidated affiliate. Fixed charges consist of
interest expense, the interest component of operating leases and
amortization of deferred financing costs. For the years ended December 31,
1995, 1996, 1997 and 1998, earnings were insufficient to cover fixed
charges by $21,000, $0.9 million, $10.8 million and $37.8 million,
respectively.

(g) The 1995, 1996 and 1997 amounts represent (1) senior convertible preferred
stock we privately placed in August 1997 and October 1997, all of which
has been converted into shares of common stock, and (2) Series A
convertible preferred stock, the Series B convertible preferred stock and
Series C convertible preferred stock we privately placed in April 1995,
July 1996 and February 1997, respectively, all of which has been converted
into shares of common stock in connection with the completion of our
initial public offering in August 1998. The 1998 amount represents our 12
3/4% exchangeable preferred stock.

RISK FACTORS

You should carefully consider the risks described below, as well as the other
information included in this prospectus, when evaluating your participation in
the exchange offer.

Failure to Exchange Your Shares of Old Preferred Stock--If you fail to exchange
your shares of old preferred stock, they will continue to be restricted
securities and may become less liquid.

Shares of old preferred stock which you do not tender or we do not accept
will, following the exchange offer, continue to be restricted securities and
you may not offer or sell them except pursuant to an exemption from, or in a
transaction not subject to, the Securities Act of 1933 and applicable state
securities law. We will issue new preferred stock in exchange for the old
preferred stock pursuant to the exchange offer only following the satisfaction
of the procedures and conditions set forth in "The Exchange Offer--Procedures
for Tendering." Such procedures and conditions include timely receipt by the
exchange agent of such shares of old preferred stock, and of a properly
completed and duly executed letter of transmittal.

Because we anticipate that most holders of old preferred stock will elect to
exchange such shares of old preferred stock, we expect that the liquidity of
the market for any shares of old preferred stock remaining after the completion
of the exchange offer may be substantially limited. Any shares of old preferred
stock tendered and exchanged in the exchange offer will reduce the aggregate
principal amount of the old preferred stock outstanding. Following the exchange
offer, if you did not tender your shares of old preferred stock you generally
will not have any further registration rights, and such shares of old preferred
stock will continue to be subject to certain transfer restrictions.
Accordingly, the liquidity of the market for such shares of old preferred stock
could be adversely affected. The shares of old preferred stock are currently
eligible for sale pursuant to Rule 144A and Regulation S through the Private
Offerings, Resale and Trading through Automated Linkages market of the National
Association of Securities Dealers, Inc.

Failure to Properly Manage Our Growth--If we are unable to successfully
integrate acquired operations or to manage our existing operations as we grow,
our business will be adversely affected and we may not be able to continue our
current business strategy.

We cannot guarantee that we will be able to successfully integrate acquired
businesses and assets into our business or implement our plans without delay.
If we fail to do so it could have a material adverse effect on our financial
condition and results of operations. We have grown significantly over the past
two years through acquisitions, and such growth continues to be an important
part of our business plan. The addition of over 4,700 towers to our operations
through our recent and proposed transactions will increase our current business
considerably and will add operating complexities. Successful integration of
these transactions will depend primarily on our ability to manage these
combined operations and to integrate new management and employees with and into
our existing operations.

Implementation of our acquisition strategy may impose significant strains on
our management, operating systems and financial resources. We regularly
evaluate potential acquisition and joint venture opportunities and are
currently evaluating potential transactions that could involve substantial
expenditures, possibly in the near term. If we fail to manage our growth or
encounter unexpected difficulties during expansion it could have a material
adverse effect on our financial condition and results of operations. The
pursuit and integration of acquisitions and joint venture opportunities will
require substantial attention from our senior management, which will limit the
amount of time they are able to devote to our existing operations.

We May Not Complete the Proposed Transactions--If we fail to complete any or
all of the proposed transactions described in this prospectus, we may lose
funds that we have placed in escrow and we will not recognize some of the
benefits that we describe in this prospectus.

If one or more of the proposed transactions we describe in this prospectus is
not completed or is completed on significantly different terms than those
described in this prospectus, it could substantially affect the implementation
of our business strategy. If we fail to close these transactions, our ability
to offer tower clusters in major U.S. markets will be impaired. As a result,
our future site rental revenue would be adversely affected. We cannot guarantee
that we will complete any or all of these transactions that we describe in this
prospectus. The agreements relating to these transactions contain many
conditions that must be satisfied before we can close these transactions.

In addition, we cannot assure you that the transactions, if and when
completed, will be done so on the terms described in this prospectus. For
example, each of the agreements relating to these proposed transactions
includes provisions that could result in our purchasing fewer towers at
closing.

When we entered into the acquisition agreement with Powertel, we made a $50.0
million escrow payment, which we may have to forfeit if the Powertel
acquisition does not close because of our inability or unwillingness to deliver
the balance of the purchase price at the scheduled closing date. When we
entered into the agreement for the BellSouth transaction, we placed $50.0
million into an escrow fund. We could be forced to pay this amount to BellSouth
if we do not enter into definitive agreements for the BellSouth transaction, or
if we fail to comply with all conditions, covenants and representations we are
required to fulfill under our agreement with BellSouth. The loss of these
escrow payments, alone or together, would significantly affect our available
working capital and could have a material adverse effect on our ability to
implement our business strategy. See "Recent and Proposed Transactions".

Substantial Level of Indebtedness--Our substantial level of indebtedness could
adversely affect our ability to react to changes in our business. We may also
be limited in our ability to use debt to fund future capital needs.

We have a substantial amount of indebtedness. The following chart sets forth
certain important credit information and is presented as of December 31, 1998,
(1) assuming we had completed our proposed debt and equity offerings and (2)
assuming we had completed our proposed debt and equity offerings and the recent
and proposed transactions described in this prospectus, each as of December 31,
1998.

Pro Forma for
Proposed
Offerings and
Pro Forma for Recent and
Proposed Proposed
Offerings Transactions
------------- -------------
(Dollars in thousands)

Total indebtedness.......................... $ 879,710 $1,059,710
Redeemable preferred stock.................. 201,063 201,063
Stockholders' equity........................ 1,114,562 1,491,562
Debt and redeemable preferred stock to
equity ratio............................... 0.97x 0.85x

In addition, assuming we had completed the proposed debt and equity offerings
and these transactions on January 1, 1998, our earnings for the twelve months
ended December 31, 1998, would have been insufficient to cover fixed charges by
$141.0 million.

Given our substantial indebtedness, we could be affected in the following
ways:

. We could be more vulnerable to general adverse economic and industry
conditions.

. We may find it more difficult to obtain additional financing to fund
future working capital, capital expenditures and other general corporate
requirements.

. We will be required to dedicate a substantial portion of our cash flow
from operations to the payment of principal and interest on our debt,
reducing the available cash flow to fund other projects.

. We may have limited flexibility in planning for, or reacting to, changes
in our business and in the industry.

. We will have a competitive disadvantage relative to other companies with
less debt in our industry.

We cannot guarantee that we will be able to generate enough cash flow from
operations or that we will be able to obtain enough capital to service our debt
or fund our planned capital expenditures. In addition, we may need to refinance
some or all of our indebtedness on or before maturity. We cannot guarantee,
however, that we will be able to refinance our indebtedness on commercially
reasonable terms or at all.

Our Ability to Pay Dividends on the Exchangeable Preferred Stock May be
Restricted by Law or by the Terms of Debt Instruments--If we are unable to pay
dividends on the exchangeable preferred stock, we may default on our
obligations under the terms of the exchangeable preferred stock.

Our ability to pay any dividends is dependent on applicable provisions of
state law, and our ability to pay cash dividends on the exchangeable preferred
stock is subject to the terms of the 10 5/8% notes indenture, which currently
prohibit us from paying cash dividends on any preferred stock, including the
exchangeable preferred stock. Our ability to pay dividends on the exchangeable
preferred stock in the future will depend on our meeting certain financial
criteria. See "Description of Certain Indebtedness". Moreover, under Delaware
law we are permitted to pay dividends on our capital stock, including the
exchangeable preferred stock, only out of surplus, or if there is no surplus,
out of net profits for the year in which a dividend is declared or for the
immediately preceding fiscal year. Surplus is defined as the excess of a
company's total assets over the sum of its total liabilities plus the par value
of its outstanding capital stock. In order to pay dividends in cash, we must
have surplus or net profits equal to the full amount of the cash dividend at
the time such dividend is declared. We cannot predict what the value of our
assets or the amount of the liabilities will be in the future and, accordingly,
we cannot guarantee that we will be able to pay cash dividends on the
exchangeable preferred stock.

The Exchangeable Preferred Stock is Subordinated to Our Other Debt--As a
result, upon any distribution to our creditors in a bankruptcy, liquidation or
reorganization or similar proceeding relating to us or our property, the
holders of our debt, including subordinated debt, will be entitled to be paid
in full in cash before any payment may be made with respect to the exchange
debentures.

Our obligations relating to the exchangeable preferred stock are subordinate
and junior in right of payment to all our present and future indebtedness,
including the 10 5/8% discount notes. In the event of a bankruptcy, liquidation
or reorganization, our assets will be available to pay obligations on the
exchangeable preferred stock only after we have paid all other indebtedness.
Therefore, we may not have sufficient assets remaining to pay amounts due on
any or all of the exchangeable preferred stock then outstanding.

While any shares of exchangeable preferred stock are outstanding, we may not
authorize, create or increase the amount of any class or series of stock that
ranks senior to the exchangeable preferred stock relating to the payment of
dividends or amounts upon liquidation, dissolution or winding up without the
consent of the holders of a majority of the outstanding shares of exchangeable
preferred stock. However, without the consent of any holder of exchangeable
preferred

stock, we may create additional classes of stock, increase the authorized
number of shares of preferred stock or issue a new series of stock that ranks
equally with or junior to the exchangeable preferred stock relating to the
payment of dividends and amounts upon liquidation, dissolution or winding up.

If We Issue the Exchange Debentures, They Will be Subordinated to Our Other
Debt--As a result, upon any distribution to our creditors in a bankruptcy,
liquidation or reorganization or similar proceeding relating to us or our
property, the holders of our senior debt will be entitled to be paid in full
in cash before any payment may be made relating to the exchange debentures.

If we issue the exchange debentures, they will rank behind all of our
existing indebtedness (other than our trade payables) and all of our future
borrowings (other than our trade payables), except any future indebtedness
that expressly provides that it ranks equal with, or subordinated in right of
payment to, the exchange debentures.

In the event of a bankruptcy, liquidation or reorganization or similar
proceeding involving us, holders of the exchange debentures will be entitled
along with trade creditors and all other holders of our subordinated
indebtedness to the assets remaining only after we have paid all of our senior
debt.

On December 31, 1998, we had $545.4 million of outstanding indebtedness and
other liabilities (including approximately $375.9 million of indebtedness and
other liabilities of our subsidiaries), all of which would have been senior in
right of payment to the exchange debentures. Assuming we had completed the
recent and proposed transactions and our proposed debt and equity offerings
and applied the net proceeds as intended on December 31, 1998, as of that date
we would have had $1,025.7 million of indebtedness and other liabilities
(including $556.2 million of indebtedness and other liabilities of our
subsidiaries). See "Description of Securities--Description of the Senior
Subordinated Exchange Debentures--Ranking".

We May Not Have Sufficient Funds to Repurchase the Exchangeable Preferred
Stock or the Exchange Debentures Upon a Change of Control--If we do not
repurchase the exchangeable preferred stock when required, it will result in a
default under the terms of our exchangeable preferred stock.

Under the certificate of designation (in the case of the exchangeable
preferred stock) and the exchange indenture (in the case of the exchange
debentures), in the event of a change of control of CCIC:

. we are required to offer to purchase all outstanding shares of
exchangeable preferred stock, in whole or in part, at a purchase price
equal to 101% of its aggregate liquidation preference, plus accumulated
and unpaid dividends; and

. each holder of exchange debentures may require us to purchase their
exchange debentures, in whole or in part, at a purchase price equal to
101% of their aggregate principal amount, plus any accrued and unpaid
interest.

In the case of the exchangeable preferred stock, our offer to repurchase
upon a change of control must comply with certain provisions of our existing
senior notes indenture. If we are unable to comply with those provisions and
fail to repurchase the exchangeable preferred stock, then holders of our
exchangeable preferred stock would be entitled to limited voting rights. In
addition, if a change of control were to occur, we may not have the financial
resources to repurchase all of the exchangeable preferred stock and/or
exchange debentures and repay any other indebtedness that would become payable
upon the occurrence of the change of control. This feature of the exchangeable
preferred stock and exchange debentures may in certain circumstances
discourage or make more difficult a sale or takeover of us.

As a Holding Company, We Require Dividends from Subsidiaries to Meet Cash
Requirements or Pay Dividends--If our subsidiaries are unable to dividend cash
to us when we need it, we may be unable to pay dividends or satisfy our
obligations under our debt instruments, including interest payments under the
notes.

Crown Castle International Corp. is a holding company with no business
operations of its own. CCIC's only significant asset is the outstanding capital
stock of its subsidiaries. CCIC conducts all its business operations through
its subsidiaries. Accordingly, CCIC's only source of cash to pay dividends or
make other distributions on its capital stock or to pay interest on its
outstanding indebtedness is distributions relating to its ownership interest in
its subsidiaries from the net earnings and cash flow generated by such
subsidiaries. We currently expect that the earnings and cash flow of CCIC's
subsidiaries will be retained and used by such subsidiaries in their
operations, including to service their respective debt obligations. Even if we
did determine to make a distribution in respect of the capital stock of CCIC's
subsidiaries, there can be no assurance that CCIC's subsidiaries will generate
sufficient cash flow to pay such a dividend or distribute such funds, or that
applicable state law and contractual restrictions, including negative covenants
contained in the debt instruments of such subsidiaries, would permit such
dividends or distributions. Furthermore, the terms of our U.S. and U.K. credit
facilities place restrictions on our principal subsidiaries' ability to pay
dividends or to make distributions, and in any event, such dividends or
distributions may only be paid if no default has occurred under the applicable
instrument. Moreover, CCIC's subsidiaries are permitted under the terms of
their existing debt instruments to incur additional indebtedness that may
restrict or prohibit the making of distributions, the payment of dividends or
the making of loans by such subsidiaries to CCIC. See "--Our Substantial Level
of Indebtedness Could Adversely Affect Our Financial Condition", "--Ability to
Service Debt" and "Description of Certain Indebtedness".

Ability to Service Debt--To service our indebtedness, we will require a
significant amount of cash from our subsidiaries. Failure to generate
sufficient cash, or an inability to access our subsidiaries' cash flow, may
lead to an acceleration of our indebtedness, including the notes. Currently,
the instruments governing our subsidiaries' indebtedness do not allow
sufficient funds to be distributed to CCIC to service its indebtedness.

If CCIC is unable to refinance its subsidiary debt or renegotiate the terms
of such debt, CCIC may not be able to meet its debt service requirements,
including interest payments on the notes, in the future. The cash-pay notes
will require annual cash interest payments of approximately $ million. Prior
to May 15, 2003 and , 2004, the interest expense on our 10 5/8% discount
notes and the discount notes offered in the debt offering, respectively, will
be comprised solely of the amortization of original issue discount. Thereafter,
the 10 5/8% discount notes and the discount notes offered in the debt offering
will require annual cash interest payments of approximately $26.7 million and
$ million, respectively. Prior to December 15, 2003, we do not expect to pay
cash dividends on our exchangeable preferred stock or, if issued, cash interest
on the exchange debentures. Thereafter, assuming all dividends or interest have
been paid-in-kind, our exchangeable preferred stock or, if issued, the exchange
debentures will require annual cash dividend or interest payments of
approximately $47.8 million. Annual cash interest payments on the Castle
Transmission bonds are (Pounds)11.25 million ($18.7 million). In addition,
Crown Communication's senior credit facility and Castle Transmission's credit
facility will require periodic interest payments on amounts borrowed
thereunder.

As a holding company, CCIC will require distributions or dividends from its
subsidiaries, or will be forced to use capital raised in debt and equity
offerings, to fund its debt obligations, including interest payments on the
cash-pay notes and eventually the 10 5/8% discount notes and the discount notes
offered in the debt offering. As we described above, the terms of the
indebtedness of CCIC's subsidiaries significantly limit such subsidiaries'
ability to distribute cash to CCIC. As a result, CCIC will be required to apply
a portion of the net proceeds from the offerings to fund interest payments on
the cash-pay notes. If CCIC does not retain sufficient funds from the offerings
or any future financing, CCIC may not be able to make its interest payments on
the cash-pay notes.

Our ability to make scheduled payments of principal of, or to pay interest
on, our debt obligations, and our ability to refinance any such debt
obligations, will depend on our future performance, which, to a certain extent,
is subject to general economic, financial, competitive, legislative, regulatory
and other factors that are beyond our control. We anticipate that we may need
to refinance all or a portion of our indebtedness (including our 10 5/8%
discount notes and the Castle Transmission bonds) on or prior to its scheduled
maturity. There can be no assurance that we will be able to effect any required
refinancings of our indebtedness on commercially reasonable terms or at all.

Restrictive Debt Covenants--The terms of our debt instruments impose
significant restrictions on our ability to take a number of actions that our
management might otherwise believe to be in your best interests. In addition,
if we fail to comply with our covenants our debt could be accelerated.

Currently we have debt instruments in place that restrict our ability to
incur more indebtedness, pay dividends, create liens, sell assets and engage in
certain mergers and acquisitions. Some of our subsidiaries, under their debt
instruments, are also required to maintain specific financial ratios. Our
ability to comply with the restrictions of these instruments and to satisfy our
debt obligations will depend on our future operating performance. If we fail to
comply with the debt restrictions, we will be in default under those
instruments, which in some cases would cause the maturity of substantially all
of our long-term indebtedness to be accelerated. See "Description of Certain
Indebtedness" and "Description of Capital Stock--Senior Exchange Preferred
Stock".

We May Have Broad Discretion in the Application of Proceeds from Our Proposed
Offerings--If we don't close the BellSouth transaction or the Powertel
acquisition, we would have the ability to utilize some or all of the proceeds
of the proposed offerings to fund as yet unidentified acquisitions, investments
or joint ventures.

We will allocate a substantial portion of the estimated net proceeds from our
proposed debt and equity offerings to fund the BellSouth transaction and the
Powertel acquisition. If either or both of these transactions are not
completed, we cannot determine now how we would reallocate such proceeds. In
addition, we would have broad discretion in allocating these net proceeds from
the offerings without any action or approval of our stockholders. Moreover, the
indenture governing the issuance of the notes will not contain any restrictions
on the use of proceeds from the proposed offerings. Accordingly, investors may
not have the opportunity to evaluate the economic, financial and other relevant
information that we will consider in determining the application of the net
proceeds.

Our Agreements with TdF Give TdF Substantial Governance and Economic Rights--
The exercise of these rights by TdF could have a material adverse effect on our
business.

We have entered into agreements with TeleDiffusion de France International
S.A., or TdF, an affiliate of France Telecom that gave TdF substantial rights.
The agreements were entered into in order to induce TdF to participate in the
roll-up of our U.K. business, and they give TdF significant rights relating to
the governance of CCIC and our U.K. business. Our U.K. business currently
accounts for a substantial majority of our revenues. See "Certain Relationships
and Related Transactions--Agreements with TdF--Governance Agreement".

TdF's Governance Rights May Restrict Us From Taking Actions Our Board of
Directors Consider to Be in Your Best Interests.

We have granted TdF the ability to govern some of our activities, including
the ability to:

. prohibit us from entering into material acquisitions, issuing new
equity securities and incurring significant indebtedness;

. elect up to two members of our board of directors; and

. elect at least one director to the executive and nominating and
corporate governance committees of our board of directors.

In addition, TdF has significant governance rights over our U.K. business.
Although TdF currently has only a 20% equity interest in CTSH, TdF has the
right to restrict a number of corporate actions at CTSH.

TdF's exercise of these rights could be contrary to your interests.

TdF Will Be Able to Buy Our Interest, or Require Us to Buy Their Interest, in
Our U.K. Business in Connection with a Sale of CCIC.

Under the circumstances described below, TdF will have the right to acquire
all of our shares in CTSH or to require us to purchase all of TdF's shares in
CTSH, at fair market value in either case. This right will be triggered under
the following circumstances:

. the sale of all or substantially all of our assets;

. a merger, consolidation or similar transaction that would result in any
person owning more than 50% of our voting power or equity securities;

. an unsolicited acquisition by any person of more than 25% of our voting
power or equity securities; or

. other circumstances arising from an acquisition by any person that
would give rise to a right of the BBC to terminate our analog or
digital transmission contracts with the BBC.

Further, immediately before any of these events occurs, TdF will have the
right to require us to purchase 50% of their Class A common stock in cash at
the same price we would have to pay once the event occurs.

If we were required to sell our shares in CTSH to TdF, we would no longer own
our U.K. business and would lose all the benefits of owning such business that
we describe in this prospectus. On the other hand, if we were required to
purchase all of TdF's shares in CTSH and/or purchase 50% of their Class A
common stock, we cannot guarantee that we would have the necessary funds to do
so or that we would be permitted to do so at the time under our debt
instruments. If we did not have sufficient funds, we would have to seek
additional financing. We cannot guarantee, however, that such financing would
be available on commercially reasonable terms or at all. If such financing were
not available, we might be forced to sell assets at unfavorable prices in order
to generate the cash needed to buy the shares from TdF. In addition, our
obligation to purchase TdF's shares could result in an event of default under
our debt instruments.

TdF Has an Option to Put to Us Its Interest in Our U.K. Business Following the
Second Anniversary of the Roll-Up of Our U.K. Business. This Could Result in A
Default Under Our Debt Instruments or Substantial Dilution to Our Other
Stockholders.

If TdF has not exchanged its interest in CTSH for an interest in CCIC by the
second anniversary of the roll-up of our U.K. business, TdF will have the right
to require us to purchase all of their shares in CTSH, at fair market value. We
may elect to pay either (1) in cash or (2) with our common stock at a discount
of 15% to its market value. We cannot guarantee that we will have sufficient
funds to purchase such shares for cash if TdF were to require us to purchase
their shares of capital stock of CTSH. If we did not have sufficient funds, we
would either need to seek additional financing or purchase the shares with our
common stock. We cannot guarantee that we could obtain such financing on terms
acceptable to us. In addition, the purchase of these shares for cash could
result in

an event of default under our debt instruments. If we were to issue shares of
common stock to effect the purchase, this would result in substantial dilution
to our other stockholders, could adversely affect the market prices of the
common stock and could impair our ability to raise additional capital through
the sale of our equity securities.

TdF Has Preemptive Rights to Acquire Our Common Stock When We Otherwise Issue
Common Stock. This Could Result in Substantial Dilution to Our Other
Stockholders.

Except in limited circumstances, if we issue any equity securities to any
person, including the equity offering, the formation of the Bell Atlantic joint
venture and the closing of the BellSouth transaction, we must offer TdF the
right to purchase, at the same cash price, up to an amount of such equity
securities as would be necessary for TdF and its affiliates to maintain their
consolidated ownership percentage in us before such issuance. The exercise of
these rights by TdF could result in substantial dilution to our other
stockholders.

We Require Significant Capital to Fund Our Operations and Make Acquisitions--If
we are unable to raise capital in the future, we will be unable to achieve our
currently contemplated business strategy and we may not be able to fund our
operations.

We will require substantial capital (1) as we increase the number of towers
we own and manage by partnering with wireless carriers to assume ownership or
control of their existing towers, by pursuing opportunities to build new
towers, or build-to-suit opportunities, for wireless carriers and by pursuing
other tower acquisition opportunities and (2) to acquire existing transmission
networks globally as opportunities arise.

To fund the execution of our business strategy, including the proposed
transactions described in this prospectus and the construction of new towers
that we have agreed to build, we expect to use the net proceeds of our proposed
debt and equity offerings and borrowings available under our U.S. and U.K.
credit facilities. We will have additional cash needs to fund our operations in
the future. We may also have additional cash needs in the near term if
additional tower acquisition or build-to-suit opportunities arise. Some of the
opportunities that we are currently pursuing could require significant
additional capital. If we do not otherwise have cash available, or borrowings
under our credit facilities have otherwise been utilized, when our cash need
arises, we would be forced to seek additional debt or equity financing or to
forgo the opportunity. In the event we determine to seek additional debt or
equity financing, there can be no assurance that any such financing will be
available, on commercially acceptable terms or at all, or permitted by the
terms of our existing indebtedness. See "Management's Discussion and Analysis
of Financial Condition and Results of Operations--Liquidity and Capital
Resources".

We May Not Be Able to Construct New Towers at the Pace and in the Locations
that We Desire--If we are unable to do so, we may not be able to satisfy our
current agreements to build new towers and we may have difficulty finding
tenants to lease space on our new towers.

Our growth strategy depends in part on our ability to construct and operate
towers in conjunction with expansion by wireless carriers. As of December 31,
1998, we had 72 towers under construction. We currently have plans to commence
construction on approximately 900 to 1,200 additional towers during fiscal
1999. Our ability to construct these new towers can be affected by a number of
factors beyond our control, including:

. zoning and local permitting requirements and national regulatory
approvals;

. availability of construction equipment and skilled construction
personnel; and

. bad weather conditions.

In addition, as the concern over tower proliferation has grown in recent
years, certain communities have placed restrictions on new tower construction
or have delayed granting permits required for construction. You should consider
that:

. the barriers to new construction may prevent us from building towers
where we want;

. we may not be able to complete the number of towers planned for
construction in accordance with the requirements of our customers; and

. we cannot guarantee that there will be a significant need for the
construction of new towers once the wireless carriers complete their
tower networks.

If we are unable to build new towers when wireless carriers require them, or
we are unable to build new towers where we believe the best opportunity to add
tenants exists, we could fail to meet our contractual obligations under build-
to-suit agreements, and we could lose opportunities to lease space on our
towers.

Our Business Depends on the Demand for Wireless Communications--We will be
adversely affected by any slowdown in the growth of, or reduction in demand
for, wireless communications.

Demand for our site rentals depends on demand for communication sites from
wireless carriers, which, in turn, depends on the demand for wireless services.
The demand for our sites depends on many factors which we cannot control,
including:

. the level of demand for wireless services generally;

. the financial condition and access to capital of wireless carriers;

. the strategy of carriers relating to owning or leasing communication
sites;

. changes in telecommunications regulations; and

. general economic conditions.

A slowdown in the growth of, or reduction in, demand in a particular wireless
segment could adversely affect the demand for communication sites. Moreover,
wireless carriers often operate with substantial indebtedness, and financial
problems for our customers could result in accounts receivable going
uncollected, in the loss of a customer and the associated lease revenue or in a
reduced ability of these customers to finance expansion activities. Finally,
advances in technology, such as the development of new satellite systems, could
reduce the need for land-based, or terrestrial, transmission networks. The
occurrence of any of these factors could have a material adverse effect on our
financial condition and results of operations.

Variability in Demand for Network Services May Reduce the Predictability of Our
Results--Our network services business has historically experienced significant
volatility in demand. As a result, the operating results of our network
services business for any particular period may vary significantly, and should
not be considered as necessarily being indicative of longer-term results.

Demand for our network services fluctuates from period to period and within
periods. These fluctuations are caused by a number of factors, including:

. the timing of customers' capital expenditures;

. annual budgetary considerations of customers;

. the rate and volume of wireless carriers' tower build-outs;

. timing of existing customer contracts; and

. general economic conditions.

While demand for our network services fluctuates, we must incur certain
costs, such as maintaining a staff of network services employees in
anticipation of future contracts, even when there may be no current business.
Furthermore, as wireless carriers complete their build-outs, the need for the
construction of new towers and the demand for our network services could
decrease significantly and could result in fluctuations and, possibly,
significant declines in our operating performance.

We Operate our Business in an Increasingly Competitive Industry and Many of Our
Competitors Have Significantly More Resources--As a result of this competition,
we may find it more difficult to achieve favorable lease rates on our towers
and we may be forced to pay more for future tower acquisitions.

We face increasing competition for site rental customers from various
sources, including:

. other large independent tower owners;

. wireless carriers that own and operate their own towers and lease
antenna space to other carriers;

. site development companies that acquire antenna space on existing
towers for wireless carriers and manage new tower construction; and

. traditional local independent tower operators.

Wireless carriers that own and operate their own tower portfolios generally
are substantially larger and have greater financial resources than we have. As
competition for tenants on towers increases, lease rates could be adversely
affected.

In addition, competition for the acquisition of towers is keen, and we expect
it to continue to grow. We not only compete against other independent tower
owners and operators, but also against wireless carriers, broadcasters and site
developers. As competition increases for tower acquisitions, we may be faced
with fewer acquisition opportunities, as well as higher acquisition prices.
While we regularly explore acquisition opportunities, we cannot guarantee that
we will be able to identify suitable towers to acquire in the future.

A Substantial Portion of Our Revenues Is Dependent Upon Agreements with the BBC
and NTL--If we were to lose our contracts with the BBC or our site sharing
agreement with NTL, we would likely lose a substantial portion of our revenues.

Assuming we had completed the roll-up of our U.K. subsidiary from 34.5% to
80% ownership and the recent and proposed transactions described in this
prospectus, each as of January 1, 1998, the BBC would have still accounted for
approximately 25.1% of our revenues for the twelve month period ended December
31, 1998.

Our broadcast business is substantially dependent on our contracts with the
BBC. See "Business--U.K. Operations--Significant Contracts". We cannot
guarantee that the BBC will renew our contracts or that they will not attempt
to negotiate terms that are not as favorable to us as those in place now. If we
were to lose these BBC contracts, our business, results of operations and
financial condition would be materially adversely affected. The initial term of
our analog transmission contract with the BBC will expire on March 31, 2007,
and our digital transmission contract with the BBC expires on October 31, 2010.
In addition, our digital transmission contract with the BBC may be terminated
by the BBC after five years if the BBC's board of governors does not believe
that digital television in the United Kingdom has enough viewers.

A substantial portion of our U.K. broadcast transmission operations are
conducted using sites owned by National Transmission Limited, or NTL, our major
competitor in the United Kingdom. NTL also utilizes our sites for their
broadcast operations. See "Business--U.K. Operations--Significant

Contracts". This site sharing arrangement with NTL may be terminated with five
years' notice by either us or NTL, and may be terminated sooner upon a
continuing breach of the agreement. The agreement is set to expire on December
31, 2005. We cannot guarantee that this agreement will not be terminated, which
could have a material adverse effect on our business, results of operations and
financial condition.

Extensive Regulations Which Could Change at Any Time and Which We Could Fail to
Comply With Regulate Our Business--If we fail to comply with applicable
regulations, we could be fined or even lose our right to conduct some of our
business.

A variety of foreign, federal, state and local regulations apply to our
business. Failure to comply with applicable requirements may lead to civil
penalties or require us to assume costly indemnification obligations. We cannot
guarantee that existing regulatory policies will not adversely affect the
timing or cost of new tower construction or that additional regulations will
not be adopted which increase delays or result in additional costs. These
factors could have a material adverse effect on our financial condition and
results of operations.

Since we signed our analog transmission contract with the BBC, the BBC has
increased its service requirements to include 24-hour broadcasting on our
transmission network for the BBC's two national television services and a
requirement for us to add a number of additional stations to our network to
extend existing BBC services. The BBC has agreed to increases of approximately
(Pounds)800,000 ($1,330,240) per year in the charges payable by the BBC to us
for these service enhancements. The additional charges, however, may
necessitate an amendment to Castle Transmission's transmission
telecommunications license. We are discussing with OFTEL, the relevant
regulatory authority in the United Kingdom, the most appropriate way to rectify
this situation in order to allow the additional services to be provided to the
BBC in return for the additional agreed payments. There can be no assurance
that we will achieve a favorable resolution of these issues with OFTEL.

Emissions from Our Antennas May Create Health Risks--We could suffer from
future claims if the radio frequency emissions from our equipment on our towers
is demonstrated to cause negative health effects.

The government imposes requirements and other guidelines on our towers
relating to radio frequency emissions. The potential connection between radio
frequency emissions and certain negative health effects, including some forms
of cancer, has been the subject of substantial study by the scientific
community in recent years. To date, the results of these studies have been
inconclusive. We cannot guarantee that claims relating to radio frequency
emissions will not arise in the future.

Our International Operations Expose Us to Changes in Foreign Currency Exchange
Rates--If we fail to properly match or hedge the currencies in which we conduct
business, we could suffer losses as a result of changes in currency exchange
rates.

We conduct business in countries outside the United States, which exposes us
to fluctuations in foreign currency exchange rates. We also intend to expand
our international operations in the future. For the twelve month period ended
December 31, 1998, assuming we had completed the roll-up of our U.K. operations
on January 1, 1998, but without giving effect to the recent and proposed
transactions we describe in this prospectus, approximately 74.3% of our
consolidated revenues would have originated outside the United States, all of
which were denominated in currencies other than U.S. dollars, principally
pounds sterling. We have not historically engaged in significant hedging
activities relating to our non-U.S. dollar operations, and we could suffer
losses as a result of changes in currency exchange rates.

We Are Heavily Dependent on Our Senior Management--If we lose members of our
senior management, we may not be able to find appropriate replacements on a
timely basis and our business could be adversely affected.

Our existing operations and continued future development are dependent to a
significant extent upon the performance and active participation of certain key
individuals, including our chief executive officer and the chief operating
officers of our principal U.S. and U.K. subsidiaries. We cannot guarantee that
we will be successful in retaining the services of these, or other key
personnel. None of our employees have signed noncompetition agreements. If we
were to lose any of these individuals, we may not be able to find appropriate
replacements on a timely basis and our financial condition and results of
operations could be materially adversely affected.

Year 2000 Compliance Problems Could Affect Our Business--If we are unable to
remedy our year 2000 compliance problems we may suffer business interruptions,
as well as financial loss and reputational harm.

We are in the process of conducting a comprehensive review of our computer
systems to identify which of our systems will need to be modified, upgraded or
converted to recognize dates after December 31, 1999, which is known as the
year 2000 problem. The failure to correct a material year 2000 problem could
result in a system failure, such as the failure of tower lighting or security
monitoring systems, or miscalculations causing disruption of operations
including, among other things, a temporary inability to process transactions,
send invoices, or engage in similar normal business activities.

We cannot assure you that we will be able to resolve all year 2000 compliance
issues without any future disruption or that we will not incur significant
additional expense in attempting to do so. In addition, if some of our major
suppliers and customers fail to address their own year 2000 compliance issues,
their non-compliance could have a material adverse effect on us and our
operations.

There is Currently No Market for the Securities--If an active trading market
for the notes does not develop, the liquidity and value of the securities could
be harmed.

The shares of new preferred stock will be new securities for which there
currently is no established trading market. We do not intend to apply for
listing of the new preferred stock on a national securities exchange or
automatic quotation system. Although the initial purchasers of the old
preferred stock have informed us that they currently intend to make a market in
the new preferred stock, the initial purchasers are not obligated to do so, and
any such market making may be discontinued at any time without notice. There
can be no assurance as to the development or liquidity of any market for the
shares of new preferred stock. If an active trading market for the shares of
new preferred stock does not develop, the market price and liquidity of the
shares of new preferred stock may be adversely affected.

The liquidity of, and trading markets for, the shares of new preferred stock
also may be adversely affected by general declines in the market for payment-
in-kind preferred stock. Such declines may adversely affect the liquidity of,
and trading markets for, the shares of new preferred stock, independent of our
financial performance or prospects.

This Document Includes Forward-Looking Statements--If our expectations
reflected in these forward-looking statements prove to be incorrect, our actual
results could differ materially from these expectations.

This document includes "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. All statements other

than statements of historical facts included in this document, including,
without limitation, the statements under "Prospectus Summary", "Management's
Discussion and Analysis of Financial Condition and Results of Operations",
"Industry Background" and "Business" and located elsewhere in this prospectus
regarding industry prospects, our prospects and our financial position are
forward-looking statements. Although we believe that the expectations reflected
in such forward-looking statements are reasonable, we can give no assurance
that such expectations will prove to have been correct. Important factors that
could cause actual results to differ materially from our expectations are
disclosed in this document, including, without limitation, in conjunction with
the forward-looking statements included under "Risk Factors". All subsequent
written and oral forward-looking statements attributable to us or persons
acting on our behalf are expressly qualified in their entirety by the
cautionary statements included in this document. In light of these risks,
uncertainties and assumptions, the forward-looking events discussed in this
document might not occur.

USE OF PROCEEDS

We will not receive any proceeds from the exchange offer.

DIVIDEND POLICY

We have never declared or paid any cash dividends on our capital stock and do
not anticipate paying cash dividends on our capital stock in the foreseeable
future. It is our current policy to retain earnings to finance the expansion of
our operations. Future declaration and payment of dividends, if any, will be
determined in light of the then-current conditions, including our earnings,
operations, capital requirements, financial condition and other factors deemed
relevant by our board of directors. In addition, our ability to pay dividends
is limited by the terms of our debt instruments and the terms of the
certificate of designations in respect of our exchangeable preferred stock. See
"Description of Certain Indebtedness" and "Description of Capital Stock".

CAPITALIZATION

The following table sets forth as of December 31, 1998 (1) our historical
capitalization, (2) our pro forma capitalization after giving effect to our
proposed debt and equity offerings and (3) our pro forma capitalization after
giving effect to such proposed offerings and the recent and proposed
transactions we describe in this prospectus. The information set forth below
should be read in conjunction with "Unaudited Pro Forma Condensed Consolidated
Financial Statements", "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and the consolidated financial statements
and related notes included elsewhere in this document. The proposed
transactions are not contingent upon our proposed offerings. See "Unaudited Pro
Forma Condensed Consolidated Financial Statements" for detail regarding the pro
forma adjustments.

December 31, 1998
--------------------------------------
Pro Forma
for Proposed
Offerings and
Pro Forma Recent and
for Proposed Proposed
Actual Offerings Transactions
---------- ------------ -------------
(Dollars in thousands, except share
amounts)

Cash and cash equivalents(a)............ $ 296,450 $1,108,450 $ 195,458
========== ========== ==========
Notes payable and current maturities of
long-term debt......................... $ -- $ -- $ --
========== ========== ==========
Long-term debt (less current
maturities):
Senior Credit Facility(b).............. $ 5,500 $ 5,500 $ 5,500
Castle Transmission Credit
Facility(b)........................... 55,177 55,177 55,177
Bell Atlantic Joint Venture Credit
Facility.............................. -- -- 180,000
10 5/8% Senior Discount Notes due
2007.................................. 168,099 168,099 168,099
9% Guaranteed Bonds due 2007........... 200,934 200,934 200,934
Proposed Notes offered................. -- 450,000 450,000
---------- ---------- ----------
Total long-term debt(a).............. 429,710 879,710 1,059,710
---------- ---------- ----------
Minority interests...................... 39,185 39,185 50,915
Redeemable preferred stock:
Exchangeable Preferred Stock ($.01 par
value; 400,000 shares authorized;
200,000 shares issued)(a)............. 201,063 201,063 201,063
Stockholders' equity:
Common stock ($.01 par value;
690,000,000 shares authorized):
Common stock (83,123,873 shares
issued, actual; 106,590,968 shares
issued, pro forma for offerings; and
131,272,778 shares issued, pro forma
for the offerings and the proposed
transactions)........................ 831 1,066 1,313
Class A common stock (11,340,000
shares issued)....................... 113 113 113
Additional paid-in capital............. 795,153 1,174,918 1,551,671
Cumulative foreign currency translation
adjustment............................ 1,690 1,690 1,690
Accumulated deficit.................... (60,225) (63,225) (63,225)
---------- ---------- ----------
Total stockholders' equity(a)........ 737,562 1,114,562 1,491,562
---------- ---------- ----------
Total capitalization(a)............. $1,407,520 $2,234,520 $2,803,250
========== ========== ==========

- --------

(a) On a pro forma basis for our proposed offerings and the recent and proposed
transactions we describe in this prospectus, the restricted group would
have cash and cash equivalents, total long-term debt, redeemable preferred
stock, total stockholders' equity and total capitalization of $149.2
million, $623.6 million, $201.1 million, $1,491.6 million, and $2,316.2
million, respectively. See "Unaudited Pro Forma Condensed Consolidated
Financial Statements--Notes to Unaudited Pro Forma Condensed Consolidated
Balance Sheet".

(b) As of March 1, 1999, Crown Communication had unused borrowing availability
under its senior credit facility of approximately $54.0 million, and Castle
Transmission had approximately (Pounds)24.0 million ($39.9 million) of
unused borrowing availability under its credit facility. See "Description
of Certain Indebtedness".

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following unaudited pro forma condensed consolidated financial
statements are based on the historical financial statements of CCIC and the
historical financial statements of the entities acquired by CCIC during the
period presented, adjusted to give effect to the following transactions:

(1) the roll-up of our U.K. subsidiary to an 80% ownership interest in
August 1998;

(2) CCIC's initial public offering in August 1998;

(3) the conversion of CCIC's senior convertible preferred stock into
common stock (all of which, as of July 17, 1998, had been converted);

(4) the issuance of CCIC's 12 3/4% Exchangeable Preferred Stock due 2010
in December 1998;

(5) the proposed offerings;

(6) the Bell Atlantic joint venture;

(7) the proposed BellSouth transaction; and

(8) the proposed Powertel acquisition.

The Unaudited Pro Forma Condensed Consolidated Statement of Operations for
the year ended December 31, 1998 gives effect to these transactions as if they
had occurred as of January 1, 1998. The Unaudited Pro Forma Condensed
Consolidated Balance Sheet gives effect to the (1) proposed offerings and (2)
the recent and proposed transactions described in clauses (6), (7) and (8)
above as if they had occurred as of December 31, 1998. The pro forma
adjustments are described in the accompanying notes and are based upon
available information and certain assumptions that management believes are
reasonable.

Included in the notes accompanying the pro forma financial statements are
tables summarizing the unaudited pro forma results of operations and balance
sheet for CCIC and its subsidiaries that are restricted by covenants in our
high yield debt instruments. These subsidiaries exclude our U.K. subsidiaries
and the Bell Atlantic joint venture, both of which are designated as
unrestricted subsidiaries under our high yield debt instruments.

The pro forma financial statements do not purport to represent what CCIC's
results of operations or financial condition would actually have been had these
transactions in fact occurred on such dates or to project CCIC's results of
operations or financial condition for any future date or period. The pro forma
financial statements should be read in conjunction with the consolidated
financial statements and related notes included elsewhere in this prospectus
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations".

The roll-up, the Bell Atlantic joint venture and the proposed Powertel
acquisition are accounted for under the purchase method of accounting. The
total purchase price for the roll-up, the Bell Atlantic joint venture and the
Powertel acquisition have been allocated to the identifiable tangible and
intangible assets and liabilities of the applicable acquired business based
upon CCIC's preliminary estimate of their fair values with the remainder
allocated to goodwill and other intangible assets. The allocations of the
purchase prices may be revised when additional information concerning asset and
liability valuations is obtained; however, we do not expect that any such
revisions will have a material effect on our consolidated financial position or
results of operations. We have recorded the purchase price for the roll-up
based on (1) the number of shares of our common stock and Class A common stock
exchanged for shares of CTSH's capital stock and (2) the price per share
received by us in our initial public offering.

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

Year Ended December 31, 1998
(Dollars in thousands, except per share amounts)

Pro Forma Historical
for 1998 Bell
Historical Adjustments Pro Forma Adjustments Transactions Atlantic Adjustments
Historical Castle for 1998 for 1998 for Proposed and Proposed Joint for Joint
CCIC(a) Transmission(b) Transactions Transactions Offerings Offerings Venture(j) Venture
---------- --------------- ------------ ------------ ------------ ------------ ---------- -----------

Net revenues:
Site rental and
broadcast
transmission.... $ 75,028 $84,714 $ -- $159,742 $ -- $ 159,742 $ 11,183 $31,009(k)
Network services
and other....... 38,050 12,514 (265)(c) 50,299 -- 50,299 -- --
-------- ------- -------- -------- -------- --------- -------- -------
Total net
revenues........ 113,078 97,228 (265) 210,041 -- 210,041 11,183 31,009
-------- ------- -------- -------- -------- --------- -------- -------
Operating
expenses:
Costs of
operations:
Site rental and
broadcast
transmission.... 26,254 35,901 -- 62,155 -- 62,155 14,941 -- (l)
Network services
and other....... 21,564 7,916 -- 29,480 -- 29,480 -- --
General and
administrative.. 23,571 5,265 (265)(c) 28,571 -- 28,571 -- -- (l)
Corporate
development..... 4,625 8 -- 4,633 -- 4,633 -- --
Non-cash
compensation
charges......... 12,758 3,831 -- 16,589 -- 16,589 -- --
Depreciation and
amortization.... 37,239 25,684 11,463 (d) 74,386 -- 74,386 6,278 23,346 (m)
-------- ------- -------- -------- -------- --------- -------- -------
126,011 78,605 11,198 215,814 -- 215,814 21,219 23,346
-------- ------- -------- -------- -------- --------- -------- -------
Operating income
(loss)........... (12,933) 18,623 (11,463) (5,773) -- (5,773) (10,036) 7,663
Other income
(expense):
Equity in
earnings of
unconsolidated
affiliate....... 2,055 -- (2,055)(e) -- -- -- -- --
Interest and
other income
(expense)....... 4,220 725 -- 4,945 -- 4,945 -- --
Interest expense
and amortization
of deferred
financing
costs........... (29,089) (13,378) 3,689 (f) (38,778) (48,294)(i) (87,072) -- (17,711)(n)
-------- ------- -------- -------- -------- --------- -------- -------
Income (loss)
before income
taxes and
minority
interests........ (35,747) 5,970 (9,829) (39,606) (48,294) (87,900) (10,036) (10,048)
Provision for
income taxes..... (374) -- -- (374) -- (374) -- --
Minority
interests........ (1,654) -- (1,194)(g) (2,848) -- (2,848) -- 4,155 (o)
-------- ------- -------- -------- -------- --------- -------- -------
Net income
(loss)........... (37,775) 5,970 (11,023) (42,828) (48,294) (91,122) (10,036) (5,893)
Dividends on
preferred stock.. (5,411) -- (21,334)(h) (26,745) -- (26,745) -- --
-------- ------- -------- -------- -------- --------- -------- -------
Net income (loss)
after deduction
of dividends on
preferred stock.. $(43,186) $ 5,970 $(32,357) $(69,573) $(48,294) $(117,867) $(10,036) $(5,893)
======== ======= ======== ======== ======== ========= ======== =======
Loss per common
share--basic and
diluted ......... $ (1.02) $ (0.74) $ (1.00)
======== ======== =========
Common shares
outstanding--
basic and diluted
(in thousands)... 42,518 94,064 117,531
======== ======== =========

Pro Forma
for 1998 Adjustments Adjustments
Transactions, for for
Offerings Proposed Proposed Pro Forma
and Joint BellSouth Historical Powertel for the
Venture Transaction Powertel(s) Acquisition Transactions
------------- --------------- ----------- ------------- ------------

Net revenues:
Site rental and
broadcast
transmission.... $ 201,934 $33,840(p) $ 1,865 $14,040(t) $ 251,679
Network services
and other....... 50,299 -- -- -- 50,299
------------- --------------- ----------- ------------- ------------
Total net
revenues........ 252,233 33,840 1,865 14,040 301,978
------------- --------------- ----------- ------------- ------------
Operating
expenses:
Costs of
operations:
Site rental and
broadcast
transmission.... 77,096 11,400(l)(q) 6,167 -- (l) 94,663
Network services
and other....... 29,480 -- -- -- 29,480
General and
administrative.. 28,571 -- (l) -- -- (l) 28,571
Corporate
development..... 4,633 -- -- -- 4,633
Non-cash
compensation
charges......... 16,589 -- -- -- 16,589
Depreciation and
amortization.... 104,010 30,500 (r) 7,534 6,111 (u) 148,155
------------- --------------- ----------- ------------- ------------
260,379 41,900 13,701 6,111 322,091
------------- --------------- ----------- ------------- ------------
Operating income
(loss)........... (8,146) (8,060) (11,836) 7,929 (20,113)
Other income
(expense):
Equity in
earnings of
unconsolidated
affiliate....... -- -- -- -- --
Interest and
other income
(expense)....... 4,945 -- -- -- 4,945
Interest expense
and amortization
of deferred
financing
costs........... (104,783) -- -- -- (104,783)
------------- --------------- ----------- ------------- ------------
Income (loss)
before income
taxes and
minority
interests........ (107,984) (8,060) (11,836) 7,929 (119,951)
Provision for
income taxes..... (374) -- -- -- (374)
Minority
interests........ 1,307 -- -- -- 1,307
------------- --------------- ----------- ------------- ------------
Net income
(loss)........... (107,051) (8,060) (11,836) 7,929 (119,018)
Dividends on
preferred stock.. (26,745) -- -- -- (26,745)
------------- --------------- ----------- ------------- ------------
Net income (loss)
after deduction
of dividends on
preferred stock.. $(133,796) $(8,060) $(11,836) $ 7,929 $(145,763)
============= =============== =========== ============= ============
Loss per common
share--basic and
diluted ......... $ (1.01) $ (1.02)
============= ============
Common shares
outstanding--
basic and diluted
(in thousands)... 133,129 142,213
============= ============

(footnotes on the following page)

See Notes to Unaudited Pro Forma Condensed Consolidated Statement of
Operations

Notes to Unaudited Pro Forma Condensed Consolidated Statement of Operations
(Dollars in thousands)

(a) The historical results of operations for our U.K. business are included in
CCIC's historical results of operations for the period from the date of the
roll-up, August 21, 1998, through December 31, 1998.

(b) Reflects the historical results of operations of our U.K. business (under
U.S. GAAP) for the periods prior to the completion of the roll-up on August
21, 1998. Such results have been translated from pounds sterling to U.S.
dollars at the average noon buying rate for the period.

(d) Reflects the incremental amortization of goodwill as a result of the roll-
up. Goodwill is being amortized over twenty years.

(e) Reflects the elimination of equity accounting adjustments to include CCIC's
percentage in our U.K. business' earnings and losses.

(f) Reflects decrease in interest expense attributable to the repayment of
borrowings under CCIC's senior credit facility from a portion of the net
proceeds from the issuance of our 12 3/4% exchangeable preferred stock.

(g) Reflects the minority interest in dividends accrued on CTSH's redeemable
preference shares.

(h) Reflects (1) decrease in dividends of $4,348 attributable to the conversion
of the outstanding shares of senior convertible preferred stock into shares
of common stock and (2) increase in dividends of $25,682 attributable to 12
3/4% exchangeable preferred stock.

(i) Reflects (1) increase in interest expense of $44,044 as a result of the
issuance of the notes in the proposed debt offerings at assumed interest
rates of % per annum for the discount notes and % per annum for the cash-
pay notes, (2) amortization of deferred financing costs related to the
notes of $1,250 and (3) nonrecurring financing fees of $3,000 related to
the term loans incurred to fund the escrow payments in connection with the
proposed BellSouth transaction and the proposed Powertel acquisition (the
"Term Loans").

(j) Reflects the historical results of operations of the tower operations
contributed to the Bell Atlantic joint venture.

(k) Reflects additional revenues to be recognized by the Bell Atlantic joint
venture under the global lease and the formation agreement.

(l) We expect that the Bell Atlantic joint venture will incur incremental
operating expenses as a stand-alone entity. Such incremental expenses are
currently estimated to amount to approximately $5,137 per year. In
addition, we expect that we will incur incremental operating expenses as a
result of the BellSouth transaction and the Powertel acquisition. Such
incremental expenses are currently estimated to amount to approximately
$15,917 per year. These incremental operating expenses are based on
management's best estimates rather than any contractual obligations; as
such, these amounts have not been presented as adjustments in the
accompanying pro forma financial statement.

(m) Reflects the incremental depreciation of property and equipment as a result
of the Bell Atlantic joint venture. Property and equipment is being
depreciated over twenty years.

(n) Reflects additional interest expense attributable to borrowings under the
credit facility entered into by the Bell Atlantic joint venture. Such
borrowings are initially estimated to incur interest at a rate of 9.25% per
annum.

(o) Reflects the minority partner's 38.5% interest in the joint venture's
operations.

(p) Reflects additional revenues to be recognized by CCIC in connection with
the BellSouth transaction for the sublease of tower space by BellSouth.
This amount includes $26,640 in revenues to be received from BellSouth and
$7,200 in revenues to be received from other tenants.

(q) Reflects additional costs to be incurred for ground rents in connection
with the preliminary BellSouth agreement.

(r) Reflects the incremental depreciation of property and equipment as a result
of the BellSouth transaction. Property and equipment is being depreciated
over twenty years.

(s) Reflects the historical results of operations of the tower operations to be
acquired in the Powertel acquisition.

(t) Reflects additional revenues to be recognized by CCIC in connection with
the Powertel acquisition under the master site agreements.

(u) Reflects the incremental depreciation of property and equipment as a result
of the Powertel acquisition. Property and equipment is being depreciated
over twenty years.

The following tables summarize the unaudited pro forma results of operations
for the restricted group under our high yield debt instruments. Such
information is not intended as an alternative measure of the operating results
as would be determined in accordance with generally accepted accounting
principles.

Year Ended December 31, 1998
---------------------------------------------------------------------------------------------------
Restricted Adjustments Adjustments Restricted
Exclusion of Group for for Group Pro
Pro Forma Exclusion of Certain Pro Forma Proposed Proposed Forma for
for Proposed Unrestricted Adjustments for Proposed BellSouth Historical Powertel the
Offerings Subsidiaries for Roll-Up Offerings Transaction Powertel Acquisition Transactions
------------ ------------ ------------ ------------ ----------- ---------- ----------- ------------

Net revenues:
Site rental and
broadcast
transmission...... $ 159,742 $(137,201) $ -- $ 22,541 $33,840 $ 1,865 $14,040 $ 72,286
Network services
and other......... 50,299 (18,082) -- 32,217 -- -- -- 32,217
--------- --------- -------- --------- ------- -------- ------- ---------
Total net
revenues......... 210,041 (155,283) -- 54,758 33,840 1,865 14,040 104,503
--------- --------- -------- --------- ------- -------- ------- ---------
Operating expenses:
Costs of
operations:
Site rental and
broadcast
transmission..... 62,155 (56,038) -- 6,117 11,400 6,167 -- 23,684
Network services
and other........ 29,480 (12,151) -- 17,329 -- -- -- 17,329
General and
administrative.... 28,571 (7,683) 265 21,153 -- -- -- 21,153
Corporate
development....... 4,633 (8) -- 4,625 -- -- -- 4,625
Non-cash
compensation
charges........... 16,589 (6,682) -- 9,907 -- -- -- 9,907
Depreciation and
amortization...... 74,386 (46,002) (11,463) 16,921 30,500 7,534 6,111 61,066
--------- --------- -------- --------- ------- -------- ------- ---------
215,814 (128,564) (11,198) 76,052 41,900 13,701 6,111 137,764
--------- --------- -------- --------- ------- -------- ------- ---------
Operating income
(loss)............ (5,773) (26,719) 11,198 (21,294) (8,060) (11,836) 7,929 (33,261)
Other income
(expense):
Interest and other
income (expense).. 4,945 (3,844) -- 1,101 -- -- -- 1,101
Interest expense
and amortization
of deferred
financing costs... (87,072) 20,740 -- (66,332) -- -- -- (66,332)
--------- --------- -------- --------- ------- -------- ------- ---------
Income (loss)
before income
taxes and minority
interests......... (87,900) (9,823) 11,198 (86,525) (8,060) (11,836) 7,929 (98,492)
Provision for
income taxes...... (374) -- -- (374) -- -- -- (374)
Minority
interests......... (2,848) 1,654 1,194 -- -- -- -- --
--------- --------- -------- --------- ------- -------- ------- ---------
Net income (loss).. (91,122) (8,169) 12,392 (86,899) (8,060) (11,836) 7,929 (98,866)
Dividends on
preferred stock... (26,745) -- -- (26,745) -- -- -- (26,745)
--------- --------- -------- --------- ------- -------- ------- ---------
Net income (loss)
after deduction of
dividends on
preferred stock... $(117,867) $ (8,169) $ 12,392 $(113,644) $(8,060) $(11,836) $ 7,929 $(125,611)
========= ========= ======== ========= ======= ======== ======= =========

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

As of December 31, 1998
(Dollars in thousands)

Pro Forma
for Adjustments
Adjustments Pro Forma Historical Proposed for
for for Bell Atlantic Adjustments Offerings Proposed
Historical Proposed Proposed Joint for Joint and Joint BellSouth Historical
CCIC Offerings Offerings Venture(e) Venture Venture Transaction Powertel(o)
---------- ----------- ---------- ------------- ----------- ---------- ----------- -----------

Assets:
Current assets:
Cash and cash
equivalents..... $ 296,450 $812,000(a) $1,108,450 $ -- $(208,375)(f) $ 900,075 $(430,000)(l) $ --
Receivables...... 36,420 -- 36,420 -- -- 36,420 -- --
Inventories...... 6,599 -- 6,599 -- -- 6,599 -- --
Prepaid expenses
and other
current assets.. 2,647 -- 2,647 -- -- 2,647 -- 2,031
---------- -------- ---------- ------- --------- ---------- --------- --------
Total current
assets......... 342,116 812,000 1,154,116 -- (208,375) 945,741 (430,000) 2,031
Property and
equipment, net.. 592,594 -- 592,594 83,557 508,923 (g) 1,185,074 610,000 (m) 121,490
Investments in
affiliates...... 2,258 -- 2,258 -- -- 2,258 -- --
Goodwill and
other intangible
assets, net..... 569,740 -- 569,740 -- -- 569,740 -- --
Deferred
financing costs
and other
assets, net..... 16,522 15,000(b) 31,522 -- 4,625 (h) 36,147 -- --
---------- -------- ---------- ------- --------- ---------- --------- --------
$1,523,230 $827,000 $2,350,230 $83,557 $ 305,173 $2,738,960 $ 180,000 $123,521
========== ======== ========== ======= ========= ========== ========= ========
Liabilities and
Stockholders'
Equity:
Current
liabilities:
Accounts
payable......... $ 46,020 $ -- $ 46,020 $ -- $ -- $46,020 $ -- $ --
Other current
liabilities..... 46,867 -- 46,867 -- -- 46,867 -- 309
Long-term debt,
current
maturities...... -- -- -- -- -- -- -- --
---------- -------- ---------- ------- --------- ---------- --------- --------
Total current
liabilities.... 92,887 -- 92,887 -- -- 92,887 -- 309
Long-term debt,
less current
maturities...... 429,710 450,000(c) 879,710 -- 180,000 (i) 1,059,710 -- --
Other
liabilities..... 22,823 -- 22,823 -- -- 22,823 -- --
---------- -------- ---------- ------- --------- ---------- --------- --------
Total
liabilities.... 545,420 450,000 995,420 -- 180,000 1,175,420 -- 309
---------- -------- ---------- ------- --------- ---------- --------- --------
Minority
interests....... 39,185 -- 39,185 -- 11,730 (j) 50,915 -- --
Redeemable
preferred
stock........... 201,063 -- 201,063 -- -- 201,063 -- --
Stockholders'
equity.......... 737,562 377,000(d) 1,114,562 83,557 113,443 (k) 1,311,562 180,000 (n) 123,212
---------- -------- ---------- ------- --------- ---------- --------- --------
$1,523,230 $827,000 $2,350,230 $83,557 $ 305,173 $2,738,960 $ 180,000 $123,521
========== ======== ========== ======= ========= ========== ========= ========

Adjustments
for
Proposed Pro Forma
Powertel for the
Acquisition Transactions
-------------- ------------

Assets:
Current assets:
Cash and cash
equivalents..... $(274,617)(p) $ 195,458
Receivables...... -- 36,420
Inventories...... -- 6,599
Prepaid expenses
and other
current assets.. -- 4,678
-------------- ------------
Total current
assets......... (274,617) 243,155
Property and
equipment, net.. 151,405 (q) 2,067,969
Investments in
affiliates...... -- 2,258
Goodwill and
other intangible
assets, net..... -- 569,740
Deferred
financing costs
and other
assets, net..... -- 36,147
-------------- ------------
$(123,212) $2,919,269
============== ============
Liabilities and
Stockholders'
Equity:
Current
liabilities:
Accounts
payable......... $ -- $ 46,020
Other current
liabilities..... -- 47,176
Long-term debt,
current
maturities...... -- --
-------------- ------------
Total current
liabilities.... -- 93,196
Long-term debt,
less current
maturities...... -- 1,059,710
Other
liabilities..... -- 22,823
-------------- ------------
Total
liabilities.... -- 1,175,729
-------------- ------------
Minority
interests....... -- 50,915
Redeemable
preferred
stock........... -- 201,063
Stockholders'
equity.......... (123,212)(r) 1,491,562
-------------- ------------
$(123,212) $2,919,269
============== ============

See Notes to Unaudited Pro Forma Condensed Consolidated Balance Sheet

Notes to Unaudited Pro Forma Condensed Consolidated Balance Sheet
(Dollars in thousands)

(a) Reflects the following adjustments to cash and cash
equivalents:
(1) Increase resulting from the receipt of proceeds from the
proposed offerings....................................... $ 850,000
(2) Decrease resulting from the payment of underwriting
discounts and commissions and other fees and expenses
related to the proposed offerings........................ (35,000)
(3) Decrease resulting from the payment of nonrecurring
financing fees related to the Term Loans................. (3,000)
---------
Total adjustments to cash and cash equivalents........... $ 812,000
=========
(b) Reflects deferred financing costs resulting from the payment
of underwriting discounts and commissions and other fees and
expenses related to our proposed debt offerings.
(c) Reflects the increase resulting from the receipt of proceeds
from our proposed debt offerings.
(d) Reflects the following adjustments to stockholders' equity:
(1) Increase resulting from the receipt of proceeds from our
proposed equity offering................................. $ 400,000
(2) Decrease resulting from the payment of underwriting
discounts and commissions and other fees and expenses
related to our proposed equity offering.................. (20,000)
(3) Decrease resulting from payment of nonrecurring financing
fees related to the Term Loans........................... (3,000)
---------
Total adjustments to stockholders' equity................ $ 377,000
=========
(e) Reflects the historical amounts from the statement of net
assets for the tower operations contributed to the Bell
Atlantic joint venture.
(f) Reflects the following adjustments to cash and cash
equivalents:
(1) Increase resulting from borrowings under the credit
facility entered into by the Bell Atlantic joint
venture.................................................. $ 180,000
(2) Decrease resulting from distribution to minority
partner.................................................. (380,000)
(3) Decrease resulting from payment of deferred financing
costs for the credit facility entered into by the Bell
Atlantic joint venture................................... (4,625)
(4) Decrease resulting from payment of fees and expenses
related to the Bell Atlantic joint venture............... (3,750)
---------
Total adjustments to cash and cash equivalents........... $(208,375)
=========
(g) Reflects the increase in basis of property and equipment
contributed to the Bell Atlantic joint venture by the minority
partner.
(h) Reflects the deferred financing costs for the credit facility
entered into by the Bell Atlantic joint venture.
(i) Reflects the borrowings under the credit facility entered into
by the Bell Atlantic joint venture.
(j) Reflects the 38.5% minority interest in the Bell Atlantic
joint venture.
(k) Reflects the following adjustments to stockholders' equity:
(1) Increase resulting from increase in basis of property and
equipment contributed to the Bell Atlantic joint venture
by the minority partner.................................. $ 508,923
(2) Decrease resulting from distribution to minority
partner.................................................. (380,000)
(3) Decrease resulting from minority interest................ (11,730)
(4) Decrease resulting from payment of fees and expenses
related to the Bell Atlantic joint venture............... (3,750)
---------
Total adjustments to stockholders' equity................ $ 113,443
=========
(l) Reflects the payment of the cash portion of the purchase price
for the proposed BellSouth transaction.
(m) Reflects the basis of property and equipment recorded in
connection with the proposed BellSouth transaction.
(n) Reflects the increase resulting from the issuance of common
stock for a portion of the purchase price for the proposed
BellSouth transaction.
(o) Reflects the historical amounts from the statement of net
assets for the tower operations to be acquired in the proposed
Powertel acquisition.
(p) Reflects the payment of the closing price for the proposed
Powertel acquisition.
(q) Reflects the increase in basis of property and equipment
acquired in the proposed Powertel acquisition.
(r) Reflects the elimination of the historical basis of the net
assets acquired in the proposed Powertel acquisition.

The following table summarizes the adjustments for the proposed offerings,
with increases to liabilities and stockholders' equity balances shown as
negative amounts:

Adjustment Reference
-------------------------------------------------
(a)(1),(c),(d)(1) (a)(2),(b),(d)(2) (a)(3),(d)(3) Totals
----------------- ----------------- ------------- ---------

Cash and cash
equivalents............ $ 850,000 $(35,000) $(3,000) $ 812,000
Deferred financing cost
and other assets, net.. -- 15,000 -- 15,000
Long-term debt, less
current maturities..... (450,000) -- -- (450,000)
Stockholders' equity.... (400,000) 20,000 3,000 (377,000)
--------- -------- ------- ---------
$ -- $ -- $ -- $ --
========= ======== ======= =========

The following table summarizes the adjustments for the Bell Atlantic joint
venture, with increases to liabilities and stockholders' equity balances shown
as negative amounts:

Adjustment Reference
------------------------------------------------------------------------
(f)(1),(i) (f)(2),(k)(2) (f)(3),(h) (f)(4),(k)(4) (g),(j),(k)(1),(k)(3) Totals
---------- ------------- ---------- ------------- --------------------- ---------

Cash and cash equiva-
lents.................. $ 180,000 $(380,000) $(4,625) $(3,750) $ -- $(208,375)
Property and equipment,
net.................... -- -- -- -- 508,923 508,923
Deferred financing costs
and other assets, net.. -- -- 4,625 -- -- 4,625
Long-term debt, less
current maturities..... (180,000) -- -- -- -- (180,000)
Minority interests...... -- -- -- -- (11,730) (11,730)
Stockholders' equity.... -- 380,000 -- 3,750 (497,193) (113,443)
--------- --------- ------- ------- --------- ---------
$ -- $ -- $ -- $ -- $ -- $ --
========= ========= ======= ======= ========= =========

The following table summarizes the adjustments for the BellSouth
transaction, with increases to liabilities and stockholders' equity balances
shown as negative amounts:

Adjustment Reference
--------------------
(l),(m),(n)
--------------------

Cash and cash equivalents............................... $(430,000)
Property and equipment, net............................. 610,000
Stockholders' equity.................................... (180,000)
---------
$ --
=========

The following table summarizes the adjustments for the Powertel acquisition,
with increases to liabilities and stockholders' equity balances shown as
negative amounts:

Adjustment Reference
--------------------
(p),(q),(r)
--------------------

Cash and cash equivalents............................... $(274,617)
Property and equipment, net............................. 151,405
Stockholders' equity.................................... 123,212
---------
$ --
=========

The following table summarizes the unaudited pro forma balance sheet for the
restricted group under our high yield debt instruments. Such information is not
intended as an alternative measure of financial position as determined in
accordance with generally accepted accounting principles.

As of December 31, 1998
------------------------------------------------------------------------------------------------------------
Restricted
Group
Pro Forma
Restricted for
Group Adjustments Proposed Adjustments Restricted
Pro Pro for Offerings for Adjustments Group
Forma for Exclusion of Forma for Bell Atlantic and Proposed for Proposed Pro Forma
Proposed Unrestricted Proposed Joint Joint BellSouth Historical Powertel for the
Offerings Subsidiaries Offerings Venture Venture Transaction Powertel Acquisition Transactions
---------- ------------ ---------- ------------- ---------- ----------- ---------- ------------ ------------

Assets:
Current assets:
Cash and cash
equivalents...... $1,108,450 $(254,665) $ 853,785 $ -- $ 853,785 $(430,000) $ -- $(274,617) $ 149,168
Receivables....... 36,420 (18,733) 17,687 -- 17,687 -- -- -- 17,687
Inventories....... 6,599 (5,309) 1,290 -- 1,290 -- -- -- 1,290
Prepaid expenses
and other
current assets... 2,647 (2,039) 608 -- 608 -- 2,031 -- 2,639
---------- --------- ---------- -------- ---------- --------- -------- --------- ----------
Total current
assets......... 1,154,116 (280,746) 873,370 -- 873,370 (430,000) 2,031 (274,617) 170,784
Property and
equipment, net.... 592,594 (427,389) 165,205 -- 165,205 610,000 121,490 151,405 1,048,100
Investments in
affiliates........ 2,258 -- 2,258 -- 2,258 -- -- -- 2,258
Investments in
Unrestricted
Subsidiaries...... -- 744,941 744,941 197,000 941,941 -- -- -- 941,941
Goodwill and other
intangible assets,
net............... 569,740 (426,011) 143,729 -- 143,729 -- -- -- 143,729
Deferred financing
costs and other
assets, net....... 31,522 (3,340) 28,182 -- 28,182 -- -- -- 28,182
---------- --------- ---------- -------- ---------- --------- -------- --------- ----------
$2,350,230 $(392,545) $1,957,685 $197,000 $2,154,685 $ 180,000 $123,521 $(123,212) $2,334,994
========== ========= ========== ======== ========== ========= ======== ========= ==========
Liabilities and
Stockholders'
Equity:
Current
liabilities:
Accounts
payable.......... $ 46,020 $ (34,648) $11,372 $ -- $11,372 $ -- $ -- $ -- $ 11,372
Other current
liabilities...... 46,867 (40,586) 6,281 -- 6,281 -- 309 -- 6,590
Long-term debt,
current
maturities....... -- -- -- -- -- -- -- -- --
---------- --------- ---------- -------- ---------- --------- -------- --------- ----------
Total current
liabilities.... 92,887 (75,234) 17,653 -- 17,653 -- 309 -- 17,962
Long-term debt,
less current
maturities........ 879,710 (256,111) 623,599 -- 623,599 -- -- -- 623,599
Other liabilities.. 22,823 (22,015) 808 -- 808 -- -- -- 808
---------- --------- ---------- -------- ---------- --------- -------- --------- ----------
Total
liabilities...... 995,420 (353,360) 642,060 -- 642,060 -- 309 -- 642,369
---------- --------- ---------- -------- ---------- --------- -------- --------- ----------
Minority
interests......... 39,185 (39,185) -- -- -- -- -- -- --
Redeemable
preferred stock... 201,063 -- 201,063 -- 201,063 -- -- -- 201,063
Stockholders'
equity............ 1,114,562 -- 1,114,562 197,000 1,311,562 180,000 123,212 (123,212) 1,491,562
---------- --------- ---------- -------- ---------- --------- -------- --------- ----------
$2,350,230 $(392,545) $1,957,685 $197,000 $2,154,685 $ 180,000 $123,521 $(123,212) $2,334,994
========== ========= ========== ======== ========== ========= ======== ========= ==========

SELECTED FINANCIAL AND OTHER DATA OF CCIC

The selected historical consolidated financial and other data for CCIC set
forth below for each of the four years in the period ended December 31, 1998,
and as of December 31, 1995, 1996, 1997 and 1998, have been derived from the
consolidated financial statements of CCIC, which have been audited by KPMG LLP,
independent certified public accountants. The results of operations for the
year ended December 31, 1998 are not comparable to the year ended December 31,
1997, and the results for the year ended December 31, 1997 are not comparable
to the year ended December 31, 1996 as a result of business acquisitions
completed in 1997 and 1998. Results of operations of these acquired businesses
are included in CCIC's consolidated financial statements for the periods after
the respective dates of acquisition. The selected historical financial and
other data for the restricted group under our high yield debt instruments are
not intended as alternative measures of operating results or cash flows from
operations (as determined in accordance with generally accepted accounting
principles). The information set forth below should be read in conjunction with
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Results of Operations--CCIC" and the consolidated financial
statements and related notes of CCIC included elsewhere in this prospectus.

Years Ended December 31,
-----------------------------------------
1995 1996 1997 1998
-------- -------- --------- ----------
(Dollars in thousands)

Statement of Operations Data:
Net revenues:
Site rental and broadcast
transmission..................... $ 4,052 $ 5,615 $ 11,010 $ 75,028
Network services and other........ 6 592 20,395 38,050
-------- -------- --------- ----------
Total net revenues.............. 4,058 6,207 31,405 113,078
-------- -------- --------- ----------
Costs of operations:
Site rental and broadcast
transmission..................... 1,226 1,292 2,213 26,254
Network services and other........ -- 8 13,137 21,564
-------- -------- --------- ----------
Total costs of operations....... 1,226 1,300 15,350 47,818
-------- -------- --------- ----------
General and administrative......... 729 1,678 6,824 23,571
Corporate development(a)........... 204 1,324 5,731 4,625
Non-cash compensation charges(b)... -- -- -- 12,758
Depreciation and amortization...... 836 1,242 6,952 37,239
-------- -------- --------- ----------
Operating income (loss)............ 1,063 663 (3,452) (12,933)
Equity in earnings (losses) of
unconsolidated affiliate.......... -- -- (1,138) 2,055
Interest and other income
(expense)(c)...................... 53 193 1,951 4,220
Interest expense and amortization
of deferred financing costs....... (1,137) (1,803) (9,254) (29,089)
-------- -------- --------- ----------
Loss before income taxes and
minority interests................ (21) (947) (11,893) (35,747)
Provision for income taxes......... -- (10) (49) (374)
Minority interests................. -- -- -- (1,654)
-------- -------- --------- ----------
Net loss........................... (21) (957) (11,942) (37,775)
Dividends on preferred stock....... -- -- (2,199) (5,411)
-------- -------- --------- ----------
Net loss after deduction of
dividends on preferred stock...... $ (21) $ (957) $ (14,141) $ (43,186)
======== ======== ========= ==========
Loss per common share--basic and
diluted........................... $ (0.01) $ (0.27) $ (2.27) $ (1.02)
======== ======== ========= ==========
Common shares outstanding--basic
and diluted (in thousands)........ 3,316 3,503 6,238 42,518
======== ======== ========= ==========
Other Data:
Site data (at period end)(d):
Towers owned....................... 126 155 240 1,344
Towers managed..................... 7 7 133 129
Rooftop sites managed (revenue
producing)........................ 41 52 80 135
-------- -------- --------- ----------
Total sites owned and managed...... 174 214 453 1,608
======== ======== ========= ==========
EBITDA(e).......................... $ 1,899 $ 1,905 $ 3,500 $ 37,064
Restricted Group EBITDA............ 1,899 1,905 3,500 5,799
Capital expenditures............... 161 890 18,035 138,759
Summary cash flow information:
Net cash provided by (used for)
operating activities............. 1,672 (530) (624) 44,976
Net cash used for investing
activities....................... (16,673) (13,916) (111,484) (149,248)
Net cash provided by financing
activities....................... 15,597 21,193 159,843 345,248
Ratio of earnings to fixed
charges(f)........................ -- -- -- --
Balance Sheet Data (at period end):
Cash and cash equivalents.......... $ 596 $ 7,343 $ 55,078 $ 296,450
Property and equipment, net........ 16,003 26,753 81,968 592,594
Total assets....................... 19,875 41,226 371,391 1,523,230
Total debt......................... 11,182 22,052 156,293 429,710
Redeemable preferred stock(g)...... 5,175 15,550 160,749 201,063
Total stockholders' equity
(deficit)......................... 619 (210) 41,792 737,562

(footnotes on the following page)

- --------

(a) Corporate development expenses represent costs incurred in connection with
acquisitions and development of new business initiatives. These expenses
consist primarily of allocated compensation, benefits and overhead costs
that are not directly related to the administration or management of
existing towers. For the year ended December 31, 1997, such expenses
include (1) nonrecurring cash bonuses of $0.9 million paid to certain
executive officers in connection with our initial investment in Castle
Transmission and (2) a nonrecurring cash charge of $1.3 million related to
our purchase of shares of our common stock from our former chief executive
officer for our initial Castle Transmission investment. See "Certain
Relationships and Related Transactions".
(b) Represents charges related to the issuance of stock options to certain
employees and executives.

(c) Includes a $1.2 million fee received in March 1997 as compensation for
leading an investment consortium that provided the equity financing for our
initial Castle Transmission investment.

(d) Represents our aggregate number of sites as of the end of each period.

(e) EBITDA is defined as operating income (loss) plus depreciation and
amortization and non-cash compensation charges. EBITDA is presented as
additional information because management believes it to be a useful
indicator of our ability to meet debt service and capital expenditure
requirements. It is not, however, intended as an alternative measure of
operating results or cash flow from operations (as determined in accordance
with generally accepted accounting principles). Furthermore, our measure of
EBITDA may not be comparable to similarly titled measures of other
companies.

(g) The 1995, 1996 and 1997 amounts represent (1) the senior convertible
preferred stock we privately placed in August 1997 and October 1997, all of
which has been converted into shares of common stock, and (2) Series A
convertible preferred stock, the Series B convertible preferred stock and
the Series C convertible preferred stock we privately placed in April 1995,
July 1996 and February 1997, respectively, all of which has been converted
into shares of common stock in connection with the completion of our
initial public offering in August 1998. The 1998 amount represents our 12
3/4% exchangeable preferred stock.

----------------

The selected quarterly historical consolidated financial data for CCIC set
forth below have been derived from the consolidated financial statements of
CCIC.

Three Months Ended
------------------------------------------------------------
March 31 June 30 September 30 December 31
------------ ------------ --------------- --------------
(In thousands of dollars, except per share amounts)

1997:
Net revenues........... $ 1,994 $ 4,771 $ 11,481 $ 13,159
Gross profit(1)........ 1,731 2,258 5,648 6,418
Net loss............... (443) (1,706) (4,001) (5,792)
Loss per common share--
basic and diluted..... (0.13) (0.51) (0.62) (0.69)
1998:
Net revenues........... $ 11,837 $ 11,530 $ 28,894 $ 60,817
Gross profit(1)........ 6,244 7,550 15,835 35,631
Net loss............... (6,606) (6,426) (17,444) (7,299)
Loss per common share--
basic and diluted..... (0.79) (0.78) (0.33) (0.09)

- --------
(1) Represents net revenues less costs of operations.

SELECTED FINANCIAL AND OTHER DATA OF CTSH

The selected historical financial data for CTSH, which was 34.3% owned by
CCIC prior to the roll-up, presents (1) selected historical financial data of
the BBC home service transmission business prior to its acquisition by CTSH
(the "Predecessor") for the year ended March 31, 1996 and the eleven and two
months ended February 27, 1997, (2) selected historical consolidated financial
data of CTSH after such acquisition for the one month ended March 31, 1997 and
for the nine months ended December 31, 1997, and (3) selected historical
consolidated financial data of CTSH for the eight months ended August 31, 1998.
The selected historical financial data for the year ended March 31, 1996 and
the eleven months ended February 27, 1997 have been derived from the financial
statements of the Predecessor, which have been audited by KPMG, Chartered
Accountants. The selected financial data for the one month ended March 31, 1997
and the nine months ended December 31, 1997 have been derived from the
consolidated financial statements of CTSH, which have been audited by KPMG,
Chartered Accountants. The selected historical financial data for the two
months ended February 27, 1997 have been derived from the unaudited financial
statements of the Predecessor, and the selected historical financial data for
the eight months ended August 31, 1998 have been derived from the unaudited
consolidated financial statements of CTSH, which include all adjustments that
CTSH considers necessary for a fair presentation of the financial position and
results of operations for that period. The results of operations for the one
month ended March 31, 1997, the nine months ended December 31, 1997 and the
eight months ended August 31, 1998 are not necessarily indicative of the
results of operations of CTSH that may be expected for the entire year. CCIC
acquired a majority ownership interest in CTSH and its subsidiaries upon
completion of the roll-up of our U.K. business in August 1998 and, as a result,
historical financial data of CTSH for the year ended December 31, 1998 is not
presented. This information reflects financial data for CTSH as a whole, is
not limited to that portion of the financial data attributable to CCIC's
percentage ownership of CTSH before the roll-up and is not indicative of any
distributions or dividends that CCIC might receive in the future. Our U.K.
business is significantly limited in its ability to make dividends and
distributions to CCIC. See "Risk Factors--As a Holding Company, We Depend on
Dividends from Subsidiaries to Meet Cash Requirements or Pay Dividends". The
information set forth below should be read in conjunction with "Management's
Discussion and Analysis of Financial Condition and Results of Operations--
Results of Operations--CTSH" and the consolidated financial statements and
related notes of CTSH included elsewhere in this document.

Predecessor Company CTSH
---------------------------------------------- ---------------------------------------------
Eleven Two One Nine Eight
Year Months Months Month Months Months
Ended Ended Ended Ended Ended Ended
March 31, February 27, February 27, March 31, December 31, August 31,
1996 1997 1997 1997 1997 1998
-------------- -------------- -------------- ------------- -------------- --------------
(Pounds sterling in thousands)

Statement of
Operations Data:
Net revenues..... (Pounds)70,367 (Pounds)70,614 (Pounds)12,805 (Pounds)6,433 (Pounds)56,752 (Pounds)59,033
Operating
expenses(b)..... 62,582 56,612 10,108 5,188 47,976 47,821
-------------- -------------- -------------- ------------- -------------- --------------
Operating
income.......... 7,785 14,002 2,697 1,245 8,776 11,212
Interest and
other income.... -- -- -- 49 288 440
Interest expense
and amortization
of deferred
financing
costs........... -- -- -- (969) (12,419) (9,507)
-------------- -------------- -------------- ------------- -------------- --------------
Income (loss)
before income
taxes........... 7,785 14,002 2,697 325 (3,355) 2,145
Provision for
income taxes.... -- -- -- -- -- --
-------------- -------------- -------------- ------------- -------------- --------------
Net income (loss)
under U.K.
GAAP............ 7,785 14,002 2,697 325 (3,355) 2,145
Adjustments to
convert to U.S.
GAAP............ 3,707 3,993 726 78 866 1,493
-------------- -------------- -------------- ------------- -------------- --------------
Net income (loss)
under U.S.
GAAP............ (Pounds)11,492 (Pounds)17,995 (Pounds) 3,423 (Pounds) 403 (Pounds)(2,489) (Pounds) 3,638
============== ============== ============== ============= ============== ==============
Other Data:
Site data(c):
Towers and
revenue
producing
rooftop sites
at end of
period.........
EBITDA (under
U.S. GAAP)(d)... (Pounds)20,620 (Pounds)27,040 (Pounds) 5,161 (Pounds)3,064 (Pounds)25,695 (Pounds)29,244
Capital
expenditures
(under U.S.
GAAP)........... 18,079 21,810 711 748 14,361 36,304
Ratio of earnings
to fixed
charges(e)......
Ratio of EBITDA
to cash interest
expense.........
Summary cash flow
information
(under U.S.
GAAP):
Net cash provided
by operating
activities...... 24,311 28,146 5,161 4,871 25,555 27,226
Net cash used for
investing
activities...... (17,190) (21,811) (711) (52,889) (14,668) (36,135)
Net cash provided
by (used for)
financing
activities...... (7,121) (6,335) (4,450) 57,706 (12,423) 9,955

CTSH
----------------------------------
One Nine Eight
Month Months Months
Ended Ended Ended
March 31, December 31, August 31,
1997(a) 1997(a) 1998(a)
---------- ------------ ----------
(Dollars in thousands)

Statement of
Operations Data:
Net revenues..... $ 10,697 $ 94,365 $ 98,160
Operating
expenses(b)..... 8,627 79,774 79,517
---------- ------------ ----------
Operating
income.......... 2,070 14,591 18,643
Interest and
other income.... 81 479 731
Interest expense
and amortization
of deferred
financing
costs........... (1,611) (20,650) (15,808)
---------- ------------ ----------
Income (loss)
before income
taxes........... 540 (5,580) 3,566
Provision for
income taxes.... -- -- --
---------- ------------ ----------
Net income (loss)
under U.K.
GAAP............ 540 (5,580) 3,566
Adjustments to
convert to U.S.
GAAP............ 130 1,440 2,483
---------- ------------ ----------
Net income (loss)
under U.S.
GAAP............ $ 670 $ (4,140) $ 6,049
========== ============ ==========
Other Data:
Site data(c):
Towers and
revenue
producing
rooftop sites
at end of
period......... 801 808
============ ==========
EBITDA (under
U.S. GAAP)(d)... $ 5,095 $ 42,726 $ 48,627
Capital
expenditures
(under U.S.
GAAP)........... 1,244 23,879 60,366
Ratio of earnings
to fixed
charges(e)...... 1.44x -- 1.44x
Ratio of EBITDA
to cash interest
expense......... 3.58x 2.71x 3.76x
Summary cash flow
information
(under U.S.
GAAP):
Net cash provided
by operating
activities...... 8,099 42,493 45,271
Net cash used for
investing
activities...... (87,944) (24,390) (60,085)
Net cash provided
by (used for)
financing
activities...... 95,954 (20,657) 16,553

(footnotes on the following page)

- --------

(a) CTSH publishes its consolidated financial statements in pounds sterling.
For the convenience of the reader, the information set forth above
contains translations of pound sterling amounts into U.S. dollars at the
applicable noon buying rate on December 31, 1998 of (Pounds)1.00=1.6628.
No representation is made that the pound sterling amounts have been, could
have been or could be converted into U.S. dollars at the rate indicated or
any other rates. On February 26, 1999, the noon buying rate was
(Pounds)1.00 = $1.6027.
(b) Included in operating expenses for the eight months ended August 31, 1998
are non-cash compensation charges for (Pounds)2.3 million ($3.9 million)
related to the issuance of stock options to certain executives and
employees.

(c) As of August 31, 1998, our U.K. business had 54 revenue producing rooftop
sites that were occupied by its transmitters but were not available for
leasing to customers.

(d) EBITDA is defined as operating income (loss) plus depreciation and
amortization and non-cash compensation charges. EBITDA is presented as
additional information because management believes it to be a useful
indicator of CTSH's ability to meet debt service and capital expenditure
requirements. It is not, however, intended as an alternative measure of
operating results or cash flow from operations (as determined in
accordance with generally accepted accounting principles). Furthermore,
Castle Transmission's measure of EBITDA may not be comparable to similarly
titled measures of other companies.
(e) For purposes of computing the ratio of earnings to fixed charges, earnings
represent income (loss) before income taxes and fixed charges. Fixed
charges consist of interest expense, the interest component of operating
leases and amortization of deferred financing costs. For the nine months
ended December 31, 1997, earning were insufficient to cover fixed charges
by (Pounds)2.5 million ($4.1 million).

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

The following discussion sets forth separately the historical consolidated
results of operations of CCIC and CTSH and is intended to assist in
understanding (1) CCIC's consolidated financial condition as of December 31,
1998 and its consolidated results of operations for each year in the three-year
period ended December 31, 1998 and (2) CTSH's consolidated results of
operations for each twelve-month period in the two-year period ended March 31,
1998. This discussion should be read in conjunction with "Unaudited Pro Forma
Condensed Consolidated Financial Statements", "Selected Financial and Other
Data of CCIC", "Selected Financial and Other Data of CTSH" and the consolidated
financial statements and related notes included elsewhere in this prospectus.
Results of operations of the acquired businesses that are wholly and majority
owned are included in our consolidated financial statements for the periods
subsequent to the respective dates of acquisition. As such, our results of
operations for the year ended December 31, 1998 are not comparable to the year
ended December 31, 1997, and the results for the year ended December 31, 1997
are not comparable to the year ended December 31, 1996.

Overview

The continued growth of our business depends substantially on the condition
of the wireless communications and broadcast industries. We believe that the
demand for communications sites will continue to grow and expect that, due to
increased competition, wireless carriers will continue to seek operating and
capital efficiencies by (1) outsourcing certain network services and the build-
out and operation of new and existing infrastructure and (2) co-locating
antennas and transmission equipment on multiple tenant towers. In addition,
wireless carriers are beginning to seek to sell their wireless communications
infrastructure to, or establish joint ventures with, experienced infrastructure
providers, such as CCIC, that have the ability to manage networks.

Further, we believe that wireless carriers and broadcasters will continue to
seek to outsource the operation of their towers and, eventually, their
transmission networks, including the transmission of their signals. Management
believes that our ability to manage towers and transmission networks and our
proven track record of providing services addressing all aspects of signaling
systems from the originating station to the terminating receiver, or "end-to-
end" services, to the wireless communications and broadcasting industries
position it to capture such business.

The willingness of wireless carriers to utilize our infrastructure and
related services is affected by numerous factors, including consumer demand for
wireless services, interest rates, cost of capital, availability of capital to
wireless carriers, tax policies, willingness to co-locate equipment, local
restrictions on the proliferation of towers, cost of building towers and
technological changes affecting the number of communications sites needed to
provide wireless communications services to a given geographic area. Our
revenues that are derived from the provision of transmission services to the
broadcasting industry will be affected by the timing of the roll-out of digital
terrestrial television broadcasts in both the United Kingdom and the United
States, as well as in other countries around the world, consumer demand for
digital terrestrial broadcasting, interest rates, cost of capital, zoning
restrictions on towers and the cost of building towers.

As an important part of our business strategy, we will seek:

(1) to maximize utilization of our tower capacity,

(2) to utilize the expertise of U.S. and U.K. personnel to capture global
growth opportunities,

(3) to partner with wireless carriers to assume ownership of their existing
towers,

(4) to build new towers for wireless carriers and broadcasters,

(5) to acquire existing broadcast transmission networks, and

(6) to continue to decentralize our management functions.

Results of Operations

Our primary sources of revenues are from:

(1) the rental of antenna space on towers and rooftops sites,

(2) the provision of network services and

(3) the provision of analog and digital broadcast transmission services.

CCIC

CCIC's primary sources of revenues are from (1) the rental of antenna space
on towers and rooftop sites and (2) the provision of network services, which
includes network design and site selection, site acquisition, site development
and construction and antenna installation.

Site rental revenues are received primarily from wireless communications
companies, including those operating in the following categories of wireless
communications: cellular, personal communications services, paging, specialized
mobile radio, enhanced specialized mobile radio and microwave. Site rental
revenues are generally recognized on a monthly basis under lease agreements,
which typically have original terms of five years (with three or four optional
renewal periods of five years each). Average revenues for CCIC's managed
rooftop sites are less than for the owned and managed towers because a
substantial portion of the revenues from the tenants at rooftop sites is
remitted to the building owner or manager.

Network services revenues consist of revenues from:

(1) network design and site selection,

(2) site acquisition,

(3) site development and construction,

(4) antenna installation and

(5) other services.

Network services revenues are received primarily from wireless communications
companies. Network services revenues are recognized under service contracts
which provide for billings on either a fixed price basis or a time and
materials basis. Demand for CCIC's network services fluctuates from period to
period and within periods. See "Risk Factors--Variability in Demand for Network
Services May Reduce the Predictability of Our Results". Consequently, the
operating results of CCIC's network services businesses for any particular
period may vary significantly, and should not be considered as indicative of
longer-term results. CCIC also derives revenues from the ownership and
operation of microwave radio and specialized mobile radio networks in Puerto
Rico where CCIC owns radio wave spectrum in the 2,000 MHz and 6,000 MHz range
(for microwave radio) and the 800 MHz range (for specialized mobile radio).
These revenues are generally recognized under monthly management or service
agreements.

Costs of operations for site rental primarily consist of land leases, repairs
and maintenance, utilities, insurance, property taxes and monitoring costs as
well as, in the case of managed sites, rental payments. For any given tower,
such costs are relatively fixed over a monthly or an annual time period. As
such, operating costs for owned towers do not generally increase significantly
as additional customers are added. However, rental expenses at certain managed
towers increase as additional customer antennas are added, resulting in higher
incremental revenues but lower incremental margins than on owned towers. Costs
of operations for network services consist primarily of employee compensation
and related benefits costs, subcontractor services, consulting fees, and other
on-site construction and materials costs. CCIC incurs these network services
costs (1) to support its internal operations, including construction and
maintenance of its owned towers, and (2) to maintain the employees necessary to
provide end-to-end services to third parties regardless of

the level of such business at any time. We believe that our experienced staff
enables us to provide the type of end-to-end services that enhance our ability
to acquire access to the infrastructure of wireless carriers and to attract
significant build-to-suit contracts.

General and administrative expenses consist primarily of employee
compensation and related benefits costs, advertising, professional and
consulting fees, office rent and related expenses and travel costs. Corporate
development expenses represent costs incurred in connection with acquisitions
and development of new business initiatives. These expenses consist primarily
of allocated compensation, benefits and overhead costs that are not directly
related to the administration or management of existing towers.

Depreciation and amortization charges relate to CCIC's property and equipment
(primarily towers, construction equipment and vehicles), goodwill and other
intangible assets recorded in connection with business acquisitions.
Depreciation of towers and amortization of goodwill are computed with a useful
life of 20 years. Amortization of other intangible assets (principally the
value of existing site rental contracts at Crown Communication) is computed
with a useful life of 10 years. Depreciation of construction equipment and
vehicles are generally computed with useful lives of 10 years and 5 years,
respectively.

In May 1997, we completed the acquisition of TEA and the acquisition of
TeleStructures. In August 1997, we completed the acquisition of Crown
Communication. In August 1998, we completed a share exchange with the
shareholders of CTSH, under which our ownership of CTSH increased from
approximately 34.3% to 80%. In October 1998, CTSH completed the acquisition of
Millennium. Results of operations of these acquired businesses are included in
our consolidated financial statements for the periods subsequent to the
respective dates of acquisition. As such, our results of operations for the
year ended December 31, 1998 are not comparable to the year ended December 31,
1997, and the results for the year ended December 31, 1997 are not comparable
to the year ended December 31, 1996. See "--CTSH" for a description of the
revenues and operating expenses that are included in CCIC's consolidated
results of operations subsequent to the completion of the share exchange in
August 1998.

The following information is derived from CCIC's historical Consolidated
Statements of Operations for the periods indicated.

Year Ended Year Ended Year Ended
December 31, 1996 December 31, 1997 December 31, 1998
-------------------- ------------------ ------------------
Percent Percent Percent
of Net of Net of Net
Amount Revenues Amount Revenues Amount Revenues
--------- --------- -------- -------- -------- --------
(Dollars in thousands)

Net revenues:
Site rental and
broadcast
transmission.......... $ 5,615 90.5% $ 11,010 35.1% $ 75,028 66.4%
Network services and
other................. 592 9.5 20,395 64.9 38,050 33.6
--------- ------- -------- ----- -------- -----
Total net revenues... 6,207 100.0 31,405 100.0 113,078 100.0
--------- ------- -------- ----- -------- -----
Operating expenses:
Costs of operations:
Site rental and
broadcast
transmission.......... 1,292 23.0 2,213 20.1 26,254 35.0
Network services and
other................. 8 1.4 13,137 64.4 21,564 56.7
--------- -------- --------
Total costs of
operations.......... 1,300 21.0 15,350 48.9 47,818 42.3
General and
administrative........ 1,678 27.0 6,824 21.7 23,571 20.8
Corporate development.. 1,324 21.3 5,731 18.3 4,625 4.1
Non-cash compensation
charges............... -- -- -- -- 12,758 11.3
Depreciation and
amortization.......... 1,242 20.0 6,952 22.1 37,239 32.9
--------- ------- -------- ----- -------- -----
Operating income
(loss)................. 663 10.7 (3,452) (11.0) (12,933) (11.4)
Other income (expense):
Equity in earnings
(losses) of
unconsolidated
affiliate............. -- -- (1,138) (3.6) 2,055 1.8
Interest and other
income (expense)...... 193 3.1 1,951 6.2 4,220 3.7
Interest expense and
amortization of
deferred financing
costs................. (1,803) (29.0) (9,254) (29.5) (29,089) (25.7)
--------- ------- -------- ----- -------- -----
Loss before income taxes
and minority
interests.............. (947) (15.2) (11,893) (37.9) (35,747) (31.6)
Provision for income
taxes.................. (10) (0.2) (49) (0.1) (374) (0.3)
Minority interests...... -- -- -- -- (1,654) (1.5)
--------- ------- -------- ----- -------- -----
Net loss................ $ (957) (15.4)% $(11,942) (38.0)% $(37,775) (33.4)%
========= ======= ======== ===== ======== =====

Comparison of Years Ended December 31, 1998 and 1997

Consolidated revenues for 1998 were $113.1 million, an increase of $81.7
million from 1997. This increase was primarily attributable to:

(1) a $64.0 million, or 581.5%, increase in site rental and broadcast
transmission revenues, of which $52.5 million was attributable to CTSH
and $11.5 million was attributable to the Crown Communication
operations;

(2) an $11.4 million increase in network services revenues from the Crown
Communication operations; and

(3) $5.6 million in network services revenues from CTSH.

Costs of operations for 1998 were $47.8 million, an increase of $32.5 million
from 1997. This increase was primarily attributable to:

(1) a $24.0 million increase in site rental and broadcast transmission
costs, of which $20.1 million was attributable to CTSH and $3.9 million
was attributable to the Crown Communication operations;

(2) a $3.8 million increase in network services costs related to the Crown
Communication operations; and

(3) $4.2 million in network services costs from CTSH.

Costs of operations for site rental and broadcast transmission as a percentage
of site rental and broadcast transmission revenues increased to 35.0% for 1998
from 20.1% for 1997, primarily due to (1) higher costs attributable to the CTSH
operations which are inherent with CTSH's broadcast transmission business, and
(2) higher costs for the Crown Communication operations. Costs of
operations for network services as a percentage of network services revenues
decreased to 56.7%

for 1998 from 64.4% for 1997, primarily due to improved margins from the Crown
Communication operations. Margins from the Crown Communication network services
operations vary from period to period, often as a result of increasingly
competitive market conditions.

General and administrative expenses for 1998 were $23.6 million, an increase
of $16.7 million from 1997. This increase was primarily attributable to:

(1) an $11.3 million increase in expenses related to the Crown
Communication operations;

(2) a $2.8 million increase in expenses at our corporate office; and

(3) $2.4 million in expenses at CTSH.

General and administrative expenses as a percentage of revenues decreased for
1998 to 20.8% from 21.7% for 1997 because of lower overhead costs as a
percentage of revenues for CTSH, partially offset by higher overhead costs as a
percentage of revenues for Crown Communication and the increase in costs at our
corporate office.

Corporate development expenses for 1998 were $4.6 million, a decrease of $1.1
million from 1997. Corporate development expenses for 1997 included
nonrecurring compensation charges associated with the CTSH investment of (1)
$0.9 million for certain executive bonuses and (2) the repurchase of shares of
our common stock from a member of our board of directors, which resulted in
compensation charges of $1.3 million. Corporate development expenses for 1998
included discretionary bonuses related to our performance totaling
approximately $1.8 million for certain members of our management.

We have recorded non-cash compensation charges of $12.8 million related to
the issuance of stock options to certain employees and executives. Such charges
are expected to amount to approximately $1.6 million per year through 2002 and
approximately $0.8 million in 2003. See "--Compensation Charges Related to
Stock Option Grants".

Depreciation and amortization for 1998 was $37.2 million, an increase of
$30.3 million from 1997. This increase was primarily attributable to (1) a $9.5
million increase in depreciation and amortization related to the property and
equipment, goodwill and other intangible assets acquired in the Crown
Communication acquisition; and (2) $20.3 million of depreciation and
amortization related to the property and equipment and goodwill from CTSH.

The equity in earnings (losses) of unconsolidated affiliate represents our
34.3% share of CTSH's net earnings (losses) for the periods from March 1997
through August 1998 (at which time the share exchange with CTSH's shareholders
was completed). For the eight months ended August 31, 1998, after making
appropriate adjustments to CTSH's results of operations for such period to
conform to generally accepted accounting principles of the United States, CTSH
had net revenues, operating income, interest expense (including amortization of
deferred financing costs) and net income of $97.2 million, $18.6 million, $13.4
million and $6.0 million, respectively. Included in CTSH's results of
operations for such period are non-cash compensation charges for approximately
$3.8 million related to the issuance of stock options to certain members of
CTSH's management.

Interest and other income for 1997 includes a $1.2 million fee received in
March 1997 as compensation for leading the investment consortium which provided
the equity financing for CTSH. Interest income for 1998 resulted primarily from
(1) the investment of excess proceeds from the sale of the 10 5/8% discount
notes in November 1997; and (2) the investment of the net proceeds from the
initial public offering in August 1998. See "--Liquidity and Capital
Resources".

Interest expense and amortization of deferred financing costs for 1998 was
$29.1 million, an increase of $19.8 million, or 214.3%, from 1997. This
increase was primarily attributable to amortization of the original issue
discount on the 10 5/8% notes and interest on CTSH's indebtedness.

Minority interests represent the minority shareholder's 20% interest in
CTSH's operations.

Comparison of Years Ended December 31, 1997 and 1996

Consolidated revenues for 1997 were $31.4 million, an increase of $25.2
million from 1996. This increase was primarily attributable to:

(1) a $5.4 million, or 96.1%, increase in site rental revenues, of which
$4.2 million was attributable to the Pittsburgh tower operations we
acquired in 1996 and $0.7 million was attributable to the Puerto Rico
operations;

(2) $10.4 million in network services revenues from TEA; and

(3) $7.2 million in network services revenues from the Pittsburgh tower
operations.

The remainder of the increase was largely attributable to higher revenues from
specialized mobile radio and microwave radio services in Puerto Rico and the
monthly service fees received from CTSH beginning in March 1997.

Costs of operations for 1997 were $15.4 million, an increase of $14.1 million
from 1996. This increase was primarily attributable to:

(1) $8.5 million of network services costs related to the TEA operations;

(2) $3.9 million of network services costs related to the Pittsburgh tower
operations; and

(3) $0.9 million in site rental costs attributable to the Pittsburgh tower
operations.

Costs of operations for site rental as a percentage of site rental revenues
decreased to 20.1% for 1997 from 23.0% for 1996 because of increased
utilization of the towers located in the southwestern United States and Puerto
Rico. Costs of operations for network services as a percentage of network
services revenues were 64.4% for 1997, reflecting lower margins that are
inherent in the network services businesses acquired in 1997.

General and administrative expenses for 1997 were $6.8 million, an increase
of $5.1 million from 1996. This increase was primarily attributable to $3.0
million of expenses related to the Pittsburgh tower operations and $1.4 million
of expenses related to the TEA operations, along with an increase in costs of
$0.2 million at CCIC's corporate office. General and administrative expenses as
a percentage of revenues decreased for 1997 to 21.7% from 27.0% for 1996
because of lower overhead costs as a percentage of revenues for the Pittsburgh
tower operations and TEA.

Corporate development expenses for 1997 were $5.7 million, an increase of
$4.4 million from 1996. A substantial portion of this increase was attributable
to nonrecurring compensation charges associated with the CTSH investment of (1)
$0.9 million for certain executive bonuses and (2) the repurchase of shares of
CCIC's common stock from a member of its board of directors, which resulted in
compensation charges of $1.3 million. The remaining $2.2 million of the
increase in corporate development expenses was attributable to a higher
allocation of personnel costs, along with an overall increase in such costs,
associated with an increase in acquisition and business development activities.

Depreciation and amortization for 1997 was $7.0 million, an increase of $5.7
million from 1996. This increase was primarily attributable to:

(1) $4.7 million of depreciation and amortization related to the property
and equipment, goodwill and other intangible assets acquired in the
Pittsburgh tower operations acquisition;

(2) $0.5 million of depreciation and amortization related to the property
and equipment and goodwill acquired in the acquisitions of TEA and
TeleStructures; and

(3) $0.3 million resulting from twelve months of depreciation related to
the property and equipment acquired in the Puerto Rico acquisition.

The equity in losses of unconsolidated affiliate of $1.1 million represents
CCIC's 34.3% share of CTSH's net loss for the period from March through
December 1997. After making appropriate adjustments to CTSH's results of
operations for such period to conform to generally accepted accounting
principles of the United States, CTSH had net revenues, operating income,
interest expense (including amortization of deferred financing costs) and net
losses of $103.5 million, $16.5 million, $20.4 million and $3.3 million,
respectively.

Interest and other income for 1997 includes a $1.2 million fee received in
March 1997 as compensation for leading the investment consortium which provided
the equity financing for CTSH, the impact on earnings of which was partially
offset by certain executive bonuses related to the CTSH investment and included
in corporate development expenses. Interest income for 1997 resulted primarily
from the investment of excess proceeds from the sale of CCIC's Series C
convertible preferred stock in February 1997.

Interest expense and amortization of deferred financing costs for 1997 was
$9.3 million, an increase of $7.5 million, or 413.3%, from 1996. This increase
was primarily attributable to;

(1) commitment fees related to an unfunded interim loan facility related to
the Pittsburgh tower operations acquisition and an unfunded revolving
credit facility;

(2) interest on notes payable to the former stockholders of the Pittsburgh
tower operations for a portion of the purchase price of Crown
Communication Inc.;

(3) amortization of the original issue discount on the 10 5/8% discount
notes;

(4) interest and fees associated with borrowings under CCIC's bank credit
facility which were used to finance the Pittsburgh tower operations
acquisition on an interim basis;

(5) interest on outstanding borrowings assumed in connection with the
Pittsburgh tower operations acquisition; and

(6) interest on borrowings under CCIC's bank credit facility which were
used to finance the acquisition of the Puerto Rico system.

CTSH

CTSH's primary sources of revenues are from:

(1) the provision of analog and digital broadcast transmission services to
the BBC and commercial broadcasters,

(2) the rental of antenna space on towers and

(3) the provision of network services, which includes broadcast consulting,
network design and site selection, site acquisition, site development
and antenna installation, and site management and other services.

Broadcast transmission services revenues are received for both analog and
digital transmission services. Monthly analog transmission revenues are
principally received from the BBC under a contract with an initial 10-year term
through March 31, 2007. Digital transmission services revenues from the BBC and
ONdigital are recognized under contracts with initial terms of 12 years through
November 15, 2010. Monthly revenues from these digital transmission contracts
increase over time as the network rollout progresses. See "Business--U.K.
Operations--Significant Contracts".

Site rental revenues are received from other broadcast transmission service
providers (primarily NTL) and wireless communications companies, including all
four U.K. cellular operators (Cellnet, Vodafone, One2One and Orange). As of
December 31, 1998, approximately 200 companies rented space on approximately
514 of CTSH's 919 towers and rooftops. Site rental revenues are generally
recognized on a monthly basis under lease agreements with original terms of
three to twelve years. Such lease agreements generally require annual payments
in advance, and include rental rate adjustment provisions between one and three
years from the commencement of the lease. Site rental revenues are expected to
become an increasing portion of CTSH's total U.K. revenue base, and we believe
that the demand for site rental from communication service providers will
increase in line with the expected growth of these communication services in
the United Kingdom.

Network services revenues consist of (1) network design and site selection,
site acquisition, site development and antenna installation (collectively,
"network design and development") and (2) site management and other services.
Network design and development services are provided to:

(1) a number of broadcasting and related organizations, both in the United
Kingdom and other countries;

(2) all four U.K. cellular operators; and

(3) a number of other wireless communications companies, including Dolphin
and Highway One.

These services are usually subject to a competitive bid, although a significant
proportion result from an operator coming onto an existing CTSH site. Revenues
from such services are recognized on either a fixed price or a time and
materials basis. Site management and other services, consisting of both network
monitoring and equipment maintenance, are carried out in the United Kingdom for
a number of emergency service organizations. CTSH receives revenues for such
services under contracts with original terms of between three and five years.
Such contracts provide fixed prices for network monitoring and variable pricing
dependent on the level of equipment maintenance carried out in a given period.

Costs of operations for broadcast transmission services consist primarily of
employee compensation and related benefits costs, utilities, rental payments
under the Site-Sharing Agreement with NTL, circuit costs and repairs and
maintenance on both transmission equipment and structures.

Site rental operating costs consist primarily of employee compensation and
related benefits costs, utilities and repairs and maintenance. The majority of
such costs are relatively fixed in nature, with increases in revenue from new
installations on existing sites generally being achieved without a
corresponding increase in costs.

Costs of operations for network services consist primarily of employee
compensation and related benefits costs and on-site construction and materials
costs.

General and administrative expenses consist primarily of office occupancy and
related expenses, travel costs, professional and consulting fees, advertising,
insurance and employee training and recruitment costs. Corporate development
expenses represent costs incurred in connection with acquisitions and
development of new business initiatives. These expenses consist primarily of
external professional fees related to specific activities and allocated
compensation, benefits and overhead costs that are not directly related to the
administration or management of CTSH's existing lines of business.

Depreciation and amortization charges relate to CTSH's property and equipment
(primarily towers, broadcast transmission equipment and associated buildings)
and goodwill recorded in connection with the acquisition of the home service
transmission business from the BBC. Depreciation of towers is computed with
useful lives of 20 to 25 years; depreciation of broadcast

transmission equipment is computed with a useful life of 20 years; and
depreciation of buildings is computed with useful lives ranging from 20 to 50
years. Amortization of goodwill is computed with a useful life of 20 years.

The following information is derived from the Consolidated Profit and Loss
Accounts of (1) CTSH for periods subsequent to February 28, 1997 (the date of
inception of CTSH's operations) and (2) the BBC home service transmission
business for periods prior to that date. For purposes of the following
discussion, CTSH's results for the month ended March 31, 1997 have been
combined with the results of the BBC Home Service Transmission Business for the
eleven months ended February 27, 1997, and CTSH's results for the nine months
ended December 31, 1997 have been combined with its results for the three
months ended March 31, 1998. The following discussion presents an analysis of
such combined results for the twelve-month periods ended March 31, 1998 and
1997. Results for CTSH are not comparable to results from the BBC home service
transmission business due to differences in the carrying amounts of property
and equipment and goodwill. As of December 31, 1997, CTSH changed its fiscal
year end for financial reporting purposes from March 31 to December 31; as
such, the results for the three months ended March 31, 1998 are unaudited.

CTSH uses the U.K. pound sterling as the functional currency for its
operations. The following amounts have been translated to U.S. dollars using
the average noon buying rate for each period. The following amounts reflect
certain adjustments to present the results of operations in accordance with
U.S. generally accepted accounting principles. For the results of the BBC home
service transmission business, such adjustments affect depreciation and
amortization expense as a result of differences in the carrying amounts for
property and equipment; for CTSH, such adjustments affect (1) operating
expenses as a result of differences in the accounting for pension costs, and
(2) interest expense as a result of the capitalization of interest costs in
connection with constructed assets.

Twelve Months Ended Twelve Months Ended
March 31, 1997 March 31, 1998
----------------------- -----------------------
Percent Percent
of Net of Net
Amount Revenues Amount Revenues
----------- ---------- ----------- ----------
(Dollars in thousands)

Net revenues:
Site rental and broadcast
transmission............... $ 112,122 91.7% $ 113,558 89.2%
Network services and other.. 10,090 8.3 13,731 10.8
----------- -------- ----------- --------
Total net revenues........ 122,212 100.0 127,289 100.0
----------- -------- ----------- --------
Operating expenses:
Costs of operations:
Site rental and broadcast
transmission.............. 61,339 54.7 53,957 47.5
Network services and oth-
er........................ 5,912 58.6 6,075 44.2
----------- -------- ----------- --------
Total cost of operations.. 67,251 55.0 60,032 47.1
General and administrative.. 7,196 5.9 8,626 6.8
Corporate development....... -- -- 2,303 1.8
Depreciation and
amortization............... 17,256 14.1 37,382 29.4
----------- -------- ----------- --------
Operating income.............. 30,509 25.0 18,946 14.9
Other income (expense):
Interest and other income... 79 0.1 746 0.6
Interest expense and
amortization of deferred
financing costs............ (1,434) (1.2) (24,201) (19.0)
Income (loss) before income
taxes........................ 29,154 23.9 (4,509) (3.5)
Provision for income taxes.. -- -- -- --
----------- -------- ----------- --------
Net income (loss)............. $ 29,154 23.9% $ (4,509) (3.5)%
=========== ======== =========== ========

Comparison of Twelve Months Ended March 31, 1998 and Twelve Months Ended March
31, 1997

Consolidated revenues for the twelve months ended March 31, 1998 were $127.3
million, an increase of $5.1 million from the twelve months ended March 31,
1997. This increase was primarily attributable to (1) a $1.4 million increase
in broadcast transmission services and site rental revenues and (2) a $3.6
million increase in network services and other revenues. Revenues from the BBC
for the twelve months ended March 31, 1998 amounted to $79.5 million, or 62.5%
of total revenues, as compared to $85.5 million, or 70.0% of total revenues,
for the twelve months ended March 31, 1997. Revenues from NTL for the twelve
months ended March 31, 1998 amounted to $11.8 million, or 9.2% of total
revenues. Network services revenues for the twelve months ended March 31, 1998
consisted of $10.6 million from network design and development services and
$3.1 million from site management and other services.

Costs of operations for the twelve months ended March 31, 1998 were $60.0
million, a decrease of $7.2 million from the twelve months ended March 31,
1997. This decrease was primarily attributable to a $7.4 million decrease in
broadcast transmission services and site rental costs, partially offset by a
$0.2 million increase in network services and other costs. Costs of operations
as a percentage of revenues for broadcast transmission services and site rental
were 47.5% for the twelve months ended March 31, 1998, as compared to 54.7% for
the twelve months ended March 31, 1997. This decrease was attributable to (1)
increases in site rental revenues from existing sites with little change in
site operating costs; and (2) the elimination, as of February 28, 1997, of
certain costs recharged to the BBC home service transmission business by the
BBC. Costs of operations as a percentage of revenues for network services and
other were 44.2% for the twelve months ended March 31, 1998, as compared to
58.6% for the twelve months ended March 31, 1997. This decrease was
attributable to (1) a higher proportion of broadcast consulting revenues, which
result in higher margins than certain other network design and development
services, and (2) the elimination, as of February 28, 1997, of certain costs
recharged to the BBC home service transmission business by the BBC. Costs of
operations for site rental and broadcast transmission for the twelve months
ended March 31, 1998 includes non-cash compensation charges for $1.1 million
related to the issuance of stock options to certain employees.

General and administrative expenses for the twelve months ended March 31,
1998 were $8.6 million, an increase of $1.4 million from the twelve months
ended March 31, 1997. As a percentage of revenues, general and administrative
expenses were 6.8% and 5.9% for the twelve months ended March 31, 1998 and
1997, respectively. This increase was attributable to costs incurred by CTSH as
a separate enterprise which were not directly incurred by the BBC home service
transmission business as a part of the BBC.

Corporate development expenses for the twelve months ended March 31, 1998
relate primarily to costs incurred in connection with certain projects in
Australasia and non-cash compensation charges for $1.8 million related to the
issuance of stock options to certain executives.

Depreciation and amortization for the twelve months ended March 31, 1998 was
$37.4 million, an increase of $20.1 million from the twelve months ended March
31, 1997. Monthly charges for depreciation and amortization increased for
periods subsequent to February 28, 1997 due to (1) a decrease in the estimated
useful lives for certain transmission and power plant equipment from 25 to 20
years; and (2) the amortization of goodwill recorded in connection with the
acquisition of the BBC Home Service Transmission Business.

Interest and other income for the twelve months ended March 31, 1998 resulted
primarily from (1) the investment of excess proceeds from amounts drawn under
CTSH's bank credit facilities in February 1997; and (2) the investment of cash
generated from operations during the period.

Interest expense and amortization of deferred financing costs for the twelve
months ended March 31, 1998 was $24.2 million. This amount was comprised of:

(1) $4.9 million related to amounts drawn under the CTSH credit facility;

(2) $15.6 million related to the Castle Transmission bonds; and

(3) $3.7 million for the amortization of deferred financing costs. Interest
expense and amortization of deferred financing costs of $1.4 million
for the twelve months ended March 31, 1997 was attributable to amounts
drawn under the CTSH credit facility. The BBC home service transmission
business did not incur any financing costs as a part of the BBC prior
to February 28, 1997.

Liquidity and Capital Resources

Our business strategy contemplates substantial capital expenditures:

(1) in connection with the expansion of our tower portfolios by partnering
with wireless carriers to assume ownership or control of their existing
towers by pursuing build-to-suit opportunities and by pursuing other
tower acquisition opportunities and

(2) to acquire existing transmission networks globally as opportunities
arise. Since its inception, CCIC has generally funded its activities
(other than acquisitions and investments) through excess proceeds from
contributions of equity capital. CCIC has financed acquisitions and
investments with the proceeds from equity contributions, borrowings
under our senior credit facilities, issuances of debt securities and
the issuance of promissory notes to sellers. Since its inception, CTSH
has generally funded its activities (other than the acquisition of the
BBC home service transmission business) through cash provided by
operations and borrowings under CTSH's credit facility. CTSH financed
the acquisition of the BBC home service transmission business with the
proceeds from equity contributions and the issuance of the Castle
Transmission bonds.

For the years ended December 31, 1996, 1997 and 1998, our net cash provided
by (used for) operating activities was ($0.5 million), ($0.6 million) and $45.0
million, respectively. For the years ended December 31, 1996, 1997 and 1998,
our net cash provided by financing activities was $21.2 million, $159.8 million
and $345.2 million, respectively. Our primary financing-related activities in
1998 included the following:

Exchangeable Preferred Stock Offering. On December 16, 1998, we privately
placed 200,000 shares of our 12 3/4% Senior Exchangeable Preferred Stock
due 2010, with a liquidation preference of $1,000 per share, resulting in
net proceeds to us of approximately $193.0 million. We used a portion of
the net proceeds of the exchangeable preferred stock offering to repay our
outstanding indebtedness under Crown Communication's senior credit
facility. We used the remainder of the net proceeds of the exchangeable
preferred stock offering to finance a portion of our investment in the Bell
Atlantic joint venture.

Initial Public Offering. On August 18, 1998, we completed our initial
public offering at a price to the public of $13.00 per share. We sold
12,320,000 shares of our common stock and received proceeds of $151.0
million (after underwriting discounts of $9.1 million but before other
expenses of our initial public offering, which totaled approximately $4.1
million). We used the net proceeds from our initial public offering to
finance a portion of our investment in the Bell Atlantic joint venture.

Capital expenditures were $138.8 million for the twelve months ended December
31, 1998, of which $3.7 million were for CCIC, $84.9 million were for Crown
Communication and $50.2 million were for CTSH. We anticipate that we will
build, through the end of 1999, between 900 and 1,200

towers at an aggregate cost of between $170.0 million and $220.0 million. We
also expect that the capital expenditure requirements related to the roll-out
of digital broadcast transmission in the United Kingdom will be approximately
(Pounds)40.0 million ($66.5 million).

In addition to capital expenditures in connection with build-to-suits, we
expect to apply a significant amount of capital to finance the cash portion of
the consideration being paid in connection with the proposed transactions.

In connection with the Bell Atlantic joint venture, we issued approximately
15.6 million shares of our common stock and contributed $250.0 million in cash
to the joint venture. The joint venture borrowed approximately $180.0 million
under a committed $250.0 million revolving credit facility, following which the
joint venture made a $380.0 million cash distribution to Bell Atlantic.

In connection with the proposed BellSouth transaction, we will issue
approximately 9.1 million shares of our common stock and pay BellSouth $430.0
million in cash. We have deposited $50.0 million in an escrow account pending
the first closing of the transaction, which we funded through a loan agreement
we entered into on March 15, 1999. We expect to use a portion of the net
proceeds of our proposed debt and equity offerings to finance this transaction.

In connection with the proposed Powertel acquisition, we will pay Powertel
$275.0 million in cash. We have deposited $50.0 million, which we funded
through the March 15, 1999 loan agreement, in an escrow account to be applied
to the purchase price at closing. We expect to use a portion of the net
proceeds of our proposed debt and equity offerings to finance this transaction.

We expect that the completion of the proposed transactions and the execution
of our new tower build, or build-to-suit program will have a material impact on
our liquidity. We expect that once integrated, these transactions will have a
positive impact on liquidity, but will require some period of time to offset
the initial adverse impact on liquidity. In addition, we believe that as new
build-to-suit towers become operational and we begin to add tenants, they
should result in a long-term increase in liquidity.

Our liquidity may also be materially impacted if we fail to complete the
BellSouth transaction or the Powertel acquisition. If we complete our proposed
debt and equity offerings and subsequently fail to complete the BellSouth
transaction or the Powertel acquisition, the proceeds of the proposed offerings
would no longer be required to be allocated to finance such transactions and
would be available to us as additional liquidity. The increase in our
liquidity, however, could be somewhat offset by any portion of the escrow
payments made in connection with such transactions that we may forfeit as a
result of not closing such transactions. See "Recent and Proposed
Transactions".

To fund the execution of our business strategy, including the proposed
transactions described in this prospectus and the construction of new towers
that we have agreed to build, we expect to use the net proceeds of our proposed
debt and equity offerings and borrowings available under our U.S. and U.K.
credit facilities. We will have additional cash needs to fund our operations in
the future. We may also have additional cash needs in the near term if
additional tower acquisition or build-to-suit opportunities arise. Some of the
opportunities that we are currently pursuing could require significant
additional capital. If we do not otherwise have cash available, or borrowings
under our credit facilities have otherwise been utilized, when our cash need
arises, we would be forced to seek additional debt or equity financing or to
forego the opportunity. In the event we determine to seek additional debt or
equity financing, there can be no assurance that any such financing will be
available, on commercially acceptable terms or at all, or permitted by the
terms of our existing indebtedness.

As of December 31, 1998, assuming we had completed our proposed debt and
equity offerings, we would have had consolidated cash and cash equivalents of
$1,108.5 million (including $6.5 million at CTSH), consolidated long-term debt
of $879.7 million, consolidated redeemable preferred stock of

$201.1 million and consolidated stockholders' equity of $1,114.6 million. As of
December 31, 1998, assuming we had completed the proposed offerings and the
recent and proposed transactions described in this prospectus, we would have
had consolidated cash and cash equivalents of $195.5 million (including $6.5
million at CTSH and $45.9 million at the Bell Atlantic joint venture),
consolidated long-term debt of $1,059.7 million, consolidated redeemable
preferred stock of $201.1 million and consolidated stockholders' equity of
$1,491.6 million.

As of March 1, 1999, Crown Communication and its subsidiaries had unused
borrowing availability under its senior credit facility of approximately $54.0
million, and CTSH had unused borrowing availability under its credit facility
of approximately (Pounds)24.0 million ($39.9 million). As of December 31, 1998,
Crown Communication and its subsidiaries and CTSH and its subsidiaries had
approximately $77.6 million and (Pounds)30.8 million ($51.2 million) of unused
borrowing availability, respectively, under Crown Communication's senior credit
facility and CTSH's credit facility. Upon its formation, the Bell Atlantic
joint venture borrowed $180.0 million under a committed $250.0 million credit
facility. Crown Communication's senior credit facility, CTSH's credit facility
and the joint venture's credit facility require that the respective borrowers
maintain certain financial covenants; in addition, all three credit facilities
place restrictions on the ability of the borrower and its subsidiaries to,
among other things, incur debt and liens, pay dividends, make capital
expenditures, undertake transactions with affiliates and make investments.
These facilities also limit the ability of the borrowing subsidiaries to pay
dividends to CCIC.

Compensation Charges Related to Stock Option Grants

During the period from April 24, 1998 through July 15, 1998, we granted
options to employees and executives for the purchase of 3,236,980 shares of our
common stock at an exercise price of $7.50 per share. Of such options, options
for 1,810,730 shares vested upon completion of the initial public offering and
the remaining options for 1,426,250 shares will vest at 20% per year over five
years, beginning one year from the date of grant. In addition, we have assigned
our right to repurchase 100,000 shares of our common stock from a stockholder
(at a price of $6.26 per share) to two individuals (including a newly-elected
director). Since the granting of these options and the assignment of these
rights to repurchase shares occurred subsequent to the date of the share
exchange agreement with CTSH's shareholders and at prices substantially below
the price to the public in the initial public offering, we have recorded a non-
cash compensation charge related to these options and shares based upon the
difference between the respective exercise and purchase prices and the price to
the public in the initial public offering. Such compensation charge will total
approximately $18.4 million, of which approximately $10.6 million was
recognized upon completion of the initial public offering (for such options and
shares which vested upon completion of the initial public offering), and the
remaining $7.8 million is being recognized over five years (approximately $1.6
million per year) through the second quarter of 2003. An additional $1.6
million in non-cash compensation charges will be recognized through the third
quarter of 2001 for stock options issued to certain members of CTSH's
management prior to the completion of the share exchange.

Impact of Recently Issued Accounting Standards

In April 1998, the Accounting Standards Executive Committee of the American
Institute of Certified Public Accountants issued Statement of Position 98-5,
Reporting on the Costs of Start-Up Activities ("SOP 98-5"). SOP 98-5 requires
that costs of start-up activities be charged to expense as incurred and broadly
defines such costs. We have deferred certain costs incurred in connection with
potential business initiatives and new geographic markets, and SOP 98-5 will
require that such deferred costs be charged to results of operations upon its
adoption. SOP 98-5 is effective for fiscal years beginning after December 15,
1998. We will adopt the requirements of SOP 98-5 as of January 1, 1999. The
cumulative effect of the change in accounting principle for the adoption of SOP
98-5 will result in a charge to results of operations in our financial
statements for the three months ending March 31, 1999; it is currently
estimated that such charge will amount to approximately $2,300,000.

In June 1998, the FASB issued Statement of Financial Accounting Standards No.
133, Accounting for Derivative Instruments and Hedging Activities ("SFAS 133").
SFAS 133 requires that derivative instruments be recognized as either assets or
liabilities in the consolidated balance sheet based on their fair values.
Changes in the fair values of such derivative instruments will be recorded
either in results of operations or in other comprehensive income, depending on
the intended use of the derivative instrument. The initial application of SFAS
133 will be reported as the effect of a change in accounting principle. SFAS
133 is effective for all fiscal quarters of fiscal years beginning after June
15, 1999. We will adopt the requirements of SFAS 133 in our financial
statements for the three months ending March 31, 2000. We have not yet
determined the effect that the adoption of SFAS 133 will have on our
consolidated financial statements.

Year 2000 Compliance

The year 2000 problem is the result of computer programs having been written
using two digits (rather than four) to define the applicable year. Any of our
computer programs that have date-sensitive software may recognize a date using
"00" as 1900 rather than the year 2000, or may not recognize the date at all.
This could result in a system failure or miscalculations causing disruption of
operations including, among other things, a temporary inability to process
transactions, send invoices, or engage in similar normal business activities.

In 1997 we established a year 2000 project to ensure that the issue received
appropriate priority and that necessary resources were made available. This
project includes the replacement of our worldwide business computer systems
with systems that use programs primarily from J.D. Edwards, Inc. The new
systems are expected to make approximately 90% of our business computer systems
year 2000 compliant and are in production today. Remaining business software
programs, including those supplied by vendors, will be made year 2000 compliant
through the year 2000 project or they will be retired. None of our other
information technology projects has been delayed due to the implementation of
the year 2000 project.

Our year 2000 project is divided into the following phases:

(1) inventorying year 2000 items;

(2) assigning priorities to identified items;

(3) assessing the year 2000 compliance of items determined to be material
to us;

(4) repairing or replacing material items that are determined not to be
year 2000 compliant;

(5) testing material items; and

(6) designing and implementing contingency and business continuation plans
for each organization and company location.

We have completed the inventory and priority assessment phases and are 90%
complete with the assessing compliance phase. The remaining items include
various third party assurances regarding the year 2000 status of their
operations. We are now continuing with the testing phase of the year 2000
project. All critical broadcast equipment and non-information technology
related equipment has been tested and is either year 2000 compliant, has been
designated as year 2000 ready, or will be repaired or replaced by June 1999. A
year 2000 ready designation implies the equipment or system will function
without adverse effects beyond year 2000 but may not be aware of the century.
All critical information technology systems have been designated year 2000
compliant or are scheduled to be retired or remediated by July 1999. The
testing phase is ongoing as hardware or system software is remediated, upgraded
or replaced. Testing as well as remediation is scheduled for completion in July
1999. The final phase of our year 2000 project, contingency planning, will be
completed and tested to the extent possible by September 1999.

We have expended $6.9 million on the year 2000 project through December 31,
1998, of which approximately $6.8 million related to the implementation of the
J.D. Edwards Systems and related hardware. Funds for the year 2000 project are
provided from a separate budget of $0.6 million for all items.

The failure to correct a material year 2000 problem could result in an
interruption in, or a failure of, certain normal business activities or
operations. Such failures could materially and adversely affect our results of
operations, liquidity and financial condition. Due to the general uncertainty
inherent in the year 2000 problem, resulting in part from the uncertainty of
the year 2000 readiness of third-party suppliers and customers, we are unable
to determine at this time whether the consequences of year 2000 failures will
have a material impact on our results of operations, liquidity or financial
condition. The year 2000 project is expected to significantly reduce our level
of uncertainty about the year 2000 problem and, in particular, about the year
2000 compliance and readiness of our material business partners. We believe
that, with the implementation of new business systems and completion of the
project as scheduled, the possibility of significant interruptions of normal
operations should be reduced.

THE EXCHANGE OFFER

Purpose of the Exchange Offer

In connection with the sale of the old preferred stock, we entered into a
registration rights agreement with the initial purchasers, under which we
agreed to use our best efforts to file an exchange offer registration statement
under the Securities Act.

We are making the exchange offer in reliance on the position of the SEC as
set forth in certain no-action letters. However, we have not sought our own no-
action letter. Based upon these interpretations by the SEC, we believe that a
holder of new preferred stock, but not a holder who is our "affiliate" within
the meaning of Rule 405 of the Securities Act, who exchanges the old preferred
stock for new preferred stock in the exchange offer, generally may offer the
new preferred stock for resale, sell the new preferred stock and otherwise
transfer the new preferred stock without further registration under the
Securities Act and without delivery of a prospectus that satisfies the
requirements of Section 10 of the Securities Act. This does not apply, however,
to a holder who is our "affiliate" within the meaning of Rule 405 of the
Securities Act. We also believe that a holder may offer, sell or transfer the
new preferred stock only if the holder acquires the new preferred stock in the
ordinary course of its business and is not participating, does not intend to
participate and has no arrangement or understanding with any person to
participate in a distribution of the new preferred stock.

Any holder of the old preferred stock using the exchange offer to participate
in a distribution of new preferred stock cannot rely on the no-action letters
referred to above. This includes a broker-dealer that acquired old preferred
stock directly from us, but not as a result of market-making activities or
other trading activities. Consequently, the holder must comply with the
registration and prospectus delivery requirements of the Securities Act in the
absence of an exemption from such requirements.

Each broker-dealer that receives new preferred stock for its own account in
exchange for old preferred stock, as a result of market-making activities or
other trading activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such new preferred stock. This prospectus, as it
may be amended or supplemented from time to time, may be used by a broker-
dealer in connection with resales of new preferred stock received in exchange
for old preferred stock where such old preferred stock were acquired by such
broker-dealer as a result of market-making activities or other trading
activities. The letter of transmittal states that by acknowledging and
delivering a prospectus, a broker-dealer will not be considered to admit that
it is an "underwriter" within the meaning of the Securities Act. We have agreed
that for a period of 180 days after the expiration date, we will make this
prospectus available to broker-dealers for use in connection with any such
resale. See "Plan of Distribution".

Except as described above, this prospectus may not be used for an offer to
resell, resale or other retransfer of new preferred stock.

The exchange offer is not being made to, nor will we accept tenders for
exchange from, holders of old preferred stock in any jurisdiction in which the
exchange offer or the acceptance of it would not be in compliance with the
securities or blue sky laws of such jurisdiction.

Terms of the Exchange

Upon the terms and subject to the conditions of the exchange offer, we will
accept any and all old preferred stock validly tendered prior to 5:00 p.m., New
York City time, on the expiration date. The date of acceptance for exchange of
the old preferred stock, and completion of the exchange offer, is the exchange
date, which will be the first business day following the expiration date
(unless

extended as described in this document). We will issue, on or promptly after
the exchange date, an aggregate liquidation preference of up to $200,000,000 of
new preferred stock in exchange for an equal liquidation preference at maturity
of outstanding old preferred stock tendered and accepted in connection with the
exchange offer. The new preferred stock issued in connection with the exchange
offer will be delivered on the earliest practicable date following the exchange
date. Holders may tender some or all of their old preferred stock in connection
with the exchange offer.

The terms of the new preferred stock are identical in all material respects
to the terms of the old preferred stock, except that the new preferred stock
have been registered under the Securities Act and are issued free from any
covenant regarding registration, including the payment of additional interest
upon a failure to file or have declared effective an exchange offer
registration statement or to complete the exchange offer by certain dates. The
new preferred stock will have the same obligations as the old preferred stock
and will be issued under and be entitled to the same benefits under the
certificate of designation as the old preferred stock. As of the date of this
prospectus, $200,000,000 aggregate liquidation preference of the old preferred
stock is outstanding.

In connection with the issuance of the old preferred stock, we arranged for
the old preferred stock originally purchased by qualified institutional buyers
to be issued and transferable in book-entry form through the facilities of The
Depository Trust Company, acting as depositary. Except as described under
"Book-Entry, Delivery and Form," the new preferred stock will be issued in the
form of a global note registered in the name of DTC or its nominee and each
holder's interest in it will be transferable in book-entry form through DTC.
See "Book-Entry, Delivery and Form."

Holders of old preferred stock do not have any appraisal or dissenters'
rights in connection with the exchange offer. Old preferred stock which are not
tendered for exchange or are tendered but not accepted in connection with the
exchange offer will remain outstanding and be entitled to the benefits of the
certificate of designations, but will not be entitled to any registration
rights under the registration rights agreement.

We shall be considered to have accepted validly tendered old preferred stock
if and when we have given oral or written notice to the exchange agent. The
exchange agent will act as agent for the tendering holders for the purposes of
receiving the new preferred stock from us.

If we do not accept any tendered old preferred stock for exchange because of
an invalid tender, the occurrence of certain other events described in this
prospectus or otherwise, we will return certificates for such unaccepted old
preferred stock, without expense, to the tendering holder as quickly as
possible after the expiration date.

Holders who tender old preferred stock will not be required to pay brokerage
commissions or fees or, subject to the instructions in the letter of
transmittal, transfer taxes on exchange of old preferred stock. We will pay all
charges and expenses, other than certain applicable taxes described below, in
connection with the exchange offer. See "--Fees and Expenses".

Expiration Date; Extensions; Amendments

The term "expiration date" shall mean 5:00 p.m., New York City time, on
, 1999, unless extended by us in our sole discretion (but in no event to a
date later than , 1999), in which case the term "expiration date" shall
mean the latest date and time to which the exchange offer is extended.

We reserve the right, in our sole discretion:

. to delay accepting any old preferred stock, to extend the offer or to
terminate the exchange offer if, in our reasonable judgment, any of the
conditions described below shall not have

been satisfied, by giving oral or written notice of the delay, extension
or termination to the exchange agent, or

. to amend the terms of the exchange offer in any manner.

If we amend the exchange offer in a manner that we consider material, we
will disclose such amendment by means of a prospectus supplement, and we will
extend the exchange offer for a period of five to ten business days.

If we determine to make a public announcement of any delay, extension,
amendment or termination of the exchange offer, we will do so by making a
timely release through an appropriate news agency.

Conditions to the Exchange Offer

Despite any other term of the exchange offer, we will not be required to
accept for exchange, or exchange new preferred stock for, any old preferred
stock and may terminate the exchange offer as provided in this prospectus
before the acceptance of the old preferred stock, if:

(1) any action or proceeding is instituted or threatened in any court or
by or before any governmental agency relating to the exchange offer
which, in our reasonable judgment, might materially impair our ability
to proceed with the exchange offer or materially impair the
contemplated benefits of the exchange offer to us, or any material
adverse development has occurred in any existing action or proceeding
relating to us or any of our subsidiaries;

(2) any change, or any development involving a prospective change, in our
business or financial affairs or any of our subsidiaries has occurred
which, in our reasonable judgment, might materially impair our ability
to proceed with the exchange offer or materially impair the
contemplated benefits of the exchange offer to us;

(3) any law, statute, rule or regulation is proposed, adopted or enacted,
which in our reasonable judgment, might materially impair our ability
to proceed with the exchange offer or materially impair the
contemplated benefits of the exchange offer to us; or

(4) any governmental approval has not been obtained, which approval we, in
our reasonable discretion, consider necessary for the completion of
the exchange offer as contemplated by this prospectus.

The conditions listed above are for our sole benefit and may be asserted by
us regardless of the circumstances giving rise to any of these conditions. We
may waive these conditions in our reasonable discretion in whole or in part at
any time and from time to time. The failure by us at any time to exercise any
of the above rights shall not be considered a waiver of such right and such
right shall be considered an ongoing right which may be asserted at any time
and from time to time.

If we determine in our reasonable discretion that any of the conditions are
not satisfied, we may:

(1) refuse to accept any old preferred stock and return all tendered old
preferred stock to the tendering holders,

(2) extend the exchange offer and retain all old preferred stock tendered
before the expiration of the exchange offer, subject, however, to the
rights of holders to withdraw these old notes (See "--Withdrawal of
Tenders" below), or

(3) waive unsatisfied conditions relating to the exchange offer and accept
all properly tendered old notes which have not been withdrawn.

Procedures for Tendering

Unless the tender is being made in book-entry from, to tender in the exchange
offer, a holder must complete, sign and date the letter of transmittal, or a
facsimile of it,

.have the signatures guaranteed if required by the letter of transmittal
and

. mail or otherwise deliver the letter of transmittal or the facsimile,
the old preferred stock and any other required documents, to the
exchange agent prior to 5:00 p.m., New York City time, on the expiration
date.

Any financial institution that is a participant in DTC's Book-Entry Transfer
Facility system may make book-entry delivery of the old preferred stock by
causing DTC to transfer the old preferred stock into the exchange agent's
account. Although delivery of old preferred stock may be effected through book-
entry transfer into the exchange agent's account at DTC, the letter of
transmittal (or facsimile), with any required signature guarantees and any
other required documents, must, in any case, be transmitted to and received or
confirmed by the exchange agent at its addresses set forth under the caption
"exchange agent," below, prior to 5:00 p.m., New York City time, on the
expiration date. Delivery of documents to DTC in accordance with its procedures
does not constitute delivery to the exchange agent.

The tender by a holder of old preferred stock will constitute an agreement
between us and the holder in accordance with the terms and subject to the
conditions set forth in this prospectus and in the letter of transmittal.

The method of delivery of old preferred stock and the letter of transmittal
and all other required documents to the exchange agent is at the election and
risk of the holders. Instead of delivery by mail, we recommend that holders use
an overnight or hand delivery service. In all cases, holders should allow
sufficient time to assure delivery to the exchange agent before the expiration
date. No letter of transmittal of old preferred stock should be sent to us.
Holders may request their respective brokers, dealers, commercial banks, trust
companies or nominees to effect the tenders for such holders.

Any beneficial owner whose old preferred stock are registered in the name of
a broker, dealer, commercial bank, trust company or other nominee and who
wishes to tender should contact the registered holder promptly and instruct
such registered holder to tender on behalf of the beneficial owner. If the
beneficial owner wishes to tender on that owner's own behalf, the owner must,
prior to completing and executing the letter of transmittal and delivery of
such owner's old preferred stock, either make appropriate arrangements to
register ownership of the old preferred stock in the owner's name or obtain a
properly completed bond power from the registered holder. The transfer of
registered ownership may take considerable time.

Signature on a letter of transmittal or a notice of withdrawal, must be
guaranteed by an eligible guarantor institution within the meaning of Rule
17Ad-15 under the Exchange Act, unless the old preferred stock tendered
pursuant thereto are tendered:

. by a registered holder who has not completed the box entitled "Special
Payment Instructions" or "Special Delivery Instructions" on the letter
of transmittal, or

. for the account of an eligible guarantor institution.

In the event that signatures on a letter of transmittal or a notice of
withdrawal, are required to be guaranteed, such guarantee must be by:

. a member firm of a registered national securities exchange or of the
National Association of Securities Dealers, Inc.,

. a commercial bank or trust company having an office or correspondent in
the United States or

. an "eligible guarantor institution".

If the letter of transmittal is signed by a person other than the registered
holder of any old preferred stock, the old preferred stock must be endorsed by
the registered holder or accompanied by a properly completed bond power, in
each case signed or endorsed in blank by the registered holder.

If the letter of transmittal or any old preferred stock or bond powers are
signed or endorsed by trustees, executors, administrators, guardians, attorney-
in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so indicate when signing, and
unless waived by us, submit evidence satisfactory to us of their authority to
act in that capacity with the letter of transmittal.

We will determine all questions as to the validity, form, eligibility
(including time of receipt) and acceptance and withdrawal of tendered old
preferred stock in our sole discretion. We reserve the absolute right to reject
any and all old preferred stock not properly tendered or any old preferred
stock whose acceptance by us would, in the opinion of our U.S. counsel, be
unlawful. We also reserve the right to waive any defects, irregularities or
conditions of tender as to any particular old preferred stock either before or
after the expiration date. Our interpretation of the terms and conditions of
the exchange offer (including the instructions in the letter of transmittal)
will be final and binding, on all parties. Unless waived, any defects or
irregularities in connection with tenders of old preferred stock must be cured
within a time period we will determine. Although we intend to request the
exchange agent to notify holders of defects or irregularities relating to
tenders of old preferred stock, neither we, the exchange agent nor any other
person will have any duty or incur any liability for failure to give such
notification. Tenders of old preferred stock will not be considered to have
been made until such defects or irregularities have been cured or waived. Any
old preferred stock received by the exchange agent that are not properly
tendered and as to which the defects or irregularities have not been cured or
waived will be returned by the exchange agent to the tendering holders, unless
otherwise provided in the letter of transmittal, as soon as practicable
following the expiration date.

In addition, we reserve the right, as set forth above under the caption
"Conditions to the Exchange Offer", to terminate the exchange offer.

By tendering, each holder represents to us that, among other things:

. the new preferred stock acquired in connection with the exchange offer
are being obtained in the ordinary course of business of the person
receiving the new preferred stock, whether or not such person is the
holder,

. that neither the holder nor any such other person has an arrangement or
understanding with any person to participate in the distribution of such
new preferred stock and that neither the holder nor any such other
person is our "affiliate" (as defined in Rule 405 under the Securities
Act).

If the holder is a broker-dealer which will receive new preferred stock for
its own account in exchange of old preferred stock, it will acknowledge that it
acquired such old preferred stock as the result of market making activities or
other trading activities and it will deliver a prospectus in connection with
any resale of such new preferred stock. See "Plan of Distribution".

Guaranteed Delivery Procedures

A holder who wishes to tender its old preferred stock and:

--whose old preferred stock are not immediately available;

--who cannot deliver the holder's old preferred stock, the letter of
transmittal or any other required documents to the exchange agent prior to
the expiration date; or

--who cannot complete the procedures for book-entry transfer, before the
expiration date,

may effect a tender if:

--the tender is made through an eligible guarantor institution;

--before the expiration date, the exchange agent receives from the eligible
guarantor institution:

. a properly completed and duly executed notice of guaranteed delivery
by facsimile transmission, mail or hand delivery,

. the name and address of the holder,

. the certificate number(s) of the old preferred stock and the
principal amount of old preferred stock tendered, stating that the
tender is being made and guaranteeing that, within three New York
Stock Exchange trading days after the expiration date, the letter of
transmittal and the certificate(s) representing the old preferred
stock (or a confirmation of book-entry transfer), and any other
documents required by the letter of transmittal will be deposited by
the eligible guarantor institution with the exchange agent; and

--the exchange agent receives, within three New York Stock Exchange trading
days after the expiration date, a properly completed and executed letter
of transmittal or facsimile, as well as the certificate(s) representing
all tendered old preferred stock in proper form for transfer or a
confirmation of book-entry transfer, and all other documents required by
the letter of transmittal.

Withdrawal of Tenders

Except as otherwise provided herein, tenders of old preferred stock may be
withdrawn at any time prior to 5:00 p.m., New York City time, on the expiration
date.

To withdraw a tender of old preferred stock in connection with the exchange
offer, a written facsimile transmission notice of withdrawal must be received
by the exchange agent at its address set forth herein prior to 5:00 p.m., New
York City time, on the expiration date. Any such notice of withdrawal must:

. specify the name of the person who deposited the old preferred stock to
be withdrawn,

. identify the old preferred stock to be withdrawn (including the
certificate number or numbers and principal amount of such old preferred
stock),

. be signed by the depositor in the same manner as the original signature
on the letter of transmittal by which such old preferred stock were
tendered (including any required signature guarantees) or be accompanied
by documents of transfer sufficient to have the trustee register the
transfer of such old preferred stock into the name of the person
withdrawing the tender, and

. specify the name in which any such old preferred stock are to be
registered, if different from that of the depositor. We will determine
all questions as to the validity, form and eligibility (including time
of receipt) of such withdrawal notices. Any old preferred stock so
withdrawn

will be considered not to have been validly tendered for purposes of the
exchange offer and no new preferred stock will be issued with unless the
old preferred stock withdrawn are validly re-tendered. Any old preferred
stock which have been tendered but which are not accepted for exchange
or which are withdrawn will be returned to the holder without cost to
such holder as soon as practicable after withdrawal, rejection of tender
or termination of the exchange offer. Properly withdrawn old preferred
stock may be retendered by following one of the procedures described
above under the caption "Procedures for Tendering" at any time prior to
the expiration date.

Exchange Agent

ChaseMellon Shareholder Services, L.L.C. has been appointed as exchange
agent in connection with the exchange offer. Questions and requests for
assistance, requests for additional copies of this prospectus or of the letter
of transmittal should be directed to the exchange agent, at its offices at
2323 Bryan Street, Suite 2300, Dallas, Texas 75201. The exchange agent's
telephone number is (214) 965-2220 and facsimile number is (214) 965-2233.

Fees and Expenses

We will not make any payment to brokers, dealers or others soliciting
acceptances of the exchange offer. We will pay certain other expenses to be
incurred in connection with the exchange offer, including the fees and
expenses of the exchange agent, accounting and certain legal fees.

Holders who tender their old preferred stock for exchange will not be
obligated to pay any transfer taxes. If, however:

. new preferred stock are to be delivered to, or issued in the name of, any
person other than the registered holder of the old preferred stock
tendered, or

. if tendered old preferred stock are registered in the name of any person
other than the person signing the letter of transmittal, or

. if a transfer tax is imposed for any reason other than the exchange of
old preferred stock in connection with the exchange offer,

then the amount of any such transfer taxes (whether imposed on the registered
holder or any other persons) will be payable by the tendering holder. If
satisfactory evidence of payment of such taxes or exemption from them is not
submitted with the letter of transmittal, the amount of such transfer taxes
will be billed directly to the tendered holder.

Accounting Treatment

The new preferred stock will be recorded at the same carrying value as the
old preferred stock as reflected in our accounting records on the date of the
exchange. Accordingly, we will not recognize any gain or loss for accounting
purposes upon the completion of the exchange offer. Any expenses of the
exchange offer that we paid will be charged against our additional paid-in
capital in accordance with generally accepted accounting principles.

Consequences of Failures to Properly Tender Old Preferred Stock in the
Exchange

Issuance of the new preferred stock in exchange for the old preferred stock
under the exchange offer will be made only after timely receipt by the
exchange agent of such old preferred stock, a properly completed and duly
executed letter of transmittal and all other required documents. Therefore,
holders of the old preferred stock desiring to tender such old preferred stock
in exchange for new preferred stock should allow sufficient time to ensure
timely delivery. We are under no duty to give notification of defects or
irregularities of tenders of old preferred stock for exchange. Old

preferred stock that are not tendered or that are tendered but we do not
accept, will, following completion of the exchange offer, continue to be
subject to the existing restrictions upon transfer thereof under the Securities
Act and, upon completion of the exchange offer, certain registration rights
under the registration rights agreement will terminate.

In the event the exchange offer is completed, we will not be required to
register the remaining old preferred stock. Remaining old preferred stock will
continue to be subject to the following restrictions on transfer:

. the remaining old preferred stock may be resold only if registered
pursuant to the Securities Act, if any exemption from registration is
available, or if neither such registration nor such exemption is required
by law, and

. the remaining old preferred stock will bear a legend restricting transfer
in the absence of registration or an exemption. We do not currently
anticipate that we will register the remaining old preferred stock under
the Securities Act. To the extent that old preferred stock are tendered
and accepted in connection with the exchange offer, any trading market
for remaining old preferred stock could be adversely affected.

INDUSTRY BACKGROUND

General

The wireless communications industry is growing rapidly as new wireless
technologies are developed and consumers become more aware of the benefits of
wireless services. Wireless technologies are being used in more applications
and the cost of wireless services to consumers is declining. A significant
number of new competitors in the wireless communications industry have
developed as additional frequency spectrum has become available for a wide
range of uses, most notably personal communications services. This competition,
combined with an increasing reliance on wireless communications by consumers
and businesses, has led to an increased demand for higher quality,
uninterrupted service and improved coverage, which, in turn, has led to
increased demand for communications sites as new carriers develop and
construct, or "build out," their networks and existing carriers upgrade and
expand their networks to maintain their competitiveness. These trends are
affecting the wireless communications industry around the world.

As the wireless communications industry has become more competitive, wireless
carriers have sought operating and capital efficiencies by outsourcing certain
network services and the build-out and operation of new and existing
infrastructure and by placing, their transmission equipment with the equipment
of other carriers on multiple tenant towers. This joining of the transmission
equipment of different carriers on the same tower is referred to as "co-
location". The need for co-location has also been driven by the growing trend
by municipalities to slow the proliferation of towers. Further, we believe that
there has been a fundamental shift in strategy among established wireless
carriers relating to infrastructure ownership. We believe that in order to free
up capital for the growth and management of their customer bases and expansion
of their service offerings, such carriers are beginning to seek to sell their
wireless communications infrastructure to, or establish joint ventures with,
experienced infrastructure providers that have the ability to manage networks.
We believe that those infrastructure providers with a proven track record of
providing comprehensive services will be best positioned to successfully
acquire access to such wireless communications infrastructure.

The television broadcasting industry is experiencing significant change
because of the impending widespread deployment of digital land-based, or
terrestrial, television broadcasting. In the United States, the Federal
Communications Commission has required the four major networks (ABC, CBS, NBC
and Fox) to commence digital terrestrial television broadcasts in the top ten
markets by May 1999 and in the top 30 markets by November 1999. In the United
Kingdom, under the Broadcasting Act 1996, six digital television transmission
"multiplexes", which permit the holders to transmit digital television
broadcasting services, have been allocated. We successfully began commercial
operation of the digital terrestrial television network from an initial 22
transmission sites on November 15, 1998. Australia, France, Germany, Japan,
Spain and Sweden are expected to be the next countries to introduce digital
terrestrial television, followed by other European nations and later by
developing countries. Many countries are expected to start to establish digital
services within the next five years. The shift to digital transmission will
require network design, development and engineering services and the
significant enhancement of existing broadcast transmission infrastructure,
including new transmission and monitoring equipment and the modification,
strengthening and construction of towers (including over 1,000 tall towers in
the United States). In addition, state-run broadcast transmission networks are
continuing to be privatized throughout the world.

We expect these trends to continue around the world in both the wireless
communications and broadcasting industries. We believe that the next logical
step in the outsourcing of infrastructure by wireless carriers and broadcasters
will be the outsourcing of the operation of their towers and transmission
networks, including the transmission of their signals, in much the same way as
the BBC has done with its transmission network. This outsourcing will allow
carriers to realize additional operating and capital efficiencies and to focus
on management of their customer bases and

expansion of their service offerings. Management believes that such carriers
will only entrust the transmission of their signals to those infrastructure
providers, such as us, that have the ability to manage towers and transmission
networks and a proven track record of providing end-to-end services to the
wireless communications and broadcasting industries.

Development of the Tower Industry

United States. The U.S. wireless communications industry was transformed in
the 1970s through the issuance of licenses by the FCC to provide high quality
communications services to vehicle-mounted and hand-held portable telephones,
pagers and other devices. The licensees built and began operating wireless
networks that were supported by communication sites, transmission equipment and
other infrastructure. In the early 1980s, the number of towers began to expand
significantly with the development of more advanced wireless communications
systems, particularly cellular and paging. Nevertheless, as additional towers
were built by the wireless carriers, they often were built for a single purpose
rather than as multiple tenant towers. Further, these towers were generally
owned and maintained by carriers and were treated as corporate cost centers
operated primarily for the purpose of transmitting or receiving such carriers'
signals.

During the mid-to-late 1980s, a number of independent operators of towers
began to emerge. These independent tower operators focused on owning and
managing towers with multiple tenants by adding lessees to existing and
reconstructed towers. We believe the majority of these operators were small
business owners with a small number of local towers and few services other than
site rental. In the last five years, however, several larger independent tower
operators have emerged as demand for wireless services has continued to grow
and as additional high frequency licenses have been awarded for new wireless
services, such as personal communications services, narrowband paging and
wireless local loop. These independent tower operators have sought to acquire
smaller operators as well as suitable clusters of towers formerly owned by
carriers and broadcasters in order to establish regional and national "tower
footprints". Carriers expanding or building a network in a geographic area
generally seek to lease space for antennas from a tower company whose
footprints comprise strategically located clusters of towers and other
communication sites in that area to efficiently and effectively establish
service coverage in a given market.

Today, towers are owned by a variety of companies, including wireless
carriers, local and long distance telecommunications companies, broadcasting
companies, independent tower operators, utilities and railroad companies.
Despite the increasing demand for towers, the tower industry in the United
States remains highly fragmented, with only a few independent tower operators
owning a large number of towers. The pace of consolidation has begun to
accelerate, however, as the larger independent operators continue to acquire
small local operators and purchase towers from wireless communications
companies. In addition, wireless carriers are building out new, or filling in
existing, tower footprints for new and existing wireless services. Independent
operators have also expanded into a number of associated network and
communication site services, including the design of communication sites and
networks, the selection and acquisition of tower and rooftop sites (including
the resolution of zoning and permitting issues) and the construction of towers.
Previously, carriers typically handled such services through in-house
departments, and local nonintegrated service contractors focused on specific
segments such as radio frequency engineering and site acquisition.

Broadcast towers in the United States have typically been owned and operated
on a fragmented basis. Typically, each network affiliate in each major market
owns and operates its own television broadcasting tower. Local stations often
have co-located their transmission equipment on these towers. Radio broadcast
towers have also typically been erected by each station in a given market. Both
television and radio broadcast towers have generally been constructed only for
a single user and would require substantial strengthening to house new digital
transmission equipment or other

analog transmission equipment. As a result, similar to wireless communications
towers, such towers historically have been treated as corporate cost centers
operated primarily for the purpose of transmitting such broadcasters' signals.

United Kingdom. The first towers in the United Kingdom were built for the
BBC's medium frequency radio services. Additional towers were built from the
1940s on for transmission of evolving radio and television technologies and
services. The size and structure of towers varies widely due to location,
antenna requirements and wind loading. Towers built primarily for broadcast
transmission are often able to carry wireless communications antennas. Those
that are currently incapable of doing so can be strengthened or replaced.

Since 1982, the growth of wireless communications in the United Kingdom has
led to significant expansion in the number of towers. Historically, there have
been four major wireless carriers in the United Kingdom, each of which, in
general, built towers for its own use, rather than as multiple tenant owners.
These towers are owned and maintained by such carriers and, as in the United
States, were treated as corporate cost centers operated primarily for the
purpose of transmitting or receiving their signals. With the smaller geographic
size of the United Kingdom, as compared to the United States, these carriers
typically constructed their tower footprint to provide national coverage. As a
result of those national footprints, independent tower owners have not
developed as they have in the United States. In addition to wireless
communications providers, towers in the United Kingdom are owned by a variety
of companies, such as telecommunications companies, utilities and railroad
companies.

Today, tower owners are upgrading their networks to provide more capacity and
better service to their customers, while new entrants to the wireless
communications market have sought to acquire rapid access to networks that
provide national coverage. With the significant costs associated with the
approval process for, and the construction of, new towers, and the significant
capital requirements associated with ownership of tower infrastructure,
wireless carriers have begun to look to third party tower owners to co-locate
their antennas on existing towers, to build, own and operate new towers and to
acquire such carriers' portfolios of existing towers.

Characteristics of the Tower Industry

Management believes that, in addition to the favorable growth and outsourcing
trends in the wireless communications and broadcasting industries and high
barriers to entry as a result of regulatory and local zoning restrictions
associated with new tower sites, tower operators benefit from several favorable
characteristics. The ability of tower operators to provide antenna sites to
customers on multiple tenant towers provides them with diversification against
the specific technology, product and market risks typically faced by any
individual carrier. The emergence of new technologies, carriers, products and
markets may allow independent tower operators to further diversify against such
risks. In addition, tower operators face increased "not-in-my-backyard"
sentiment by communities and municipalities, which is reducing the number of
opportunities for new towers to be built and driving the trend toward co-
location on multiple tenant towers.

We believe that independent tower operators also benefit from the contractual
nature of the site rental business and the predictability and stability of
monthly, recurring revenues. In addition, the site rental business has low
variable costs and significant operating leverage. Towers generally are fixed
cost assets with minimal variable costs associated with additional tenants. A
tower operator can generally expect to experience increasing operating margins
when new tenants are added to existing towers.

The site rental business typically experiences low rates of tenant turnover
as a result of the high costs that would be incurred by a wireless carrier were
it to relocate an antenna to another site and consequently be forced to re-
engineer its network. Moving a single antenna may alter the pre-

engineered maximum signal coverage, requiring a reconfigured network at
significant cost to maintain the same coverage. Similarly, a television or FM
broadcaster would incur significant costs were it to relocate a transmitter
because, in order to avoid interruption of its transmissions, it would be
necessary for the broadcaster to install and commence operations of a second
broadcast site prior to ceasing signal transmission at the first site. In
addition, regulatory problems associated with licensing the location of the new
antenna with the FCC, in the United States, or being licensed for the location
by the Radiocommunications Agency in the United Kingdom, may arise if the new
location is at the edge of the wireless carrier's coverage area and if there is
a possible adverse impact on other carriers. Municipal approvals are becoming
increasingly difficult to obtain and may also affect the carrier's decision to
relocate. The costs associated with network reconfiguration and FCC,
Radiocommunications Agency and municipal approval and the time required to
complete these activities may not be justified by any potential savings in
reduced site rental expense.

Trends in the Wireless Communications and Broadcasting Industries

Our existing and future business opportunities are affected by the ongoing
trends within the two major industries we serve, namely the wireless
communications industry and the radio and television broadcasting industry.
Each of these industries is currently experiencing a period of significant
change that we believe is creating an increasing demand for communication sites
and related infrastructure and network support services.

Wireless Communications

The wireless communications industry now provides a broad range of services,
including cellular, personal communications services, paging and specialized
mobile radio. The industry has benefitted in recent years from increasing
demand for its services, and industry experts expect this demand to continue to
increase.

We believe that more communication sites will be required in the future to
accommodate the expected increase in demand for wireless communications
services. Further, we see additional opportunities with the development of
higher frequency technologies (such as personal communications services), which
have a reduced cell range as a result of signal propagation characteristics
that require a more dense network of towers. In addition, network services may
be required to service the network build-outs of new carriers and the network
upgrades and expansion of existing carriers.

In addition to the increasing demand for wireless services and the need to
develop and expand wireless communications networks, we believe that other
trends influencing the wireless communication industry have important
implications for independent tower operators. In order to speed new network
deployment or expansion and generate efficiencies, carriers are increasingly
co-locating transmission equipment with that of other network operators. The
trend towards co-location has been furthered by the "not-in-my-backyard"
arguments generated by local zoning/planning authorities in opposition to the
proliferation of towers. Further, the number of competitors in wireless
communications is increasing due to the auction of new spectra and the
deployment of new technologies. In this increasingly competitive environment,
many carriers are dedicating their capital and operations primarily to those
activities that directly contribute to subscriber growth, such as marketing and
distribution. These carriers, therefore, have sought to reduce costs and
increase efficiency through the outsourcing of infrastructure network functions
such as communication site ownership, construction, operation and maintenance.
Further, we believe that these carriers are beginning to seek to move their
tower portfolios off their balance sheets through sales to, or joint ventures
with, experienced tower operators who have the proven capability to provide
comprehensive services to the wireless communications industry.

United States. Current emerging wireless communications systems, such as
personal communications services and specialized mobile radio, represent an
immediate and sizable market for independent tower operators and network
services providers as carriers build out large nationwide and regional
networks. While several personal communications services and specialized mobile
radio carriers have already built limited networks in certain markets, these
carriers still need to fill in "dead zones" and expand geographic coverage. The
Cellular Telecommunications Industry Association estimates that, as of June
1998, there were 57,674 antenna sites in the United States. The Personal
Communications Industry Association estimates that the wireless communications
industry will construct at least 100,000 new antenna sites over the next 10
years. As a result of advances in digital technology, specialized mobile radio
operators, including Nextel, have also begun to design and deploy digital
mobile telecommunications networks in competition with cellular carriers. In
particular response to the increased competition, cellular operators are re-
engineering their networks by increasing the number of sites, locating sites
within a smaller radius, filling in "dead zones" and converting from analog to
digital cellular service in order to manage subscriber growth, extend
geographic coverage and provide competitive services. The demand for
communication sites is also being stimulated by the development of new paging
applications, such as e-mail and voicemail notification and two-way paging, as
well as other wireless data applications. In addition, as wireless
communications networks expand and new networks are deployed, we anticipate
that demand for microwave transmission facilities that provide "backhaul" of
traffic between communications sites to or from a central switching facility
will also increase.

Licenses are also being awarded, and technologies are being developed, for
numerous new wireless applications that will require networks of communication
sites. Future potential applications include those that will be deployed by the
winners of licenses auctioned in February and March 1998 for local multi-point
distribution services, including wireless local loop, wireless cable
television, wireless data and wireless Internet access, as well as the
forthcoming auctions for personal communications services and local multi-point
distribution services. Radio spectrum required for these technologies has, in
many cases, already been awarded and licensees have begun to build out and
offer services through new wireless systems. Examples of these systems include
local loop networks operated by WinStar and Teligent, wireless cable networks
operated by companies such as Cellular Vision and CAI Wireless, and data
networks being constructed and operated by RAM Mobile Data, MTEL and Ardis.

United Kingdom. As in the United States, the development of newer wireless
communications technologies, such as personal communications services and
digital terrestrial trunked radio, provides tower operators with immediate
opportunities for site rental and new tower build out. The four existing
national carriers offering global standard for mobile communications or
personal communication services continue to fill in "dead zones" and add
capacity to their networks. Also, the carrier that is using the terrestrial
trunked radio standard, which is similar to the global standard for mobile
communications and has been adopted throughout Europe, is deploying a network
across the United Kingdom. The United Kingdom's newly-licensed wireless local
loop operators have the potential to be important site rental customers.
Wireless local loop operators provide transmission services of voice or other
signals that are comparable to the range and quality of services delivered over
the wire networks. This technology is being rapidly deployed as a low-cost
alternative to fixed networks. To date, a total of seven spectrum licenses have
been awarded to companies planning to deploy wireless loop systems. In
addition, the deployment of a new national digital PMR system (using the
terrestrial trunked radio standard) for the use of the U.K. emergency services
and the announced licensing in early 1999 by the U.K. Government of universal
mobile telecommunications service networks, which will be the third generation
of cellular, should create additional demand for antenna space and tower sites.

Radio and Television Broadcasting

General. There are currently three main transmission delivery methods for
television and radio broadcasts: terrestrial, direct-to-home satellite and
cable. Terrestrial technology, the most common delivery method in the United
States, the United Kingdom and many other countries, relies on signal
transmission by wireless telegraphy, a type of data transmission technique,
from a network of ground-based transmitters for direct reception by viewers or
listeners through an aerial system. Satellite signals are transmitted to
satellites that then beam the signal over a target area (satellite footprint)
for reception by a customer's satellite dish. A satellite customer must either
purchase or rent a dish and a receiver/decoder and pay subscription fees to the
relevant provider. A cable television customer typically rents a
receiver/decoder and pays a subscription fee to receive services that are
distributed to the home through co-axial or fiber optic cable.

Until the 1990s, all three delivery methods used analog technology, which
remains the most widespread technology in use today. In the early 1990s,
digital technology was developed for radio and television broadcasting and has
begun to be introduced for the transmission of radio and television signals.
Digital transmission is now possible by terrestrial, satellite and cable
methods.

Digital technology allows a number of signals to be compressed and
interleaved, using a technical process called "multiplexing", before the
combined signal is transmitted within a single frequency channel. This process
makes the signal more robust, allowing the use of parts of the spectrum
unavailable to analog. A greater quantity of audio-visual information can be
transmitted with the same amount of frequency spectrum allowing higher
resolution or multiple channels to be broadcast. At the point of reception, the
compression and interleaving are decoded and individual signals recovered.

Some of the principal advantages of digital compared to analog transmission
include:

(1) greater number, choice and flexibility of broadcasting services
offered;

(2) scope for greater interactivity on the part of viewers and listeners;

(3) greater capacity for pay-television (subscription and pay-per-view) as
well as free-to-air services; and

(4) enhanced picture quality and sound. The development and timing of
implementation of digital transmission technology to the general public
is a function of several factors, including technological advancement,
cost of equipment and conversion process, quality improvement of visual
and sound transmission and demand for terrestrial bandwidth. The
transition to digital transmission will involve additional costs to
viewers and program and transmission service providers. Viewers will
require additional equipment such as set-top boxes or digital
televisions. Program providers have begun to re-equip their studios and
production facilities with digital technology.

United States. Prior to the introduction of digital transmission, the U.S.
broadcasting industry had generally been a mature one in terms of demand for
transmission tower capacity, although even then opportunities existed for
independent tower operators to purchase transmission networks, manage them on
behalf of broadcasters under long-term contracts and lease space on
broadcasting towers to wireless carriers.

The FCC-mandated introduction of digital television broadcasting will provide
new opportunities for independent tower operators. The conversion of
broadcasting systems from analog to digital technology will require a
substantial number of new towers to be constructed to accommodate the new
systems and analog equipment displaced from existing towers. Even with digital
terrestrial television transmissions, television station owners will continue
to broadcast the existing analog

signals for a number of years. Broadcasters that own their own tower
infrastructure may elect to remove third-party tenants from their towers to
make room for their own digital terrestrial television broadcasting equipment.
These displaced tenants, and tower owners that are unable to remove existing
third party tenants from their towers, will require new towers to accommodate
their transmission equipment. The National Association of Broadcasters projects
that by the year 2010 approximately 1,400 tall towers will be required to be
built, strengthened or modified to support digital terrestrial television
broadcasting, with 200 towers required in the top 50 markets within the next
five years. Further, because of the need for broadcasters to purchase new
transmission equipment to deploy digital terrestrial television, they will have
fewer resources to devote to the build out of new tower infrastructure. We
believe that these circumstances, along with the relative scarcity of suitable
sites and prevalent "not-in-my-backyard" attitudes, will allow experienced
tower operators to build and operate multiple tenant broadcast towers to
transmit digital terrestrial television broadcasting signals. These towers will
also be attractive sites for the distribution of FM radio broadcasts.

United Kingdom. The broadcasting industry in the United Kingdom has generally
been a mature one in terms of demand for transmission tower capacity. Existing
towers provide almost universal coverage for analog transmission, which remains
the primary mode of transmission for television and radio programs in the
United Kingdom. Most of the BBC's radio services, three Independent National
Radio services and many local services are broadcast by analog terrestrial
means. Some radio services are also available by satellite and cable for
reception on fixed installations, but not portable or mobile sets.

Digital television services in the United Kingdom were launched in 1998 from
terrestrial transmitters and satellite. The Broadcasting Act of 1996 sets out a
framework for the licensing of digital terrestrial multiplexes and an industry
interest group has been established to coordinate the establishment of digital
television in the United Kingdom. The British Government has allocated six
multiplexes for digital terrestrial transmitters: two and one-half of these
multiplexes were reserved for the BBC, ITV, Channel 4, S4C and Channel 5, three
were awarded to ONdigital (which is a joint venture of Carlton Communications
PLC and Granada Group PLC) and the other one-half was awarded to S4C Digital
Network. We have been awarded the digital transmission contract for the four
multiplexes held by the BBC and ONdigital, while NTL has been awarded the
digital transmission contract for the other two multiplexes.

Build-out of digital terrestrial transmission equipment in the United Kingdom
is being based on existing analog terrestrial infrastructure, including
transmission sites and towers. In the initial phase of the deployment of
digital terrestrial transmission equipment, 81 analog transmission sites and
towers will be upgraded with new transmitters and associated systems required
to support digital terrestrial broadcasting. Digital broadcasts from these
sites are expected to reach approximately 90% of the U.K. population. It is
expected that additional sites will continue to be upgraded until the "vast
majority" of viewers can receive digital broadcasts.

While no formal timetable has been set for the discontinuation of analog
terrestrial television broadcasting, the British Government has announced its
intention to review, by 2002, the timing of analog "switch-off". When analog
television transmission ceases, large amounts of frequency spectrum will be
released. New uses for this spectrum have not yet been defined but applications
are likely to include other digital broadcasting applications and mobile
communications. The spectrum is inherently suitable for terrestrial
transmission, so it is likely that existing towers will be used to provide many
of the new services.

In September 1995, the BBC launched the United Kingdom's first digital radio
service, which is now broadcast to approximately 60% of the U.K. population
from 29 transmission sites. Independent local radio licenses for additional
digital radio multiplexes are expected to be issued by the end of 1999.

To date, existing broadcast towers have been used as transmission sites for
the BBC's digital radio service, and it is anticipated that existing towers
also will be used for the independent services, often sharing the antennas used
for the BBC's digital radio service. While digital radio has the advantage of
using a single frequency network, which enables expanded geographic coverage as
compared with the multiple frequency networks used for analog radio, to
replicate the coverage of analog radio it will be necessary to broadcast
digital radio from more sites than at present. Although detailed planning has
not yet begun, it is expected that existing towers will provide the necessary
sites. As with digital terrestrial television, we believe that ownership of key
broadcasting sites across the United Kingdom will allow an experienced operator
to provide the infrastructure necessary to accommodate the growth in digital
radio at minimum cost.

BUSINESS

We are a leading owner and operator of towers and transmission networks for
wireless communications and broadcast companies. After giving effect to the
completion of the recent and proposed transactions, as of December 31, 1998, we
owned or managed 6,136 towers, including 4,450 towers in the United States and
Puerto Rico and 1,686 towers in the United Kingdom. Our customers currently
include many of the world's major wireless communications and broadcast
companies, including Bell Atlantic Mobile, BellSouth, AT&T Wireless, Nextel and
the BBC.

Our strategy is to use our leading domestic and international position to
capture the growing opportunities to consolidate ownership of existing towers
and to build new towers created by:

. the outsourcing of ownership and management by major wireless carriers;

. the need for existing wireless carriers to expand coverage and improve
capacity;

. the additional demand for towers created by new entrants into the
wireless communications industry;

. the privatization of state-run broadcast transmission networks; and

. the introduction of new digital broadcast transmission technology and
wireless technologies.

Our two main businesses are leasing antenna space on wireless and broadcast
multi-tenant towers and operating broadcast transmission networks. We also
provide related services to our customers, including network design, radio
frequency engineering, site acquisition, site development and construction,
antenna installation and network management and maintenance. We believe that
our full service capabilities are a key competitive advantage in forming
strategic partnerships to acquire tower clusters and in winning contracts for
new tower construction.

Our primary business in the United States is the leasing of antenna space to
wireless carriers. After completion of the recent and proposed transactions we
describe in this prospectus, we will have tower clusters in 26 of the 50
largest U.S. metropolitan areas, including 23 metropolitan areas east of the
Mississippi river. We believe that by owning and managing large tower clusters
we are able to offer customers the ability to fulfill rapidly and efficiently
their network expansion plans across particular markets or regions. We have
entered into agreements with Bell Atlantic and BellSouth that will allow us to
control and operate substantially all the towers in their 850 MHz networks.

Our primary business in the United Kingdom is the operation of television and
radio broadcast transmission networks. Following the 1997 acquisition of the
BBC's broadcast and tower infrastructure, we were awarded long-term contracts
to provide the BBC and other broadcasters analog and digital transmission
services. We also lease antenna space to wireless operators in the United
Kingdom on the towers we acquired from the BBC and from various wireless
carriers. After completion of the One2One transaction described in this
prospectus, we will have nationwide broadcast and wireless coverage in the
United Kingdom.

We believe our towers are attractive to a diverse range of wireless
communications industries, including personal communications services,
cellular, enhanced specialized mobile radio, specialized mobile radio, paging,
and fixed microwave, as well as radio and television broadcasting. In the
United States our major customers include AT&T Wireless, Aerial, Bell Atlantic,
BellSouth, Motorola, Nextel, PageNet and Sprint PCS. In the United Kingdom our
major customers include the BBC, Cellnet, Dolphin, NTL, ONdigital, One2One,
Orange, Virgin Radio and Vodafone.

We have embarked on a major construction program for our customers to enhance
our tower portfolios. In 1998, we constructed 231 towers at an aggregate cost
of approximately $46.0 million, and had begun construction of an additional 72
towers as of December 31, 1998. In 1999, we plan to

construct between 900 and 1,200 towers at an estimated aggregate cost between
$170.0 million and $220.0 million for wireless carriers such as Bell Atlantic,
BellSouth and Nextel. The actual number of towers built may be outside that
range depending on acquisition opportunities and potential build-to-suit
contracts from large wireless carriers. In addition, we were selected to build
and operate the world's first digital terrestrial television system in the
United Kingdom based on our broadcast engineering expertise.

Growth Strategy

Our objective is to become the premier global owner and operator of towers
and transmission networks for wireless communications and broadcast companies.
Our experience in establishing and expanding our existing tower portfolios, our
experience in owning and operating both analog and digital transmission
networks, our significant relationships with wireless carriers and broadcasters
and our ability to offer customers our in-house technical and operational
expertise, uniquely position us to capitalize on global growth opportunities.
The key elements of our business strategy are to:

. Maximize Utilization of Tower Capacity. We are seeking to take advantage
of the substantial operating leverage of our site rental business by
increasing the number of antenna leases on our owned and managed
communications sites. We believe that many of our towers have
significant capacity available for additional antenna space rental and
that increased utilization of our tower capacity can be achieved at low
incremental cost. For example, prior to our purchase of the BBC's
broadcast transmission network in 1997, the rental of available antenna
capacity on the BBC's premier tower sites was not actively marketed to
third parties. We believe there is substantial demand for such capacity.
In addition, we believe that the extra capacity on our tower portfolios
in the United States and the United Kingdom will be highly desirable to
new entrants into the wireless communications industry. Such carriers
are able to launch service quickly and relatively inexpensively by
designing the deployment of their networks based on our attractive
existing tower portfolios. Further, we intend to selectively build and
acquire additional towers to improve the coverage of our existing tower
portfolios to further increase their attractiveness. We intend to use
targeted sales and marketing techniques to increase utilization of and
investment return on our existing, newly constructed and acquired
towers.

. Utilize Expertise of Our U.S. and U.K. Personnel to Capture Global
Growth Opportunities. We are seeking to leverage the skills of our
personnel in the United States and the United Kingdom. We believe that
our ability to manage networks, including the transmission of signals,
will be an important competitive advantage in our pursuit of global
growth opportunities, as evidenced by our BBC, One2One, Bell Atlantic,
BellSouth and Powertel transactions. With our wireless communications
and broadcast transmission network design and radio frequency
engineering expertise, we are well positioned (1) to partner with major
wireless carriers to assume ownership of their existing towers, (2) to
provide new tower construction wireless carriers and broadcasters and
(3) to acquire existing broadcast transmission networks that are being
privatized around the world.

. Partner with Wireless Carriers to Assume Ownership of their Existing
Towers. In addition to the joint venture with Bell Atlantic and the
transaction with BellSouth, we are continuing to seek to partner with
other major wireless carriers to assume ownership of their existing
towers directly or through joint ventures or control their towers
through contractual arrangements. We believe the primary criteria of
such carriers in selecting a company to own and operate their wireless
communications infrastructure will be the company's perceived capability
to maintain the integrity of their networks, including their
transmission signals. Therefore, we believe that those companies with a
proven track record of providing end-to-end services will be best
positioned to successfully acquire access to such wireless

communications infrastructure. We believe that similar opportunities
will arise globally as the wireless communications industry further
expands.

. Build New Towers for Wireless Carriers and Broadcasters. As wireless
carriers continue to expand and fill-in their service areas, they will
require additional communications sites and will have to build new
towers where multi-tenant towers are not available. Similarly, the
introduction of digital terrestrial television broadcasting in the
United States will require the construction of new broadcast towers to
accommodate new digital transmission equipment and analog transmission
equipment displaced from existing towers. We are aggressively pursuing
these opportunities to build new towers for wireless carriers,
leveraging on our ability to offer end-to-end services.

. Acquire Existing Broadcast Transmission Networks. In 1997, Castle
Transmission, successfully acquired the privatized domestic broadcast
transmission network of the BBC. In addition, we are implementing the
roll-out of digital television transmission services throughout the
United Kingdom. As a result of this experience, we are well positioned
to acquire other state-owned analog and digital broadcast transmission
networks globally when opportunities arise. These state-owned broadcast
transmission networks typically enjoy premier sites giving an acquirer
the ability to offer unused antenna capacity to new and existing radio
and television broadcasters and wireless carriers, as well as to install
new technologies such as digital terrestrial transmission services. In
addition, our experience in broadcast transmission services allows us to
consider, when attractive opportunities arise, acquiring wireless
transmission networks as well as the acquisition of associated wireless
communications infrastructure. We are currently pursuing international
acquisition and privatization opportunities.

. Continue to Decentralize Our Management Functions. In order to better
manage our efforts to add tenants to our towers and our new tower build
programs, and in anticipation of the continued growth of our tower
portfolios throughout the United States, we have begun and plan to
continue decentralizing some management and operational functions. To
that end, in addition to our Pittsburgh operating headquarters and
regional office, we have opened and staffed five regional offices,
including Houston, Louisville, Phoenix, Albany and Puerto Rico. Upon
completion of the recent and proposed transactions we plan to open 10
additional regional offices, five in connection with the joint venture
with Bell Atlantic and five in connection with the BellSouth
transaction. The principal responsibilities of these offices are to
manage the leasing of tower space on a regional basis through a
dedicated local sales force, to maintain the towers already located in
the region and to implement our commitments to build new towers for
wireless carriers in the area. We believe that by moving a significant
amount of our operating personnel to regional offices we will be better
able to strengthen our relationship with regional carriers, serve our
customers more effectively and identify additional opportunities to
build new towers for local and regional carriers.

CCIC

The following table indicates, as of December 31, 1998, assuming we had
completed the recent and proposed transactions, the geographic concentration of
our 6,136 owned and managed towers and 132 revenue producing rooftop sites:

U.S. Towers and Rooftop Sites

% of
Crown % of CCIC
Communication Bell Atlantic BellSouth Powertel Total U.S. Total Total
------------- ------------- --------- -------- ----- ---------- -----

Towers:
Georgia............... -- 22 341 151 514 11.3% 8.2%
Florida............... 3 -- 434 76 513 11.3 8.2
Alabama............... -- 9 179 188 376 8.3 6.0
Pennsylvania.......... 219 218(a) -- -- 332 7.3 5.3
Tennessee............. 1 1 202 113 317 6.9 5.1
Louisiana............. 51 13 162 -- 226 5.0 3.6
Mississippi........... 21 8 125 62 216 4.8 3.5
Texas................. 167 43 -- -- 210 4.6 3.4
Kentucky.............. -- -- 191 -- 191 4.2 3.1
South Carolina........ 12 148 10 19 189 4.2 3.0
Indiana............... -- -- 183 -- 183 4.0 2.9
North Carolina........ 11 141 20 -- 172 3.8 2.7
Arizona............... 12 159 -- -- 171 3.8 2.7
New Jersey............ 1 150 -- -- 151 3.3 2.4
New York.............. -- 130 -- -- 130 2.9 2.1
Maryland.............. -- 115 -- -- 115 2.5 1.8
Massachusetts......... -- 80 -- -- 80 1.8 1.3
New Mexico............ 34 37 -- -- 71 1.6 1.1
Virginia.............. 5 66 -- -- 71 1.6 1.1
Connecticut........... -- 37 -- -- 37 * *
Ohio.................. 26 -- -- -- 26 * *
New Hampshire......... -- 26 -- -- 26 * *
Delaware.............. -- 25 -- -- 25 * *
West Virginia......... 17 14(b) -- -- 19 * *
Puerto Rico........... 14 -- -- -- 14 * *
Rhode Island.......... -- 14 -- -- 14 * *
All Others............ 15 12 3 41 61 1.3 1.0
--- ----- ----- --- ----- ----- ----
Rooftops(d)............. 78 -- -- -- 78 1.7 1.2
--- ----- ----- --- ----- ----- ----
Total................... 687 1,458(c) 1,850 650 4,528 100.0% 72.2%
=== ===== ===== === ===== ===== ====

- --------
(a) Includes 105 towers we currently manage.
(b) Includes 12 towers we currently manage.
(c) Includes 117 towers we currently manage.
(d) We manage an additional 1,286 rooftop sites throughout the United States
that do not currently produce revenue but are available for leasing to our
customers.
* Less than 1%.

U.K. Towers and Rooftop Sites

% of
Castle % of CCIC
Transmission One2One Total U.K. Total Total
------------ ------- ----- ---------- -----

Towers:
England.......................... 492 767 1,259 72.4% 20.1%
Wales............................ 134 39 173 9.9 2.8
Scotland......................... 151 15 166 9.5 2.6
Northern Ireland................. 88 -- 88 5.1 1.4
--- --- ----- ----- ----
Rooftops........................... 54 -- 54 3.1 *
--- --- ----- ----- ----
Total.............................. 919 821 1,740 100.0% 27.8%
=== === ===== ===== ====

U.S. Operations

Overview

Our primary business focus in the United States is the leasing of antenna
space on multiple tenant towers and rooftops to a variety of wireless carriers
under long-term lease contracts. Supporting our competitive position in the
site rental business, we maintain in-house expertise in, and offer our
customers, infrastructure and network support services that include network
design and communication site selection, site acquisition, site development and
construction and antenna installation.

We lease antenna space to our customers on our owned and managed towers. We
generally receive fees for installing customers' equipment and antennas on a
tower and also receive monthly rental payments from customers payable under
site rental leases that generally range in length from three to five years. Our
U.S. customers include such companies as AT&T Wireless, Aerial Communications,
AirTouch Cellular, Arch Communications, Bell Atlantic, BellSouth, Cellular One,
Federal Express, Lucent Technologies, Motorola, Nextel, Nokia, PageNet, Skytel,
Sprint PCS and TSR Wireless. We also provide tower space to private network
operators and various federal and local government agencies, such as the FBI,
the IRS and the U.S. Postal Service.

At December 31, 1998, without giving effect to the recent and proposed
transactions described in this prospectus, we owned or managed 609 towers and
78 rooftop sites in the United States and Puerto Rico. These towers and rooftop
sites are located in western Pennsylvania (primarily in and around the greater
Pittsburgh area), in the southwestern United States (primarily in western
Texas), across Puerto Rico and along I-95 in North Carolina and South Carolina.

The joint venture with Bell Atlantic controls and operates 1,458 towers.
These towers represent substantially all the towers in Bell Atlantic's 850 MHz
wireless network in the eastern and southwestern United States and provide
coverage of 11 of the top 50 U.S. metropolitan areas including New York,
Philadelphia, Boston, Washington D.C. and Phoenix. A substantial majority of
these towers are over 100 feet tall and can accommodate multiple tenants.

After completion of the BellSouth transaction, we will control and operate an
additional 1,850 towers. These towers represent substantially all the towers in
BellSouth's 850 MHz wireless network in the southeastern and midwestern United
States and provide coverage of 12 of the top 50 U.S. metropolitan areas,
including Miami, Atlanta, Tampa, Nashville and Indianapolis. A substantial
majority of these towers are over 100 feet tall and can accommodate multiple
tenants.

Upon completion of the Powertel acquisition, we will own and operate an
additional 650 towers. These towers represent substantially all of Powertel's
owned towers in its 1.9 GHz wireless network

in the southeastern and midwestern United States. Approximately 90% of these
towers are clustered in seven southeastern states providing coverage of such
metropolitan areas as Atlanta, Birmingham, Jacksonville, Memphis and
Louisville, and a number of major connecting highway corridors in the
southeast. These towers are complementary to BellSouth's 850 MHz tower
portfolio in the southeast and have minimal coverage overlap. Substantially all
of these towers are over 100 feet tall, were built within the last three years
and can such accommodate multiple tenants.

We are actively seeking to enter into arrangements with other major wireless
carriers and independent tower operators to acquire additional tower
footprints. We believe that, like Bell Atlantic, BellSouth and Powertel, other
wireless carriers will seek to enter into contractual arrangements with
independent tower carriers, such as us, for the ownership or control of their
tower footprints.

We also plan to capitalize on our network design expertise to construct new
towers. We plan to build towers in areas where carriers' signals fail to
transmit in their coverage area. The areas, commonly known as "dead zones", are
attractive tower locations. When population density and perceived demand are
such that we believe the economics of constructing such towers are justified,
we build towers that can accommodate multiple tenants. The multiple tenant
design of these towers obviates the need for expensive and time consuming
modifications to upgrade undersized towers, saving critical capital and time
for carriers facing time-to-market constraints. The towers are also designed to
easily add additional customers, and the equipment shelters are built to
accommodate another floor for new equipment and air conditioning units when
additional capacity is needed. The tower site is zoned for multiple carriers at
the time the tower is constructed to allow new carriers to quickly utilize the
site. In addition, the towers, equipment shelters and site compounds are
engineered to protect and maintain the structural integrity of the site.

Our existing contracts for construction of new towers include an agreement
with Nextel, under which we have already constructed 67 sites and have an
option to construct up to 96 additional sites. In connection with the joint
venture, Bell Atlantic and the joint venture entered into a master build-to-
suit agreement under which the joint venture will build and own the next 500
towers to be built for Bell Atlantic's wireless communications business over
the next five years. Further, we have agreed to enter into a similar agreement
with BellSouth, as part of the BellSouth transaction, to construct at least 500
towers on behalf of BellSouth in the region covered by that transaction over
the next five years. See "Recent and Proposed Transactions--Bell Atlantic Joint
Venture--Build-to-Suit Agreement" and "--Proposed BellSouth Transaction--
Build-to-Suit Agreement".

Site Rental

In the United States, we rent antenna space on our owned and managed towers
and rooftops to a variety of carriers operating cellular, personal
communications services, specialized mobile radio, enhanced specialized mobile
radio, paging and other networks.

Tower Site Rental. We lease space to our customers on our owned and managed
towers. We generally receive fees for installing customers' equipment and
antennas on a tower (as provided in our network services programs) and also
receive monthly rental payments from customers payable under site leases. In
the United States, the majority of our outstanding customer leases, and the new
leases typically entered into by us, have original terms of five years (with
three or four optional renewal periods of five years each) and provide for
annual price increases based on the Consumer Price Index.

We also provide a range of site maintenance services in order to support and
enhance our site rental business. We believe that by offering services such as
antenna, base station and tower maintenance and security monitoring, we are
able to offer quality services to retain our existing customers and attract
future customers to our communication sites. We were the first site

management company in the United States selected by a major wireless
communications company to exclusively manage its tower network and market the
network to other carriers for multi-tenant use of their towers.

The following table describes, while excluding the results of the recent and
proposed transactions, our top ten revenue producing towers in the United
States and Puerto Rico:

December
Number of 1998
Tenant Monthly
Name Location Height (ft) Leases Revenue
---- -------- ----------- --------- --------

Crane.............................. Pennsylvania 450 99 $67,372
Bluebell........................... Pennsylvania 300 110 54,555
Monroeville........................ Pennsylvania 500 63 39,315
Lexington.......................... Kentucky 500 89 38,644
Sandia Crest....................... New Mexico 140 16 26,984
Greensburg......................... Pennsylvania 375 40 26,932
Cranberry.......................... Pennsylvania 400 44 26,455
Cerro de Punta..................... Puerto Rico 220 37 24,988
Beaver............................. Pennsylvania 500 43 25,360
El Yunque.......................... Puerto Rico 200 34 23,500
--- --------
Total..................................................... 575 $354,105
=== ========

We have existing master lease agreements with AT&T Wireless, Aerial
Communications, Bell Atlantic, Nextel and Sprint PCS, among others, which
provide terms (including economic terms) that govern new leases entered into by
such parties during the term of their master lease agreements. These agreements
include the lease of space on towers in the Pittsburgh major trading area,
which includes greater Pittsburgh and parts of Ohio, West Virginia and western
Pennsylvania. Each of the Aerial Communications and Sprint PCS agreements has a
10-year master lease term through December 2006, with one 10-year and one five-
year renewal period. Rents are adjusted periodically based on the cumulative
Consumer Price Index. Nextel's master lease agreement with us has a 10-year
master lease term through October 2006, with two 10-year renewal options. We
have also entered into an independent contractor agreement with Nextel. The
Bell Atlantic agreement has a 25-year master lease term through December 2020.

We have significant site rental opportunities arising out of our existing
agreements with Bell Atlantic and Nextel. In our existing lease agreement with
Bell Atlantic, we have exclusive leasing rights for 117 existing towers and we
currently have sublessees on 58 of these towers in the greater Pittsburgh area.
The lease agreement provides that we may sublet space on any of these towers to
another carrier subject to certain approval rights of Bell Atlantic. To date,
Bell Atlantic has never failed to approve a sublease we have proposed. Upon
completing the joint venture, those 117 towers were among the 1,458 towers
contributed to the joint venture; however, since we maintain the right to put
sublessees on those 117 towers, revenue resulting from the addition of new
tenants on those towers will continue to be realized by us rather than the
joint venture. In connection with the Nextel Agreement, as of December 31,
1998, we have the option to own and operate up to 96 additional towers.

We also have significant site rental opportunities in connection with the
recent and proposed transactions we describe in this prospectus. In connection
with the joint venture, we entered into a global lease under which Bell
Atlantic will lease antenna space on the towers transferred to the joint
venture, as well as the towers built under the build-to-suit agreement. In
connection with the BellSouth transaction, we will be paid a monthly site
maintenance fee from BellSouth for its use of space on the towers we control.
We will also enter into a master lease agreement with the sellers in

the Powertel acquisition under which the sellers will rent space on the
acquired towers. In each of the these transactions, we will be permitted to
lease additional space on the towers to third parties. See "Recent and Proposed
Transactions".

Rooftop Site Rental. We are a leading rooftop site management company in the
United States. Through our subsidiary, Spectrum, we develop new sources of
revenue for building owners by effectively managing all technical aspects of
rooftop telecommunications, including two-way radio systems, microwave
facilities, fiber optics, wireless cable, paging, rooftop infrastructure
services and optimization of equipment location. We also handle billing and
collections and all calls and questions regarding the site, totally relieving
the building's management of this responsibility. In addition to the technical
aspects of site management, we provide operational support for both wireless
carriers looking to build out their wireless networks, and building owners
seeking to out source their site rental activities. We generally enter into
management agreements with building owners and receive a percentage of the
revenues generated from the tenant license agreements.

Network Services

We design, build and operate our own communication sites. We have developed
an in-house expertise in certain value-added services that we offer to the
wireless communications and broadcasting industries. Because we are a provider
of total systems with "end-to-end" design, construction and operating
expertise, we offer our customers the flexibility of choosing between the
provision of a full ready-to-operate network infrastructure or any of the
component services involved therein. Such services include network design and
site selection, site acquisition, site development and construction and antenna
installation.

Network Design and Site Selection. We have extensive experience in network
design and engineering and site selection. While we maintain sophisticated
network design services primarily to support the location and construction of
company-owned multiple tenant towers, we do from time to time provide network
design and site selection services to carriers and other customers on a
consulting contract basis. Our network design and site selection services
provide our customers with relevant information, including recommendations
regarding location and height of towers, appropriate types of antennas,
transmission power and frequency selection and related fixed network
considerations. In 1998, we provided network design services primarily for our
own footprints and also for certain customers, including Triton Communications,
Nextel, Aerial Communications and Sprint PCS. These customers were typically
charged on a time and materials basis.

To capitalize on the growing concerns over tower proliferation, we have
developed a program called "Network Solutions" through which we will attempt to
form strategic alliances with local governments to create a single
communications network in their communities. To date our efforts have focused
on western Pennsylvania, where we have formed alliances with three
municipalities. These alliances are intended to accommodate wireless carriers
and local public safety, emergency services and municipal services groups as
part of an effort to minimize tower proliferation. By promoting towers designed
for co-location, these alliances will reduce the number of towers in
communities while serving the needs of wireless carriers and wireless
customers.

Site Acquisition. In the United States, we are engaged in site acquisition
services for our own purposes and for third parties. Based on data generated in
the network design and site selection process, a "search ring", generally of a
one-mile radius, is issued to the site acquisition department for verification
of possible land purchase or lease deals within the search ring. Within each
search ring, geographic information systems specialists select the most
suitable sites, based on demographics, traffic patterns and signal
characteristics. Once a site is selected and the terms of an option to purchase
or lease the site are completed, a survey is prepared and the resulting site
plan is created. The plan is then submitted to the local zoning/planning board
for approval. If the site is approved, our construction department takes over
the process of constructing the site.

We have provided site acquisition services to several customers, including
AT&T Wireless, Aerial Communications, AirTouch Cellular, Bell Atlantic,
BellSouth, GTE Mobilnet, Nextel, Omnipoint, Pagemart, Sprint PCS and Teligent.
These customers engage us for such site acquisition services on either a fixed
price contract or a time and materials basis.

Site Development and Construction and Antenna Installation. We have provided
site development and construction and antenna installation services to the U.S.
communications industry for over 18 years. We have extensive experience in the
development and construction of tower sites and the installation of antenna,
microwave dishes and electrical and telecommunications lines. Our site
development and construction services include clearing sites, laying
foundations and electrical and telecommunications lines, and constructing
equipment shelters and towers. We have designed and built and presently
maintain tower sites for a number of our wireless communications customers and
a substantial part of our own tower network. We can provide cost-effective and
timely completion of construction projects in part because our site development
personnel are cross-trained in all areas of site development, construction and
antenna installation. A varied inventory of heavy construction equipment and
materials are maintained by us at our 45-acre equipment storage and handling
facility in Pittsburgh, which is used as a staging area for projects in major
cities in the eastern region of the United States. We generally set prices for
each site development or construction service separately. Customers are billed
for these services on a fixed price or time and materials basis and we may
negotiate fees on individual sites or for groups of sites. We have the
capability and expertise to install antenna systems for our paging, cellular,
personal communications services, specialized mobile radio, enhanced
specialized mobile radio, microwave and broadcasting customers. As this service
is performed, we use our technical expertise to ensure that there is no
interference with other tenants. We typically bill for our antenna installation
services on a fixed price basis.

Our construction management capabilities reflect our extensive experience in
the construction of networks and towers. For example, Crown Communication was
instrumental in launching networks for Sprint PCS, Nextel and Aerial
Communications in the Pittsburgh MTA. In addition, Crown Communication supplied
these carriers with all project management and engineering services which
included antenna design and interference analyses.

In 1998, we provided site development and construction and antenna
installation services to approximately 33 customers in the United States,
including AT&T Wireless, Bell Atlantic, Nextel and Sprint PCS.

Broadcast Site Rental and Services

We also provide site rental and related services to customers in the
broadcasting industry in the United States. The launch of digital terrestrial
television in the United States will require significant expansion and
modification of the existing broadcast infrastructure. The television
broadcasting industry has historically been opposed to locating their equipment
on towers with other tenants and third party ownership of broadcast
infrastructure. Because of the significant cost involved in the construction or
modification of broadcast towers, and the large capital expenditures
broadcasters will incur in acquiring digital broadcast equipment, we believe
that the television broadcasting industry will begin to outsource tower
ownership. See "Industry Background".

Our objective is to become a leader in the construction of the approximately
200 tall towers expected to be built in the United States over the next five
years. We believe that our experience in providing digital transmission
services in the United Kingdom will make us an attractive provider of broadcast
services to the major networks and their affiliates. In addition, we will seek
to partner with broadcasters and major station ownership groups that own
property zoned for tall towers, but that lack sufficient resources and
expertise to build a tower. We will then attempt to locate on the tower

the transmitters of commercial broadcast television stations and high powered
FM radio stations in that market as well as wireless carriers.

Electronic news gathering systems benefit from the towers and services we
offer. The electronic news gathering trucks, often in the form of local
television station news vans with telescoping antennas on their roofs, send
live news transmission back to the studio from the scene of an important event.
Typically, these vans cannot transmit signals beyond about 25 miles. In
addition, if they are shielded from the television transmitter site, they
cannot make the connection even at close range. We have developed a repeater
system for such news gathering that can be used on many of our towers in
western Pennsylvania and expect to develop similar systems in other markets in
which we have or develop tower clusters. This system allows the van to send a
signal to one of our local towers where the signal is retransmitted back to the
television transmitter site. The retransmission of the signal from our tower to
the various television transmitter sites is done via a microwave link. We
charge the station for the electronic news gathering receiver system at the top
of our tower and also charge them for the microwave dish they place on our
tower. Our electronic news gathering customers are affiliates of the NBC, ABC,
CBS and Fox networks.

We also have employees with considerable direct construction experience and
market knowledge in the U.S. broadcasting industry, having worked with numerous
television networks around the United States, and a number of other local
broadcasting companies. We have installed master FM and television systems on
buildings across the country. We have supervised the construction and operation
of the largest master FM antenna facility in the United States and have
engineered and installed two 2,000 foot broadcast towers with master FM
antennas. We believe that this experience may help us negotiate favorable
construction contracts for both tower and rooftop sites, and to gain an
expertise in the complex issues surrounding electronic compatibility and radio
frequency engineering.

Significant Contracts

We have many agreements with telecommunications providers in the United
States, including leases, site management contracts and independent contractor
agreements. We currently have important contracts with, among others, Bell
Atlantic, Nextel and BellSouth. While these agreements currently are important
to us, our most significant contracts in the U.S. will result from completion
of the recent and proposed transactions described in this prospectus. In
addition, we are party to a contract with the State of New York, which we
believe to be the first of its kind, to manage all State-owned real estate for
wireless communications purposes for the next 20 years. This contract includes
the rights to more than 16,000 structures and rooftops, tens of thousands of
miles of rights-of-way and millions of acres of State-owned land.

Customers

In both our site rental and network services businesses, we work with a
number of customers in a variety of businesses including cellular, personal
communications services, enhanced specialized mobile radio, paging and
broadcasting. We work primarily with large national carriers such as Bell
Atlantic, BellSouth, Sprint PCS, Nextel and AT&T Wireless. For the year ended
December 31, 1998, no customer in the United States accounted for more than
10.0% of our U.S. revenues, other than Nextel, which accounted for
approximately 12.5% of our U.S. consolidated revenues. Nextel revenues are
expected to grow as we build out Nextel interstate corridor sites.

Industry Selected Customers
-------- ------------------

Cellular.................... AT&T Wireless, Bell Atlantic
Personal Communication Serv-
ices....................... Sprint PCS, Western Wireless, Powertel
Broadcasting................ Hearst Argyle Television, Trinity Broadcasting

Industry Selected Customers
-------- ------------------

Specialized mobile radio/enhanced spe-
cialized mobile radio................... Nextel, SMR Direct
Governmental Agencies.................... FBI, INS, Puerto Rico Police
Private Industrial Users................. IBM, Phillips Petroleum
Data..................................... Ardis, RAM Mobile Data
Paging................................... AirTouch, PageNet, TSR Wireless
Utilities................................ Equitable Resources, Nevada Power
Other.................................... WinStar, Teligent

Sales and Marketing

Our sales and marketing personnel, located in our regional offices, target
carriers expanding their networks, entering new markets, bringing new
technologies to market and requiring maintenance or add-on business. All types
of wireless carriers are targeted including broadcast, cellular, paging,
personal communications services, microwave and two-way radio. We are also
interested in attracting 9-1-1, federal, state, and local government agencies,
as well as utility and transportation companies to locate on existing sites.
Our objective is to pre-sell capacity on our towers by promoting sites prior to
construction. Rental space on existing towers is also aggressively marketed and
sold.

We utilize numerous public and proprietary databases to develop detailed
target marketing programs directed at awardees of bandwidth licenses auctioned
by the government, existing tenants and specific market groups. Mailings focus
on regional build outs, new sites and services. The use of databases, such as
those with information on sites, demographic data, licenses and deployment
status, coupled with measured coverage data and radio frequency coverage
prediction software, allows our sales and marketing personnel to target
specific carriers' needs for specific sites. To foster productive relationships
with our major existing tenants and potential tenants, we have formed a team of
account relationship managers. These managers work to develop new tower
construction, site leasing services and site management opportunities, as well
as ensure that customers' emerging needs are translated into new site products
and services.

The marketing department maintains our visibility within the wireless
communications industry through regular advertising and public relations
efforts including actively participating in trade shows and generating regular
press releases, newsletters and targeted mailings (including promotional
flyers). Our promotional activities range from advertisements and site listings
in industry publications to maintaining a presence at national trade shows.
Potential clients are referred to our Web site, which contains information
about us as well as site listings. In addition, our sites are listed on the
Cell Site Express Web site. This Web site enables potential tenants to locate
existing structures by latitude, longitude or address. Clients can easily
contact us via e-mail through the Web site or Cell Site Express. Our network
services capabilities are marketed in conjunction with our tower footprints.

To follow up on targeted mailings and to cold-call on potential clients, we
have established a telemarketing department. Telemarketers field inbound and
outbound calls and forward leads to local sales representatives or relationship
managers for closure. Local sales representatives are stationed in each cluster
to develop and foster close business relationships with decision-makers in each
customer organization. Sales professionals work with marketing specialists to
develop sales presentations targeting specific client demands.

In addition to a dedicated, full-time sales and marketing staff, a number of
senior managers spend a significant portion of their efforts on sales and
marketing activities. These managers call on existing and prospective customers
and also seek greater visibility in the industry through speaking engagements
and articles in national publications. Furthermore, many of these managers have
been

recognized as industry experts, are regularly quoted in articles and are called
on to testify at local hearings and to draft local zoning ordinances.

Public and community relations efforts include coordinating community events,
such as working with amateur radio clubs to supply emergency and disaster
recovery communications, charitable event sponsorship, and promoting charitable
donations through press releases.

Competition

In the United States, we compete with other independent tower owners, some of
which also provide site rental and network services; wireless carriers, which
own and operate their own tower networks; service companies that provide
engineering and site acquisition services; and other potential competitors,
such as utilities, outdoor advertisers and broadcasters, some of which have
already entered the tower industry. Wireless carriers that own and operate
their own tower networks generally are substantially larger and have greater
financial resources than we have. We believe that tower location, capacity,
price, quality of service and density within a geographic market historically
have been and will continue to be the most significant competitive factors
affecting tower rental companies. We also compete for acquisition and new tower
construction opportunities with wireless carriers, site developers and other
independent tower operating companies. We believe that competition for tower
site acquisitions will increase and that additional competitors will enter the
tower market, some of which may have greater financial resources than us.

The following is a list of the independent tower companies that we compete
with in the United States: American Tower Corporation, Pinnacle Towers,
SpectraSite, SBA Communications, WesTower, Unisite, LCC International and
Lodestar Communications.

The following companies are primarily competitors for our rooftop site
management activities in the United States: AAT, APEX, Commsite International,
JJS Leasing, Inc., Motorola, Signal One, Subcarrier Communications, Tower
Resources Management and Unisite.

We believe that the majority of our competitors in the site acquisition
business operate within local market areas exclusively, while a small minority
of firms appear to offer their services nationally, including SBA
Communications Corporation, Whalen & Company and Gearon & Company (a subsidiary
of American Tower Corporation). We offer our services nationwide and we believe
we are currently one of the largest providers of site development services to
the U.S. and international markets. The market includes participants from a
variety of market segments offering individual, or combinations of, competing
services. The field of competitors includes site acquisition consultants,
zoning consultants, real estate firms, right-of-way consulting firms,
construction companies, tower owners/managers, radio frequency engineering
consultants, telecommunications equipment vendors (which provide turnkey site
development services through multiple subcontractors) and carriers' internal
staff. We believe that carriers base their decisions on site development
services on certain criteria, including a company's experience, track record,
local reputation, price and time for completion of a project. We believe that
we compete favorably in these areas.

U.K. Operations

Overview

We own and operate, through our 80% interest in Castle Transmission, one of
the world's most established television and radio transmission networks and are
expanding our leasing of antenna space on our towers to a variety of wireless
carriers. We provide transmission services for four of the six digital
terrestrial television services in the U.K., two BBC analogue television
services, six national BBC radio services (including the first digital audio
broadcast service in the United Kingdom), 37 local

BBC radio stations and two national commercial radio services through our
network of transmitters, which reach 99.4% of the U.K. population. These
transmitters are located on approximately 1,300 towers, more than half of which
we own and the balance of which are licensed to us under a site-sharing
agreement with NTL, our principal competitor in the United Kingdom. We have
also secured long-term contracts to provide digital television transmission
services to the BBC and ONdigital. See "--Significant Contracts". In addition
to providing transmission services, we also lease antenna space on our
transmission infrastructure to various communications service providers and
provide telecommunications network installation and maintenance services and
engineering consulting services.

Our core revenue generating activity in the United Kingdom is the analog
terrestrial transmission of radio and television programs broadcast by the BBC.
Castle Transmission's business, which was formerly owned by the BBC, was
privatized under the Broadcasting Act 1996 and sold to Castle Transmission in
February 1997. At the time the BBC home service transmission business was
acquired, Castle Transmission entered into a 10-year transmission contract with
the BBC for the provision of terrestrial analog television and analog and
digital radio transmission services in the United Kingdom. In the twelve months
ended December 31, 1998, approximately 60.6% of Castle Transmission's
consolidated revenues were derived from the provision of services to the BBC.

At December 31, 1998, we owned, leased or licensed 861 transmission sites on
which we operated 865 towers, including the 102 towers we acquired from a
wireless carrier. In addition, as of December 31, 1998 we were constructing
eight new towers on existing sites and had 112 site acquisition projects in
process for new tower sites. We have 54 revenue producing rooftop sites that
are occupied by our transmitters but are not available for leasing to our
customers. Our sites are located throughout England, Wales, Scotland and
Northern Ireland.

We expect to significantly expand our existing tower portfolios in the United
Kingdom by building and acquiring additional towers. We believe our existing
tower network encompasses many of the most desirable tower locations in the
United Kingdom for wireless communications. However, due to the shorter range
over which communications signals carry (especially newer technologies such as
personal communications networks) as compared to broadcast signals, wireless
communications providers require a denser portfolio of towers to cover a given
area. Therefore, in order to increase the attractiveness of our tower
portfolios to wireless communications providers, we will seek to build or
acquire new communications towers. Using our team of over 300 engineers with
state-of-the-art network design and radio frequency engineering expertise, we
locate sites and design towers that will be attractive to multiple tenants. We
seek to leverage such expertise by entering into new tower construction
contracts with various carriers, such as BT, Cable & Wireless Communications,
Cellnet, Dolphin, Energis, Highway One, One2One, Orange and Scottish Telecom,
thereby securing an anchor tenant for a site before incurring capital
expenditures for the site build-out. As of December 31, 1998, we were building
eight towers that we will own. In addition, we expect to make strategic
acquisitions of existing communications sites (primarily those owned by
wireless carriers) to expand our infrastructure and to further leverage our
site management experience.

On March 5, 1999, Castle Transmission entered into an agreement with One2One
under which Castle Transmission will manage, develop and, at its option,
acquire 821 towers. These towers represent substantially all the towers in
One2One's nationwide 900 MHz wireless network in the United Kingdom. These
towers will allow Castle Transmission to market a nationwide network of towers
to third generation wireless carriers in the United Kingdom following the
completion of the pending auction of such licenses by the U.K. government.

We believe that we generally have significant capacity on our towers in the
United Kingdom. Although approximately 133 of our towers are poles with limited
capacity, we typically will be able to

build new towers that will support multiple tenants on these sites (subject to
the applicable planning process). We intend to upgrade these limited capacity
sites where we believe we can achieve appropriate returns to merit the
necessary capital expenditure. For example, in connection with a contract with
Vodafone, we are upgrading 68 of these sites with limited capacity. See "--
Significant Contracts--Vodafone". Approximately 59 of our sites are used for
medium frequency broadcast transmissions. At this frequency, the entire tower
is used as the transmitting antenna and is therefore electrically "live". Such
towers are therefore unsuitable for supporting other tenant's communications
equipment. However, medium frequency sites generally have substantial ground
area available for the construction of new multiple tenant towers.

Transmission Business

Analog. For the twelve months ended December 31, 1998, Castle Transmission
generated approximately 52.8% of its revenues from the provision of analog
broadcast transmission services to the BBC. Under the BBC analog transmission
contract, we provide terrestrial transmission services for the BBC's analog
television and radio programs and certain other related services (including BBC
digital radio) for an initial 10-year term through March 31, 2007. See "--
Significant Contracts". For the twelve months ended December 31, 1998, the BBC
analog transmission contract generated revenues of approximately (Pounds)49.4
million ($82.1 million) for us.

In addition to the BBC analog transmission contract, we have separate
contracts to provide maintenance and transmission services for two national
radio stations, Virgin Radio and Talk Radio. These contracts are for periods of
eight years commencing from, respectively, March 31, 1993 and February 4, 1995.

We own all of the transmission equipment used for broadcasting the BBC's
domestic radio and television programs, whether located on one of Castle
Transmission's sites or on an NTL or other third-party site. As of December 31,
1998, Castle Transmission had 3,465 transmitters, of which 2,196 were for
television broadcasting and 1,269 were for radio.

A few of our most powerful television transmitters together cover the
majority of the U.K. population. The coverage achieved by the less powerful
transmitters is relatively low, but is important to the BBC's ambition of
attaining universal coverage in the United Kingdom. This is illustrated by the
following analysis of the population coverage of our analog television
transmitters:

Combined
Number of sites population
(ranked by coverage) coverage
-------------------- ----------

1 (Crystal Palace).......................... 21%
top 16...................................... 79
top 26...................................... 86
top 51...................................... 92
all......................................... 99.4

All of our U.K. transmitters are capable of unmanned operation and are
maintained by mobile maintenance teams from 27 bases located across the United
Kingdom. Access to the sites is strictly controlled for operational and
security reasons, and buildings at 140 of the sites are protected by security
alarms connected to Castle Transmission's Technical Operations Centre at
Warwick. The site-sharing agreement provides us with reciprocal access rights
to NTL's broadcast transmission sites on which we have equipment.

Certain of our transmitters that serve large populations or important
geographic areas have been designated as priority transmitters. These
transmitters have duplicated equipment so that a single

failure will not result in total loss of service but will merely result in an
output-power reduction that does not significantly degrade the service to most
viewers and listeners.

Digital. We have entered into contracts with the holders (including the BBC)
of four of the six digital terrestrial television multiplexes allocated by the
U.K. government to design, build and operate their digital transmission
networks. In connection with the implementation of digital terrestrial
television, new transmission infrastructure will be required. We have committed
to invest approximately (Pounds)100.0 million ($170.0 million) for the build
out of new infrastructure to support digital terrestrial television over the
next two years, (Pounds)55.3 million ($92.0 million) of which we had already
invested by December 31, 1998. By the year 2000, 81 transmission sites will
need to be upgraded with new transmitters and associated systems to support
digital terrestrial television. Of these sites, 49 are owned by us with the
remainder owned by NTL. An arrangement similar to that of the site-sharing
agreement is being negotiated to govern the particular issues arising out of
the sharing of digital transmission sites between NTL and us.

We successfully began commercial operation of the digital terrestrial
television networks from an initial 22 transmission sites on November 15, 1998.
This launch marks the first stage of the project to introduce the digital
broadcast system that will eventually replace conventional analog television
services in the United Kingdom. As the network size expands during 1999, the
number of viewers who are able to receive the service will increase
significantly. We have accepted an invitation from the U.K. television
regulator, the Independent Television Commission, to play a major role in
planning further digital terrestrial television network extensions to be built
in the year 2000 and beyond.

We are currently the sole provider of transmission services for digital radio
broadcasts in the United Kingdom. In September 1995, the BBC launched its
initial dynamically allocable bandwidth scheme over our transmission network,
and this service is now broadcast to approximately 60% of the U.K. population.
A license for an independent national digital radio network was awarded to the
Digital One consortium during 1998 and it is expected that this service will
commence during 1999. We are in negotiations to provide accommodation and
access to masts and antennas at 24 transmission sites to support the launch of
Digital One. In addition, local digital radio licenses will be awarded during
1999. We believe we are well positioned to become the transmission service
provider to the winners of such licenses.

Site Rental

The BBC transmission network provides a valuable initial portfolio of towers
for the creation of wireless communications networks. As of December 31, 1998,
approximately 200 companies rented antenna space on approximately 405 of Castle
Transmission's 919 towers and rooftops. These site rental agreements have
normally been for three to 12 years and are generally subject to rent reviews
every three years. Site sharing customers are generally charged annually in
advance, according to rate cards that are based on the antenna size and
position on the tower. Our largest site rental customer in the United Kingdom
is NTL under the site-sharing agreement. This agreement generated approximately
(Pounds)592,000 ($984,400) of site rental revenue in December 1998.

As in the United States, we provide a range of site maintenance services in
the United Kingdom to support and enhance the site rental business. We
complement our U.K. transmission experience with our site management experience
in the United States to provide customers with a top-of-the-line package of
service and technical support.

The following table describes our top ten revenue producing towers in the
United Kingdom:

Number of
Tenant December 1998
Name Location Height(ft) Leases Monthly Revenue
---- ------------ ---------- --------- ------------------------

Brookmans Park.......... S.E. England 147 19 (Pounds) 25,026 $ 41,613
Bow Brickhill........... S.E. England 197 13 17,479 29,064
Mendip.................. S.W. England 924 19 16,534 27,493
Hannington.............. S. England 440 15 12,267 20,398
Crystal Palace.......... London 653 14 11,638 19,352
Wrotham................. S. England 379 14 11,385 18,931
Waltham................. C. England 954 10 10,750 17,875
Redruth................. S.W. England 500 18 10,523 17,498
Heathfield.............. S. England 443 15 10,296 17,120
Oxford.................. C. England 507 14 9,973 16,583
--- --------------- --------
Total......................................... 151 (Pounds)135,871 $225,927
=== =============== ========

Other than NTL, Castle Transmission's largest (by revenue) site rental
customers consist mainly of wireless carriers such as Cellnet, One2One, Orange
and Vodafone. Revenues from these non-BBC sources are expected to become an
increasing portion of Castle Transmission's total U.K. revenue base, as the
acquired BBC home service transmission business is no longer constrained by
governmental restrictions on the BBC's commercial activities. We believe that
the demand for site rental from communication service providers will increase
in line with the expected growth of these communication services in the United
Kingdom.

We have master lease agreements with all of the major U.K. telecommunications
site users including BT, Cable & Wireless Communications, Cellnet, Dolphin,
Energis, Highway One, One2One, Orange, Scottish Telecom and Vodafone. These
agreements typically specify the terms and conditions (including pricing and
volume discount plans) under which these customers have access to all sites
within our U.K. portfolio. Customers make orders for specific sites using the
standard terms included in the master lease agreements. As of December 31,
1998, there were approximately 400 applications in process for installations at
existing sites under such agreements.

Network Services

Castle Transmission provides broadcast and telecommunications engineering
services to various customers in the United Kingdom. We retained all the BBC
home service transmission business employees when we acquired Castle
Transmission. Accordingly, we have engineering and technical staff of the
caliber and experience necessary not only to meet the requirements of our
current customer base, but also to meet the challenges of developing digital
technology. Within the United Kingdom, Castle Transmission has worked with
several telecommunications operations on design and build projects as they
roll-out their networks. Castle Transmission has had success in bidding for
broadcast consulting contracts, including, over the last four years, in
Thailand, Taiwan, Poland and Sri Lanka. With the expertise of our engineers and
technical staff, we are a provider of complete systems to the wireless
communications and broadcast industries.

Network Design and Site Selection. We have extensive experience in network
design and engineering and site selection. Our U.K. customers therefore also
receive the benefit of our sophisticated network design and site selection
services.

Site Acquisition. As in the United States, we are involved in site
acquisition services for our own purposes and for third parties. We recognize
that the site acquisition phase often carries the highest risk for a project.
To ensure the greatest possible likelihood of success and timely acquisition,

we combine a desktop survey of potential barriers to development with a
physical site search with relevant analyses, assessments and, where necessary,
surveys. We leverage off our experience in site acquisition and co-location
when meeting with local planning authorities.

Site Development and Antenna Installation. We use a combination of external
and internal resources for site construction. Our engineers are experienced in
both construction techniques and construction management, ensuring an efficient
and simple construction phase. Selected civil contractors are managed by Castle
Transmission staff for the ground works phase. Specialist erection companies,
with whom we have a long association, are used for tower installation. Final
antenna installation is undertaken by our own experienced teams.

Site Management and Other Services. We also provide complete site management,
preventive maintenance, fault repair and system management services to the
Scottish Ambulance Service. We also maintain a mobile radio system for the
Greater Manchester Police and provide maintenance and repair services for
transmission equipment and site infrastructure.

Significant Contracts

Castle Transmission's principal analog broadcast transmission contract is the
BBC analog transmission contract. Castle Transmission also has entered into two
digital television transmission contracts, the BBC digital transmission
contract and the ONdigital digital transmission contract. Castle Transmission
also provides facilities to NTL (in its capacity as a broadcast transmission
provider to non-Castle Transmission customers) under the site-sharing
agreement. Castle Transmission also has long-term service agreements with
broadcast customers such as Virgin Radio and Talk Radio. In addition, Castle
Transmission has several agreements with telecommunications providers,
including leases, site management contracts and independent contractor
agreements. Castle Transmission has entered into contracts to design and build
infrastructure for customers such as Cellnet, One2One, Orange, Scottish Telecom
and Vodafone.

BBC Analog Transmission Contract

Castle Transmission entered into a 10-year transmission contract with the BBC
for the provision of terrestrial analog television and analog and digital radio
transmission services in the United Kingdom at the time the BBC home service
transmission business was acquired. The BBC analog transmission contract
provides for charges of approximately (Pounds)46.5 million ($77.3 million) to
be payable by the BBC to Castle Transmission for the year ended March 31, 1998
and each year thereafter to the termination date, adjusted annually at the
inflation rate less 1%. In addition, for the duration of the contract an annual
payment of (Pounds)300,000 ($498,840) is payable by the BBC for additional
broadcast-related services. At the BBC's request, since October 1997, the
number of television broadcast hours has been increased to 24 hours per day for
the BBC's two national television services, which has added over
(Pounds)500,000 ($831,400) annually to the payments made by the BBC to us.

The BBC analog transmission contract also provides for Castle Transmission to
be liable to the BBC for "service credits" (i.e., rebates of its charges) in
the event that certain standards of service are not attained as a result of
what the contract characterizes as "accountable faults" or the failure to meet
certain "response times" in relation to making repairs at certain key sites. We
believe that Castle Transmission is well-equipped to meet the BBC's service
requirements by reason of the collective experience its existing management
gained while working with the BBC. Following completion of three formal six-
month performance reviews, Castle Transmission achieved a 100% "clean sheet"
performance, incurring no service credit penalties.

The initial term of the BBC analog transmission contract ends on March 31,
2007. Thereafter, the BBC analog transmission contract may be terminated with
12 months' prior notice by either of the

parties, expiring on March 31 in any contract year, from and including March
31, 2007. It may also be terminated earlier:

(1) by mutual agreement between Castle Transmission and the BBC,

(2) by one party upon the bankruptcy or insolvency of the other party
within the meaning of section 123 of the Insolvency Act 1986,

(3) upon certain force majeure events for the contract as a whole or for
any site (in which case the termination will relate to that site only),

(4) by the non-defaulting party upon a material breach by the other party
and

(5) upon the occurrence of certain change of control events.

BBC Commitment Agreement

On February 28, 1997, in connection with the acquisition of the BBC home
service transmission business, we, TdF, TeleDiffusion de France S.A., which is
the parent company of TdF and DFI ("TdF Parent"), and the BBC entered into the
BBC commitment agreement, whereby we and TdF agreed (1) not to dispose of any
shares in CTSH or any interest in such shares (or enter into any agreement to
do so) until February 28, 2000; and (2) to maintain various minimum indirect
ownership interests in Castle Transmission and CTSH for periods ranging from
three to five years commencing February 28, 1997. These provisions restrict our
ability and the ability of TdF to sell, transfer or otherwise dispose of their
respective CTSH shares (and, indirectly, their Castle Transmission shares). The
restrictions do not apply to disposals of which the BBC has been notified in
advance and to which the BBC has given its prior written consent, which,
subject to certain exceptions, consent shall not be unreasonably withheld or
delayed.

The BBC commitment agreement also required TdF's parent and us to enter into
a services agreements with Castle Transmission. The original services agreement
entered into by TdF's parent and Castle Transmission on February 28, 1997
(under which TdF makes available certain technical consultants, executives and
engineers to Castle Transmission) was amended on August 21, 1998 to extend the
original minimum term of services provided from three years to seven years,
commencing February 28, 1997, thereafter terminable on 12-month's prior notice
given by Castle Transmission to TdF after February 28, 2003. See "The Roll-Up--
Roll-Up Arrangements--Castle Transmission Services Agreement".

ONdigital Digital Transmission Contract

In 1997, the Independent Television Commission awarded ONdigital three of the
five available commercial digital terrestrial television "multiplexes" for new
program services. We bid for and won the 12 year contract from ONdigital to
build and operate its digital television transmission network. The contract
provides for approximately (Pounds)20.0 million ($34.0 million) of revenue per
year from 2001 to 2008, with lesser amounts payable before and after these
years and with service credits repayable for performance below agreed
thresholds.

BBC Digital Transmission Contract

In 1998, we bid for and won the 12 year contract from the BBC to build and
operate its digital terrestrial television transmission network. This contract
provides for approximately (Pounds)10.5 million ($17.8 million) of revenue per
year (assuming the BBC commits to the full digital terrestrial television roll-
out contemplated by the BBC digital transmission contract) during the 12 year
period, with service credits repayable for performance below agreed thresholds.
There is a termination provision during the three-month period following the
fifth anniversary of our commencement of digital terrestrial transmission
services for the BBC exercisable by the BBC but only if the BBC's Board of
Governors

determines, in its sole discretion, that digital television in the United
Kingdom does not have sufficient viewership to justify continued digital
television broadcasts. Under this provision, the BBC will pay us a termination
fee in cash that substantially recovers our capital investment in the network,
and any residual ongoing operating costs and liabilities. Like the BBC analog
transmission contract, the contract is terminable upon the occurrence of
certain change of control events.

BT Digital Distribution Contract

Under the BBC digital transmission contract and the ONdigital digital
transmission contract, in addition to providing digital terrestrial
transmission services, Castle Transmission has agreed to provide for the
distribution of the BBC's and ONdigital's broadcast signals from their
respective television studios to Castle Transmission's transmission network.
Consequently, in May 1998, Castle Transmission entered into a 12 year
distribution contract with British Telecommunications plc (with provisions for
extending the term), in which British Telecom has agreed to provide fully
duplicated, fiber-based, digital distribution services, with penalties for late
delivery and service credits for failure to deliver 99.99% availability.

Site-Sharing Agreement

In order to optimize service coverage and enable viewers to receive all
analog UHF television services using one receiving antenna, the BBC, as the
predecessor to Castle Transmission, and NTL made arrangements to share all UHF
television sites. This arrangement was introduced in the 1960s when UHF
television broadcasting began in the United Kingdom. In addition to service
coverage advantages, the arrangement also minimizes costs and avoids the
difficulties of obtaining additional sites.

Under the site-sharing agreement, the party that is the owner, lessee or
licensee of each site is defined as the "station owner". The other party, the
sharer, is entitled to request a license to use certain facilities at that
site. The site-sharing agreement and each site license provide for the station
owner to be paid a commercial license fee in accordance with the site-sharing
agreement ratecard and for the sharer to be responsible, in normal
circumstances, for the costs of accommodation and equipment used exclusively by
it. The site-sharing agreement may be terminated with five years' prior notice
by either of the parties and expires on December 31, 2005 or on any tenth
anniversary of that date. It may also be terminated:

(1) following a material breach by either party which, if remediable, is
not remedied within 30 days of notice of such breach by the non-
breaching party,

(2) on the bankruptcy or insolvency of either party and

(3) if either party ceases to carry on a broadcast transmission business
or function.

Negotiations are in progress between NTL and us to amend the site-sharing
agreement to account for the build-out of digital transmission sites and
equipment, a new rate card related to site sharing fees for new digital
facilities and revised operating and maintenance procedures related to digital
equipment.

Vodafone

On April 16, 1998, under Vodafone's master lease agreement with us, Vodafone
agreed to locate antennas on 122 of our existing communication sites in the
United Kingdom. The first 39 sites had been completed by the end of December
1998. This included 4 sites at which a new tower had been constructed to
replace an existing structure of limited capacity. The remaining sites are
expected to be completed by end of July 1999 and will include the construction
of a further 60 replacement towers. After their upgrade, these sites will be
able to accommodate additional tenants.

Customers

For the twelve months ended December 31, 1998, the BBC accounted for
approximately 60.6% of Castle Transmission's consolidated revenues. This
percentage has decreased from 64.6% for the twelve months ended March 31, 1998
and is expected to continue to decline as Castle Transmission continues to
expand its site rental business. Castle Transmission provides all four U.K.
PCN/cellular operators (Cellnet, One2One, Orange and Vodafone) with
infrastructure services and also provides fixed telecommunications operators,
such as British Telecom, Cable & Wireless Communications, Energis and Scottish
Telecom, with microwave links and backhaul infrastructure. The following is a
list of some of Castle Transmission's leading site rental customers by industry
segment.

Industry Selected Customers
-------- ------------------

Broadcasting.............. BBC, NTL, Virgin Radio, Talk Radio, XFM
PMR/TETRA................. National Band 3, Dolphin
Personal Communication
Network.................. Orange, One2One
Data...................... RAM Mobile Data, Cognito
Paging.................... Hutchinson, Page One
Governmental Agencies..... Ministry of Defense
Cellular.................. Vodafone, Cellnet
Public
Telecommunications....... British Telecom, Cable & Wireless Communications
Other..................... Aerial Sites, Health Authorities
Utilities................. Welsh Water, Southern Electric

Sales and Marketing

We have 20 sales and marketing personnel in the United Kingdom who identify
new revenue-generating opportunities, develop and maintain key account
relationships, and tailor service offering to meet the needs of specific
customers. An excellent relationship has been maintained with the BBC, and
successful new relationships have been developed with many of the major
broadcast and wireless carriers in the United Kingdom. We have begun to
actively cross-sell our products and services so that, for example, site rental
customers are also offered build-to-suit services.

Competition

NTL, the privatized engineering division of the IBA and now a subsidiary of
NTL Inc. (formerly International CableTel Inc.), is Castle Transmission's
primary competition in the terrestrial broadcast transmission market in the
United Kingdom. NTL provides analog transmission services to ITV, Channels 4
and 5, and S4C. It also has been awarded the transmission contract for the new
digital terrestrial television multiplex service from Digital 3 & 4 Limited,
and a similar contract for the digital terrestrial television service for SDN
(Castle Transmission has been awarded similar contracts for the BBC and
ONdigital--serving a total of four multiplexes compared with NTL's two). Since
its creation in 1991, NTL has diversified from its core television broadcasting
business using its transmission infrastructure to enter into the radio
transmission and telecommunications sectors.

Although Castle Transmission and NTL are direct competitors, they have
reciprocal rights to the use of each others' sites for broadcast transmission
usage in order to enable each of them to achieve the necessary country-wide
coverage. This relationship is formalized by the site-sharing agreement entered
into in 1991, the time at which NTL was privatized.

NTL also offers site rental on approximately 1,000 of its sites (some of
which are managed on behalf of third parties). Like Castle Transmission, NTL
offers a full range of site-related services to its customers, including
installation and maintenance. Castle Transmission believes its towers to be at
least as well situated as NTL's and that it will be able to expand its own
third-party site-sharing penetration. Castle Transmission also believes that
its penetration of this market has to date lagged

behind NTL only because of the governmental restrictions on the commercial
activities of Castle Transmission's business prior to its privatization.

All four U.K. mobile operators own site infrastructure and lease space to
other users. Their openness to sharing with direct competitors varies by
operator. Cellnet and Vodafone have agreed to cut site costs by jointly
developing and acquiring sites in the Scottish Highlands. BT and Cable &
Wireless Communications are both major site sharing customers but also compete
by leasing their own sites to third parties. British Telecom's position in the
market is even larger when considered in combination with its interest in
Cellnet.

Several other companies compete in the market for site rental. These include
British Gas, Racal Network Systems, Aerial Sites Plc, Relcom Aerial Services
and the Royal Automobile Club. Some companies own sites initially developed for
their own networks, while others are developing sites specifically to exploit
this market.

Castle Transmission faces competition from a large number of companies in the
provision of network services. The companies include NTL, specialty consultants
and equipment manufacturers such as Nortel and Ericsson.

Properties

In the United States, our interests in our tower sites are comprised of a
variety of fee interests, leasehold interests created by long-term lease
agreements, private easements and easements, licenses or rights-of-way granted
by government entities. In rural areas, a tower site typically consists of a
three- to five-acre tract, which supports towers, equipment shelters and guy
wires to stabilize the structure. Less then 3,000 square feet are required for
a self-supporting tower structure of the kind typically used in metropolitan
areas. Our land leases generally have five- or ten-year terms and frequently
contain one or more renewal options. Some land leases provide "trade-out"
arrangements whereby we allow the landlord to use tower space in lieu of paying
all or part of the land rent. As of December 31, 1998, we had approximately 384
land leases. Under the senior credit facility, our senior lenders have liens on
a substantial number of our land leases and other property interests in the
United States.

In the United Kingdom, tower sites range from less than 400 square feet for a
small rural TV booster station to over 50 acres for a high-power radio station.
As in the United States, the site accommodates the towers, equipment buildings
or cabins and, where necessary, guy wires to support the structure. Land is
either owned freehold, which is usual for the larger sites, or is held on long-
term leases that generally have terms of 21 years or more.

Legal Proceedings

We are occasionally involved in legal proceedings that arise in the ordinary
course of business. Most of these proceedings are appeals by landowners of
zoning and variance approvals of local zoning boards. While the outcome of
these proceedings cannot be predicted with certainty, management does not
expect any pending matters to have a material adverse effect on our financial
condition or results of operations. We are currently in discussions with the
Department of Labor to settle an investigation it has conducted into employment
practices put into place prior to our acquisition of Crown Communication. Upon
notification by the Department of Labor of its investigation, the practices
were ceased. We anticipate the settlement to be approximately $200,000.

Employees

At March 1, 1999, we employed 928 people worldwide. Other than in the United
Kingdom, we are not a party to any collective bargaining agreements. In the
United Kingdom, we are party to a

collective bargaining agreement with the Broadcast, Entertainment,
Cinematographic and Technicians Union. This agreement establishes bargaining
procedures relating to the terms and conditions of employment for all of Castle
Transmission's non-management staff. We have not experienced any strikes or
work stoppages, and management believes that our employee relations are
satisfactory.

Regulatory Matters

United States

Federal Regulations. Both the FCC and FAA regulate towers used for wireless
communications transmitters and receivers. Such regulations control the siting
and marking of towers and may, depending on the characteristics of particular
towers, require registration of tower facilities. Wireless communications
devices operating on towers are separately regulated and independently licensed
based upon the particular frequency used.

The FCC, in conjunction with the FAA, has developed standards to consider
proposals for new or modified antenna structures. These standards mandate that
the FCC and the FAA consider the height of proposed antenna structures, the
relationship of the structure to existing natural or man-made obstructions and
the proximity of the antenna structures to runways and airports. Proposals to
construct or to modify existing antenna structures above certain heights are
reviewed by the FAA to ensure the structure will not present a hazard to
aviation. The FAA may condition its issuance of a determination that the
structure will not present a hazard to aviation upon compliance with specified
lighting and/or marking requirements. The FCC will not license the operation of
wireless telecommunications devices on towers unless the tower is in compliance
with the FAA's rules and is registered with the FCC, if necessary. The FCC will
not register a tower unless it has been cleared by the FAA. The FCC may also
enforce special lighting and painting requirements. Owners of wireless
transmissions towers may have an obligation to maintain painting and lighting
to conform to FAA and FCC standards. Tower owners may also bear the
responsibility of notifying the FAA of any tower lighting outage. We generally
indemnify our customers against any failure to comply with applicable
regulatory standards. Failure to comply with the applicable requirements may
lead to civil penalties.

The 1996 Telecom Act limits certain state and local zoning authorities'
jurisdiction over the construction, modification and placement of towers. The
new law prohibits any action that would (1) discriminate between different
providers of personal wireless services or (2) prohibit or have the effect of
prohibiting the provision of personal wireless service. Finally, the 1996
Telecom Act requires the federal government to help licensees for wireless
communications services gain access to preferred sites for their facilities.
This may require that federal agencies and departments work directly with
licensees to make federal property available for tower facilities.

Local Regulations. Local regulations include city and other local ordinances,
zoning restrictions and restrictive covenants imposed by community developers.
These regulations vary greatly, but typically require tower owners to obtain
approval from local officials or community standards organizations prior to
tower construction. Local zoning authorities generally have been hostile to
construction of new transmission towers in their communities because of the
height and visibility of the towers.

Licenses Under the Communications Act of 1934. We hold, through certain of
our subsidiaries, licenses for radio transmission facilities granted by the
FCC, including licenses for common carrier microwave and commercial mobile
radio services, including specialized mobile radio and paging facilities, as
well as private mobile radio services including industrial/business radio
facilities, which are subject to additional regulation by the FCC. We are
required to obtain the FCC's approval prior to the transfer of control of any
of our FCC licenses. Completion of the initial public offering and the roll-

up of our U.K. business would have resulted in a transfer of control of us
under the FCC's rules and policies if, after such transactions, over 50% of our
voting stock would have been owned by new stockholders.

We, as the parent company of the licensees of common carrier and commercial
mobile radio services facilities, are also subject to Section 310(b)(4) of the
Communications Act of 1934, as amended, which would limit us to a maximum of
25% foreign ownership absent a ruling from the FCC that foreign ownership in
excess of 25% is in the public interest. In light of the World Trade
Organization Agreement on Basic Telecommunications Services, which took effect
on February 5, 1998, the FCC has determined that such investments are generally
in the public interest if made by individuals and entities from WTO-member
nations. We are over 25% foreign owned by companies headquartered in France,
the United Kingdom and New Zealand. See "Principal and Selling Stockholders".
Each of these nations is a signatory to the WTO agreement. The FCC has granted
approval of up to 49.9% foreign ownership of us, at least 25% of which will be
from WTO-member nations.

United Kingdom

Telecommunications systems and equipment used for the transmission of signals
over radio frequencies have to be licensed in the United Kingdom. These
licenses are issued on behalf of the British Government by the Secretary of
State for Trade and Industry under the Telecommunications Act 1984 and the
Wireless Telegraphy Acts 1949, 1968 and 1998. Castle Transmission has a number
of such licenses under which it runs the telecommunications distribution and
transmission systems which are necessary for the provision of its transmission
services. Castle Transmission's operations are subject to comprehensive
regulation under the laws of the United Kingdom.

Licenses under the Telecommunications Act 1984

Castle Transmission has the following three licenses under the
Telecommunications Act 1984:

Transmission License. The transmission license is a renewable license to run
telecommunications systems for the transmission via wireless telegraphy, a type
of data transmissions technique, of broadcasting services. This license is for
a period of at least twenty-five years from January 23, 1997, and is Castle
Transmission's principal license. Its main provisions include:

(1) a price control condition covering the provision of all analog radio
and television transmission services to the BBC under the BBC analog
transmission agreement (for an initial price of approximately (Pounds)44
million for regulated elements of the services provided by Castle
Transmission under the BBC analog transmission agreement in the year ended
March 31, 1997, subject to an increase cap which is 1% below the rate of
increase in the Retail Price Index over the previous calendar year). The
current price control condition applies until March 31, 2006;

(2) a change of control provision which requires notification of
acquisitions of interest in Castle Transmission of more than 20% by a
public telecommunications operator or any Channel 3 or Channel 5 licensee,
which acquisitions entitle the Secretary of State to revoke the license;

(3) a site sharing requirement requiring Castle Transmission to provide
space on its towers to analog and digital broadcast transmission operators
and including a power for OFTEL, as the regulator, to determine prices if
there is failure between the site owner and the prospective site sharer to
agree to a price;

(4) a fair trading provision enabling OFTEL to act against anti-
competitive behavior by the licensee; and

(5) a prohibition on undue preference or discrimination in the provision
of the services it is required to provide third parties under the
transmission license.

OFTEL has made a determination on a complaint made by Classic FM and NTL in
respect of certain charges, imposed previously by the BBC under the site-
sharing agreement with NTL for the use by Classic FM of BBC radio antennas and
passed on to Classic FM by NTL. OFTEL's position is that the site-sharing
agreement did not cover charges for new services to customers such as Classic
FM, thereby enabling OFTEL to intervene and determine the appropriate rate
under the "applicable rate" mechanism in Castle Transmission's transmission
license. This procedure could result in the fees NTL pays to Castle
Transmission for site sharing facilities for Classic FM, currently calculated
under the site-sharing agreement, being determined at a reduced rate and
otherwise not being covered by the terms of any existing contract which could
lead to a diminution of Castle Transmission's income of approximately
(Pounds)300,000 per annum (equivalent to approximately 0.4% of revenues and
1.0% of EBITDA for the fiscal year ended March 31, 1997). Castle Transmission
has applied for leave to obtain a judicial review of this decision. In
addition, Castle Transmission has made a provision of approximately (Pounds)1.9
million relating to any rate adjustment imposed by OFTEL relating to previous
charges for Classic FM under the site-sharing agreement.

Castle Transmission is discussing with OFTEL certain amendments to Castle
Transmission's Telecommunications Act transmission license to ensure that the
price control condition accommodates the provision by Castle Transmission of
additional contractually agreed upon services to the BBC in return for
additional agreed upon payments. See "Risk Factors--Extensive Regulations Which
Could Change at Any Time and Which We Could Fail to Comply With Regulate Our
Business".

The Secretary of State has designated the transmission license a public
telecommunications operator license in order to reserve to himself certain
emergency powers for the protection of national security. This designation is,
however, limited to this objective. Castle Transmission does not have a full
domestic public telecommunications operator license and does not require one
for its current activities. The Department of Trade and Industry has,
nevertheless, indicated that it would be willing to issue Castle Transmission
such a license. As a result Castle Transmission would gain wider powers to
provide services to third parties including public switched voice transmission
and satellite uplink and would grant Castle Transmission powers to build out
its network over public property (so-called "code powers").

General Telecom License. The general telecom license is a general license to
run telecommunications systems and authorizes Castle Transmission to run all
the necessary telecommunications systems to convey messages to its transmitter
sites (e.g., via leased circuits or using its own microwave links). The license
does not cover the provision of public switched transmission networks (which
would require a public telecommunications operator license as described above).

Satellite License. The satellite license is a license to run
telecommunications systems for the provision of satellite telecommunication
services and allows the conveyance via satellite of messages, including data
and radio broadcasting. The license excludes television broadcasting direct to
the home via satellite although distribution via satellite of television
broadcasting services which are to be transmitted by terrestrial facilities is
permitted.

Licenses under the Wireless Telegraphy Acts 1949, 1968 and 1998

Castle Transmission has a number of licenses under the Wireless Telegraphy
Acts 1949, 1968 and 1998, authorizing the use of radio equipment for the
provision of certain services over allocated radio frequencies including:

(1) a broadcasting services license in relation to the transmission
services provided to the BBC, Virgin Radio and Talk Radio;

(2) a fixed point-to-point radio links license;

(3) two bandwidth test and development licenses; and

(4) digital terrestrial television test and development licenses.

All the existing licenses under the Wireless Telegraphy Acts 1949, 1968 and
1998 have to be renewed annually with the payment of a significant fee. The
BBC, Virgin Radio and Talk Radio have each contracted to pay their portion of
these fees. ONdigital is obligated under the ONdigital digital transmission
contract to pay most of their portion of these fees.

Environmental Matters

Our operations are subject to foreign, federal, state and local laws and
regulations relating to the management, use, storage, disposal, emission, and
remediation of, and exposure to, hazardous and nonhazardous substances,
materials and wastes. As an owner and operator of real property, we are subject
to certain environmental laws that impose strict, joint and several liability
for the cleanup of on-site or off-site contamination relating to existing or
historical operations, and also could be subject to personal injury or property
damage claims relating to such contamination. We are potentially subject to
cleanup liabilities in both the United States and the United Kingdom.

We are also subject to regulations and guidelines that impose a variety of
operational requirements relating to radio frequency emissions. The potential
connection between radio frequency emissions and certain negative health
effects, including some forms of cancer, has been the subject of substantial
study by the scientific community in recent years. To date, the results of
these studies have been inconclusive. Although we have not been subject to any
claims relating to radio frequency emissions, we have established operating
procedures designed to reduce employee exposures to radio frequency emissions
and are presently evaluating certain of our towers and transmission equipment
in the United States and the United Kingdom to determine whether radio
frequency emission reductions are possible.

In addition, we are subject to licensing, registration and related
requirements concerning tower siting, construction and operation. In the United
States, the FCC's decision to license a proposed tower may be subject to
environmental review under the National Environmental Policy Act of 1969, which
requires federal agencies to evaluate the environmental impacts of their
decisions under certain circumstances. The FCC regulations implementing the Act
place responsibility on each applicant to investigate any potential
environmental effects of a proposed operation and to disclose any significant
effects on the environment in an environmental assessment prior to commencing
construction. In the event the FCC determines that a proposed tower would have
a significant environmental impact, the FCC would be required to prepare an
environmental impact statement. This process could significantly delay or
prevent the registration or construction of a particular tower, or make tower
construction more costly. In certain jurisdictions, local laws or regulations
may impose similar requirements.

We believe that we are in substantial compliance with all applicable
environmental laws. Nevertheless, there can be no assurance that the costs of
compliance with existing or future environmental laws will not have a material
adverse effect on our business, results of operations, or financial condition.

RECENT AND PROPOSED TRANSACTIONS

We have recently completed or entered into agreements to complete the
transactions described below. Completion of these transactions will result in a
significant increase in the size of our operations and the number of towers
that we own or manage. The Bell Atlantic joint venture closed on March 31,
1999, and we expect to close the Powertel acquisition and the One2One
transaction during the second quarter of 1999. The BellSouth transaction is
scheduled to close in a series of closings over eight months, beginning on May
31, 1999. There can be no assurance that the BellSouth transaction, the
Powertel acquisition or the One2One transaction will be completed on the terms
described in this prospectus or at all. See "Risk Factors--We May Not Complete
the Proposed Transactions". The descriptions of the terms of these transactions
are summaries of the material portions of the relevant agreements. These
descriptions are qualified in their entirety by reference to the complete text
of the agreements, each of which is available as described under the heading
"Available Information".

Bell Atlantic Joint Venture

On March 31, 1999, Bell Atlantic Mobile and certain of its affiliates, CCIC
and CCA Investment Corp. ("CCAIC"), our wholly owned indirect subsidiary,
formed a joint venture to own and operate a significant majority of Bell
Atlantic's towers. We own approximately 61.5% of the joint venture and Bell
Atlantic and certain of its affiliates own the remaining 38.5%. Bell Atlantic
also owns a 0.001% interest in the joint venture's operating subsidiary to
preserve its rights if we later own the entire venture. For financial reporting
purposes, we intend to consolidate the joint venture's results of operations
and financial condition with our own.

We manage the day-to-day operations of the joint venture. The joint venture
will actively seek to add additional tenants to its towers in order to increase
its revenues. The joint venture will also construct and own new towers that are
needed by Bell Atlantic's wireless communications business. In addition, the
joint venture will have the right to pursue the next 300 new tower builds that
we identify for parties other than Bell Atlantic in the territories in which
the joint venture will operate. See "--Build-to-Suit Agreement" and "--Global
Lease". The joint venture will have regional offices that will be staffed
primarily with our employees to perform marketing, billing, operations and
maintenance functions.

Formation Agreement

Formation of the Joint Venture. Under the formation agreement, CCAIC
contributed $250.0 million in cash and approximately 15.6 million shares of our
common stock (valued at $197.0 million) to the joint venture. Bell Atlantic and
its affiliates transferred approximately 1,458 towers (56 of which are under
construction) along with related assets and liabilities to the joint venture.
The joint venture borrowed $180.0 million under a committed $250.0 million
revolving credit facility and made a $380.0 million cash distribution to Bell
Atlantic.

Concurrently with the formation of the joint venture, Bell Atlantic and the
joint venture entered into an agreement for the joint venture to build new
towers for Bell Atlantic, or a master build-to-suit agreement, and a global
lease under which Bell Atlantic will lease space on the joint venture's towers.

Terms and Conditions. In connection with its contribution of assets and
liabilities to the joint venture, Bell Atlantic made representations and
warranties to the joint venture concerning the contributed assets and
liabilities. In general, the joint venture will have until June 30, 2000 to
raise any claims for indemnification for breaches of the representations and
warranties by Bell Atlantic. However, Bell Atlantic's indemnification
obligations are subject to a number of significant limitations

including a per occurrence deductible of $25,000, an aggregate deductible of
$7.5 million and an absolute cap of $195.0 million.

Build-to-Suit Agreement

Under the build-to-suit agreement and subject to some conditions, Bell
Atlantic and the joint venture agreed that (1) the next 500 towers to be built
for Bell Atlantic's wireless communications business will be constructed and
owned by the joint venture and (2) immediately thereafter the joint venture
will have a right of first refusal to construct the next 200 additional towers
to be built for Bell Atlantic. Bell Atlantic is required to submit these 700
site proposals to the joint venture during the five-year period following the
formation of the joint venture; however, the five-year period will be extended
for additional one-year periods, until 700 site proposals are submitted to the
joint venture. The joint venture will be required to build towers in the
general vicinity of the locations proposed by Bell Atlantic. Upon completion of
a tower, the tower will be included as part of the global lease. Space not
leased by Bell Atlantic or its affiliates on each tower is available for lease
by the joint venture to third parties.

Global Lease

All of the 1,458 towers acquired by the joint venture from Bell Atlantic and
its affiliates, and all towers constructed by the joint venture under the
build-to-suit agreement, will be governed by the global lease. The average
monthly rent paid by Bell Atlantic on each of the 1,458 towers contributed to
the joint venture by Bell Atlantic will be approximately $1,850. Minimum
monthly rents on the towers built under the build-to-suit agreement will range
from $1,250 to $1,833 depending on the region in which the tower is located.
These rents may increase based on the amount of Bell Atlantic's equipment to be
installed at a site. Rents are subject to annual increase based on the consumer
price index, subject to certain adjustments. For all sites, the initial lease
term is ten years. Bell Atlantic has the right to extend any lease for three
additional five-year terms and one additional term of four years and eleven
months. Each lease will automatically renew for an option term unless Bell
Atlantic notifies the joint venture at least six months before the then current
term expires. Space not leased by Bell Atlantic or its affiliates on each tower
is available for lease by the joint venture to third parties.

Operating Agreements

In connection with the formation of the joint venture, Bell Atlantic and
CCAIC entered into limited liability company operating agreements that
established and govern the limited liability companies comprising the joint
venture.

Governance. The business and affairs of the joint venture will be managed by
its managers under the supervision of a board of representatives. Each manager
will be selected by CCAIC. Members of the board of representatives will be
selected by each of Bell Atlantic and CCAIC in proportion to their ownership
interests in the joint venture. The board of representatives initially will
have six members, with two selected by Bell Atlantic and four selected by
CCAIC. So long as Bell Atlantic maintains at least a 5% interest in the joint
venture, it will maintain the right to designate at least one member of the
board of representatives.

The managers will operate the joint venture on a day-to-day basis. In
general, the managers will have the power and authority to take all necessary
or appropriate actions to conduct the joint venture's business in accordance
with its then current business plan. Actions requiring the approval of the
board of representatives generally will be authorized upon the affirmative vote
of a majority of

the members of the board of representatives. However, a number of material
corporate actions will require the mutual consent of Bell Atlantic and CCAIC,
including, among others:

. engaging in any business other than the tower business in the United
States;

. voluntarily entering into a bankruptcy proceeding;

. issuing any additional equity interests in the joint venture;

. mergers or consolidations; and

. approval of the business plan.

Restrictions on Transfers of Interests; Rights of First Refusal; Tag-Along
Rights. Except for transfers to wholly owned affiliates, neither Bell Atlantic
nor CCAIC may transfer its interest in the joint venture to a third party
unless it first offers its interest to the other on terms and conditions,
including price, no less favorable than the terms and conditions on which it
proposes to sell its interest to the third party. In addition, if Bell Atlantic
or CCAIC wishes to transfer its interest in the joint venture to a third party,
the other party will have the right to require the third party, as a condition
to the sale, to purchase a pro rata portion of its interest in the joint
venture on the same terms and conditions, including price. Bell Atlantic may
only transfer its 0.001% nominal interest in the operating subsidiary of the
joint venture to its wholly owned affiliates or in connection with a merger or
consolidation transaction to which Bell Atlantic or Bell Atlantic Corporation
is a party.

Dissolution of the Joint Venture. We have agreed with Bell Atlantic that upon
a dissolution of the joint venture, in satisfaction of our respective interests
in the joint venture, we would receive all the assets and liabilities of the
joint venture other than the approximately 15.6 million shares of our common
stock held by the joint venture and Bell Atlantic would receive all of the
shares of our common stock held by the joint venture and a payment from us,
equal to 14.0% of the fair market value of the assets and liabilities of the
joint venture (other than our common stock), to be made in cash or our common
stock at our election. In certain limited circumstances, we may elect to
participate in an increased value on the shares of our common stock held by the
joint venture. Bell Atlantic would continue to retain its 0.001% nominal
interest in the joint venture's operating subsidiary following dissolution of
the joint venture. For so long as it retains such interest, the operations
formerly included in the joint venture would remain subject to the operating
restrictions set forth above under "--Governance". A dissolution of the joint
venture may be triggered (1) by Bell Atlantic at any time following the third
anniversary of the formation of the joint venture and (2) by us at any time
following the fourth anniversary of its formation; however, if we trigger the
dissolution prior to the seventh anniversary, we may be required to make
additional cash payments to Bell Atlantic.

Transitional Services Agreement; Services Agreement

In connection with the formation of the joint venture, Bell Atlantic and the
joint venture entered into a transitional services agreement under which Bell
Atlantic will provide the joint venture with services necessary to ensure a
smooth transition of the business to the joint venture. In addition, we and the
joint venture entered into a services agreement under which we will provide the
joint venture with a number of services, including accounting and other
information technology services.

Proposed BellSouth Transaction

On March 5, 1999, we entered into a preliminary letter agreement with
BellSouth Mobility Inc., BellSouth Telecommunications Inc. and certain of its
affiliates. The letter agreement sets forth the terms of our agreement under
which BellSouth will sell to us, in a taxable sale under a master sublease
agreement, their 1,850 wireless communications towers for $610.0 million,
consisting of $430.0 million in cash and approximately 9.1 million shares of
our common stock (valued at $180.0

million), subject to adjustments. The aggregate consideration will be subject
to increase if BellSouth transfers more than 1,850 towers to us in connection
with the transaction. The letter agreement contemplates that we will enter into
a build-to-suit agreement with BellSouth under which we will build up to 500
towers over five years for BellSouth.

We will be responsible for managing, maintaining and leasing the available
space on BellSouth's wireless communications towers located throughout Indiana,
Kentucky, Louisiana, Mississippi, Alabama, Arkansas, Florida, Georgia and
Tennessee. While we will have complete responsibility for the towers, and their
monitoring and maintenance, BellSouth will continue to fully own its
communications components including switching equipment, shelters and cell site
facilities. BellSouth will pay us a fee of $1,200 per month per site for its
services on existing and newly built towers.

The transaction is expected to close in a series of closings, beginning in
the second quarter of 1999, and is expected to be fully closed no later than
eight months thereafter. In connection with our entering into the letter
agreement we placed $50.0 million in an escrow account which will be returned
to us at the first stage of the multi-stage closing.

Letter Agreement

General. Under the letter agreement, a newly formed subsidiary of ours, Crown
Castle South Inc ("CCSI"), will receive rights to lease, sublease, design,
develop, contract, operate, market and manage approximately 1,850 tower sites
owned by BellSouth, or to be constructed on behalf of BellSouth, in Indiana,
Kentucky, Louisiana, Mississippi, Alabama, Arkansas, Florida, Georgia and
Tennessee, in exchange for aggregate consideration of $610.0 million,
consisting of $430.0 million in cash and approximately 9.1 million shares of
our common stock (valued at $180.0 million), subject to adjustments.

The terms and conditions of the sublease of the 1,850 sites are set forth in
a sublease to be entered into between BellSouth and CCSI and us. Further, we
have agreed to enter into a site management agreement, under which we will
provide certain management services on sites that are not part of the 1,850
towers contemplated by the sublease. We are entering into this management
agreement because of restrictions on transfer.

The letter agreement provides that the transaction will require further
documentation including the preparation, acceptance and delivery of a
definitive acquisition agreement, the terms of which have not yet been fully
negotiated.

Consideration. Under the letter agreement, we will pay to BellSouth the sum
of $324,324.32 for each site leased or subleased to CCSI under the sublease. If
subleases covering the full 1,850 towers are transferred to CCSI as
contemplated by the letter agreement, the aggregate consideration payable to
BellSouth will consist of $430.0 million in cash and $180.0 million in our
common stock, but we will retain the option to increase the cash portion of the
aggregate consideration by up to $30.0 million and decrease the equity portion
to not less than $150.0 million. This option must be exercised by us prior to
the first closing. The number of shares of our common stock included in the
consideration will be approximately 9.1 million shares and was determined using
the average closing price of our common stock on the 30 trading days
immediately preceding March 5, 1999. While the letter agreement contemplates
the sublease by BellSouth of approximately 1,850 sites to CCSI, in the event
that additional sites are subleased to CCSI, the consideration paid for the
next 250 sites will be payable in cash only. If CCSI subleases more than 2,100
sites from BellSouth in connection with the sublease, consideration for any
additional towers will be payable in shares of our common stock.

The letter agreement provides that if the average closing price of our common
stock during the 30 day period immediately preceding the first anniversary of
the final closing is less than the initial

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share price we described above, then we will, at our option, (1) pay BellSouth
cash in a make-up amount of cash equal to (x) the difference between the
initial share price and this subsequent share price multiplied by (y) the
number of shares issued as part of the consideration less (z) the gross
proceeds from all sales of such shares prior to the first anniversary of the
final closing or (2) issue to BellSouth the number of shares of our common
stock equal to the make-up amount of cash divided by the subsequent share
price; in each case not to exceed $50.0 million in cash or $75.0 million in
common stock.

Under the letter agreement, the consideration we pay may be adjusted based on
the amount we are required to pay in calendar year 1999 for the lease of the
land on which these towers are located, or ground rents. If a post-closing
audit demonstrates that the amount we are required to pay, in aggregate, for
such ground rents exceeds $11.4 million, BellSouth will be required to pay to
CCSI an amount equal to a certain multiple of the amount by which the rents
exceed $11.4 million, not to exceed $45.0 million.

Escrow Payment. In connection with the signing of the letter agreement, we
deposited $50.0 million into an escrow account. BellSouth is entitled to
receive the escrow payment in full in the event that:

. we and BellSouth fail to execute a definitive acquisition agreement
within 90 days of the date of the letter agreement (and BellSouth has
negotiated the operative documents in good faith) or

. the acquisition agreement is executed but the initial closing fails to
occur as a result of any breach of the acquisition agreement by us or
CCSI or any failure of us or CCSI to satisfy the closing conditions set
forth in the agreement.

Upon completion of the first closing, the escrow payment will be returned to
us.

Closings. In connection with the letter agreement, we and BellSouth have
agreed that the sublease of the sites under the sublease will be completed in a
series of closings over not more than eight months and will include a minimum
number of sites to be included in each closing, the first of which is expected
to take place on May 31, 1999. BellSouth has agreed to use all commercially
reasonable efforts to sublease approximately 250 sites at each closing, grouped
so as to be located in contiguous regions, until all sites have been subleased
prior to or at the final closing. The sites to be included on the initial
closing date will be located in Kentucky and Indiana.

Termination Right. The letter agreement provides that in the event that any
one of the closings contemplated by the transaction is not completed due to our
or CCSI's failure to comply with all our conditions, covenants and
representations, in addition to any other remedies BellSouth may have at equity
or law, BellSouth will have the right to require us to pay to BellSouth a
termination fee of $50 million to terminate all agreements between the parties,
and at BellSouth's option, to rescind all prior closings. If BellSouth elects
to rescind the prior closings, payment of the termination fee will be made by
netting it against the amounts previously paid to BellSouth at the previous
closings, and BellSouth will return to us any amount which is in excess of the
termination fee.

Sublease

Under the letter agreement, the parties fully and completely agreed upon the
terms of the sublease.

General. Under the terms of the sublease, BellSouth has agreed to grant a
lease to CCSI, under which CCSI will lease (or sublease) the land, tower and
improvements at each site other than certain space reserved by BellSouth and
space utilized by third parties under existing subleases. BellSouth has agreed
to lease to CCSI all its sites in the territories where the towers are located

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except where it is legally prohibited from doing so and except for sites that
are specifically excluded from the sublease. BellSouth expects that the number
of sites available for sublease will be approximately 1,850. The sites
constructed under the build-to-suit agreement, as described below, will also be
made part of and subject to the sublease.

Under the sublease, CCSI will be entitled to use the subleased property of
each site for constructing, installing, operating, managing, maintaining and
marketing the tower and improvements on each site, including leasing space to
third party tenants. BellSouth has agreed to pay CCSI a site maintenance charge
of $1,200 per month per site, subject to an increase of five percent per year
for the first ten years following the applicable commencement date of the
sublease on such site. If, after the tenth anniversary following each
commencement date, the then current site maintenance charge is below the market
rate, then such site maintenance charge will automatically be increased on such
anniversary and each anniversary thereafter by the consumer price index. If the
then site maintenance charge is above the market rate, then such site
maintenance charge will be automatically reset at ninety percent of such agreed
upon market rate and will increase on each following anniversary by the then
current annual market rate of increase for comparable properties. CCSI has
agreed to pay as rent to BellSouth the ground rents relating to each site that
is leased by BellSouth, and rent of $1.00 per year for sites that are owned by
BellSouth. In addition, CCSI has agreed to sublease available space to any
party to existing agreements providing for the sharing of tower space, or co-
location agreements, with BellSouth. CCSI, however, will receive all rents and
other economic benefits from the parties to such co-location agreements.

Term. The term of the sublease will be one hundred years for sites owned by
BellSouth and, for sites leased by BellSouth, one day less than the term of the
underlying ground lease. CCSI will be responsible for negotiating and obtaining
extensions or renewals of the ground leases. In addition, if CCSI is able to
acquire ownership in a site, CCSI has agreed to transfer such ownership to
BellSouth for $1.00, in which event CCSI will pay no ground rent as of the date
title vests in BellSouth.

Reserved Space. Under the sublease, BellSouth has reserved space on each
site. The reserved space generally relates to the portion of the site,
including space on the tower, in use by BellSouth and its affiliates. BellSouth
has the right to increase the number of antennas on its reserved space to 12,
without increasing the related site maintenance payment, on up to 120 towers so
long as it meets certain conditions. BellSouth also has the right to substitute
the reserved space for other available space on the tower, as well as a right
of first refusal and right of substitution as to available space which CCSI
intends to sublease to any third party.

If BellSouth ceases using its reserved space on a site and elects to transfer
the interest in the reserved space on such site, CCSI will have the right to
acquire BellSouth's interest in the applicable reserved space by paying to
BellSouth consideration of (1) $5,000 (subject to increase based on the
consumer price index) plus (2) a grant to BellSouth of the right to receive up
to thirty-five percent of all gross revenues payable to CCSI for such reserved
space.

BellSouth will have the right to put to CCSI its rights in its reserved space
relating to a site, and thereby add such space to the sublease, but the number
of sites subject to such a put right may not exceed the greater of one and one
half percent or thirty of the total sites. If this happens, BellSouth will
assign to CCSI all its rights in the reserved space on that site and will no
longer be responsible for the related site maintenance charge.

Withdrawal Right. After the tenth anniversary of the first closing, BellSouth
will have the right, subject to certain notice requirements, to withdraw its
rights on any site. In such case, BellSouth will assign to CCSI all its rights,
including the ground lease and any reserved space, for any withdrawn site and
will no longer be responsible for the related site maintenance charge.

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Termination. The sublease may be terminated by each party in the event of
certain breaches by the other party, including the failure to timely make
required payments under the sublease, breaches of covenants and other
agreements in the Sublease, breaches of representations and warranties and
insolvency. In the case of BellSouth's right to terminate, BellSouth may
terminate the sublease as to an applicable site following a breach (and failure
to cure) relating to that particular site. BellSouth may terminate the entire
sublease upon the occurrence of unwaived defaults by CCSI on more than fifty
sites during any consecutive five-year period.

Build-to-Suit Agreement

BellSouth has agreed to enter into a build-to-suit agreement with us and CCSI
under which CCSI will develop and construct all towers built in the territory
where the 1,850 towers are located on behalf of BellSouth for a period of five
years. If CCSI has not constructed at least 500 towers over the five year
period following the signing of the build-to-suit agreement, the term of the
build-to-suit agreement will be extended for up to an additional two years
until such time as CCSI has constructed 500 towers. BellSouth will be required
to submit to CCSI all proposals to develop and construct tower sites within the
territory until CCSI has completed construction of 500 towers. CCSI will be
required to develop and construct tower sites in locations that satisfy
BellSouth's engineering requirements. Upon substantial completion of a tower
site, the site will become subject to and part of the sublease. The build-to-
suit agreement will provide that space not reserved by BellSouth on each tower
will be available for lease by CCSI to third parties.

Site Maintenance Agreement

The parties have agreed to enter into a site maintenance agreement whereby
CCSI will perform management services at those sites in the territory which are
not leased or subleased to CCSI under the management sublease and that are
designated by BellSouth for inclusion in the site maintenance agreement. Under
the letter agreement, we and BellSouth have agreed that BellSouth will pay to
us a site maintenance fee of $333.00 per site per month, increased annually by
the consumer price index, for sites designated under the site maintenance
agreement. Further, we have agreed that the total number of sites to be covered
by the site management agreement will not exceed 100 sites.

Site Marketing Agreement

On March 25, 1998, we and BellSouth entered into a site marketing agreement
under which we currently market BellSouth's tower sites located in Kentucky. In
connection with the letter agreement, we agreed to renew the site marketing
agreement, the term of which ended on February 15, 1999, and to extend the
scope of the agreement to include the entire territory where the 1,850 towers
are located.

Registration Rights Agreement

We have agreed to enter into a registration rights agreement whereby we will
grant to BellSouth certain registration rights in respect of shares of our
common stock we pay to BellSouth as consideration for the proposed BellSouth
transaction.

Proposed Powertel Acquisition

On March 15, 1999, we and a newly formed wholly owned indirect subsidiary,
CCP, entered into an asset purchase agreement with Powertel and five of its
subsidiaries, under which the parties agreed that we would purchase from
Powertel approximately 650 towers and related assets and liabilities.

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We will pay to Powertel aggregate consideration of $275 million (subject to
adjustment based on the amount of towers actually tendered to us at closing)
for the 650 towers. At closing, Powertel will pay us a credit against the
purchase price in an aggregate amount of $383,000, as consideration for our
acceptance of certain towers containing site leases that may require revenue
received from Powertel or its affiliates to be shared with the site lessors.
Under the asset purchase agreement, we have placed $50.0 million in escrow to
be applied to the closing price. In the event that Powertel has fulfilled all
conditions precedent to closing and we are unable or unwilling to deliver the
balance of the closing price, Powertel will receive up to the full $50 million
as liquidated damages. See "--Asset Purchase Agreement", "--Escrow Agreement"
and "Risk Factors--We May Not Complete the Proposed Transactions".

At closing Powertel will assign and we will assume five master site
agreements, under which Powertel or its affiliates will agree to pay us monthly
rent of $1,800 per tower for continued use of space Powertel occupies on the
towers. This per tower amount is subject to increase on each fifth anniversary
of the agreement and as Powertel adds equipment to these towers.

Asset Purchase Agreement

Purchase Price. Under the asset purchase agreement, we will pay the $275
million, less the credit described above, in cash on or before June 4, 1999 to
Powertel for Powertel's tower structures, rights to tower sites, related assets
and rights under applicable governmental permits. The purchase price is subject
to adjustment up or down based on the actual number of sites tendered at
closing. The asset purchase agreement provides that sites considered defective
or incomplete, will not be tendered at closing, and consequently, the purchase
price will be reduced by an amount equal to $423,077 for each such rejected
site.

Terms and Conditions. We and Powertel are making certain representations and
warranties which must be true on the closing date in order for the transaction
to be completed. Other conditions which must be satisfied on the closing date
include:

. compliance by us and Powertel with the asset purchase agreement;

. absence of litigation;

. receipt of regulatory approvals; and

. absence of any material adverse effect relating to the Powertel assets
and assumed liabilities.

In addition, we have deposited $50 million with SunTrust Bank Atlanta as
escrow agent. At closing, this escrow deposit will be delivered to Powertel and
credited against the closing price. However, we have agreed that the escrow
deposit will be forfeited to Powertel in the event that we are unable to
receive adequate financing to complete the acquisition and thus are unable to
close the acquisition in a timely manner. As a condition to the asset purchase
agreement, we have agreed to use our reasonable best efforts to have a
registration statement relating to such financing declared effective as
expeditiously as possible. Further, upon the occurrence of the events described
below, we are required to provide Powertel with adequate written assurance that
we have at least one alternative financing source, which in Powertel's sole
judgment provides it assurance that we will have on hand a minimum of an
additional $225.0 million in cash to apply to the purchase price at closing.
Such financing assurance must be received by Powertel within five days of the
occurrence of certain events including:

. our failure to file the registration statement before March 19, 1999;

. the withdrawal or abandonment of the registration statement or the
decision not to proceed with the offerings;

104

. our failure to commence presentations to institutional investors by May
15, 1999 or, after commencement of such presentations, termination or
abandonment of such presentations and failure to proceed to pricing of
the offerings.

If we are required to provide Powertel with a financing assurance, Powertel
will have five days to accept or reject it. If Powertel rejects the financing
assurance, we will have ten days from receipt of the rejection to deliver the
$225.0 million balance of the closing price to the escrow agent, who will
deliver the entire closing price to Powertel at closing. However, if we are
unable or unwilling to deliver the additional sum into escrow, Powertel will
have the right to unilaterally terminate the asset purchase agreement, and
receive, as its sole remedy, from the escrow deposit liquidated damages in the
amount of $10.0 million on or prior to May 15, 1999 or $25.0 million after May
15, 1999 but prior to June 4, 1999. If on June 4, 1999, Powertel has fulfilled
all of its obligations and conditions precedent to closing in all material
respects and has not defaulted or breached its obligations under the asset
purchase agreement, and we have failed to deliver the additional sum into
escrow or are otherwise unable or unwilling to deliver the purchase price,
Powertel will receive as liquidated damages the entire amount of the escrow
deposit.

Master Site Agreement

On the closing date, the parties to the asset purchase agreement and certain
of Powertel's affiliates will enter into master site agreements governing all
towers acquired under the asset purchase agreement. Under these agreements,
Powertel will agree to continue to lease the space it currently occupies on the
towers to be acquired by us. The monthly rent paid by Powertel for each tower
will be $1,800. Such monthly payment is subject to increase based on an agreed
upon schedule if and when Powertel adds equipment to a site. Nonetheless, the
monthly rent, including additional rents related to the addition of certain
equipment, will be increased on each fifth anniversary of the agreement up to
an amount that is 115% of the rent paid during the preceding five year period.
The master site agreements provide that space not occupied by Powertel on the
acquired towers can be leased to third parties.

Under the master site agreements, the term of each tower lease will be ten
years. Powertel has the right to extend any site lease for up to three
additional five year periods. Each site lease will automatically renew for an
option term unless Powertel notifies us of its intent not to renew at least 180
days prior to the end of the then current term.

Proposed One2One Transaction

On March 5, 1999, we entered into the framework agreement with One2One, under
which Castle Transmission has agreed to manage, develop and, at its option,
acquire up to 821 towers. These towers represent substantially all the towers
in One2One's nationwide wireless network in the United Kingdom. Approximately
one-half of these 821 towers can accommodate additional tenants. We expect to
upgrade or replace the other towers as demand for space on such towers arises.
We believe that the cost of upgrading or replacing any single tower will not
exceed $40,000.

Castle Transmission will be responsible for managing and leasing available
space on the towers, and will receive all the income from any such third party
leases. The term of the management arrangements will be for up to 25 years.
During the three-year period following the closing, Castle Transmission will
have the right, at its option, to acquire for (Pounds)1.00 per site One2One's
interest in the 821 towers, to the extent such interests can be assigned.
One2One has also agreed to include as part of the framework agreement,
including Castle Transmission's right to acquire sites during the three-year
period, any new One2One towers constructed during the term of the agreement.

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Framework Agreement

Terms and Conditions. The 821 existing towers will be managed by Castle
Transmission under a management contract with an initial term of 10 years,
which is extendable at Castle Transmission's option for an additional 15 years.
Castle Transmission will also assume all liabilities in connection with the 821
existing towers. During the three-year period following the closing One2One
will assign to Castle Transmission, at Castle Transmission's option, One2One's
interest in the sites on which the 821 existing towers are located. For sites
where the underlying ground lease is not assignable, the management contract
will continue in effect. Castle Transmission also has the right during this
three-year option period to assume ownership of any new One2One towers which
are built by or for One2One during the option period.

Consideration. As consideration for the framework agreement, One2One will
receive varying rent-free periods of site use depending on the type of tower
site as follows:

. The 821 existing towers. One2One will enter into a 25 year site sharing
agreement with Castle Transmission permitting One2One to continue to
occupy the 821 existing towers. This agreement will be rent-free until
March 2007 (with a retroactive adjustment to April 1998). After the
expiration of this initial period, One2One will pay to Castle
Transmission an annually indexed rental fee (based on (Pounds)3,750.0
per site index adjusted from 1999) plus a further additional
compensatory payment to Castle Transmission in the event that Castle
Transmission is chosen as the contractor for fewer than 250 new One2One
sites. See "--One2One ADC Contract".

. New One2One sites. One2One will also enter into 25 year site sharing
agreements with Castle Transmission to occupy all new One2One towers and
pay Castle Transmission an annually indexed rental fee (based on
(Pounds)4,000.0 per site index adjusted from 1999) after an initial
rent-free period of fifteen years.

. 166 Castle Transmission towers currently under lease by One2One. One2One
currently occupies 166 Castle Transmission sites under a master lease
agreement. This master lease will be modified to allow One2One to occupy
these sites rent-free from April 1998 until March 2000.

The framework agreement is conditional upon the approvals of both parties'
board of directors and senior creditors.

One2One ADC Contract

In connection with the framework agreement, Castle Transmission entered into
a separate contract with One2One under which Castle Transmission will provide
acquisition, design and construction services for up to 250 new One2One sites.
If One2One requests Castle Transmission's services for all 250 sites, Castle
Transmission will be paid aggregate fees in excess of (Pounds)7.0 million.
Castle Transmission also believes that some of the new sites will be new
builds, which are known as greenfield sites, under the framework agreement, and
thus Castle Transmission will be eligible to assume ownership of these
greenfield sites following their construction, under the terms of the framework
agreement.

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THE PROPOSED OFFERINGS

On March 16, 1999, we filed a registration statement on Form S-1 for a
proposed concurrent public underwritten offering of $475,000,000 of our common
stock, $.01 par value, $300,000,000 of our Senior Discount Notes due 2011 and
$150,000,000 of our Senior Notes due 2011.

We expect to use the proceeds of these proposed offerings to repay
indebtedness incurred to finance a portion of the BellSouth transaction and the
Powertel acquisition, to finance the balance of the BellSouth transaction and
the Powertel acquisition and for general corporate purposes.

We cannot guarantee, however, that these proposed offerings will be completed
on the terms contained in the S-1 registration statement or at all.

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MANAGEMENT

Directors and Executive Officers

The following table sets forth certain information, as of March 31, 1999, for
our directors or executive officers and other key personnel:

Name Age Positions
---- --- ---------

Ted B. Miller, Jr....... 47 Chief Executive Officer and Vice Chairman of the Board of
Directors
David L. Ivy............ 52 President and Director
Charles C. Green, III... 52 Executive Vice President and Chief Financial Officer
John L. Gwyn............ 51 Executive Vice President
E. Blake Hawk........... 49 Executive Vice President and General Counsel
Wesley D. Cunningham.... 39 Senior Vice President, Corporate Controller and Chief
Accounting Officer
Edward W. Wallander..... 41 Senior Vice President and Chief Information Officer
John P. Kelly........... 41 President and Chief Operating Officer of Crown
Communication
Alan Rees............... 55 Chief Operating Officer and Director of CTSH
George E. Reese......... 48 Chief Financial Officer, Secretary and Director of CTSH
Michel Azibert.......... 43 Director
Bruno Chetaille......... 45 Director
Robert A. Crown......... 44 Director
Carl Ferenbach.......... 56 Chairman of the Board of Directors
Randall A. Hack......... 51 Director
Robert F. McKenzie...... 55 Director
William A. Murphy....... 31 Director
Jeffrey H. Schutz....... 47 Director

Under our certificate of incorporation and by-laws, our board of directors,
other than those directors who may be elected by holders of any series of
preferred stock or holders of the Class A common stock, are classified into
three classes of directors, denoted as class 1, class 2 and class 3. Messrs.
Ferenbach, Schutz and McKenzie are class 1 directors. Messrs. Crown, Murphy and
Ivy are class 2 directors, and Messrs. Hack and Miller are class 3 directors.
The terms of class 1, class 2 and class 3 directors expire at the annual
meetings of stockholders to be held in 1999, 2000 and 2001, respectively. See
"Description of Capital Stock--Certificate of Incorporation and By-laws--
Classified Board of Directors and Related Provisions". Messrs. Azibert and
Chetaille were elected to the board of directors by the holders of the Class A
common stock upon completion of the roll-up.

Ted B. Miller, Jr. has been the Chief Executive Officer since November 1996,
Vice Chairman of the board of directors since August 1997 and a director of
CCIC since 1995. Mr. Miller co-founded CTC in 1994. He was the President of
CCIC and CTC from November 1996 to August 1997. Mr. Miller has been the
Managing Director, Chief Executive Officer of Castle Transmission since
February 1997 and has served as Chairman of the board of Castle Transmission
since August 1998. In 1986, Mr. Miller founded Interstate Realty Corporation, a
real estate development and consulting company, and has been its President and
Chief Executive Officer since inception. Mr. Miller is a director and/or an
officer of each wholly owned subsidiary of CCIC.

David L. Ivy has been the President of CCIC since August 1997, and was
elected as a director of CCIC in June 1997. From October 1996 to August 1997,
he served as Executive Vice President and Chief Financial Officer of CCIC.
Since 1995, he has been the President of DLI, Inc., a real estate consulting
company. From 1993 to 1995, Mr. Ivy was a senior executive with, and later the
President and Chief Operating Officer of, J. E. Robert Companies, where he
managed a joint venture with

108

Goldman, Sachs & Co. that was established to acquire distressed assets from
financial institutions. From 1987 to 1993, Mr. Ivy served as Chairman of the
board of directors of Interstate. Mr. Ivy is a director of each wholly owned
subsidiary of CCIC.

Charles C. Green, III has been an Executive Vice President and Chief
Financial Officer of CCIC since September 1997. Mr. Green was the President and
Chief Operating Officer of Torch Energy Advisors Incorporated, a major energy
asset management and outsourcing company, from 1993 to 1995, and Vice Chairman
of the board of directors and Chief Investment Officer from 1995 to 1996. From
1992 to September 1997, he was an officer, and later the Executive Vice
President and Chief Financial Officer, of Bellwether Exploration Company, an
oil and gas exploration and production company and an affiliate of Torch. From
1982 to 1992, Mr. Green was President, Chief Operating Officer and Chief
Financial Officer of Treptow Development Company, a real estate development
company. Mr. Green currently serves on the board of directors of Teletouch
Communications, Inc. He has been a Chartered Financial Analyst since 1974. Mr.
Green is a director and/or officer of each wholly owned subsidiary of CCIC.

John L. Gwyn has been an Executive Vice President of CCIC since August 1997.
From February to August 1997, Mr. Gwyn served as Senior Vice President of CCIC
and CTC. From 1994 to February 1997, Mr. Gwyn was a Vice President and Director
of Commercial Real Estate Asset Management of Archon Group, L.P., a real estate
asset management company and a wholly owned subsidiary of Goldman, Sachs & Co.
From 1989 to 1993, he was a Senior Vice President of The Robert C. Wilson
Company, a mortgage banking company.

E. Blake Hawk has been Executive Vice President and General Counsel since
February 1999. Mr. Hawk was an attorney with Brown, Parker & Leahy, LLP in
Houston, Texas from 1980 to 1999 and became a partner with the firm in 1986.
Mr. Hawk has been board certified in tax law by the Texas Board of Legal
Specialization since 1984 and has been a Certified Public Accountant since
1976.

Wesley D. Cunningham has been a Senior Vice President of CCIC since March
1999 and Chief Accounting Officer of CCIC since April 1998. He has been the
Corporate Controller of CCIC since February 1997. Mr. Cunningham was the
Assistant Corporate Controller of Drilex International Inc., an oil field
services company, from 1996 to January 1997. From 1990 to 1996, he was the
Manager of Financial Reporting of Maxxam Inc., an aluminum, forest products and
real estate company. He has been a Certified Public Accountant since 1984. Mr.
Cunningham is an officer of each wholly owned subsidiary of CCIC.

Edward W. Wallander has been Senior Vice President and Chief Information
Officer of CCIC since April 1998. From August 1990 to April 1998, Mr. Wallander
worked for PNC Bank in various capacities including Senior Vice President and
Chief Operating Officer of PNC Brokerage Corp. Prior to PNC Bank, Mr. Wallander
was a commercial real estate lender for Mellon Bank, N.A. and a Certified
Public Accountant for Ernst & Young, L.L.P.

John Kelly has been the President of Crown Communication since December 1998.
From January 1990 to July 1998, Mr. Kelly was the President and Chief Operating
Officer of Atlantic Cellular Company L.P.. From December 1995 to July 1998, Mr.
Kelly was also President and Chief Operating Officer of Hawaiian Wireless,
Inc., an affiliate of Atlantic Cellular. Mr. Kelly has served on the board of
directors of the Cellular Association of California as well as the Vermont
Telecommunications Application Center.

Alan Rees has been the Chief Operating Officer of CTSH and each of its wholly
owned subsidiaries since February 1997. He was elected as a director of CTSH
and each of its wholly

109

owned subsidiaries in May 1997. From 1994 to 1997, Mr. Rees served as the
General Manager of Transmission for the broadcast transmission division of the
BBC.

George E. Reese has been the Chief Financial Officer and Secretary of CTSH
and each of its wholly owned subsidiaries since February 1997. He was elected
as a director of CTSH and each of its wholly owned subsidiaries in May 1997.
Since April 1995, Mr. Reese has served as President of Reese Ventures, Inc., an
international investment consulting firm, which he established in 1995. From
1972 to 1995, Mr. Reese was employed by Ernst & Young, L.L.P. where he was
named Partner In Charge of the Houston office's energy department and was
appointed Managing Partner of the firm's operations in the former Soviet Union.
Mr. Reese was a founder of the Council on Foreign Investment in Russia and was
a founding member of the American Chamber of Commerce in Russia.

Michel Azibert has been a director of CCIC since August 1998. Mr. Azibert has
been International Director of TdF Parent since 1989 and Chief Executive
Officer of TdF since 1994. Mr. Azibert took an active role in the preparation
of the Media Law enacted in France in 1986. Under the governance agreement, Mr.
Azibert was elected as one of the two directors elected by the holders of the
Class A common stock.

Bruno Chetaille has been as a director of CCIC since August 1998. Mr.
Chetaille has been Chairman and Chief Executive Officer of TdF Parent since
1992. Prior to 1992, Mr. Chetaille was a technical advisor to the President of
the French Republic for four years. Under the governance agreement, Mr.
Chetaille was elected as one of the two directors elected by the holders of the
Class A common stock.

Robert A. Crown founded Crown Communications in 1980 and was President from
its inception until December 1998. Mr. Crown is Chairman of the board of Crown
Communication Inc. and was elected as a director of CCIC in August 1997. Mr.
Crown has been responsible for the initial construction in Pittsburgh of the
Cellular One system, as well as a substantial portion of the Bell Atlantic
Mobile system in Pittsburgh. He also negotiated one of the first complete end-
to-end build-outs for Nextel for the Pittsburgh MTA. Under the stockholders
agreement, Mr. Crown was the nominee of the Crown Parties for election as a
director of CCIC. Mr. Crown is a director of Crown Communication and each of
its wholly owned subsidiaries.

Carl Ferenbach was elected as the Chairman of the board of directors of CCIC
in April 1997. Since its founding in 1986, Mr. Ferenbach has been a Managing
Director of Berkshire Partners LLC, a private equity investment firm that
manages five investment funds with approximately $1.6 billion of capital. Mr.
Ferenbach has also served as: a Managing Director of Berkshire Investors LLC
since its formation in 1996; a Managing Director of Third Berkshire Managers
LLC, the general partner of Third Berkshire Associates Limited Partnership, the
general partner of Berkshire Fund III, A Limited Partnership, since its
formation in 1997 (and was previously an individual general partner of
Berkshire Fund III since its formation in 1992); and a Managing Director of
Fourth Berkshire Associates LLC the general partner of Berkshire Fund IV,
Limited Partnership ("Berkshire Fund IV, collectively with Berkshire Fund III
and Berkshire Investors, the "Berkshire Group") since formation in 1996. In
addition, Mr. Ferenbach currently serves on the board of directors of Wisconsin
Central Transportation Corporation, Tranz Rail Limited, English, Welsh &
Scottish Railway Limited, Australian Transport Network Limited and U.S. Can
Corporation. Under the stockholders agreement, Mr. Ferenbach was the nominee of
Berkshire Group for election as a director of CCIC.

Randall A. Hack was elected as a director of CCIC in February 1997. Since
January 1995, Mr. Hack has been a member of Nassau Capital L.L.C., an
investment management firm. From 1990 to 1994, he was the President and Chief
Executive Officer of Princeton University Investment Company, which manages the
endowment for Princeton University. Mr. Hack also serves on the board of

110

directors of several private companies. Under the stockholders agreement, Mr.
Hack was the nominee of Nassau Group for election as a director of CCIC.

Robert F. McKenzie was elected as a director of CCIC in 1996. From 1990 to
1994, Mr. McKenzie was the Chief Operating Officer and a director of OneComm,
Inc., a mobile communications provider that he helped found in 1990. From 1980
to 1990, he held general management positions with Northern Telecom, Inc. and
was responsible for the marketing and support of its Meridian Telephone Systems
and Distributed Communications networks to businesses throughout the western
United States. Mr. McKenzie also serves on the board of directors of Centennial
Communications Corporation.

William A. Murphy has been a director of CCIC since August 1998. Mr. Murphy
has been a Director of Mergers & Acquisitions at Salomon Smith Barney since
1997. From 1990 to 1997, Mr. Murphy held various positions in Mergers &
Acquisitions with Salomon Smith Barney.

Jeffrey H. Schutz was elected as a director of CCIC in 1995. Mr. Schutz has
been a General Partner of Centennial Fund IV and Centennial Fund V, each a
venture capital investing fund, since 1994 and 1996, respectively. Mr. Schutz
also serves on the board of directors of Preferred Networks, Inc. and several
other private companies. Under the stockholders agreement, Mr. Schutz was the
nominee of Centennial Group for election as a director of CCIC.

Board Committees

Our board of directors has an executive committee, a compensation committee,
a finance and audit committee and a nominating and corporate governance
committee. The executive committee, composed of Messrs. Azibert, Crown,
Ferenbach, Hack, Miller and Schutz, acts in lieu of the full board in
emergencies or in cases where immediate and necessary action is required and
the full board cannot be assembled. The compensation committee, composed of
Messrs. Ferenbach, McKenzie and Schutz, establishes salaries, incentives and
other forms of compensation for executive officers and administers incentive
compensation and benefit plans provided for employees. The finance and audit
committee, composed of Messrs. Hack, McKenzie and Murphy, reviews our audit
policies and oversees the engagement of our independent auditors, as well as
developing financing strategies for us and approving outside suppliers to
implement these strategies. The nominating and corporate governance committee,
composed of Messrs. Azibert, Ferenbach, McKenzie and Miller, is responsible for
nominating new board members and for an annual review of board performance.
Under to the stockholders agreement, the holders of the Class A common stock
have the right to appoint at least one member to each of the executive and
nominating and corporate governance committees.

Directors' Compensation and Arrangements

All of our non-management directors receive compensation for their service as
directors ($15,000 and options for 5,000 shares of common stock per year), and
are reimbursed for expenses incidental to attendance at such meetings. In
September 1997, our board of directors approved a fee of $150,000 per annum to
the Berkshire Group (half of which is to be paid by Castle Transmission) for
general consulting services and for the services of Mr. Ferenbach as Chairman
of the board. In addition, Mr. McKenzie received approximately $10,000 in 1996
for specific consulting assignments requested by the Chief Executive Officer.
Messrs. Ferenbach and Schutz are indemnified by the respective entities which
they represent on our board of directors.

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Executive Compensation

The following table sets forth the cash and non-cash compensation paid by or
incurred on behalf of us to our chief executive officer and the next four most
highly paid executive officers for each of the three years ended December 31,
1998.

Summary Compensation Table

Number of
Securities All Other
Underlying Compen-
Options/ sation
Name and Principal Position Year Salary ($) Bonus ($) SARs (#)(a) ($)
--------------------------- ---- ---------- --------- ----------- ---------

Ted B. Miller, Jr........... 1998 $325,000 $300,000 3,013,000 $ --
Chief Executive Officer and 1997 281,575 626,250 625,000 --
Vice Chairman of the Board
of Directors 1996 152,600 75,000 -- --

David L. Ivy................ 1998 $225,000 $150,000 1,455,000 $ --
President and Director 1997 200,000 300,000 250,000 --
1996 37,500(b) -- 175,000 35,000(c)

Charles C. Green, III ...... 1998 $235,000 $ 56,250 940,000 $ --
Executive Vice President and 1997 75,000(d) -- 250,000 --
Chief Financial Officer 1996 -- -- -- --

John L. Gwyn................ 1998 $185,000 $131,250 250,000 $ --
Executive Vice President 1997 160,424(e) -- 225,000 --
1996 -- -- -- --

Alan Rees................... 1998 $225,722 $ -- 756,800 $ --
Chief Operating Officer and 1997 225,722(f) 84,646 -- --
Director of CTSH 1996 -- -- -- --

- --------
(a) All awards are for options to purchase the number of shares of common stock
indicated.
(b) Mr. Ivy began working for CCIC on October 1, 1996, at an annual salary of
$150,000.

(c) Mr. Ivy worked as a consultant to CCIC from May 1996 to September 1996
before joining CCIC as an employee in October 1996.
(d) Mr. Green began working for CCIC on September 1, 1997, at an annual salary
of $225,000.
(e) Mr. Gwyn began working for CCIC on February 3, 1997, at an annual salary of
$175,000.
(f) Mr. Rees began working for CTSH on February 28, 1997 at an annual salary of
$225,722.

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Option/SAR Grants In Last Fiscal Year

Potential Realizable
Value at Assumed
Annual Rates of
Stock Price
Appreciation
Individual Grants for Option Term(a)
----------------------------------------------- ----------------------
Number of
Securities % of Total
Underlying Options/
Options/ SARs
SARs Granted to Exercise
Granted Employees in or Base Expiration
Name (#) Fiscal Year Price ($/Sh) Date 5% ($) 10% ($)
---- ---------- ------------ ------------ ---------- ---------- -----------

Ted B. Miller, Jr....... 700,000 5.2% $ 2.31 1/23/08 $1,016,923 $ 2,577,082
328,000 2.4 7.50 1/28/08 1,547,081 3,920,606
210,000 1.6 5.78 4/23/08 763,352 1,934,485
140,000 1.0 2.31 4/23/08 203,385 515,416
1,035,000 7.7 13.00 7/1/08 8,461,777 21,443,805
600,000 4.5 7.50 7/1/08 2,830,026 7,171,841

David L. Ivy............ 280,000 2.1% $ 2.31 1/23/08 $ 406,769 $ 1,030,833
225,000 1.7 7.50 1/28/08 1,061,260 2,689,440
70,000 0.5 2.31 4/24/08 101,692 257,708
545,000 4.1 13.00 7/1/08 4,455,718 11,291,665
335,000 2.5 7.50 7/1/08 1,580,098 4,004,278

Charles C. Green, III... 75,000 0.6% $ 7.50 1/28/08 $ 353,753 $ 896,480
350,000 2.6 7.50 7/1/08 1,650,848 4,183,574
515,000 3.8 13.00 7/1/08 4,210,450 10,670,106

John L. Gwyn............ 40,000 0.3% $ 7.50 1/28/08 $ 188,668 $ 478,123
175,000 1.3 13.00 7/1/08 1,430,735 3,625,764
35,000 0.3 7.50 7/1/08 165,085 418,357

Alan Rees............... 116,666 0.9% $ 2.31 1/30/08 $ 169,486 $ 429,511
116,666 0.9 3.00 1/30/08 220,112 557,807
116,667 0.9 3.90 1/30/08 286,148 725,155
66,801 0.5 0.00 5/19/08 251,355 400,241
90,000 0.7 7.50 7/1/08 424,504 1,075,776
250,000 1.9 13.00 7/1/08 2,043,908 5,179,663

- --------

(a) The potential realizable value assumes a per-share market price at the time
of the grant to be approximately equal to the exercise price (except for
Mr. Rees's bonus share grant, where we have assumed a per-share market
price of $2.31) with an assumed rate of appreciation of 5% and 10%,
respectively, compounded annually for 10 years.

113

The following table details the December 31, 1998 year end estimated value of
each named executive officer's unexercised stock options. All unexercised
options are to purchase the number of shares of common stock indicated.

Aggregated Option/SAR Exercises In Last Fiscal Year
And Year-End Option/SAR Values

Number of Securities
Underlying Unexercised Value of Unexercised
Options/ In-the-Money Options/
SARs at Year-End(#) SARs at Year-End ($)
Shares Acquired Value Exercisable (E)/ Exercisable (E)/
Name on Exercise (#) Realized ($) Unexercisable (U) Unexercisable (U)(a)
---- --------------- ------------ ---------------------- ---------------------

Ted B. Miller, Jr....... -- -- 2,848,000(E) $36,644,800(E)
1,135,000(U) 5,231,875(U)

David L. Ivy............ -- -- 1,260,000(E) 15,661,500(E)
620,000(U) 2,970,000(U)

Charles C. Green, III... -- -- 675,000(E) 7,321,875(E)
515,000(U) 2,124,375(U)

John L. Gwyn............ -- -- 130,000(E) 1,564,750(E)
345,000(U) 2,787,125(U)

Alan Rees............... -- -- 118,308(E) 1,351,025(E)
638,492(U) 6,609,678(U)

- --------

(a) The estimated value of exercised in-the-money stock options held at the end
of 1998 assumes a per-share fair market value of $17.125 and per-share
exercise prices ranging from $-0- to $13.00 as applicable.

Severance Agreements

We have entered into severance agreements with Messrs. Miller, Ivy, Green,
Gwyn, Rees, Reese and Hawk. Under the severance agreements, we are required to
provide severance benefits to these executives if they are terminated by us
without cause (as defined in the severance agreements) or the executives
terminate with good reason (as defined in the severance agreements)
(collectively, a "qualifying termination"). The severance agreements provide
for enhanced severance benefits if the executives incur a qualifying
termination within the two-year period following a change in control (as
defined in the severance agreements). Upon a qualifying termination that does
not occur during the change in control period, an eligible executive is
entitled to:

(1) a lump sum payment equal to two times the sum of his base salary and
annual bonus,

(2) continued coverage under specified welfare benefit programs for two
years and

(3) immediate vesting of any outstanding options and restricted stock
awards.

Upon a qualifying termination during the change in control period, an eligible
executive is entitled to:

(1) receive a lump sum payment equal to three times the sum of his base
salary and annual bonus,

(2) continued coverage under specified welfare benefit programs for three
years and

(3) immediate vesting of any outstanding options and restricted stock
awards.

Crown Arrangements

We have entered into a memorandum of understanding with Mr. Crown and a
related services agreement. Under the services agreement, Mr. Crown has agreed
to continue to serve in a consulting

114

capacity to (and as Chairman of) Crown Communication for a two-year period
expiring on December 9, 2000, and we have agreed, for such two-year period, to
pay Mr. Crown cash compensation of $300,000 annually, along with certain
executive perquisites. At the end of such two-year period, we will pay Mr.
Crown a severance benefit of $300,000. At the time of entering into the
memorandum of understanding, we also agreed:

. to vest all of Mr. Crown's existing stock options;

. to immediately grant Mr. Crown options to purchase 50,000 shares of
common stock at $7.50 per share; and,

. upon the closing of the initial public offering, to grant Mr. Crown
options to purchase 625,000 shares of common stock at the price to
public in the initial public offering ($13.00 per share).

Stock Option Plans

1995 Stock Option Plan

We have adopted the 1995 stock option plan, which was reamended on July 1,
1998. The purpose of the 1995 stock option plan is to advance our interests by
providing additional incentives and motivations which help us to attract,
retain and motivate employees, directors and consultants. The description set
forth below summarizes the general terms of the 1995 stock option plan and the
options granted under the 1995 stock option plan.

Under the 1995 stock option plan, we can grant options to purchase up to
18,000,000 shares of common stock. On April 20, 1999, our board of directors
approved an amendment to the 1995 stock option plan to permit as to grant
options to purchase up to 10,000,000 additional shares of our common stock;
however, this amendment will require the approval of a majority of our
shareholders.

Options granted under the 1995 stock option plan may either be incentive
stock options, under Section 422 of the Code, or nonqualified stock options.
The price at which a share of common stock may be purchased upon exercise of an
option granted under the 1995 stock option plan will be determined by the board
of directors and, in the case of nonqualified stock options, may be less than
the fair market value of the common stock on the date that the option is
granted. The exercise price may be paid:

.in cash,

.in shares of common stock (valued at fair market value at the date of
exercise),

. in option rights (valued at the excess of the fair market value of the
common stock at the date of exercise over the exercise price) or

.by a combination of such means of payment, as determined by the board.

Our employees, directors and consultants and the employees, directors and
consultants of our subsidiaries and affiliates are eligible to receive options
under the 1995 stock option plan; however, only certain employees are eligible
to receive incentive stock options. The 1995 stock option plan is administered
by the board and the board is authorized to interpret and construe the 1995
stock option plan. Subject to the terms of the 1995 stock option plan, the
board is authorized to:

.select the recipients of options from among those eligible,

.establish the number of shares that may be issued under each option and

. take any actions specifically contemplated or necessary or advisable for
the administration of the 1995 stock option plan.

No options may be granted under the 1995 stock option plan after July 31,
2005, which is ten years from the date the 1995 stock option plan was
originally adopted and approved by our board and stockholders. The 1995 stock
option plan will remain in effect until all options granted under it

115

have been exercised or expired. The board, in its discretion, may terminate the
1995 stock option plan at any time relating to any shares of common stock for
which options have not been granted. The 1995 stock option plan may be amended
by the board without the consent of our stockholders, except as to:

.a material increase in benefits,

. an increase in the number of shares that may be subject to options under
the 1995 stock option plan or

. a change in the class of individuals eligible to receive options under
the 1995 stock option plan. However, no change in any option previously
granted under the 1995 stock option plan may be made which would impair
the rights of the option holder without the approval of the holder.

Under the 1995 stock option plan, options are exercisable during the period
specified in each option agreement or certificate; except that no option is
exercisable later than ten years from the date the option is granted. Options
generally have been exercisable over a period of ten years from the grant date
and vested in equal installments over a four or five year period of service
with us as an employee. A change in control generally accelerates the vesting
of options granted to employees and some of the options vest upon achievement
of specific business goals or objectives. An option generally must be exercised
within 12 months of a holder ceasing to be involved as our employee, director
or consultant as a result of death and within three months for other reasons;
however, these periods can be extended by decision of the board (except in the
case of an incentive stock option). Shares of common stock subject to forfeited
or terminated options again become available for option awards. The board may,
subject to certain restrictions in the 1995 stock option plan (and, in the case
of an incentive stock option, in Section 422 of the Code), extend or accelerate
the vesting or exercisability of an option or waive restrictions in an option
agreement or certificate.

The 1995 stock option plan provides that the total number of shares covered
by the 1995 stock option plan, the number of shares covered by each option, and
the exercise price per share under each option will be proportionately adjusted
in the event of a recapitalization, stock split, dividend, or a similar
transaction.

The grant of an option will not constitute realized taxable income to the
grantee. Upon exercise of a nonqualified option, the holder will recognize
ordinary income in an amount equal to the excess of the fair market value of
the stock received over the exercise price paid. The tax basis in any shares of
common stock received under the exercise of such option will be equal to the
fair market value of the shares on the exercise date if the exercise price is
paid in cash. We will generally have a deduction at the same level as the
amount realized by the holder. We have the right to deduct and withhold
applicable taxes relating to taxable income realized by the holder upon
exercise of a nonqualified option and may withhold cash, shares or any
combination in order to satisfy or secure its withholding tax obligation. An
incentive stock option is not subject to taxation as income to the employee at
the date of grant or exercise and we do not get a business deduction for an
incentive stock option as long as the stock is not sold within two years after
the incentive stock option is granted and one year after the incentive stock
option is exercised. The incentive stock option is effectively taxed at capital
gain rates upon the sale of the stock by the employee. However, if the stock
acquired upon exercise of an incentive stock option is sold within two years of
the incentive stock option grant date or within one year of the exercise date,
then it is taxed the same as a nonqualified option. Upon the exercise of an
incentive stock option, the difference between the value of the stock and the
exercise price is recognized as a preference item for alternative minimum tax
purposes.

As of December 31, 1998, options to purchase a total of 13,082,220 shares of
common stock have been granted. Options for 572,825 shares of common stock have
been exercised, options for

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282,750 shares have been forfeited and options for 12,226,645 shares remain
outstanding. The following table sets forth the exercise price and number of
outstanding options as well as the number of those options which are vested and
exercisable as of December 31, 1998:

Amount
Exercise Amount Vested and
Price Outstanding Exercisable
-------- ----------- -----------

$0.40 345,000 345,000(a)
1.20 43,750 43,750
1.60 50,000 50,000
2.40 175,000 175,000
3.09 5,385 --
4.03 5,385 --
4.20 1,630,625 1,463,625
4.76 23,135 23,135
5.24 5,385 --
5.97 28,000 --
6.00 107,200 107,200
7.50 5,633,030 2,805,630
7.77 28,000 --
10.08 28,000 --
11.31 75,000 --
11.50 75,000 --
11.94 125,000 --
12.50 253,750 128,750
13.00 3,590,000 90,000
----- ---------- ---------
Total N/A 12,226,645 5,232,090
===== ========== =========

- --------
(a) Represents options held by Mr. Miller.

Except for the options for 23,135 shares with an exercise price of $4.76 per
share and options for 3,036,250 shares with an exercise price of $7.50, the
exercise prices for all of the options were equal to or in excess of the
estimated fair value of the common stock at the dates on which the numbers of
shares and the exercise prices were determined; therefore, in accordance with
the "intrinsic value based method" of accounting for stock options, we did not
recognize compensation cost related to the grant of these options. The options
for 23,135 shares with an exercise price of $4.76 were issued in 1998 in
exchange for services received from nonemployees; therefore, we will account
for the issuance of these options in 1998 based on the fair value of the
services received. Options for 3,036,250 shares granted at an exercise price of
$7.50 per share (which is below the estimated fair market value at the date of
grant) were included in the group of options which vested at the completion of
the initial public offering of common stock. We will account for these options
in 1998 based upon the fair market value of services received. The remaining
options for 2,731,230 shares granted at an exercise price of $7.50 per share
(which is below the estimated fair market value at the date of grant) were
granted in 1998 and generally are taken into account and vest over five years.
See "Management's Discussion and Analysis of Financial Condition and Results of
Operations--Compensation Charges Related to Stock Option Grants".

The options granted include incentive stock options for 627,750 shares with
an exercise price of $7.50 per share. As of December 31, 1998, incentive stock
options for 81,250 shares have been forfeited and none of the outstanding
incentive stock options are exercisable.

CTSH Stock Option Plans

CTSH has established certain stock option plans for the benefit of its
employees. Upon completion of the roll-up in August 1998, all of the
outstanding options to purchase shares of capital

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stock of CTSH granted under the CTSH stock option plans were converted into and
replaced by options to purchase shares of our common stock. Our board of
directors has adopted each of the CTSH option plans. Options granted under the
CTSH stock options plans may be adjusted at our discretion or, in the case of
options granted under the CTSH share bonus plan, by the CTSH Trustee, to take
into account any variation of our share capital subject to the written
confirmation of our auditors that the adjustment in their opinion is fair and
reasonable. The description set forth below summarizes the general terms of
each of the various plans that constitute the CTSH stock options plans.

CTSH All Employee Share Option Scheme. All outstanding options granted under
the CTSH all employee share option scheme are vested. These options may only be
exercised in full and on one occasion. Outstanding options granted under the
CTSH all employee plan will lapse if not exercised by the earlier of:

(1) the first anniversary of the option holder's death,

(2) six months following the termination of the option holder's
employment,

(3) six months following the earlier of (a) a change of control, (b) the
sanctioning by the U.K. courts of a compromise or arrangement under
the U.K. Companies Act 1985 section 425 that affects our common stock,
(c) a person becoming bound or entitled to acquire our common stock
under U.K. Companies Act 1985 sections 428-430 or (d) notice of a
general meeting of our stockholders at which a resolution will be
proposed for the purpose of our voluntary winding-up (each of the
foregoing, a corporate event),

(4) the option holder being adjudicated bankrupt under U.K. law,

(5) the surrender of the option or

(6) the seventh anniversary of the grant.

At the time of the roll-up there were outstanding options to purchase 285,250
shares of common stock at a price of $2.37 per share, of which an initial
refundable deposit of $1.20 per share has already been paid by each
participant. No additional options will be granted under the CTSH all employee
plan in the future.

CTSH Management Plan. All outstanding options granted under the CTSH
unapproved share option scheme will vest on the earlier of:

(1) March 1, 2000 or, if the option holder was not an eligible employee
(as defined in the plan) on March 1, 1997, the third anniversary of
the date on which the option was granted,

(2) the death of the option holder,

(3) the termination of the option holder's employment (other than a
termination for cause, or the voluntary resignation of the option
holder),

(4) a corporate event or

(5) the sale of our subsidiary or business in which the option holder is
employed.

Once vested, these options may be exercised in whole or in part at the
discretion of the option holder prior to the lapsing of the option. All options
granted under the CTSH management plan will lapse on the earlier of:

(1) the first anniversary of the option holder's death,

(2) six months after the termination of the option holder's employment
(other than a termination for cause, or the voluntary resignation of
the option holder),

(3) immediately upon any other termination of employment,

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(4) six months following a corporate event,

(5) the option holder being adjudicated bankrupt under U.K. law,

(6) the surrender of the option,

(7) failure to satisfy any performance condition established by the board
of directors of Castle Transmission or

(8) the seventh anniversary of the grant of the option.

Currently, there are outstanding options to purchase 1,649,844 shares of
common stock at prices ranging from (Pounds)1.43 ($2.39) to (Pounds)6.04
($10.08) per share. No additional options will be granted under the CTSH
management plan in the future.

CTSH Bonus Share Plan. In connection with the CTSH bonus share plan, CTSH has
executed the employee benefit trust, a discretionary settlement for the benefit
of past and present Castle Transmission employees, directors and their
families. Castle Transmission employees and directors are able to participate
in the CTSH bonus share plan by foregoing a portion of their annual bonuses
awarded by us in consideration for options to purchase shares of our common
stock held by the CTSH trust at predetermined prices per share depending upon
the year in which the investment is made. The predetermined price for 1997
investment was (Pounds)13.00 ($21.70) per unit (each of which will be converted
into seven shares of common stock upon completion of the roll-up), and the
Castle Transmission board has determined that the predetermined price for any
investment in 1998 and 1999 will be (Pounds)16.90 ($28.21) and (Pounds)21.97
($36.68) respectively.

All outstanding options granted under the CTSH bonus share plan are vested
and may be exercised in whole or in part at the discretion of the option holder
prior to the lapsing of the option. All options will lapse on the earlier of:

(1) the first anniversary of the option holder's death,

(2) six months after the termination of the option holder's employment,

(3) six months following a corporate event,

(4) the option holder being adjudicated bankrupt under U.K. law,

(5) the surrender of the option or

(6) the seventh anniversary of the grant of the option.

In order to satisfy the demand created by the exercise of options granted
under the CTSH bonus share plan, the CTSH trustee has been granted a call
option by us to purchase up to 149,709 shares of common stock from us at a
price of (Pounds)1.86 ($3.11) per share, the funds for which are to be
contributed to the CTSH trust by CTSH (which has already provided for such
payment in its financial statements). Currently there are outstanding options
to purchase 149,709 shares of common stock from the CTSH trustee for a nominal
sum upon exercise. Castle Transmission employees and directors continue to be
able to effectively invest a proportion of their annual bonuses in our common
stock under the CTSH bonus share plan for the fiscal years 1998 and 1999.
Thereafter, no additional options will be granted under the CTSH bonus share
plan. Grants under the CTSH bonus share plan are determined by converting
monetary awards into options to purchase shares at predetermined prices.

CTSH Option Grants to Certain Executives. In January and April of 1998, CTSH
granted options to purchase a total of 300,000 ordinary shares and 299,700,000
preference shares of CTSH to Ted B. Miller, Jr., David L. Ivy and George E.
Reese. These options are vested in full and have converted into options to
purchase 1,890,000 shares of our common stock at an exercise price of
(Pounds)1.43 and 210,000 shares of our common stock at an exercise price of
(Pounds)3.57. When we completed the roll-up, the exercise prices were set in
U.S. dollars at $2.31 for the (Pounds)1.43 exercise price and $5.96 for the
(Pounds)3.57 exercise price.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

1995 Investments

On January 11, 1995, Ted B. Miller, Jr., Edward C. Hutcheson, Jr., Centennial
Fund IV, Berkshire Fund III, A Limited Partnership, and certain trusts and
natural persons which are now members of Berkshire Investors LLC and J. Landis
Martin collectively invested $8,790,000 in return for CTC's common stock or, in
some cases, preferred stock or convertible notes of CTC. The proceeds received
on January 11, 1995 were used by us for the acquisition of towers and ancillary
assets from PCI and for working capital.

Under a securities exchange agreement, dated as of April 27, 1995, such
parties effectively made CCIC the holding company of CTC and converted some of
the obligations of CTC into capital stock of CCIC. As a result of the exchange
of CTC capital stock for CCIC capital stock, such parties received shares of
common stock, or, in some cases, preferred stock, of CCIC.

1996 Investments

Under a securities purchase agreement, dated as of July 15, 1996, among
Berkshire Fund III Group, Centennial Fund IV, J. Landis Martin, Edward C.
Hutcheson, Jr., Robert F. McKenzie and us, we privately placed 864,568 shares
of our Series B convertible preferred stock, par value $.01 per share, for an
aggregate purchase price of $10,374,816. Berkshire Fund III Group paid
$6,000,000 for 500,000 shares, Centennial Fund IV paid $3,724,812 for 310,401
shares, Mr. Martin paid $500,004 for 41,667 shares, Mr. Hutcheson paid $99,996
for 8,333 shares and Mr. McKenzie paid $50,004 for 4,167 shares. The proceeds
received were used for (a) the purchase of the towers and microwave and
specialized mobile radio businesses from Motorola in Puerto Rico, (b) an option
payment relating to the acquisition of TEA and TeleStructures and (c) working
capital.

1997 Investments

Under a securities purchase agreement, dated as of February 14, 1997, among
Centennial Fund V and Centennial Entrepreneurs Fund V, L.P. Berkshire Fund IV,
Limited Partnership, and certain trusts and natural persons that are members of
Berkshire Investors LLC, PNC Venture Corp., Nassau Capital Partners II L.P.,
NAS Partners I L.L.C., Fay, Richwhite Communications Limited, J. Landis Martin,
Robert F. McKenzie and us, we privately placed 3,529,832 shares of our Series C
convertible preferred stock, par value $.01 per share for an aggregate purchase
price of $74,126,472. As part of this transaction Centennial Fund V Investors
paid $15,464,001 for 736,381 shares, Berkshire Fund IV Group paid $21,809,991
for 1,038,571 shares, Nassau Group paid an aggregate of $19,499,991 for 928,571
shares, and Mr. Martin paid $999,999 for 47,619 shares. The proceeds received
on February 14, 1997 were used by us to fund a portion of our investment in
Castle Transmission.

In March 1997, Edward C. Hutcheson, Jr. exercised stock options for 345,000
shares of common stock. We repurchased these shares and 308,435 shares of his
existing Class A common stock for $3,422,118.

In May 1997, in connection with our acquisition of the stock of
TeleStructures, TEA and TeleShare, Inc., we issued 535,710 shares of common
stock to the shareholders of those companies.

In June 1997, Messrs. Miller and Ivy received special bonuses, related to
their services in structuring and negotiating our investment in Castle
Transmission, including arranging the consortium partners who participated with
us in the Castle Transmission transaction, of $600,000 and $300,000,
respectively.

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In August 1997, Robert A. Crown and Barbara Crown sold the assets of Crown
Communications to, and merged two related companies with, our subsidiaries. As
consideration for these transactions, the Crowns received a cash payment of
$25.0 million, our promissory note aggregating approximately $76.2 million,
approximately $2.3 million to pay certain taxes (part of which amount was paid
in September 1997 as a dividend to stockholders of record of one of the merged
companies on August 14, 1997), and 7,325,000 shares of common stock. In
addition, we assumed approximately $26.0 million of indebtedness of the Crown's
business. We repaid the seller note in full on October 31, 1997. Robert A.
Crown and Barbara Crown are both parties to the stockholders agreement and are
subject to its restrictions.

Under a securities purchase agreement, dated as of August 13, 1997, among
American Home Assurance Company and their affiliates, New York Life Insurance
Company, The Northwestern Mutual Life Insurance Company, PNC Venture Corp., J.
Landis Martin and us, we privately placed 292,995 shares of our senior
convertible preferred stock for an aggregate purchase price of $29,299,500,
together with warrants to purchase 585,990 shares of common stock at $7.50 per
share (subject to adjustment, including weighted average antidilution
adjustments). As part of this transaction, Mr. Martin paid $200,000 for 2,000
and warrants to purchase 4,000 shares of common stock. The proceeds received
were used by us to fund a portion of the acquisition of the Pittsburgh tower
operations and working capital.

Under a securities purchase agreement, dated as of October 31, 1997, among
Berkshire Partners Group, Centennial Fund V Investors, Nassau Group, Fay
Richwhite, Harvard Private Capital Holdings, Inc., Prime VIII, L.P. and the
prior purchasers of senior convertible preferred stock (other than affiliates
of American Home Assurance), an additional 364,500 shares of senior convertible
preferred stock were issued for an aggregate purchase price of $36,450,000,
together with warrants to purchase 729,000 shares of common stock at $7.50 per
share (subject to adjustment, including weighted average antidilution
adjustments). Berkshire Partners Group paid $3,500,000 for 35,000 shares and
warrants to purchase 70,000 shares of common stock. Centennial V Investors paid
$1,000,000 for 10,000 shares and warrants to purchase 20,000 shares of common
stock and J. Landis Martin paid $200,000 for 2,000 shares and warrants to
purchase 4,000 shares of common stock.

Other Transactions

Robert J. Coury, a former director of Crown Communication, and Crown
Communication were party to a management consulting agreement beginning in
October 1997 through January 1999. Under a memorandum of understanding dated
July 3, 1998, the compensation payable under such consulting agreement was
increased to $20,000 per month and Mr. Coury was granted options to purchase
60,000 shares of common stock at $7.50 per share. See "Management--Executive
Compensation--Crown Arrangements". We have recorded a noncash compensation
charge of $0.3 million related to the issuance of these stock options. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Compensation Charges Related to Stock Option Grants". In connection
with the acquisition of our Pittsburgh tower operations, Mr. Coury acted as
financial advisor to the Crowns and received a fee for such services, paid by
the Crowns.

We lease office space in a building formerly owned by our Vice Chairman and
Chief Executive Officer. Lease payments for such office space amounted to
$313,008, $130,000 and $50,000 for the years ended December 31, 1998, 1997 and
1996, respectively. The amount of space leased increased from 6,497 square feet
at $23.80 per square foot (or $154,836 in annual rent) to 19,563 square feet at
$16.00 per square foot (or $313,008 in annual rent) under a lease agreement
effective November 1, 1997. The lease term is for a period of five years with
an option to terminate in the third year or to renew at $18.40 per square foot.
Interstate Realty Corporation, a company owned by our

121

Vice Chairman and Chief Executive Officer, received a commission of $62,000 in
connection with this new lease.

Crown Communication leases its equipment storage and handling facility in
Pittsburgh from Idlewood Road Property Company, a Pennsylvania limited
partnership. HFC Development Corp., a Pennsylvania corporation owned by Mr.
Crown's parents, is the general partner of Idlewood. The annual rent for the
property is $180,000.

On August 10, 1998, Michel Azibert, who was elected as a director of CCIC in
August 1998, acquired 50,000 shares of common stock from an existing
stockholder of CCIC for $6.26 per share under a purchase right assigned to him
by CCIC. We recorded a noncash compensation charge of $0.3 million related to
the transfer of the purchase right. See "Management's Discussion and Analysis
of Financial Condition and Results of Operations--Compensation Charges Related
to Stock Option Grants".

On February 28, 1997, Castle Transmission and TdF's parent entered into the
Castle Transmission services agreement under which TdF's parent agreed to
provide certain consulting services to Castle Transmission in consideration for
a minimal annual fee of (Pounds)400,000 ($665,120) and reimbursement for
reasonable out-of-pocket expenses. TdF's parent has agreed to, among other
things, provide the services of ten executives or engineers to Castle
Transmission on a part-time basis and to provide a benchmarking review of
Castle Transmission. In addition, TdF's parent has agreed to provide additional
services relating to research, development and professional training on terms
(including as to price) to be determined. The term of the Castle Transmission
services agreement is expected to be extended for four additional years (to
February 28, 2004) and thereafter will be terminable on 12-month's prior notice
given by Castle Transmission to TdF after February 28, 2003.

In connection with the financing arrangements relating to the joint venture,
we paid an aggregate of $100,000 to Centennial Fund IV, L.P., Centennial Fund
V, L.P. and Centennial Entrepreneurs Fund V, L.P.

We have entered into a memorandum of understanding with Mr. Crown and a
related services agreement. Under the services agreement, Mr. Crown agreed to
continue to serve in a consulting capacity to (and as Chairman of) Crown
Communication for a two-year period ending December 9, 2000, and we have
agreed, for such two-year period, to pay Mr. Crown cash compensation of
$300,000 annually, along with certain executive perquisites. At the end of the
two-year period, we will pay Mr. Crown a severance benefit of $300,000.

Agreements with TdF Related to the Roll-Up

Governance Agreement

On August 21, 1998, we entered into a governance agreement with TdF and one
of its subsidiaries to provide for certain rights and obligations of each party
for our governance.

Super-Majority Voting Requirements

In general, until August 21, 2003, a super majority vote of our board of
directors is required for CCIC or any of its subsidiaries to take any of the
following actions:

. amendments to the certificate of incorporation or by-laws;

. acquisitions or investments of more than $20.0 million;

. dispositions for more than $20.0 million;

122

. significant strategic alliances;

. the incurrence of debt unless certain leverage ratios have been met;

. any transaction with a party to the stockholders agreement or any of our
affiliates;

. the issuance of any equity securities;

. any transaction that would result in any person holding 50% or more of
our voting securities or equity interests;

. any sale of all or substantially all of our assets;

. any action by us relating to our dissolution or bankruptcy; and

. any amendments to our rights plan.

TdF Veto Rights

In general, until August 21, 2003, TdF's consent will be required for CCIC or
any of its subsidiaries to take any of the following actions:

. significant acquisitions or investments;

. strategic alliances with certain third parties; and

. significant dispositions.

In addition, until August 21, 2008, TdF's consent generally will be required
for CCIC or any of its subsidiaries to take any of the following actions:

. amendments to the certificate of incorporation or bylaws;

. the issuance of any new class of security or of additional shares of
Class A common stock;

. any transaction that would result in any person holding 50% or more of
our voting securities or equity interests;

. any sale of all or substantially all of our assets; and

. the issuance to any person of equity securities representing 25% or more
of our outstanding equity securities.

TdF Preemptive Rights

Except in limited circumstances, if we issue any equity securities to any
person, we must offer TdF the right to purchase, at the same cash price and on
the same other terms proposed, up to the amount of such equity securities as
would be necessary for TdF and its affiliates to maintain their consolidated
ownership percentage in CCIC. See "Risk Factors".

TdF Standstill; Transfer Restrictions; Voting

TdF and its affiliates will not, without the prior written consent of the
board;

. acquire beneficial ownership of any of our voting securities if their
ownership interest would be greater than a specific percentage;

. propose that TdF or any of its affiliates enter into any business
combination involving us;

. make any "solicitation" of "proxies" (as such terms are used in
Regulation 14A promulgated under the Exchange Act) to vote or consent
relating to any of our voting securities in opposition to the
recommendation of a super majority vote of the board;

. except in accordance with the terms of the stockholders agreement, seek
election to or seek to place a representative on the board or seek the
removal of any member of the board;

123

. (a) solicit, seek to effect, negotiate with or provide nonpublic
information to any other person relating to or (b) otherwise make any
public announcement or proposal relating to, any form of business
combination (with any person) involving a change of control of CCIC or
the acquisition of a substantial portion of the voting securities and/or
equity securities or assets of CCIC or any subsidiary of CCIC; or

. publicly disclose any intention, plan or arrangement, or provide advice
or assistance to any person, inconsistent with the foregoing.

In general, if TdF or any of its affiliates seek to transfer 5% or more of
our voting securities, we will have the right to purchase all, or any part in
excess of such 5%, of such voting securities for cash at the price at which
they are to be transferred. These limitations do not apply to certain
transactions including underwritten public offerings and sales under Rule 144.

Whenever TdF has the right to vote any of our voting securities and a "proxy-
contest" exists or any proposal for the election of any member to the board has
received a negative vote, which in either case, had been recommended by a super
majority vote of the board, TdF has agreed to vote all of our voting securities
held by it in the manner recommended by a super majority vote of the board.

The standstill, transfer restriction and voting provisions described above
will cease to apply on or before August 21, 2003. In addition, the standstill
and voting provisions will be suspended during any period of an unsolicited
offer (including any offer commenced by TdF or any member of the TdF Group
following such suspension) and will afterwards be reinstated.

TdF CTSH Option

If (1) the board overrides a veto by TdF of a business combination or (2) an
unsolicited offer by any person (other than TdF or any of its affiliates) has
commenced or occurred, TdF will have the option us to:

. acquire for cash all of the CTSH shares beneficially owned by us at
their fair market value or

. sell for cash to us all of the CTSH shares and warrants beneficially
owned by TdF at their fair market value.

Immediately before completion of any business combination or unsolicited
offer, TdF may require us to purchase one-half of the shares of Class A common
stock held by TdF and its affiliates for cash at the offer price per share of
common stock under the business combination or unsolicited offer.

Put and Call Rights

TdF Put Right. TdF will have the right to require us (1) to purchase all
(except for one CTSH share) of the CTSH shares beneficially owned by TdF and
its affiliates in exchange for shares of Class A common stock at a specified
exchange ratio and (2) to issue in exchange for the TdF CTSH warrants a number
of shares of Class A common stock at the exchange ratio plus 100,000 shares of
Class A common stock, subject to adjustment in certain circumstances.

CCIC Call Right. On August 21, 2000, unless the weighted average price per
share of common stock over the five trading days immediately preceding August
21, 2000, is less than or equal to $12, as adjusted for any stock split or
similar transaction, we will have the right to require TdF to transfer and
deliver to us all (except for one CTSH share) of TdF's CTSH shares and the
TdF's CTSH

124

warrants in exchange for a number of shares of Class A common stock at the
exchange ratio plus 100,000 shares of Class A common stock, subject to
adjustment in certain circumstances.

Stockholders Agreement

On August 21, 1998, we entered into the stockholders agreement with certain
of our stockholders to provide for certain rights and obligations for our
governance and the stockholders' shares of common stock or Class A common
stock.

Governance

Board Representation.

. So long as the TdF group holds at least 5.0% of our common stock, TdF
will have the right to appoint one director and generally will have the
right to appoint two directors;

. so long as Robert A. Crown, Barbara Crown, certain trusts established by
them and their permitted transferees have beneficial ownership of at
least 555,555 shares of common stock, they will have the right to elect
one director;

. so long as Ted B. Miller, Jr. and his permitted transferee maintain an
ownership interest, they will have the right to elect one director;

. our chief executive officer will have the right to elect one director;

. so long as the ownership interest of Centennial Fund IV, L.P.,
Centennial Fund V, L.P., Centennial Entrepreneurs Fund V, L.P., their
affiliates and respective partners is at least 5.0%, they will have the
right to elect one director;

. so long as the ownership interest of the Berkshire group is at least
5.0%, the Berkshire group will have the right to elect one director;

. so long as the ownership interest of Nassau Capital Partners II, L.P.,
NAS Partners I, L.L.C., their affiliates and their respective partners
is not less than the ownership interest of the Nassau group immediately
following the closing of the initial public offering, the Nassau group
will have the right to elect one director; and

. all directors other than the designees will be nominated in accordance
with our certificate of incorporation and by-laws.

Solicitation and Voting of Shares. At each meeting of our stockholders at
which directors are to be elected, we will use our best efforts to solicit from
those stockholders eligible to vote in the election of directors proxies in
favor of the nominees selected in accordance with the provisions of the
stockholders agreement (including the inclusion of each director nominee in
management's slate of nominees and in the proxy statement prepared by our
management in respect of each annual meeting, vote or action by written
consent).

Each stockholder will vote its shares in favor of the election of the persons
nominated under the provisions described in "--Board Representation" above to
serve the board and against the election of any other person nominated to be a
director.

Committees of the Board. Each of the nominating and corporate governance
committee and the executive committee will contain, so long as TdF is
qualified, at least one director that is a TdF designee.

Registration Rights; Tag-Along Rights

These stockholders have been granted certain piggy-back registration rights,
demand registration rights, S-3 registration rights and tag-along rights for
their shares of common stock. If at any time

125

stockholders holding at least 2% of our voting securities determine to sell or
transfer 2% or more of the voting securities then issuable or outstanding to a
third party who is not an affiliate of any of these stockholders may have the
opportunity and the right to sell to the purchasers in such proposed transfer,
on the same terms and conditions as the selling stockholders, up to that number
of shares owned by such stockholder equaling the product of:

(a) a fraction, the numerator of which is the number of shares owned by
such stockholder as of the date of such proposed transfer and the
denominator of which is the aggregate number of shares owned by the
selling stockholders and by all stockholders exercising tag-along
rights multiplied by

(b) the number of securities to be offered.

CTSH Shareholders' Agreement

On August 21, 1998, CCIC, TdF and CTSH entered into a shareholders' agreement
to govern the relationship between CCIC and TdF as shareholders of CTSH.

Corporate Governance. The board of CTSH will be comprised of six directors,
of which CCIC and TdF will each have the right to appoint and remove two
directors with the remaining two directors to be mutually agreed upon by CCIC
and TdF. CCIC has the right to nominate the chairman, chief executive officer,
chief operating officer and chief financial officer of CTSH, subject to
approval by a super majority vote of the board of CCIC.

The affirmative vote of a majority of the board, including a director
nominated by CCIC and a director nominated by TdF, is necessary for the
adoption of a resolution. Further, the prior written consent of each of CCIC
and TdF, in their capacities as shareholders, is required for the following
actions, among others:

. significant acquisitions and dispositions;

. issuance of new shares;

. entry into transactions with shareholders, except under the Castle
Transmission services agreement and/or the Castle Transmission operating
agreement;

. entry into new lines of business;

. capital expenditures outside the budget;

. entry into banking and other financing facilities;

. entry into joint venture arrangements;

. payment of dividends, except for (1) dividends payable in respect of
CTSH's redeemable preferred shares and (2) dividends permitted by CTSH's
financing facilities; and

. establishing a public market for CTSH shares. Similar governance
arrangements also apply to CTSH's subsidiaries.

If either CCIC or TdF vetoes a transaction (either at board or shareholder
level), the other shareholder is entitled to pursue that transaction in its own
right and for its own account.

Transfer Provisions. Subject to certain exceptions, neither CCIC nor TdF may
transfer any interest in shares held in CTSH to a third party. Transfers of
shares to affiliated companies are permitted, subject to certain conditions. No
shares may be transferred if such transfer would:

(a) entitle the BBC to terminate either of the BBC contracts,

126

(b) subject CTSH to possible revocation of its licenses under the
Telecommunications Act 1984 or the Wireless Telegraphy Acts 1949, 1968
and 1998 or

(c) cause CCIC or TdF to be in breach of the commitment agreement between
TdF, TdF's parent, the BBC and us (under which we and TdF have agreed
to maintain certain minimum ownership levels in CTSH for a period of
five years). See "Business--U.K. Operations--Significant Contracts--BBC
Commitment Agreement".

In addition, shares may be sold to a third party, subject to a right of first
refusal by the other party, after the later of (a) the second anniversary of
the closing of the roll-up, and (b) the expiration of the period for the
completion of the TdF put right or the CCIC call right. If CCIC purchases TdF's
shares under such right of first refusal, it may elect (instead of paying the
consideration in cash) to discharge the consideration by issuing its common
stock at a discount of 15% to its market value. If the right of first refusal
is not exercised, the selling shareholder must procure and offer on the same
terms for the shares held by the other party. If we elect to issue common stock
to TdF under the right of first refusal, TdF will be entitled to certain demand
registration rights and tag along rights.

TdF Put Right. TdF has the right to put its shares of CTSH to CCIC for cash
if there is a change of control of CCIC. Such right is exercisable if (a) TdF
has not exchanged its shares under the governance agreement by the second
anniversary of the closing of the roll-up, or (b) prior to the second
anniversary of the closing of the roll-up, if TdF has ceased to be qualified
for the purposes of the governance agreement.

The consideration payable on the exercise of the TdF put right will be an
amount agreed between CCIC and TdF or, in the absence of agreement, the fair
market value as determined by an independent appraiser.

TdF Exit Right. TdF also has the right after the earlier of (a) the second
anniversary of the closing of the roll-up, or (b) TdF ceasing to be qualified
for purposes of the governance agreement, to require CCIC, upon at least six
months' notice, to purchase all, but not less than all, of the shares it
beneficially owns in CTSH.

The consideration to be paid to TdF, and the manner in which it is
calculated, upon exercise of the TdF Exit Right is substantially the same as
described upon exercise of the TdF put right.

CCIC is entitled to discharge the consideration payable on the exercise of
the TdF exit right either in cash or by issuing common stock to TdF at a
discount of 15% to its market value. If CCIC elects to issue common stock to
TdF on the exercise of the TdF exit right, TdF will be entitled to certain
demand registration rights and tag-along rights.

CCIC Deadlock Right. CCIC has the right to call TdF's shares of CTSH, subject
to certain procedural requirements, for cash if, after the third anniversary of
the closing of the roll-up, TdF refuses on three occasions during any
consecutive six-month period to agree to the undertaking by CTSH of certain
types of transactions (including acquisitions and disposals) that would fall
within CTSH's core business. The consideration due on the exercise of the CCIC
deadlock right is payable in cash, the fair market value of the TdF interest to
be determined in the same manner described above upon exercise of the TdF put
or exit rights.

CCIC Shotgun Right. Provided that TdF has not, under the governance
agreement, exchanged its share ownership in CTSH for shares of CCIC, CCIC may
(a) by notice expiring on August 21, 2003, or (b) at any time within 45 days of
CCIC becoming aware of a TdF change of control (as defined in the governance
agreement) offer to purchase TdF's shares in CTSH. TdF is required to either
sell its shares or agree to purchase CCIC's shares in CTSH at the same price
contained in CCIC's offer for TdF's shares of CTSH.

127

The completion of any transfer of shares between CCIC and TdF under any of
the transfer provisions described above is subject to the fulfillment of
certain conditions precedent, including obtaining all necessary governmental
and regulatory consents.

Termination. The shareholders' agreement terminates if either CCIC or TdF
ceases to be qualified. CCIC remains qualified on the condition that it holds
at least 10% of the share capital of CTSH.

Castle Transmission Services Agreement

On February 28, 1997, Castle Transmission and TdF's parent entered into a
services agreement under which TdF, parent agreed to provide certain consulting
services to Castle Transmission in consideration for a minimum annual fee of
(Pounds)400,000 ($665,120) and reimbursement for reasonable out-of-pocket
expenses. This agreement was amended and restated on August 21, 1998. TdF's
parent has agreed to, among other things, provide the services of ten
executives or engineers to Castle Transmission on a part-time basis and to
provide a benchmarking review of Castle Transmission. In addition, TdF's parent
has agreed to provide additional services relating to research, development and
professional training on terms (including as to price) to be determined.
Following February 28, 2003, the Castle Transmission services agreement will be
terminable on 12-month's prior notice given by Castle Transmission to TdF.

Castle Transmission Operating Agreement

The following summary of the terms of the Castle Transmission operating
agreement is subject to the negotiation of definitive documentation, although
we expect such agreement to have the general terms described herein. Under the
Castle Transmission operating agreement, we will be permitted to develop
business opportunities relating to terrestrial wireless communications
(including the transmission of radio and television broadcasting) anywhere in
the world except the United Kingdom. Castle Transmission will be permitted to
develop such business opportunities solely in the United Kingdom.

The Castle Transmission operating agreement will also establish a framework
for the provision of business support and technical services to us and our
subsidiaries (other than Castle Transmission) in connection with the
development of any international business by us. TdF will have the right, if
called upon to do so by CTSH or us, to provide all or part of such services to
us and our subsidiaries (other than Castle Transmission) in connection with the
provision of broadcast transmission services.

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PRINCIPAL STOCKHOLDERS

The following table shows the beneficial ownership as of March 31, 1999 of
our capital stock by our directors, officers, selling stockholders and those
whom we know beneficially own more than 5% of any class or series of our
capital stock.

Shares that a person could acquire through options, warrants or convertible
stock within 60 days from the date of this prospectus are considered when
calculating the number and percentage of shares beneficially owned by that
particular person but are not included when calculating these figures for any
other stockholder. Shares of common stock convertible from Class A common stock
have been included in calculating percentage of total voting power.

Shares Beneficially Owned Percentage
------------------------- of Total
Executive Officers and Voting
Directors(a) Title of Class Number Percent Power
- ---------------------- -------------- --------------- ----------------------

Ted B. Miller, Jr. ..... Common Stock(b) 4,020,010 3.9 3.5
David L. Ivy............ Common Stock(c) 1,432,695 1.4 1.3
Charles C. Green, III... Common Stock(d) 712,695 * *
John L. Gwyn............ Common Stock(e) 233,291 * *
John P. Kelly(f)........ Common Stock(g) 14,977 * *
E. Blake Hawk........... Common Stock(h) 2,252 * *
Alan Rees(i)............ Common Stock(j) 215,673 * *
Robert A. Crown(k)...... Common Stock(l) 5,794,888 5.8 5.2
Michel Azibert(m)....... Common Stock(n) 60,000 * *
Bruno Chetaille(o)...... Common Stock(p) 10,000 * *
Carl Ferenbach(q)....... Common Stock(r) 20,740,805 20.9 18.8
Randall A. Hack(s)...... Common Stock(t) 5,085,080 5.1 4.6
Robert F. McKenzie(u)... Common Stock(v) 202,500 * *
William A. Murphy(w).... Common Stock(x) 10,000 * *
Jeffrey H. Schutz(y).... Common Stock(z) 9,842,040 9.9 8.9
Directors and Executive
Officers as a group
(15 persons total)..... Common Stock(aa) 48,376,906 48.6 43.7

Berkshire(bb)
Berkshire Fund III, A
Limited Partnership.... Common Stock(cc) 6,095,450 6.1 5.5
Berkshire Fund IV,
Limited Partnership.... Common Stock(dd) 12,996,055 13.1 11.8
Berkshire Investors
LLC.................... Common Stock(ee) 1,619,300 1.6 1.5

Candover(ff)
Candover Investments,
plc.................... Common Stock 2,329,318 2.3 2.1
Candover (Trustees)
Limited................ Common Stock 208,317 * *
Candover Partners
Limited................ Common Stock 8,792,565 8.9 8.0

Centennial(gg)
Centennial Fund IV,
L.P.(hh)............... Common Stock 5,965,340 6.0 5.4
Centennial Fund V,
L.P.(ii)............... Common Stock 3,731,285 3.8 3.4
Centennial Entrepreneurs
Fund V, L.P.(jj)....... Common Stock 115,415 * *
Crown Atlantic Holding
Company LLC(kk)........ Common Stock 15,597,783 15.7 14.1

Nassau(ll)
Nassau Capital Partners
II, L.P................ Common Stock(mm) 5,023,825 5.1 4.5
NAS Partners I, L.L.C... Common Stock(nn) 31,255 * *

Digital Future
Investments B.V.(oo)... Class A Common Stock 11,340,000 100.0 10.3

- --------
* Less than 1%.
(a) Except as otherwise indicated, the address of each person in this table is
c/o Crown Castle International Corp., 510 Bering Drive, Suite 500, Houston,
TX 77057.

129

(b) Includes options for 2,951,908 shares of common stock. A trust for the
benefit of Mr. Miller's children holds 99,995 shares of common stock.

(d) Represents options for 712,695 shares of common stock.

(e) Includes options for 230,791 shares of common stock.

(f) Mr. Kelly's principal business address is c/o Crown Communication Inc., 375
Southpointe Blvd., Canonsburg, PA 15317.

(g) Represents options for 14,977 shares of common stock.

(h) Represents options for 2,252 shares of common stock.

(i) Mr. Rees's principal business address is c/o Castle Transmission
International Ltd., Warwick Technology Park, Heathcote Lane, Warwick
CV346TN, United Kingdom.

(j) Includes options for 145,673 shares of common stock.

(k) Mr. Crown's principal business address is c/o Crown Communication Inc., 375
Southpointe Blvd., Canonsburg, PA 15317.

(l) Includes 2,063,091 shares of common stock owned by Mr. Crown, 1,873,091
shares of common stock owned by his spouse, over which she has sole voting
and dispositive power, 125,000 shares of common stock that are jointly
owned, 791,909 shares of common stock owned by a grantor retained annuity
trust for Mr. Crown, 791,909 shares of common stock owned by a grantor
retained annuity trust for Ms. Crown and options for 149,888 shares of
common stock.

(m) Mr. Azibert's principal business address is c/o TeleDiffusion de France
International S.A., 10 Rue d'Oradour sur Glane, 75732 Paris 15 France.

(n) Includes options for 10,000 shares of common stock.

(o) Mr. Chetaille's principal business address is c/o TeleDiffusion de France
International S.A., 10 Rue d'Oradour sur Glane, 75732 Paris 15 France.

(p) Represents options for 10,000 shares of common stock.

(q) Mr. Ferenbach's principal business address is c/o Berkshire Partners LLC,
One Boston Place, Suite 3300, Boston, MA 02108.

(r) Represents options for 30,000 shares of common stock and 20,710,805 shares
of common stock beneficially owned by members of the Berkshire Group. Mr.
Ferenbach disclaims beneficial ownership of such shares, except to the
extent of his pecuniary interest therein.

(s) Mr. Hack's principal business address is c/o Nassau Capital LLC, 22
Chambers St., Princeton, NJ 08542.

(t) Represents options for 30,000 shares of common stock and 5,055,080 shares
of common stock beneficially owned by members of the Nassau Group. Mr. Hack
disclaims beneficial ownership of such shares.

(u) Mr. McKenzie's principal business address is P.O. Box 1133, 1496 Bruce
Creek Road, Eagle, CO 81631.

(v) Includes options for 109,375 shares of common stock.

(w) Mr. Murphy's principal business address is c/o Salomon Smith Barney,
Victoria Plaza, 111 Buckingham Palace Road, London, England.

(x) Represents options for 10,000 shares of common stock.

(y) Mr. Schutz's principal business address is c/o The Centennial Funds, 1428
Fifteenth Street, Denver, CO 80202-1318. Mr. Schutz is a general partner of
each of Holdings IV and Holdings V. However, neither Mr. Schutz nor any
other general partner of either Holdings IV or Holdings V, acting alone,
has voting or investment power with respect to our securities directly
beneficially held by Centennial Fund IV, Centennial Fund V and Centennial
Entrepreneurs Fund, and, as a result, Mr. Schutz disclaims beneficial
ownership of our securities directly beneficially owned by such funds,
except to the extent of his pecuniary interest therein.

(z) Represents options for 30,000 shares of common stock and 9,812,040 shares
of common stock beneficially owned by members of the Centennial Group. Mr.
Schutz disclaims beneficial ownership of such shares.

130

(aa) Includes options for 5,750,254 shares of common stock and warrants for
120,000 shares of common stock.

(bb) Berkshire Group has approximately 18.7% of the total voting power of
common stock. Carl Ferenbach, Chairman of our Board of Directors and a
director of CCIC, is a Managing Director of Berkshire Investors; a
Managing Director of Third Berkshire Managers the general partner of Third
Berkshire Associates, the general partner of Berkshire Fund III; and a
Managing Director of Fourth Berkshire Associates, the general partner of
Berkshire Fund IV. The principal business address of the Berkshire Group
is c/o Berkshire Partners LLC, One Boston Place, Suite 3300, Boston, MA
02108-401.

(cc) Includes warrants for 35,935 shares of common stock.

(dd) Includes warrants for 29,255 shares of common stock.

(ee) Includes warrants for 4,810 shares of common stock.

(ff) Candover Group has approximately 10.3% of the total voting power of common
stock. G. Douglas Fairservice is a Director of each entity in the Candover
Group. The principal business address of Candover Partners is 20 Old
Bailey, London EC4M 7LM, United Kingdom.

(gg) Centennial Fund IV, Centennial Fund V and Centennial Enterpreneurs Fund
collectively have approximately 8.9% of the total voting power of common
stock.

(hh) Holdings IV is the sole general partner of Centennial Fund IV, and,
accordingly, Holdings IV may be deemed to control Centennial Fund IV and
possess indirect beneficial ownership of our securities directly
beneficially held by Fund IV. The principal business address of Centennial
Fund IV and Holdings IV is 1428 Fifteenth Street, Denver, Colorado 80202-
1318.

(ii) Holdings V is the sole general partner of Centennial Fund V, and,
accordingly, Holdings V may be deemed to control Centennial Fund V and
possess indirect beneficial ownership of our securities directly
beneficially held by Centennial Fund V. The principal business address of
Centennial Fund V and Holdings V is 1428 Fifteenth Street, Denver,
Colorado 80202-1318.

(jj) Holdings V is the sole general partner of Centennial Entrepreneurs Fund V,
and, accordingly, may be deemed to control Centennial Entrepreneurs Fund V
and possess indirect beneficial ownership of our securities directly
beneficially held by Centennial Entrepreneurs Fund V. The principal
business address of Centennial Entrepreneurs V is 1428 Fifteenth Street,
Denver, Colorado 80202-1318.

(kk) The principal business address of Crown Atlantic Holding Company LLC is
375 Southpointe Boulevard, Canonsburg, PA 15317.

(ll) Nassau Group has approximately 4.6% of the total voting power of common
stock. Randall Hack, a director of CCIC, is a member of Nassau Capital
L.L.C., an affiliate of Nassau Group. The principal business address of
Nassau Capital Partners II, L.P. is 22 Chambers Street, Princeton, NJ
08542.

(mm) Includes warrants for 49,690 shares of common stock.

(nn) Includes warrants for 310 shares of common stock.

(oo) Digital Future Investments B.V. is an affiliate of TeleDiffusion de France
International S.A. TdF will retain ownership of 20% of the shares of
capital stock of CTSH. Pursuant to the share exchange agreement and
subject to certain conditions, TdF has the right to exchange its shares of
capital stock of CTSH for 17,443,500 shares of our Class A common stock
(which is convertible into 17,443,500 shares of common stock). DFI
currently has 10.3% of the total voting power of common stock. Combined,
TdF and DFI would have 22.5% of the Voting Power of common stock. The
principal business address of DFI is c/o TeleDiffusion de France
International S.A., 10 Rue d'Oradour sur Glane, 75732 Paris 15 France.

131

DESCRIPTION OF SECURITIES

This description of the securities being offered has five parts:

. description of the exchangeable preferred stock;

. description of the exchange debentures;

. certain definitions;

. book-entry, delivery and form; and

. registration rights and liquidated damages.

You should read all five parts of this Description of Securities for a
description of the provisions of the instruments governing the securities, the
form in which the securities are expected to be issued and certain mechanics
for trading of the securities. Although this description is provided for your
reference, you are strongly encouraged to read the certificate of designations
governing the exchangeable preferred stock, and the exchange indenture
governing the exchange debentures for the complete terms and provisions of the
securities being offered. In addition, you should be aware that the General
Corporation Law of the State of Delaware also governs the exchangeable
preferred stock and the ability of CCIC to pay dividends on the exchangeable
preferred stock. See "Description of Capital Stock" and "Risk Factors--Ability
to Pay Dividends on the Exchangeable Preferred Stock".

Brief Description of the Securities

Exchangeable Preferred Stock

These shares:

. are senior in right of payment to all classes or series of CCIC stock
other than any future stock that ranks on a parity;

.accrue dividends at a rate of 12 3/4% that are payable quarterly;

. have no voting rights except as required by law or as may arise under
circumstances described in the certificate of designations;

.can be exchanged by CCIC at any time for exchange debentures;

.are mandatorily redeemable on December 15, 2010; and

.are redeemable at CCIC's option at prices described in the certificate of
designations.

CCIC has covenanted that it will offer to repurchase shares of exchangeable
preferred stock under the circumstances described in the certificate of
designations upon:

.a Change of Control of CCIC; or

.an Asset Sale by CCIC and its Restricted Subsidiaries.

The certificate of designations governing the exchangeable preferred stock
also contains the following covenants:

.Restricted Payments;

.incurrence of Indebtedness and issuance of preferred stock;

.dividend and other payment restrictions affecting Subsidiaries;

.merger, consolidation or sale of assets;

.transactions with Affiliates;

.limitation on issuances and sales of Capital Stock of Restricted
Subsidiaries;

132

.Senior Subordinated Debt;

.Business Activities; and

.Reports.

Exchange Debentures

The exchange debentures:

.are general obligations of CCIC;

.are subordinated in right of payment to all existing and future Senior
Debt of CCIC;

.are senior in right of payment to any future subordinated Indebtedness of
CCIC;

. accrue interest from the date they are exchanged at a rate of 12 3/4%,
which is payable semi-annually; and

.mature on December 15, 2010.

The indenture governing the exchange debentures contains repurchase
requirements and covenants that are very similar to those in the certificate of
designations governing the exchangeable preferred stock. The differences
between the relevant provisions are described under the caption "Description of
the Exchange Debentures."

Description of the Exchangeable Preferred Stock

You can find the definitions of certain terms used in this description under
the subheading "Certain Definitions". In this description, "CCIC" refers only
to Crown Castle International Corp. and not to any of its subsidiaries.

The old preferred stock was and the new preferred stock will be issued under
a Certificate of Designations, Preferences and Relative, Participating,
Optional and Other Special Rights of Preferred Stock and Qualifications,
Limitations and Restrictions Thereof, which we refer to as the certificate of
designations, a copy of which is filed as an exhibit to the registration
statement of which this prospectus is a part.

The following description is a summary of the material provisions of the
certificate of designations and does not restate that agreement in its
entirety. We urge you to read the certificate of designations because it, and
not this description, defines your rights as holders of the exchangeable
preferred stock. Copies of the certificate of designations are available as set
forth below under the subheading "Additional Information". This description is
qualified in its entirety by reference to CCIC's Amended and Restated
Certificate of Incorporation, which will include the certificate of
designations and the definitions therein of certain terms used below.

The certificate of designations authorized CCIC to issue 400,000 shares of
exchangeable preferred stock with a liquidation preference of $1,000 per share
(the "Liquidation Preference"). The old preferred stock was and the new
preferred stock will, when issued, be fully paid and nonassessable and Holders
will have no preemptive rights in connection therewith.

The liquidation preference of the exchangeable preferred stock is not
necessarily indicative of the price at which shares of the exchangeable
preferred stock will actually trade at or after the time of their issuance, and
the exchangeable preferred stock may trade at prices below its liquidation
preference. The market price of the exchangeable preferred stock can be
expected to fluctuate with changes in the financial markets and economic
conditions, the financial condition and prospects of CCIC and other facts that
generally influence the market prices of securities.

133

As of December 21, 1998, all of CCIC's subsidiaries other than (1) CTSH and
its subsidiaries and (2) Crown Castle Investment Corp. and Crown Castle
Investment Corp. (II) and their subsidiaries, through which CCIC holds its
interest in the Bell Atlantic joint venture, were Restricted Subsidiaries.
However, under the circumstances described below under the subheading "Certain
Covenants--Restricted Payments," CCIC will be permitted to designate certain of
our other subsidiaries as Unrestricted Subsidiaries. Unrestricted Subsidiaries
will not be subject to most of the restrictive covenants in the certificate of
designations.

Transfer Agent

The transfer agent for the exchangeable preferred stock is ChaseMellon
Shareholder Services, L.L.C. unless and until CCIC selects a successor.

Ranking

The exchangeable preferred stock ranks senior in right of payment to all
classes or series of CCIC's capital stock as to dividends and upon liquidation,
dissolution or winding up of CCIC.

Without the consent of the Holders of at least two-thirds of the then
outstanding exchangeable preferred stock, CCIC may not authorize, create (by
way of reclassification or otherwise) or issue:

(1) any class or series of capital stock of CCIC ranking senior to the
exchangeable preferred stock ("Senior Securities"); or

(2) any obligation or security convertible or exchangeable into, or
evidencing a right to purchase, shares of any class or series of Senior
Securities.

Notwithstanding the foregoing, CCIC may, without the consent of the Holders
of the exchangeable preferred stock, authorize, create (by way of
reclassification or otherwise) or issue:

(1) any class or series of capital stock of CCIC ranking on a parity with
the exchangeable preferred stock ("Parity Securities"); or

(2) any obligation or security convertible or exchangeable into, or
evidencing a right to purchase, shares of any class or series of Parity
Securities.

Dividends

Holders of exchangeable preferred stock are entitled to quarterly cumulative
preferential dividends at a rate per share of 12 3/4% per annum. The board of
directors will declare dividends out of legally available CCIC funds. Dividends
will be payable to Holders of record as of the preceding March 1, June 1,
September 1, and December 1. Dividends on the exchangeable preferred stock will
be payable quarterly in arrears on March 15, June 15, September 15 and December
15 of each year commencing on March 15, 1999.

On or prior to December 15, 2003, CCIC may, at its option, pay dividends:

(1) in cash; or

(2) in additional fully-paid and non-assessable shares of exchangeable
preferred stock (including fractional stock) having an aggregate
Liquidation Preference equal to the amount of such dividends.

After December 15, 2003, CCIC will pay dividends in cash only. CCIC does not
expect to pay any dividends in cash before December 15, 2003.

134

Dividends payable on the exchangeable preferred stock will accrue from the
date of original issuance or, if dividends have already been paid, from the
date it was most recently paid. Dividends will be computed on the basis of a
360-day year comprised of twelve 30-day months.

Dividends on the exchangeable preferred stock will accrue on a daily basis
whether or not:

(1) CCIC has earnings or profits;

(2) there are funds legally available for the payment of such dividends;
or

(3) dividends are declared.

Dividends will accumulate to the extent they are not paid on the dividend
payment date for the quarterly period to which they relate. Accumulated unpaid
dividends will accrue dividends at the rate of 12 3/4% per annum. CCIC must
take all actions required or permitted under Delaware law to permit the payment
of dividends on the exchangeable preferred stock.

Unless CCIC has paid dividends on the exchangeable preferred stock in full
for prior periods, it will not be allowed to declare or pay dividends on the
exchangeable preferred stock for the current period.

Unless CCIC has declared and paid upon, or declared and set apart a
sufficient sum for the payment of, full cumulative dividends on all outstanding
exchangeable preferred stock due for all past dividend periods, then:

(1) no dividend (other than a dividend payable solely in stock of any
class of stock ranking junior to the exchangeable preferred stock as to the
payment of dividends and as to rights in liquidation, dissolution or
winding up of the affairs of CCIC (any such stock, "Junior Securities"))
shall be declared or paid upon, or any sum set apart for the payment of
dividends upon, any Junior Securities;

(2) no other distribution shall be declared or made upon, or any sum set
apart for the payment of any distribution upon, any Junior Securities;

(3) no Junior Securities shall be purchased, redeemed or otherwise
acquired or retired for value (excluding an exchange for other Junior
Securities) by CCIC or any of its Restricted Subsidiaries;

(4) no warrants, rights, calls or options to purchase any Junior
Securities shall be directly or indirectly issued by CCIC or any of its
Restricted Subsidiaries; and

(5) no monies shall be paid into or set apart or made available for a
sinking or other like fund for the purchase, redemption or other
acquisition or retirement for value of any Junior Securities by CCIC or any
of its Restricted Subsidiaries.

Holders of the exchangeable preferred stock will not be entitled to any
dividends, whether payable in cash, property or stock, in excess of the full
cumulative dividends as herein described.

In addition, the 10 5/8% discount notes indenture contains restrictions on
our ability to pay dividends on the exchangeable preferred stock. Moreover,
existing Indebtedness and anticipated future Indebtedness of our subsidiaries
and joint ventures restricts or will restrict our access to the cash flow of
those entities. Any future agreements relating to Indebtedness to which we or
any of our Subsidiaries becomes a party may contain similar restrictions and
provisions. See "Risk Factors--Substantial Leverage; Restrictions Imposed by
the Terms of Our Indebtedness" and "Risk Factors--Holding Company Structure;
Dependence on Dividends to Meet Cash Requirements or Pay Dividends".

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Voting Rights

Holders of record of the exchangeable preferred stock will have no voting
rights, except as required by law and as provided in the certificate of
designations. Under the certificate of designations, the number of members of
CCIC's board of directors will immediately and automatically increase by two,
and the Holders of a majority of the outstanding exchangeable preferred stock,
voting separately as a class together with holders of all other Parity
Securities having similar voting rights, may elect two members to the board of
directors of CCIC, upon the occurrence of any of the following events (each, a
"Voting Rights Triggering Event"):

(1) the accumulation of accrued and unpaid dividends on the outstanding
exchangeable preferred stock (or after December 15, 2003, such dividends
are not paid in cash) in an amount equal to six full quarterly dividends
(whether or not consecutive);

(2) failure by CCIC or any of its Restricted Subsidiaries to comply with
any mandatory redemption obligation with respect to the exchangeable
preferred stock, the failure to make an Asset Sale Offer or Change of
Control Offer in accordance with the provisions of the certificate of
designations and/or the failure to repurchase exchangeable preferred stock
pursuant to such offers;

(3) failure by CCIC to make a Change of Control Offer or to repurchase
any exchangeable preferred stock pursuant to a Change of Control Offer in
reliance on the last paragraph under the caption "Repurchase at the Option
of Holders--Change of Control" or failure by CCIC to make an Asset Sale
Offer or to repurchase any exchangeable preferred stock pursuant to an
Asset Sale Offer in reliance on the last paragraph under the caption
"Repurchase at the Option of Holders--Asset Sales";

(4) failure by CCIC or any of its Restricted Subsidiaries to comply with
any of the other covenants or agreements set forth in the certificate of
designations and the continuance of such failure for 30 consecutive days
after notice to CCIC by Holders of record of the exchangeable preferred
stock representing 25% of the outstanding shares of the exchangeable
preferred stock;

(5) defaults under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by CCIC or any of its Significant
Subsidiaries (or the payment of which is guaranteed by CCIC or any of its
Significant Subsidiaries) whether such Indebtedness or guarantee now
exists, or is created after December 21, 1998, which default

(a) is caused by a failure to pay the principal amount of such
Indebtedness at final maturity after giving effect to any applicable
grace period (a "Payment Default") or

(b) results in the acceleration of such Indebtedness prior to its
express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $20.0 million or
more; or

(6) certain events of bankruptcy or insolvency with respect to CCIC or
any of its Significant Subsidiaries.

The term of office of the directors elected as a result of a Voting Rights
Triggering Event will continue until all dividends in arrears on the
exchangeable preferred stock are paid in full and all other Voting Rights
Triggering Events have been cured or waived, at which time the term of office
of any such directors shall terminate.

In addition, as provided above under "--Ranking," CCIC may not authorize,
create (by way of reclassification or otherwise) or issue any Senior Securities
(other than Disqualified Stock), or any obligation or security convertible into
or evidencing the right to purchase Senior Securities (other than Disqualified
Stock), without the consent of the Holders of at least two-thirds of the then
outstanding exchangeable preferred stock, in each case, voting as a single
class.

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Under Delaware law, holders of preferred stock are entitled to vote as a
class upon a proposed amendment to the certificate of incorporation if the
amendment would

(a) increase or decrease the par value of the shares of that class of
preferred stock or

(b) alter or change the powers, preferences or special rights of the
shares of that class of preferred stock in a way that would affect the
holders of that preferred stock adversely.

Exchange

On any dividend payment date, CCIC may exchange all and not less than all of
the shares of then outstanding exchangeable preferred stock for CCIC's 12 3/4%
exchange debentures if:

(1) on the date of the exchange, there are no accumulated and unpaid
dividends on the exchangeable preferred stock (including the dividend
payable on that date) or other contractual impediments to the exchange;

(2) there are sufficient legally available funds;

(3) the exchange does not immediately cause:

(a) a Default (as defined in the exchange indenture); and

(b) a default or event of default under any material instrument
governing Indebtedness of CCIC, including without limitation the 10
5/8% discount notes, outstanding at the time;

(4) the exchange indenture has been qualified under the Trust Indenture
Act, if qualification is required at the time of exchange; and

(5) CCIC has delivered a written opinion to the exchange trustee (as
defined herein) stating that all conditions to the exchange have been
satisfied.

Upon any exchange, Holders of outstanding exchangeable preferred stock will
be entitled to receive:

(1) $1.00 principal amount of exchange debentures for each $1.00 of the
aggregate Liquidation Preference; plus

(2) without duplication, any accrued and unpaid dividends.

The exchange debentures will be:

(1) issued in registered form, without coupons;

(2) issued in principal amounts of $1,000 and integral multiples thereof
to the extent possible; and

(3) issuable in principal amounts less than $1,000 so that each Holder of
exchangeable preferred stock will receive interests representing the entire
amount of exchange debentures to which such Holder's share of exchangeable
preferred stock entitle such Holder, provided that CCIC may pay cash in
lieu of issuing an exchange debenture having a principal amount less than
$1,000.

The 10 5/8% discount notes indenture currently restricts the exchange of the
exchangeable preferred stock and may restrict CCIC's ability to exchange the
exchangeable preferred stock in the future. See "Description of Certain
Indebtedness--The Notes". In addition, existing Indebtedness and anticipated
future Indebtedness of our subsidiaries and joint ventures restricts or will
restrict our access to the cash flow from those entities. Any future agreements
relating to Indebtedness to which we or any of our subsidiaries or joint
ventures become a party may contain similar restrictions and provisions. See
"Risk Factors--Holding Company Structure; Dependence on Dividends to Meet Cash
Requirements or Pay Dividends".

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CCIC or its representative will send notice of the intention to exchange by
first class mail, postage prepaid, to each Holder of record of exchangeable
preferred stock at its registered address not more than 60 days nor less than
30 days prior to the exchange date. In addition to any information required by
law or by the applicable rules of any exchange upon which exchangeable
preferred stock may be listed or admitted to trading, the notice will state:

(1) the exchange date;

(2) the place or places where certificates for such stock are to be
surrendered for exchange, including any procedures applicable to exchanges
to be accomplished through book-entry transfers; and

(3) that dividends on the exchangeable preferred stock to be exchanged
will cease to accrue on the exchange date.

If notice of any exchange has been properly given, and if on or before the
exchange date the exchange debentures have been duly executed and authenticated
and an amount in cash or additional exchangeable preferred stock (as
applicable) equal to all accrued and unpaid dividends, if any, thereon to the
exchange date has been deposited with the transfer agent, then on and after the
close of business on the exchange date:

(1) the exchangeable preferred stock to be exchanged will no longer be
considered outstanding and may subsequently be issued in the same manner as
the other authorized but unissued preferred stock, including as Parity
Securities, but not as the same class as the exchangeable preferred stock;
and

(2) all rights of the Holders as stockholders of CCIC will cease, except
their right to receive upon surrender of their certificates the exchange
debentures and all accrued and unpaid dividends, if any, thereon to the
exchange date.

Mandatory Redemption

On December 15, 2010, CCIC will be required to redeem all outstanding
exchangeable preferred stock at a price in cash equal to the Liquidation
Preference, plus accrued and unpaid dividends, if any, to the date of
redemption. CCIC only will be able to redeem the exchangeable preferred stock
if it has sufficient legally available funds under Delaware law. CCIC will not
be required to make sinking fund payments with respect to the exchangeable
preferred stock. CCIC must take all actions required or permitted under
Delaware law to permit such redemption.

The 10 5/8% discount notes indenture currently restricts the redemption of
the exchangeable preferred stock.

Optional Redemption

During the first 36 months after December 21, 1998, CCIC may on any one or
more occasions redeem up to 35% of the aggregate Liquidation Preference of the
exchangeable preferred stock then outstanding at a redemption price of 112.750%
of the Liquidation Preference of the shares redeemed, plus accrued and unpaid
dividends and Liquidated Damages on the shares redeemed, if any, to the
redemption date, with the net cash proceeds of one or more Public Equity
Offerings or Strategic Equity Investments; provided that:

(1) at least $130.0 million aggregate Liquidation Preference of
exchangeable preferred stock remains outstanding immediately after the
occurrence of such redemption (excluding exchangeable preferred stock held
by CCIC and its Subsidiaries); and

(2) the redemption must occur within 60 days of the date of the closing
of the Public Equity Offering or Strategic Equity Investment.

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Except pursuant to the preceding paragraph, the exchangeable preferred stock
will not be redeemable at CCIC's option prior to December 15, 2003.

On or after December 15, 2003, CCIC may redeem all or any part of the
exchangeable preferred stock upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of the Liquidation
Preference) set forth below plus accrued and unpaid dividends and Liquidated
Damages, if any, to the applicable redemption date, if redeemed during the
twelve-month period beginning on December 15 of the years indicated below:

Year Percentage
---- ----------

2003.............................................................. 106.375%
2004.............................................................. 104.781%
2005.............................................................. 103.188%
2006.............................................................. 101.594%
2007 and thereafter............................................... 100.000%

The 10 5/8% discount notes indenture currently restricts the redemption of
the exchangeable preferred stock and additional indebtedness may restrict
CCIC's ability to redeem the exchangeable preferred stock in the future. See
"Description of Certain Indebtedness".

Selection and Notice

If less than all of the exchangeable preferred stock is to be redeemed at any
time, the transfer agent will select exchangeable preferred stock for
redemption as follows:

(1) if the exchangeable preferred stock is listed on any national
securities exchange, in compliance with the requirements of the principal
national securities exchange on which the exchangeable preferred stock is
listed; or

(2) if the exchangeable preferred stock is not listed on any national
securities exchange, on a pro rata basis, by lot or by such method as the
transfer agent shall deem fair and appropriate.

No exchangeable preferred stock with a Liquidation Preference of $1,000 or
less will be redeemed in part. Notices of redemption will be mailed by first
class mail at least 30 but not more than 60 days before the redemption date to
each Holder of exchangeable preferred stock to be redeemed at its registered
address. Notices of redemption may not be conditional.

If any exchangeable preferred stock is to be redeemed in part only, the
notice of redemption that relates to that exchangeable preferred stock shall
state the portion of the Liquidation Preference of the exchangeable preferred
stock to be redeemed. A new certificate with an aggregate Liquidation
Preference equal to the unredeemed portion of the original certificate
evidencing exchangeable preferred stock presented for redemption will be issued
in the name of the Holder thereof upon cancellation of the original
certificate. Exchangeable preferred stock called for redemption becomes due on
the date fixed for redemption. On and after the redemption date, dividends
cease to accrue on exchangeable preferred stock or portions thereof called for
redemption.

Liquidation Rights

Each Holder of the exchangeable preferred stock will be entitled to payment,
out of the assets of CCIC available for distribution, of an amount equal to the
Liquidation Preference per exchangeable preferred stock held by such Holder,
plus accrued and unpaid dividends, if any, to the date fixed for liquidation,
dissolution, winding up or reduction or decrease in capital stock, before any
distribution is made on any Junior Securities, including, without limitation,
common stock of CCIC, upon any:

(1) voluntary or involuntary liquidation, dissolution or winding up of
the affairs of CCIC; or

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(2) reduction or decrease in CCIC's capital stock resulting in a
distribution of assets to the holders of any class or series of CCIC's
capital stock (a "reduction or decrease in capital stock").

After payment in full of the Liquidation Preference and all accrued
dividends, if any, to which Holders of exchangeable preferred stock are
entitled, such Holders may not further participate in any distribution of
assets of CCIC. However, neither the voluntary sale, conveyance, exchange or
transfer (for cash, shares of stock, securities or other consideration) of all
or substantially all of the property or assets of CCIC nor the consolidation or
merger of CCIC with or into one or more corporations will be a voluntary or
involuntary liquidation, dissolution or winding up of CCIC or reduction or
decrease in capital stock, unless such sale, conveyance, exchange or transfer
is in connection with a liquidation, dissolution or winding up of the business
of CCIC or reduction or decrease in capital stock.

The certificate of designations will not contain any provision requiring
funds to be set aside to protect the Liquidation Preference of the exchangeable
preferred stock, although such Liquidation Preference will be substantially in
excess of the par value of the exchangeable preferred stock.

Repurchase at the Option of Holders

Change of Control

If a Change of Control occurs, each Holder of exchangeable preferred stock
will have the right to require CCIC to repurchase all or any part (but not any
fractional shares) of that Holder's exchangeable preferred stock pursuant to a
Change of Control Offer. In the Change of Control Offer, CCIC will offer a
payment in cash equal to 101% of the aggregate Liquidation Preference of
exchangeable preferred stock repurchased plus accrued and unpaid dividends and
Liquidated Damages, if any, on the exchangeable preferred stock repurchased, to
the date of purchase. The determination of the purchase price is subject to the
right of Holders of record on the relevant record date to receive dividends and
Liquidation Damages, if any, due on the relevant dividend payment date. Within
30 days following any Change of Control, CCIC will mail a notice to each Holder
describing the transaction or transactions that constitute the Change of
Control and offering to repurchase exchangeable preferred stock on the date
specified in the notice. The Change of Control Payment Date shall be no earlier
than 30 days and no later than 60 days from the date the notice is mailed,
pursuant to the procedures required by the certificate of designations and
described in such notice.

On the Change of Control Payment Date, CCIC will, to the extent lawful:

(1) accept for payment all exchangeable preferred stock or portions of
the exchangeable preferred stock properly tendered pursuant to the Change
of Control Offer;

(2) deposit with the paying agent an amount equal to the Change of
Control Payment in respect of all exchangeable preferred stock or portions
of the exchangeable preferred stock so tendered; and

(3) deliver or cause to be delivered to the transfer agent the
exchangeable preferred stock so accepted together with an officers'
certificate stating the aggregate Liquidation Preference of exchangeable
preferred stock or portions of the exchangeable preferred stock being
purchased by CCIC.

CCIC will promptly mail to each Holder of exchangeable preferred stock
properly tendered the Change of Control Payment for the exchangeable preferred
stock, and the transfer agent will promptly authenticate and mail (or cause to
be transferred by book entry) to each Holder a new

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certificate representing the exchangeable preferred stock equal in Liquidation
Preference to any unpurchased portion of the exchangeable preferred stock
surrendered, if any.

The Change of Control provisions described above will be applicable whether
or not any other provisions of the certificate of designations are applicable.
CCIC will comply with the requirements of Section 14(e) of the Exchange Act and
any other securities laws or regulations, to the extent those laws and
regulations are applicable to any Change of Control Offer. If the provisions of
any of the applicable securities laws or securities regulations conflict with
the provisions of the covenant described above, CCIC will comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under the covenant described above by virtue of the
compliance.

The Change of Control purchase feature is a result of negotiations between
CCIC and the initial purchasers. Management has no present intention to engage
in a transaction involving a Change of Control, although it is possible that
CCIC would decide to do so in the future. Subject to the limitations discussed
below, CCIC could, in the future, enter into certain transactions, including
acquisitions, refinancings or other recapitalizations, that would not
constitute a Change of Control under the certificate of designations, but that
could increase the amount of Indebtedness outstanding at such time or otherwise
affect CCIC's capital structure. Restrictions on the ability of CCIC to incur
additional Indebtedness are contained in the covenants described under "--
Certain Covenants--Incurrence of Indebtedness and Issuance of Preferred Stock".
Such restrictions can only be waived with the consent of the Holders of a
majority in Liquidation Preference of the exchangeable preferred stock then
outstanding. Except for the limitations contained in such covenants, however,
the certificate of designations will not contain any covenants or provisions
that may afford Holders of the exchangeable preferred stock protection in the
event of certain highly leveraged transactions.

The Senior Discount Notes indenture currently prohibits CCIC from
repurchasing any exchangeable preferred stock. In addition, existing
Indebtedness and anticipated future Indebtedness of CCIC's subsidiaries and
joint ventures restricts or will restrict CCIC's access to the cash flow from
its subsidiaries and joint ventures. Any future agreements relating to
Indebtedness to which CCIC or any of its subsidiaries or joint ventures becomes
a party may contain similar restrictions and provisions. In the event that a
Change of Control occurs at a time when CCIC is prohibited or prevented from
repurchasing exchangeable preferred stock, CCIC could seek the consent of the
applicable lenders to allow repurchase of the exchangeable preferred stock or
could attempt to refinance the borrowings that contain the prohibition. If CCIC
does not obtain such a consent or repay such borrowings, CCIC will remain
prohibited from repurchasing the exchangeable preferred stock. In this case,
CCIC's failure to purchase tendered exchangeable preferred stock would
constitute a Voting Rights Triggering Event. Future Indebtedness of CCIC and
its Subsidiaries may contain prohibitions on the repurchase of the exchangeable
preferred stock and on the occurrence of certain events that would constitute a
Change of Control or may require such Indebtedness to be repurchased if a
Change of Control occurs. Finally, CCIC's ability to pay cash to the Holders of
exchangeable preferred stock following the occurrence of a Change of Control
may be limited by CCIC's then existing financial resources, including its
ability to access the cash flow of its Subsidiaries. See "Risk Factors--
Repurchase of the Exchangeable Preferred Stock or the Exchange Debentures Upon
a Change of Control" and "Risk Factors--Holding Company Structure; Dependence
on Dividends to Meet Cash Requirements or Pay Dividends". There can be no
assurance that sufficient funds will be available when necessary to make any
required repurchases.

CCIC will not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at
the times and otherwise in compliance with the requirements set forth in the
certificate of designations applicable to a Change of Control Offer made by
CCIC and purchases all exchangeable preferred stock properly tendered and not
withdrawn under such Change of Control Offer. The provisions under the
certificate of designations

141

relative to CCIC's obligation to make an offer to repurchase the exchangeable
preferred stock as a result of a Change of Control may be waived or modified
with the written consent of the Holders of a majority in Liquidation Preference
of the exchangeable preferred stock then outstanding.

The definition of Change of Control includes a phrase relating to the sale,
lease, transfer, conveyance or other disposition of "all or substantially all"
of the assets of CCIC and its Restricted Subsidiaries taken as a whole.
Although there is a developing body of case law interpreting the phrase
"substantially all," there is no precise established definition of the phrase
under applicable law. Accordingly, the ability of a Holder of exchangeable
preferred stock to require CCIC to repurchase the exchangeable preferred stock
as a result of a sale, lease, transfer, conveyance or other disposition of less
than all of the assets of CCIC and its Subsidiaries taken as a whole to another
Person or group may be uncertain.

Notwithstanding the foregoing, the certificate of designations will provide
that CCIC may not repurchase any exchangeable preferred stock pursuant to this
provision unless such repurchase complies with the restricted payments covenant
contained in the Senior Discount Notes indenture; provided that if CCIC does
not make a Change of Control Offer or does not repurchase any exchangeable
preferred stock pursuant to a Change of Control Offer, then such failure shall
constitute a Voting Rights Triggering Event.

Asset Sales

CCIC will not, and will not permit any of its Restricted Subsidiaries to,
consummate an Asset Sale unless:

(1) CCIC (or the Restricted Subsidiary, as the case may be) receives
consideration at the time of the Asset Sale at least equal to the fair
market value of the assets or Equity Interests issued or sold or otherwise
disposed of;

(2) fair market is determined by CCIC's board of directors and evidenced
by a resolution of the board of directors set forth in an officer's
certificate delivered to the transfer agent; and

(3) except in the case of a Tower Asset Exchange, at least 75% of the
consideration received in such Asset Sale by CCIC or such Restricted
Subsidiary is in the form of cash or Cash Equivalents.

For purposes of this provision, each of the following shall be deemed to be
cash:

(1) any liabilities, as shown on CCIC's or such Restricted Subsidiary's
most recent balance sheet, of CCIC or any Restricted Subsidiary (other than
contingent liabilities and liabilities that are by their terms subordinated
to the exchangeable preferred stock or any guarantee of the exchangeable
preferred stock) that are assumed by the transferee of any such assets
pursuant to a customary novation agreement that releases CCIC or such
Restricted Subsidiary from further liability; and

(2) any securities, notes or other obligations received by CCIC or any
Restricted Subsidiary from the transferee that are converted by CCIC or the
Restricted Subsidiary into cash within 20 days of the applicable Asset
Sale, to the extent of the cash received in that conversion.

Within 365 days after the receipt of any Net Proceeds from an Asset Sale,
CCIC or the Restricted Subsidiary may apply those Net Proceeds to:

(1) reduce any Indebtedness of CCIC;

(2) reduce any Indebtedness of any of CCIC's Restricted Subsidiaries;

(3) the acquisition of all or substantially all the assets of a Permitted
Business;

(4) the acquisition of Voting Stock of a Permitted Business from a Person
that is not a Subsidiary of CCIC; provided, that, after giving effect to
the acquisition, CCIC or its Restricted

142

Subsidiary owns a majority of the Voting Stock and designates the Permitted
Business as a Restricted Subsidiary; or

(5) the making of a capital expenditure or the acquisition of other long-
term assets that are used or useful in a Permitted Business.

Pending the final application of any Net Proceeds, CCIC may temporarily
reduce revolving credit borrowings or otherwise invest the Net Proceeds in any
manner that is not prohibited by the certificate of designations.

Any Net Proceeds from Asset Sales that are not applied or invested as
provided in the preceding paragraph will constitute Excess Proceeds. When the
aggregate amount of Excess Proceeds exceeds $10.0 million, CCIC will be
required to make an offer to all holders of Senior Discount Notes and may be
required to make an offer to holders of other Indebtedness of CCIC to purchase
the maximum principal amount of the Senior Discount Notes and such other
Indebtedness that may be purchased out of the Excess Proceeds. The offer price
in any Asset Sale Offer for Senior Discount Notes and other Indebtedness will
be equal to 100% of the principal amount or accreted value of the Senior
Discount Notes or such other Indebtedness, as the case may be, plus accrued and
unpaid interest to the date of purchase, and will be payable in cash. If any
Excess Proceeds remains after consummation of the Asset Sale Offer for Senior
Discount Notes or other Indebtedness and the sum of the amount of remaining
Excess Proceeds and the remaining Excess Proceeds from any subsequent Asset
Sale Offers for Senior Discount Notes or other Indebtedness exceeds $3.0
million, CCIC will be required to make an offer to all Holders of exchangeable
preferred stock and all holders of Parity Securities containing provisions
similar to those set forth in the certificate of designations relating to the
exchangeable preferred stock with respect to offers to purchase with the
proceeds of sales of assets to purchase the maximum Liquidation Preference of
exchangeable preferred stock and the Parity Securities that may be purchased
out of the remaining Excess Proceeds. The offer price in any such Asset Sale
Offer will be equal to 100% of the Liquidation Preference plus accrued and
unpaid dividends and Liquidated Damages on the exchangeable preferred stock, if
any, to the date of purchase, in accordance with the procedures set forth in
the certificate of designations and such Parity Securities. The determination
of the offer price will be subject to the right of Holders of record on the
relevant record date to receive dividends and Liquidated Damages, if any, due
on the relevant Dividend Payment Date). If any Excess Proceeds remain after
consummation of an Asset Sale Offer for the exchangeable preferred stock, CCIC
may use the remaining Excess Proceeds for any purpose not otherwise prohibited
by the certificate of designations. If the aggregate Liquidation Preference of
exchangeable preferred stock and such Parity Securities tendered into such
Asset Sale Offer exceeds the amount of Excess Proceeds, the transfer agent will
select the exchangeable preferred stock and the Parity Securities to be
purchased on a pro rata basis. Upon completion of the offers to purchase, the
amount of Excess Proceeds will be reset at zero.

The Asset Sale provisions described above will be applicable whether or not
any other provisions of the certificate of designations are applicable. CCIC
will comply, to the extent applicable, with the requirements of Section 14(e)
of the Exchange Act and any other securities laws or regulations applicable to
any Asset Sale Offer. To the extent that the provisions of any such securities
laws or securities regulations conflict with the provisions of the covenant
described above, CCIC will comply with the applicable securities laws and
regulations and will not be deemed to have breached its obligations under the
covenant described above by virtue of such compliance.

143

Notwithstanding the foregoing, the certificate of designations will provide
that CCIC may not repurchase any exchangeable preferred stock pursuant to this
provision unless such repurchase complies with the restricted payments covenant
contained in the Senior Discount Notes indenture; provided that if CCIC does
not make an Asset Sale Offer for the exchangeable preferred stock or does not
repurchase any exchangeable preferred stock pursuant to an Asset Sale Offer for
the exchangeable preferred stock, then such failure shall constitute a Voting
Rights Triggering Event.

Certain Covenants

Restricted Payments

CCIC will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly:

(1) declare or pay any dividend or make any other payment or distribution
on account of CCIC's Junior Securities or any warrants, options or other
rights to acquire Junior Securities (other than any debt security that is
convertible into, or exchangeable for, Junior Securities) or any of CCIC's
Restricted Subsidiaries' Equity Interests (including, without limitation,
any payment in connection with any merger or consolidation involving CCIC's
or any of its Restricted Subsidiaries) or to the direct or indirect holders
of CCIC's Junior Securities or any warrants, options or other rights to
acquire Junior Securities (other than any debt security that is convertible
into, or exchangeable for, Junior Securities) or any of CCIC's Restricted
Subsidiaries' Equity Interests in their capacity as such (other than
dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of CCIC or to CCIC or a Restricted Subsidiary of CCIC);

(2) purchase, redeem or otherwise acquire or retire for value (including
without limitation, in connection with any merger or consolidation
involving CCIC) any Junior Securities of CCIC or any warrants, options or
other rights to acquire Junior Securities (other than any debt security
that is convertible into, or exchangeable for, Junior Securities) or any
Equity Interests of any direct or indirect parent of CCIC (other than any
such Equity Interests owned by CCIC or any Restricted Subsidiary of CCIC
and other than the Exchangeable Preferred Stock); or

(3) make any Restricted Investment, (all such payments and other actions
set forth in these clauses (1) through (3) above being collectively
referred to as "Restricted Payments"),

unless, at the time of and after giving effect to such Restricted Payment:

(1) no Voting Rights Triggering Event has occurred and be continuing or
would occur as a consequence thereof; and

(2) CCIC would have been permitted to incur at least $1.00 of additional
indebtedness pursuant to the Debt to Adjusted Consolidated Cash Flow Ratio
test set forth in the first paragraph of the covenant described below under
the caption "--Incurrence of Indebtedness and Issuance of Preferred Stock";
provided that CCIC and its Restricted Subsidiaries will not be required to
comply with this clause (2) in order to make any Restricted Investment; and

(3) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by CCIC and its Restricted Subsidiaries
after December 21, 1998 (excluding Restricted Payments permitted by clauses
(2) and (3) of the paragraph of exceptions below), is less than the sum,
without duplication, of:

(a) 50% of the Consolidated Net Income of CCIC for the period (taken
as one accounting period) from the beginning of the first fiscal
quarter commencing after December 21, 1998 to the end of the CCIC's
most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, if
such Consolidated Net Income for such period is a deficit, less 100% of
such deficit); plus

(b) 100% of the aggregate net cash proceeds received by CCIC since
December 21, 1998 as a contribution to its common equity capital or
from the issue or sale of Equity

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Interests of CCIC (other than Disqualified Stock and except to the
extent such net cash proceeds are used to incur new Indebtedness
outstanding pursuant to clause (10) of the second paragraph of the
covenant described below under the caption "--Incurrence of
Indebtedness and Issuance of Preferred Stock") or from the issue or
sale of Disqualified Stock or debt securities of CCIC that have been
converted into the Equity Interests (other than Equity Interests (or
Disqualified Stock or convertible debt securities) sold to a Subsidiary
of CCIC and other than Disqualified Stock or convertible debt
securities that have been converted into Disqualified Stock); plus

(c) to the extent that any Restricted Investment that was made after
December 21, 1998 is sold for cash or otherwise liquidated or repaid
for cash, the lesser of

(A) the cash return of capital with respect to the Restricted
Investment (less the cost of disposition, if any) and

(B) the initial amount of the Restricted Investment; plus

(d) to the extent that any Unrestricted Subsidiary of CCIC and all of
its Subsidiaries are designated as Restricted Subsidiaries after
December 21, 1998, the lesser of

(A) the fair market value of CCIC's Investments in such
Subsidiaries as of the date of such designation, or

(B) the sum of

(x) the fair market value of the CCIC's Investments in such
Subsidiaries as of the date on which such Subsidiaries were
originally designated as Unrestricted Subsidiaries and

(y) the amount of any Investments made in such Subsidiaries
subsequent to such designation (and treated as Restricted
Payments) by CCIC or any Restricted Subsidiary; provided that:

(i) in the event the Unrestricted Subsidiaries designated as
Restricted Subsidiaries are CTSH and its Subsidiaries, the
references in clauses (A) and (B) of this clause (d) to fair market
value of CCIC's Investments in such Subsidiaries shall mean the
amount by which the fair market value of all such Investments
exceeds 34.3% of the fair market value of CTSH and its Subsidiaries
as a whole; and

(ii) in the event the Unrestricted Subsidiaries designated as
Restricted Subsidiaries are CCAIC and its Subsidiaries, the
references in clauses (A) and (B) of this clause (d) to fair market
value of CCIC's Investments in such Subsidiaries shall mean the
amount by which the fair market value of all such Investments
exceeds $250.0 million; plus

(e) 50% of any dividends received by CCIC or a Restricted Subsidiary
after December 21, 1998 from an Unrestricted Subsidiary of CCIC, to the
extent that such dividends were not otherwise included in Consolidated
Net Income of CCIC for such period.

The preceding provisions will not prohibit:

(1) the payment of any dividend within 60 days after the date of
declaration of that dividend, if at said date of declaration such payment
would have complied with the provisions of the certificate of designations;

(2) the making of any Investment or the redemption, repurchase,
retirement, defeasance or other acquisition of any Equity Interests of CCIC
in exchange for, or out of the net cash proceeds of the sale after December
21, 1999 (other than to a Subsidiary of CCIC) of Equity Interests of CCIC
(other than any Disqualified Stock); provided that the net cash proceeds
are not used to incur new Indebtedness pursuant to clause (10) of the
second paragraph of the covenant described below under the caption "--
Incurrence of Indebtedness and Issuance of

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Preferred Stock"); and provided further that, in each such case, the amount
of any such net cash proceeds that are so utilized will be excluded from
clause (3) (b) of the preceding paragraph;

(3) the payment of any dividend by a Restricted Subsidiary of CCIC to the
holders of its Equity Interests on a pro rata basis; or

(4) the repurchase, redemption or other acquisition or retirement for
value of any Equity Interests of CCIC or any Restricted Subsidiary of CCIC
held by any member of CCIC's (or any of its Restricted Subsidiaries')
management pursuant to any management equity subscription agreement or
stock option agreement in effect as of December 21, 1998; provided that the
aggregate price paid for all such repurchased, redeemed, acquired or
retired Equity Interests may not exceed (a) $500,000 in any twelve-month
period and (b) $5.0 million in the aggregate.

The board of directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary if such designation would not cause a Voting Rights
Triggering Event; provided that in no event shall the businesses operated by
CCIC's Restricted Subsidiaries as of November 20, 1997 be transferred to or
held by an Unrestricted Subsidiary. For purposes of making such determination,
all outstanding Investments by CCIC and its Restricted Subsidiaries (except to
the extent repaid in cash) in the Subsidiary so designated will be deemed to be
Restricted Payments at the time of such designation and will reduce the amount
available for Restricted Payments under the first paragraph of this covenant.
All the outstanding Investments will be deemed to constitute Investments in an
amount equal to the fair market value of the Investments at the time of the
designation. Such designation will only be permitted if the Restricted Payment
would be permitted at the time and if such Restricted Subsidiary otherwise
meets the definition of an Unrestricted Subsidiary. The board of directors may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary if such
designation would not cause a Voting Rights Triggering Event.

The amount of all Restricted Payments (other than cash) will be the fair
market value on the date of the Restricted Payment of the assets or securities
proposed to be transferred or issued by CCIC or the applicable Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any property, assets or Investments required by this covenant
to be valued will be valued by the board of directors whose resolution with
respect to the determination will be delivered to the transfer agent.

Incurrence of Indebtedness and Issuance of Preferred Stock

CCIC will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable, contingently or otherwise, with respect
to (collectively, "incur") any Indebtedness (including Acquired Debt) and CCIC
will not issue any Disqualified Stock and will not permit any of its Restricted
Subsidiaries to issue any shares of preferred stock; provided, that CCIC may
incur Indebtedness (including Acquired Debt) or issue shares of Disqualified
Stock and CCIC's Restricted Subsidiaries may incur Indebtedness if, in each
case, CCIC's Debt to Adjusted Consolidated Cash Flow Ratio at the time of
incurrence of such Indebtedness or the issuance of such Disqualified Stock,
after giving pro forma effect to such incurrence or issuance as of such date
and to the use of proceeds therefrom as if the same had occurred at the
beginning of the most recently ended four full fiscal quarter period of CCIC
for which internal financial statements are available, would have been no
greater than 7.5 to 1.

The first paragraph of this covenant will not prohibit the incurrence of any
of the following items of Indebtedness or to the issuance of any of the
following items of Disqualified Stock or preferred stock (collectively,
"Permitted Debt"):

(1) the incurrence by CCIC or any of its Restricted Subsidiaries of
Indebtedness (including Indebtedness under Credit Facilities) in an
aggregate principal amount (with letters of credit

146

being deemed to have a principal amount equal to the maximum potential
liability of CCIC and its Restricted Subsidiaries thereunder) at any one
time outstanding not to exceed the greater of

(a) $200.0 million less the aggregate amount of all Net Proceeds of
Asset Sales applied to repay Indebtedness under a Credit Facility
pursuant to the covenant described above under the caption "--
Repurchase at the Option of Holders--Asset Sales" and

(b) 70% of the Eligible Receivables that are outstanding as of such
date of incurrence;

(2) the incurrence by CCIC and its Restricted Subsidiaries of the
Existing Indebtedness;

(3) the issuance by CCIC of preferred stock represented by the
exchangeable preferred stock and the incurrence by CCIC of Indebtedness
represented by the exchange debentures;

(4) the incurrence by CCIC or any of its Restricted Subsidiaries of
Indebtedness represented by Capital Lease Obligations, mortgage financings
or purchase money obligations, in each case incurred for the purpose of
financing all or any part of the purchase price or cost of construction or
improvement of property, plant or equipment used in the business of CCIC or
a Restricted Subsidiary, in an aggregate principal amount, including all
Permitted Refinancing Indebtedness incurred to refund, refinance or replace
any other Indebtedness incurred pursuant to this clause (4), not to exceed
$10.0 million at any one time outstanding;

(5) the incurrence by CCIC or any of its Restricted Subsidiaries of
Permitted Refinancing Indebtedness in exchange for, or the net proceeds of
which are used to extend, refinance, renew, replace, defease or refund
Indebtedness of CCIC or any of its Restricted Subsidiaries or Disqualified
Stock of CCIC (other than intercompany Indebtedness) that was permitted by
the certificate of designations to be incurred under the first paragraph
hereof or clauses (2) or (3) or this clause (5) of this paragraph;

(6) the incurrence by CCIC or any of its Restricted Subsidiaries of
intercompany Indebtedness between or among CCIC and any of its Restricted
Subsidiaries; provided, that

(a) any subsequent issuance or transfer of Equity Interests that
results in any such Indebtedness being held by a Person other than CCIC
or a Restricted Subsidiary and

(b) any sale or other transfer of any Indebtedness to a Person that
is not either CCIC or a Restricted Subsidiary shall be deemed, in each
case, to constitute an incurrence of the Indebtedness by CCIC or the
Restricted Subsidiary, as the case may be;

(7) the incurrence by CCIC or any of its Restricted Subsidiaries of
Hedging Obligations that are incurred for the purpose of fixing or hedging
interest rate risk with respect to any floating rate Indebtedness that is
permitted by the terms of the certificate of designations to be outstanding
or currency exchange risk;

(8) the guarantee by CCIC or any of its Restricted Subsidiaries of
Indebtedness of CCIC or a Restricted Subsidiary of CCIC that was permitted
to be incurred by another provision of the certificate of designations;

(9) the incurrence by CCIC or any of its Restricted Subsidiaries of
Acquired Debt in connection with the acquisition of assets or a new
Subsidiary and the incurrence by CCIC's Restricted Subsidiaries of
Indebtedness as a result of the designation of an Unrestricted Subsidiary
as a Restricted Subsidiary; provided that, in the case of such incurrence
of Acquired Debt, the Acquired Debt was incurred by the prior owner of such
assets or such Restricted Subsidiary prior to such acquisition by CCIC or
one of its Restricted Subsidiaries and was not incurred in connection with,
or in contemplation of, the acquisition by CCIC or one of its Restricted
Subsidiaries; and provided further that, in the case of any incurrence
pursuant to this clause (9), as a result of such acquisition by CCIC or one
of its Restricted Subsidiaries, CCIC's Debt to Adjusted Consolidated Cash
Flow Ratio at the time of incurrence of such Acquired Debt, after giving
pro forma effect to such incurrence as if the same had occurred at the
beginning of

147

the most recently ended four full fiscal quarter period of CCIC for which
internal financial statements are available, would have been less than
CCIC's Debt to Adjusted Consolidated Cash Flow Ratio for the same period
without giving pro forma effect to such incurrence;

(10) the incurrence by CCIC of Indebtedness not to exceed, at any one
time outstanding, the sum of

(a) 2.0 times the aggregate net cash proceeds plus

(b) 1.0 times the fair market value of non-cash proceeds (evidenced
by a resolution of the board of directors set forth in an officers'
certificate delivered to the transfer agent),

in each case, from the issuance and sale, other than to a Subsidiary, of
Equity Interests (other than Disqualified Stock) of CCIC since December 21,
1998 (less the amount of such proceeds used to make Restricted Payments as
provided in clause (3)(b) of the first paragraph or clause (2) of the
second paragraph of the covenant described above under the caption "--
Restricted Payments"); provided that such Indebtedness does not mature
prior to the Stated Maturity of the exchangeable preferred stock and the
Weighted Average Life to Maturity of such Indebtedness is longer than that
of the exchangeable preferred stock; and

(11) the incurrence by CCIC or any of its Restricted Subsidiaries of
additional Indebtedness and/or the issuance by CCIC of Disqualified Stock
in an aggregate principal amount, accreted value or liquidation preference,
as applicable, at any time outstanding, not to exceed an amount equal to
$100.0 million less the aggregate amount of all Investments made pursuant
to clause (12) of the definition of Permitted Investments; provided that,
notwithstanding the foregoing, the aggregate principal amount, accreted
value or liquidation preference, as applicable, permitted to be incurred or
issued pursuant to this clause (11) shall not be reduced to less than $25.0
million.

For purposes of determining compliance with this covenant, in the event that
an item of Indebtedness meets the criteria of more than one of the categories
of Permitted Debt described in clauses (1) through (11) above or is entitled to
be incurred pursuant to the first paragraph of this covenant, CCIC shall, in
its sole discretion, classify (or later reclassify in whole or in part) such
item of Indebtedness in any manner that complies with this covenant. Accrual of
interest, accretion or amortization of original issue discount and the payment
of interest in the form of additional Indebtedness will not be deemed to be an
incurrence of Indebtedness for purposes of this covenant.

Dividend and Other Payment Restrictions Affecting Subsidiaries

CCIC will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, create or otherwise cause or suffer to exist or become
effective any encumbrance or restriction on the ability of any Restricted
Subsidiary to:

(1) pay dividends or make any other distributions to CCIC or any of its
Restricted Subsidiaries on its Capital Stock or with respect to any other
interest or participation in, or measured by, its profits;

(2) pay any indebtedness owed to CCIC or any of its Restricted
Subsidiaries;

(3) make loans or advances to CCIC or any of its Restricted Subsidiaries;
or

(4) transfer any of its properties or assets to CCIC or any of its
Restricted Subsidiaries.

However, the preceding restrictions will not apply to encumbrances or
restrictions existing under or by reason of:

(1) Existing Indebtedness or Indebtedness under the Senior Credit
Facility, in each case as in effect on December 21, 1999, and any
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings thereof; provided that such
amendments, modifications, restatements, renewals, increases, supplements,
refundings,

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replacements or refinancings are no more restrictive, taken as a whole,
with respect to such dividend and other payment restrictions than those
contained in the applicable series of Existing Indebtedness or in the
Senior Credit Facility, in each case as in effect on December 21, 1999;

(2) encumbrances and restrictions applicable to any Unrestricted
Subsidiary, as the same are in effect as of the date on which such
Subsidiary becomes a Restricted Subsidiary, and as the same may be amended,
modified, restated, renewed, increased, supplemented, refunded, replaced or
refinanced; provided that the amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacement or refinancings
are no more restrictive, taken as a whole, with respect to the dividend and
other payment restrictions than those contained in the applicable series of
Indebtedness of such Subsidiary as in effect on the date on which such
Subsidiary becomes a Restricted Subsidiary;

(3) any Indebtedness (incurred in compliance with the covenant under the
heading "--Incurrence of Indebtedness and Issuance of Preferred Stock") or
any agreement pursuant to which such Indebtedness is issued if the
encumbrance or restriction applies only in the event of a payment default
or default with respect to a financial covenant contained in the
Indebtedness or agreement and the encumbrance or restriction is not
materially more disadvantageous to the holders of the exchangeable
preferred stock than is customary in comparable financings (as determined
by CCIC) and CCIC determines that any such encumbrance or restriction will
not materially affect CCIC's ability to pay dividends or the Liquidation
Preference on the exchangeable preferred stock;

(4) the certificate of designations;

(5) applicable law;

(6) any instrument governing Indebtedness or Capital Stock of a Person
acquired by CCIC or any of its Restricted Subsidiaries as in effect at the
time of the acquisition (except to the extent the Indebtedness was incurred
in connection with or in contemplation of the acquisition), which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person, or the property
or assets of the Person, so acquired, provided that, in the case of
Indebtedness, the Indebtedness was permitted by the terms of the
certificate of designations to be incurred;

(7) by reason of customary non-assignment provisions in leases or
licenses entered into in the ordinary course of business;

(8) purchase money obligations for property acquired in the ordinary
course of business that impose restrictions of the nature described in
clause (4) in the first paragraph of this covenant on the property so
acquired;

(9) the provisions of agreements governing Indebtedness incurred pursuant
to clause (4) of the second paragraph of the covenant described above under
the caption "--Incurrence of Indebtedness and Issuance of Preferred Stock";

(10) any agreement for the sale of a Restricted Subsidiary that restricts
that Restricted Subsidiary pending its sale;

(11) Permitted Refinancing Indebtedness, provided that the restrictions
contained in the agreements governing such Permitted Refinancing
Indebtedness are no more restrictive, taken as a whole, than those
contained in the agreements governing the Indebtedness being refinanced;

(12) Liens that limit the right of the debtor to transfer the assets
subject to such Liens;

(13) provisions with respect to the disposition or distribution of assets
or property in joint venture agreements and other similar agreements; and

(14) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business.

149

Merger, Consolidation or Sale of Assets

CCIC may not:

(1) consolidate or merge with or into (whether or not CCIC is the
surviving corporation); or

(2) sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its properties or assets in one or more related
transactions, to another corporation, Person or entity; unless:

(a) either (A) CCIC is the surviving corporation; or (B) the entity or
the Person formed by or surviving any such consolidation or merger (if
other than CCIC) or to which the sale, assignment, transfer, lease,
conveyance or other disposition shall have been made is a corporation
organized or existing under the laws of the United States, any state
thereof or the District of Columbia;

(b) the entity or Person formed by or surviving any such consolidation or
merger (if other than CCIC) or the entity or Person to which the sale,
assignment, transfer, lease, conveyance or other disposition shall have
been made assumes all the obligations of CCIC under the exchangeable
preferred stock and the certificate of designations;

(d) except in the case of (A) a merger of CCIC with or into a Wholly
Owned Restricted Subsidiary of CCIC; and (B) a merger entered into solely
for the purpose of reincorporating CCIC in another jurisdiction:

(i) in the case of a merger or consolidation in which CCIC is the
surviving corporation, CCIC's Debt to Adjusted Consolidated Cash Flow
Ratio, at the time of the transaction after giving pro forma effect to
the transaction as if the transaction had occurred at the beginning of
the most recently ended four full fiscal quarter period of CCIC for
which internal financial statements are available, would have been less
than CCIC's Debt to Adjusted Consolidated Cash Flow Ratio for the same
period without giving pro forma effect to such transaction, or

(ii) in the case of any other such transaction the Debt to Adjusted
Consolidated Cash Flow of the entity or Person formed by or surviving
any such consolidation or merger (if other than CCIC), or to which the
sale, assignment, transfer, lease, conveyance or other disposition
shall have been made, at the time of the transaction after giving pro
forma effect thereto as if such transaction had occurred at the
beginning of the most recently ended four full fiscal quarter period of
such entity or Person for which internal financial statements are
available, would have been less than CCIC's Debt to Adjusted
Consolidated Cash Flow Ratio for the same period without giving pro
forma effect to such transaction; provided that for purposes of
determining the Debt to Adjusted Consolidated Cash Flow Ratio of any
entity or Person for purposes of this clause (b) the entity or Person
will be substituted for CCIC in the definition of Debt to Adjusted
Consolidated Cash Flow Ratio and the defined terms included therein
under the caption "--Certain Definitions".

Transactions with Affiliates

CCIC will not, and will not permit any of its Restricted Subsidiaries to,
make any payment to, or sell, lease, transfer or otherwise dispose of any of
its properties or assets to, or purchase any property or assets from, or enter
into or make or amend any transaction, contract, agreement, understanding,
loan, advance or guarantee with, or for the benefit of, any Affiliate (each of
the foregoing, an "Affiliate Transaction"), unless:

(1) such Affiliate Transaction is on terms that are no less favorable to
CCIC or the relevant Restricted Subsidiary than those that would have been
obtained in a comparable transaction by CCIC or such Restricted Subsidiary
with an unrelated Person; and

(2) CCIC delivers to the transfer agent:

(a) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$1.0 million, a resolution of the board of

150

directors set forth in an officers' certificate certifying that such
Affiliate Transaction complies with clause (1) above and that such
Affiliate Transaction has been approved by a majority of the
disinterested members of the board of directors; and

(b) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$10.0 million, an opinion as to the fairness to the Holders of such
Affiliate Transaction from a financial point of view issued by an
accounting, appraisal or investment banking firm of national standing.

The following items will not be deemed to be Affiliate Transactions and
therefore will not be subject to the provisions of the prior paragraph:

(1) any employment arrangements with any executive officer of CCIC or a
Restricted Subsidiary that is entered into by CCIC or any of its Restricted
Subsidiaries in the ordinary course of business and consistent with
compensation arrangements of similarly situated executive officers at
comparable companies engaged in Permitted Businesses;

(2) transactions between or among CCIC and/or its Restricted
Subsidiaries;

(3) payment of directors fees in an aggregate annual amount not to exceed
$25,000 per Person;

(4) Restricted Payments that are permitted by the provisions of the
certificate of designations described above under the caption "--Restricted
Payments";

(5) the issuance or sale of Equity Interests (other than Disqualified
Stock) of CCIC; and

(6) transactions pursuant to the provisions of the governance agreement,
the rights agreement, the stockholders' agreement, the CTSH shareholders'
agreement, the CTI services agreement, the CTI operating agreement and the
Crown transition agreements, as the same are in effect on December 21,
1999.

Limitation on Issuances and Sales of Capital Stock of Restricted Subsidiaries

CCIC:

(1) will not, and will not permit any of its Restricted Subsidiaries to,
transfer, convey, sell, lease or otherwise dispose of any Equity Interests
in any Restricted Subsidiary of CCIC to any Person (other than CCIC or a
Wholly Owned Restricted Subsidiary of CCIC); and

(2) will not permit any of its Restricted Subsidiaries to issue any of
its Equity Interests (other than, if necessary, shares of its Capital Stock
constituting directors' qualifying shares) to any Person other than to CCIC
or a Wholly Owned Restricted Subsidiary of CCIC,

unless, in each such case:

(a) as a result of such transfer, conveyance, sale, lease or other
disposition or issuance such Restricted Subsidiary no longer constitutes a
Subsidiary and

(b) the cash Net Proceeds from such transfer, conveyance, sale, lease or
other disposition or issuance are applied in accordance with the covenant
described above under the caption "--Repurchase at the Option of Holders--
Asset Sales".

Senior Subordinated Debt

So long as any exchangeable preferred stock is outstanding, CCIC will not
incur any Indebtedness, other than the exchange debentures and new exchange
debentures, that is expressly made subordinated in right of payment to any
Senior Debt unless such Indebtedness, by its terms and by the terms of any
agreement or instrument pursuant to which such Indebtedness is outstanding, is
expressly made pari passu with, or subordinate in right of payment to, the
exchange

151

debentures pursuant to provisions substantially similar to those contained in
the exchange indenture; provided that the foregoing limitations shall not apply
to distinctions between categories of Senior Debt that exist by reason of any
Liens or Guarantees arising or created in respect of some but not all Senior
Debt.

Business Activities

CCIC will not, and will not permit any Subsidiary to, engage in any business
other than Permitted Businesses, except to such extent as would not be material
to CCIC and its Subsidiaries taken as a whole.

Reports

Whether or not required by the Securities and Exchange Commission, so long as
any exchangeable preferred stock is outstanding, CCIC will furnish to the
Holders of exchangeable preferred stock:

(1) all quarterly and annual financial information that would be required
to be contained in a filing with the SEC on Forms 10-Q and 10-K if CCIC
were required to file such Forms, including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations" that describes
the financial condition and results of operations of CCIC and its
consolidated Subsidiaries (showing in reasonable detail, in the footnotes
to the financial statements and in "Management's Discussion and Analysis of
Financial Condition and Results of Operations" (in each case to the extent
not prohibited by the SEC's rules and regulations),

(a) the financial condition and results of operations of CCIC and its
Restricted Subsidiaries separate from the financial condition and
results of operations of the Unrestricted Subsidiaries of CCIC and

(b) the Tower Cash Flow for the most recently completed fiscal
quarter and the Adjusted Consolidated Cash Flow for the most recently
completed four-quarter period) and, with respect to the annual
information only, a report thereon by CCIC's certified independent
accountants; and

(2) all current reports that would be required to be filed with the SEC
on Form 8-K if CCIC were required to file such reports, in each case within
the time periods specified in the SEC's rules and regulations.

In addition, following the consummation of the exchange offer contemplated by
the Registration Rights Agreement, whether or not required by the rules and
regulations of the SEC, CCIC will file a copy of all such information and
reports with the SEC for public availability within the time periods specified
in the SEC's rules and regulations (unless the SEC will not accept such a
filing) and make such information available to securities analysts and
prospective investors upon request.

Transfer and Exchange

A Holder may transfer or exchange exchangeable preferred stock in accordance
with the certificate of designations. The registrar and the transfer agent may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and CCIC may require a Holder to pay any taxes and fees
required by law. CCIC is not required to transfer or exchange any shares of
exchangeable preferred stock selected for redemption. Also, CCIC is not
required to transfer or exchange any share of exchangeable preferred stock for
a period of 15 days before a selection of exchangeable preferred stock to be
redeemed.

The registered Holder of a share of exchangeable preferred stock will be
treated as the owner of it for all purposes.

152

Amendment, Supplement and Waiver

Except as provided in the two paragraphs below, the certificate of
designations or the exchangeable preferred stock may be amended or supplemented
with the consent of the Holders of at least a majority in aggregate Liquidation
Preference of the exchangeable preferred stock then outstanding (including,
without limitation, consents obtained in connection with a purchase of, or
tender offer or exchange offer for, exchangeable preferred stock), and any
existing default or compliance with any provision of the certificate of
designations or the exchangeable preferred stock may be waived with the consent
of the Holders of a majority in aggregate Liquidation Preference of the then
outstanding exchangeable preferred stock (including, without limitation,
consents obtained in connection with a purchase of, or tender offer or exchange
offer for, exchangeable preferred stock).

Without the consent of each Holder affected, an amendment or waiver may not
(with respect to any shares of exchangeable preferred stock held by a non-
consenting Holder):

(1) alter the voting rights with respect to the exchangeable preferred
stock or reduce the number of shares of exchangeable preferred stock whose
Holders must consent to an amendment, supplement or waiver;

(2) reduce the Liquidation Preference of or change the Mandatory
Redemption Date of any exchangeable preferred stock or alter the provisions
with respect to the redemption (but not any required repurchase in
connection with an Asset Sale Offer or Change of Control Offer) of the
exchangeable preferred stock;

(3) reduce the rate of or change the time for payment of dividends on any
exchangeable preferred stock;

(4) waive a default in the payment of dividends on the exchangeable
preferred stock;

(5) make any exchangeable preferred stock payable in any form or money
other than that stated in the certificate of designations;

(6) waive a redemption payment (but not any payment upon a required
repurchase in connection with an Asset Sale Offer or Change of Control
Offer) with respect to any exchangeable preferred stock; or

(7) make any change in the foregoing amendment and waiver provisions.

Notwithstanding the foregoing, without the consent of any Holder of
exchangeable preferred stock, CCIC may (to the extent permitted by Delaware
law) amend or supplement the certificate of designations:

(1) to cure any ambiguity, defect or inconsistency;

(2) to provide for uncertificated exchangeable preferred stock in
addition to or in place of certificated exchangeable preferred stock;

(3) to provide for the assumption of CCIC's obligations to Holders of
exchangeable preferred stock in the case of a merger or consolidation; or

(4) to make any change that would provide any additional rights or
benefits to the Holders of exchangeable preferred stock or that does not
adversely affect the legal rights under the certificate of designations of
any such Holder.

Reissuance

Exchangeable preferred stock redeemed or otherwise acquired by CCIC will
assume the status of authorized but unissued preferred stock and may thereafter
be reissued in the same manner as the other authorized but unissued preferred
stock, including as Parity Securities, but not as the same class as the
exchangeable preferred stock.

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Description of the Exchange Debentures

These exchange debentures:

. will be general unsecured obligations of CCIC;

. will be subordinated in right of payment to all existing and future
Senior Debt of CCIC; and

. will be senior in right of payment to all existing and future
subordinated Indebtedness of CCIC other than future subordinated
Indebtedness that ranks on a parity with the exchange debentures.

The exchange debentures will, if and when issued, be issued pursuant to an
indenture, which we refer to as the exchange indenture between CCIC and United
States Trust Company of New York, as trustee. The terms of the exchange
debentures include those stated in the exchange indenture and those made part
of the exchange indenture by reference to the Trust Indenture Act of 1939, as
amended.

The following description is a summary of the material provisions of the
exchange indenture. It does not restate the exchange indenture in its entirety.
We urge you to read the exchange indenture because it, and not this
description, defines your rights as Holders of these exchange debentures.
Copies of the proposed form of exchange indenture are available as set forth
below under the subheading "Additional Information".

Principal, Maturity and Interest

CCIC will issue exchange debentures in denominations of $1,000 and integral
multiples of $1,000. The exchange debentures will mature on December 15, 2010.

Interest on these exchange debentures will accrue at the rate of 12 3/4% per
annum and will be payable semi-annually in arrears on June 15 and December 15.
CCIC will make each interest payment to the Holders of record of these exchange
debentures on the immediately preceding June 1 and December 1.

On or prior to December 15, 2003, CCIC may, at its option, pay interest:

(1) in cash; or

(2) in additional exchange debentures having an aggregate principal
amount equal to the amount of such interest.

After December 15, 2003, CCIC will pay interest in cash only. CCIC does not
expect to pay any interest in cash before December 15, 2003.

Interest on these exchange debentures will accrue from the date of original
issuance or, if interest has already been paid, from the date it was most
recently paid. Interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months.

Methods of Receiving Payments on the Exchange Debentures

If a Holder has given wire transfer instructions to CCIC, CCIC will make all
principal, premium and interest and Liquidated Damages, if any, payments on
those exchange debentures in accordance with those instructions. All other
payments on these exchange debentures will be made at the office or agency of
the paying agent and registrar within the City and State of New York unless
CCIC elects to make interest payments by check mailed to the Holders at their
address set forth in the register of Holders.

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Paying Agent and Registrar for the Exchange Debentures

The exchange trustee will initially act as paying agent and registrar. CCIC
may change the paying agent or registrar without prior notice to the Holders of
the exchange debentures, and CCIC or any of its Subsidiaries may act as paying
agent or registrar.

Transfer and Exchange

A Holder may transfer or exchange exchange debentures in accordance with the
exchange indenture. The registrar and the exchange trustee may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and CCIC may require a Holder to pay any taxes and fees required by
law or permitted by the exchange indenture. CCIC is not required to transfer or
exchange any exchange debenture selected for redemption. Also, CCIC is not
required to transfer or exchange any exchange debenture for a period of 15 days
before a selection of exchange debentures to be redeemed.

The registered Holder of a exchange debenture will be treated as the owner of
it for all purposes.

Subordination

The payment of principal, premium, interest, Liquidated Damages, if any, and
any other Obligations on, or relating to, the exchange debentures will be
subordinated to the prior payment in full in cash or Cash Equivalents (other
than cash equivalents of the type referred to in clauses (3) and (4) of the
definition of Cash Equivalents) of all Senior Debt of CCIC.

The holders of Senior Debt will be entitled to receive payment in full in
cash or Cash Equivalents (other than cash equivalents of the type referred to
in clauses (3) and (4) of the definition of Cash Equivalents) of all
Obligations due in respect of Senior Debt (including interest after the
commencement of any such proceeding at the rate specified in the applicable
Senior Debt) before the Holders of exchange debentures will be entitled to
receive any payment or distribution of any kind or character with respect to
any Obligations on, or relating to, the exchange debentures (except that
Holders of exchange debentures may receive and retain Permitted Junior
Securities and payments made from the trust described under the caption "--
Legal Defeasance and Covenant Defeasance" so long as the deposit of amounts
therein satisfied the relevant conditions specified in the exchange indenture
at the time of such deposit), in the event of any distribution to creditors of
CCIC:

(1) in a liquidation or dissolution of CCIC;

(2) in a bankruptcy, reorganization, insolvency, receivership or similar
proceeding relating to CCIC or its property;

(3) in an assignment for the benefit of creditors; or

(4) in any marshalling of CCIC's assets and liabilities.

CCIC also may not make any payment or distribution of any kind or character
with respect to any Obligations on, or with respect to, the exchange debentures
or acquire any of the exchange debentures for cash or property or otherwise
(except in Permitted Junior Securities or from the trust described under the
caption "--Legal Defeasance and Covenant Defeasance") if:

(1) a payment default on Designated Senior Debt occurs and is continuing
beyond any applicable period of grace; or

(2) any other default occurs and is continuing on Designated Senior Debt
that permits holders of the Designated Senior Debt to accelerate its
maturity immediately without further notice (except such notice as may be
required to effect such acceleration) or the expiration of any applicable
grace periods and the exchange trustee receives a notice of such default (a

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Payment Blockage Notice) from the holders of such Designated Senior Debt or
their Representative.

Payments on the exchange debentures may and shall be resumed:

(1) in the case of a payment default, upon the date on which such default
is cured or waived; or

(2) in case of a nonpayment default, upon the earlier of (x) the date on
which all nonpayment defaults are cured or waived, (y) 179 days after the
date of delivery of the applicable Payment Blockage Notice or (z) the date
on which the exchange trustee receives notice from the holders of such
Designated Senior Debt or their Representative rescinding the Payment
Blockage Notice, unless the maturity of any Designated Senior Debt has been
accelerated.

No new Payment Blockage Notice may be delivered by the holders of any
Designated Senior Debt or their Representative unless and until 360 days have
elapsed since the effectiveness of the immediately prior Payment Blockage
Notice.

No nonpayment default that existed or was continuing on the date of delivery
of any Payment Blockage Notice to the exchange trustee shall be, or be made,
the basis for a subsequent Payment Blockage Notice unless such default shall
have been cured or waived for a period of not less than 90 consecutive days.

CCIC must promptly notify holders of Senior Debt if payment of the exchange
debentures are accelerated because of an Event of Default.

As a result of the subordination provisions described above, in the event of
a bankruptcy, liquidation or reorganization of CCIC, Holders of exchange
debentures may recover less ratably than creditors of CCIC who are holders of
Senior Debt. See "Risk Factors--Subordination of the Exchangeable Preferred
Stock".

Optional Redemption

During the first 36 months after December 21, 1998, CCIC may on any one or
more occasions redeem up to 35% of the aggregate principal amount of exchange
debentures then outstanding at a redemption price of 112.750% of the principal
amount of the debentures redeemed, plus accrued and unpaid interest and
Liquidated Damages on the debentures redeemed, if any, to the redemption date,
with the net cash proceeds of one or more Public Equity Offerings or Strategic
Equity Investments; provided that:

(1) at least $162.5 million aggregate principal amount of exchange
debentures remains outstanding immediately after the occurrence of such
redemption (excluding exchange debentures held by CCIC and its
Subsidiaries); and

(2) the redemption occurs within 60 days of the date of the closing of
the Public Equity Offering or Strategic Equity Investment.

Except pursuant to the preceding paragraph, the exchange debentures will not
be redeemable at CCIC's option prior to December 15, 2003.

On or after December 15, 2003, CCIC may redeem all or any part of the
exchange debentures upon not less than 30 nor more than 60 days' notice, at the
redemption prices (expressed as percentages of the principal amount) set forth
below plus accrued and unpaid interest and Liquidated

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Damages, if any, on the exchange debentures redeemed to the applicable
redemption date, if redeemed during the twelve-month period beginning on
December 15 of the years indicated below:

Year Percentage
---- ----------

The 10 5/8% discount notes indenture currently restricts the redemption of
the exchange debentures and additional indebtedness may restrict CCIC's ability
to redeem the exchange debentures in the future. See "Description of Certain
Indebtedness".

Selection and Notice

If less than all of the exchange debentures are to be redeemed at any time,
the exchange trustee will select exchange debentures for redemption as follows:

(1) if the exchange debentures are listed on any national securities
exchange, in compliance with the requirements of the principal national
securities exchange on which the exchange debentures are listed; or

(2) If the exchange debentures are not listed on any national securities
exchange, on a pro rata basis, by lot or by such method as the exchange
trustee shall deem fair and appropriate.

No exchange debenture of $1,000 or less will be redeemed in part. Notices of
redemption will be mailed by first class mail at least 30 but not more than 60
days before the redemption date to each Holder of exchange debentures to be
redeemed at its registered address. Notices of redemption may not be
conditional.

If any exchange debentures are to be redeemed in part only, the notice of
redemption that relates to that exchange debentures shall state the portion of
the principal amount of that exchange debenture to be redeemed. A new
certificate with an aggregate principal amount equal to the unredeemed portion
of the original certificate evidencing exchange debentures presented for
redemption will be issued in the name of the Holder thereof upon cancellation
of the original certificate. Exchange debentures called for redemption become
due on the date fixed for redemption. On and after the redemption date,
interest ceases to accrue on exchange debentures or portions thereof called for
redemption.

Mandatory Redemption

CCIC is not required to make mandatory redemption or sinking fund payments
with respect to the exchange debentures.

Repurchase at the Option of Holders

Change of Control

If a Change of Control occurs, each Holder of exchange debentures will have
the right to require CCIC to repurchase all or any part (equal to $1,000 or an
integral multiple thereof) of that Holder's exchange debentures pursuant to a
Change of Control Offer on the terms set forth in the exchange indenture, which
terms are substantially identical to those contained in the certificate of
designations except that the exchange indenture does not include the provisions
described above in the last paragraph under the caption "Change of Control" in
the description of the exchangeable preferred stock.

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Asset Sales

CCIC will not, and will not permit any of its Restricted Subsidiaries to,
consummate an Asset Sale except in accordance with an Asset Sale covenant that
is substantially identical to the Asset Sale covenant contained in the
certificate of designations, except that the Asset Sale covenant contained in
the exchange indenture will have the following additional changes:

. Clause (1) of the second paragraph of the covenant will permit CCIC or
the applicable Restricted Subsidiary to apply Net Proceeds from an Asset
Sale to reduce any Indebtedness of CCIC only if the Indebtedness
constitutes Senior Debt;

. The mechanics for making an Asset Sale Offer are altered to permit CCIC
to make an Asset Sale Offer to holders of senior discount notes and of
other Senior Debt of CCIC then outstanding before making an Asset Sale
Offer to the Holders of exchange debentures; and

. The exchange indenture does not include the provisions described in the
last paragraph under the caption "Asset Sales" in the description of
exchangeable preferred stock.

Certain Covenants

The exchange indenture contains all of the covenants that are in the
certificate of designations. The covenants are substantially identical, except
that changes have been made to make appropriate references. For example, the
term exchange indenture is substituted generally for references to the
certificate of designations, and the term Default typically is substituted for
references to Voting Rights Triggering Event. The following covenants have the
additional changes described below:

Restricted Payments

. Clause (1) of the definition of Restricted Payments substitutes the term
Equity Interests for references to Junior Securities; and

. A new clause (4) is added to the definition of Restricted Payments,
providing that CCIC and its Restricted Subsidiaries will not, directly
or indirectly, make any payment on or with respect to, or purchase,
redeem, defease or otherwise acquire or retire for value any
Indebtedness that is subordinated to the exchange debentures, except a
payment of interest or principal at Stated Maturity.

Incurrence of Indebtedness and Issuance of Preferred Stock

. Clause (6) of the definition of Permitted Debt requires that if CCIC is
the obligor on any intercompany Indebtedness, the intercompany
Indebtedness must be expressly subordinated to the prior payment in full
in cash of all Obligations with respect to the exchange debentures.

Merger, Consolidation or Sale of Assets

. Clause (4) in the covenant is rewritten in its entirety to read as
follows:

(4) except in the case of a merger of CCIC with or into a Wholly Owned
Restricted Subsidiary of CCIC and except in the case of a merger entered
into solely for the purpose of reincorporating CCIC in another
jurisdiction, CCIC or the entity or Person formed by or surviving any such
consolidation or merger (if other than CCIC), or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have
been made will, at the time of such transaction after giving pro forma
effect thereto as if such transaction had occurred at the beginning of the
applicable four-quarter period, be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Debt to Adjusted Consolidated Cash
Flow Ratio test set forth in the first paragraph of the covenant described
above under the caption "--Incurrence of Indebtedness and Issuance of
Preferred Stock".

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Amendment, Supplement and Waiver

Except as provided in the two paragraphs below, the exchange indenture or the
exchange debentures may be amended or supplemented with the consent of the
Holders of a majority of the aggregate principal amount of the exchange
debentures then outstanding (including, without limitation, consents obtained
in connection with a purchase of, or tender offer or exchange offer for,
exchange debentures) or, if no exchange debentures are outstanding, the holders
of a majority in Liquidation Preference of the exchangeable preferred stock
then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for,
exchangeable preferred stock), and any existing default or compliance with any
provision of the exchange indenture or the exchange debentures may be waived
with the consent of the Holders of a majority of the aggregate principal amount
of the then outstanding exchange debentures (including consents obtained in
connection with a tender offer or exchange offer for exchange debentures) or,
if no exchange debentures are outstanding, the holders of a majority in
Liquidation Preference of the exchangeable preferred stock then outstanding
(including, without limitation, consents obtained in connection with a purchase
of, or tender offer or exchange offer for, exchangeable preferred stock).

Without the consent of each Holder affected, an amendment or waiver may not
(with respect to any exchange debentures held by a non-consenting Holder):

(1) reduce the principal amount of exchange debentures whose Holders must
consent to an amendment, supplement or waiver;

(2) reduce the principal of or change the fixed maturity of any exchange
debenture or alter the provisions with respect to the redemption (but not
any required repurchase in connection with an Asset Sale Offer or Change of
Control Offer) of the exchange debentures;

(3) reduce the rate of or change the time for payment of interest on any
exchange debenture;

(4) waive a Default in the payment of principal of or premium, if any, or
interest on the exchange debentures (except a rescission of acceleration of
the exchange debentures by the Holders of a majority in aggregate principal
amount of the exchange debentures and a waiver of the payment default that
resulted from such acceleration);

(5) make any exchange debenture payable in money other than that stated
in the exchange debentures;

(6) make any change in the provisions of the exchange indenture relating
to waivers of past Defaults or the rights of Holders of exchange debentures
to receive payments of principal of or premium, if any, or interest on the
exchange debentures;

(7) waive a redemption payment (but not any payment upon a required
repurchase in connection with an Asset Sale Offer or Change of Control
Offer) with respect to any exchange debenture;

(8) except as provided under the caption "--Legal Defeasance and Covenant
Defeasance" or in accordance with the terms of any Subsidiary Guarantee,
release a Subsidiary Guarantor from its obligations under its Subsidiary
Guarantee or make any change in a Subsidiary Guarantee that would adversely
affect the Holders of the exchange debentures; or

(9) make any change in the foregoing amendment and waiver provisions.

Notwithstanding the foregoing, without the consent of any Holder of exchange
debentures, CCIC and the exchange trustee may amend or supplement the exchange
indenture or the exchange debentures:

(1) to cure any ambiguity, defect or inconsistency;

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(2) to provide for uncertificated exchange debentures in addition to or
in place of certificated exchange debentures;

(3) to provide for the assumption of CCIC's obligations to Holders of
exchange debentures in the case of a merger or consolidation;

(4) to make any change that would provide any additional rights or
benefits to the Holders of exchange debentures or that does not adversely
affect the legal rights under the exchange indenture of any such Holder; or

(5) to comply with requirements of the SEC in order to effect or maintain
the qualification of the exchange indenture under the Trust Indenture Act.

Events of Default and Remedies

Each of the following is an Event of Default:

(1) default for 30 days in the payment when due of interest on, or
Liquidated Damages with respect to, the exchange debentures;

(2) default in payment when due of the principal of or premium, if any,
on the exchange debentures;

(3) failure by CCIC or any of its Subsidiaries for 30 days after notice
to comply with the provisions described under the caption "--Certain
Covenants--Merger, Consolidation or Sale of Assets" or failure by CCIC to
consummate a Change of Control Offer or Asset Sale Offer in accordance with
the provisions of the exchange indenture applicable thereto;

(4) failure by CCIC or any of its Subsidiaries for 60 days after notice
to comply with any of its other agreements in the exchange indenture or the
exchange debentures;

(5) default under any mortgage, indenture or instrument under which there
may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by CCIC or any of its Significant
Subsidiaries (or the payment of which is guaranteed by CCIC or any of its
Significant Subsidiaries) whether such Indebtedness or guarantee now
exists, or is created after December 21, 1998, which default

(a) is caused by a failure to pay principal of or premium, if any, or
interest on such Indebtedness prior to the expiration of the grace
period provided in such Indebtedness on the date of such default (a
"Payment Default") or

(6) failure by CCIC or any of its Significant Subsidiaries to pay final
judgments aggregating in excess of $20.0 million, which judgments are not
paid, discharged or stayed for a period of 60 consecutive days; or

(7) certain events of bankruptcy or insolvency described in the indenture
with respect to CCIC or any of its Significant Subsidiaries.

If any Event of Default occurs and is continuing, the exchange trustee or the
Holders of at least 25% of the aggregate principal amount of the then
outstanding exchange debentures may declare all the exchange debentures to be
due and payable immediately. Notwithstanding the foregoing, in the case of an
Event of Default arising from certain events of bankruptcy or insolvency, with
respect to CCIC, all outstanding exchange debentures will become due and
payable without further action or notice. Holders of the exchange debentures
may not enforce the exchange indenture or the exchange debentures except as
provided in the exchange indenture. Subject to certain limitations,

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Holders of a majority of the aggregate principal amount of the then outstanding
exchange debentures may direct the exchange trustee in its exercise of any
trust or power.

The Holders of a majority of the aggregate principal amount of the exchange
debentures then outstanding by notice to the exchange trustee may on behalf of
the Holders of all of the exchange debentures waive any existing Default or
Event of Default and its consequences under the exchange indenture except a
continuing Default or Event of Default in the payment of interest on, or the
principal of, the exchange debentures.

The exchange indenture provides that if a Default occurs and is continuing
and is known to the exchange trustee, the exchange trustee must mail to each
Holder of the exchange debentures notice of the Default within 90 days after it
occurs. Except in the case of a Default in the payment of principal of or
interest on any exchange debenture, the exchange trustee may withhold notice if
and so long as a committee of its trust officers determines that withholding
notice is not opposed to the interest of the Holders of the exchange
debentures. In addition, CCIC is required to deliver to the exchange trustee,
within 90 days after the end of each fiscal year, a certificate indicating
whether the signers thereof know of any Default that occurred during the
previous year. CCIC is also required to deliver to the exchange trustee,
promptly after the occurrence thereof, written notice of any event that would
constitute a Default, the status thereof and what action CCIC is taking or
proposes to take in respect thereof.

No Personal Liability of Directors, Officers, Employees and Stockholders

No director, officer, employee, incorporator or stockholder of CCIC, as such,
shall have any liability for any obligations of CCIC under the exchange
debentures, the exchange indenture or for any claim based on, in respect of, or
by reason of, such obligations or their creation. Each Holder of exchange
debentures by accepting a exchange debenture waives and releases all such
liability. The waiver and release are part of the consideration for issuance of
the exchange debentures. The waiver may not be effective to waive liabilities
under the federal securities laws and it is the view of the SEC that such a
waiver is against public policy.

Legal Defeasance and Covenant Defeasance

CCIC may, at its option and at any time, elect to have all of its obligations
discharged with respect to the outstanding exchange debentures except for:

(1) the rights of Holders of outstanding exchange debentures to receive
payments in respect of the principal of, premium, if any, and interest and
Liquidated Damages on such exchange debentures when such payments are due
from the trust referred to below;

(2) CCIC's obligations with respect to the exchange debentures concerning
issuing temporary exchange debentures, registration of exchange debentures,
mutilated, destroyed, lost or stolen exchange debentures and the
maintenance of an office or agency for payment and money for security
payments held in trust;

(3) the rights, powers, trusts, duties and immunities of the exchange
trustee and CCIC's obligations in connection therewith; and

(4) the Legal Defeasance provisions of the exchange indenture.

In addition, CCIC may, at its option and at any time, elect to have the
obligations of CCIC released with respect to certain covenants that are
described in the exchange indenture and thereafter any omission to comply with
such obligations shall not constitute a Default or Event of Default with
respect to the exchange debentures. In the event Covenant Defeasance occurs,
certain events (not including non-payment and bankruptcy, receivership,
rehabilitation and insolvency events

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with respect to CCIC) described under "--Events of Default and Remedies" will
no longer constitute an Event of Default with respect to the exchange
debentures.

In order to exercise either Legal Defeasance or Covenant Defeasance:

(1) CCIC must irrevocably deposit with the exchange trustee, in trust,
for the benefit of the Holders of the exchange debentures, cash in United
States dollars, non-callable Government Securities, or a combination
thereof, in such amounts as will be sufficient, in the opinion of a
nationally recognized firm of independent public accountants, to pay the
principal of, premium, if any, and interest and Liquidated Damages on the
outstanding exchange debentures on the stated maturity or on the applicable
redemption date, as the case may be, and CCIC must specify whether the
exchange debentures are being defeased to maturity or to a particular
redemption date;

(2) in the case of Legal Defeasance, CCIC shall have delivered to the
exchange trustee an opinion of counsel in the United States reasonably
acceptable to the exchange trustee confirming that

(a) CCIC has received from, or there has been published by, the
Internal Revenue Service a ruling or

(b) since December 21, 1998, there has been a change in the
applicable federal income tax law, in either case to the effect that,
and based thereon such opinion of counsel shall confirm that, the
Holders of the outstanding exchange debentures will not recognize
income, gain or loss for federal income tax purposes as a result of
such Legal Defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as would have
been the case if such Legal Defeasance had not occurred;

(3) in the case of Covenant Defeasance, CCIC shall have delivered to the
exchange trustee an opinion of counsel in the United States reasonably
acceptable to the exchange trustee confirming that the Holders of the
outstanding exchange debentures will not recognize income, gain or loss for
federal income tax purposes as a result of such Covenant Defeasance and
will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred;

(4) no Default or Event of Default shall have occurred and be continuing
on the date of such deposit (other than a Default or Event of Default
resulting from the borrowing of funds to be applied to such deposit) or
insofar as Events of Default from bankruptcy or insolvency events with
respect to CCIC are concerned, at any time in the period ending on the 91st
day after the date of deposit;

(5) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under any material
agreement or instrument (other than the exchange indenture) to which CCIC
or any of its Restricted Subsidiaries is a party or by which CCIC or any of
its Restricted Subsidiaries is bound;

(6) CCIC must have delivered to the exchange trustee an opinion of
counsel to the effect that after the 91st day following the deposit, the
trust funds will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally;

(7) CCIC must deliver to the exchange trustee an officers' certificate
stating that the deposit was not made by CCIC with the intent of preferring
the Holders of exchange debentures over the other creditors of CCIC with
the intent of defeating, hindering, delaying or defrauding creditors of
CCIC or others; and

(8) CCIC must deliver to the exchange trustee an officers' certificate
and an opinion of counsel, each stating that all conditions precedent
provided for relating to the Legal Defeasance or the Covenant Defeasance
have been complied with.

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Concerning the Exchange Trustee

The exchange indenture contains limitations on the rights of the exchange
trustee, should it become a creditor of CCIC, to obtain payment of claims or to
realize on property received in respect of those claims as security or
otherwise. The exchange trustee will be permitted to engage in other
transactions; however, if it acquires any conflicting interest it must
eliminate the conflict within 90 days, apply to the SEC for permission to
continue or resign.

The Holders of a majority of the aggregate principal amount of the then
outstanding exchange debentures will have the right to direct the time, method
and place of conducting any proceeding for exercising any remedy available to
the exchange trustee, subject to exceptions. The exchange indenture provides
that if an Event of Default occurs and is not cured, the exchange trustee will
be required, in the exercise of its power, to use the degree of care of a
prudent man in the conduct of his own affairs. Subject to these provisions, the
exchange trustee will be under no obligation to exercise any of its rights or
powers under the exchange indenture at the request of any Holder of exchange
debentures, unless that Holder shall have offered to the exchange trustee
security and indemnity satisfactory to it against any loss, liability or
expense.

Additional Information

Anyone who receives this Prospectus may obtain a copy of the certificate of
designations, the exchange indenture and the registration rights agreement
without charge by writing to Crown Castle International Corp., 510 Bering
Drive, Suite 500, Houston, Texas 77057, Attention: Chief Financial Officer.

Certain Definitions

Set forth below are certain defined terms used in the certificate of
designations and the exchange indenture. Reference is made to the certificate
of designations and the exchange indenture for a full disclosure of all such
terms, as well as any other capitalized terms used herein for which no
definition is provided.

"Acquired Debt" means, with respect to any specified Person:

(1) Indebtedness or Disqualified Stock of any other Person existing at
the time such other Person is merged with or into or became a Subsidiary of
such specified Person, including, without limitation, Indebtedness incurred
in connection with, or in contemplation of, such other Person merging with
or into or becoming a Subsidiary of such specified Person; and

(2) Indebtedness secured by a Lien encumbering any asset acquired by such
specified Person.

"Adjusted Consolidated Cash Flow" has the meaning given to such term in the
definition of "Debt to Adjusted Consolidated Cash Flow Ratio".

"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall
mean the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the Voting Stock of a Person shall be
deemed to be control.

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"Asset Sale" means:

(1) the sale, lease, conveyance or other disposition of any assets or
rights (including, without limitation, by way of a sale and leaseback);
provided that the sale, lease, conveyance or other disposition of all or
substantially all of the assets of CCIC and its Subsidiaries taken as a
whole will be governed by the provisions of the certificate of designations
or the exchange indenture, as applicable, described above under the
respective captions "--Repurchase at the Option of Holders--Change of
Control" and/or the provisions described above under the respective
captions "--Repurchase at the Option of Holders--Merger, Consolidation or
Sale of Assets" and not by the provisions of the Asset Sale covenant; and

(2) the issue or sale by CCIC or any of its Restricted Subsidiaries of
Equity Interests of any of CCIC's Subsidiaries (other than directors'
qualifying shares or shares required by applicable law to be held by a
Person other than CCIC or a Restricted Subsidiary), in the case of either
clause (1) or (2), whether in a single transaction or a series of related
transactions (a) that have a fair market value in excess of $1.0 million or
(b) for net proceeds in excess of $1.0 million. Notwithstanding the
foregoing, the following items shall not be deemed to be Asset Sales:

(1) a transfer of assets by CCIC to a Restricted Subsidiary or by a
Restricted Subsidiary to CCIC or to another Restricted Subsidiary;

(2) an issuance of Equity Interests by a Subsidiary to CCIC or to
another Restricted Subsidiary;

(3) a Restricted Payment that is permitted by the covenant described
above under the respective captions "--Certain Covenants--Restricted
Payments";

(4) grants of leases or licenses in the ordinary course of business;
and

(5) disposals of Cash Equivalents.

"Broker-Dealer" means any broker or dealer registered under the Exchange Act.

"Capital Lease Obligation" means, at the time any determination thereof is to
be made, the amount of the liability in respect of a capital lease that would
at such time be required to be capitalized on a balance sheet in accordance
with GAAP.

"Capital Stock" means:

(1) in the case of a corporation, corporate stock;

(2) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated)
of corporate stock;

(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and

(4) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.

"Cash Equivalents" means:

(1) United States dollars;

(2) securities issued or directly and fully guaranteed or insured by the
United States government or any agency or instrumentality thereof (provided
that the full faith and credit of the United States is pledged in support
thereof) having maturities of not more than six months from the date of
acquisition;

(3) certificates of deposit and eurodollar time deposits with maturities
of six months or less from the date of acquisition, bankers' acceptances
with maturities not exceeding six months and overnight bank deposits, in
each case with any lender party to the Senior Credit Facility or with

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any domestic commercial bank having capital and surplus in excess of $500.0
million and a Thompson Bank Watch Rating of "B" or better;

(4) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (2) and (3) above
entered into with any financial institution meeting the qualifications
specified in clause (3) above;

(5) commercial paper having the highest rating obtainable from Moody's
Investors Service, Inc. or Standard & Poor's Ratings Group and in each case
maturing within six months after the date of acquisition; and

(6) money market funds at least 95% of the assets of which constitute
Cash Equivalents of the kinds described in clauses (1)-(5) of this
definition.

"CCAIC" means CCA Investment Corp., which is an indirect wholly owned
Subsidiary of CCIC and was formed to hold CCIC's Equity Interests in Crown
Atlantic Holding Company LLC.

"Change of Control" means the occurrence of any of the following:

(1) the sale, lease, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of CCIC and its
Restricted Subsidiaries, taken as a whole to any "person" (as such term is
used in Section 13(d)(3) of the Exchange Act) other than a Principal or a
Related Party of a Principal;

(2) the adoption of a plan relating to the liquidation or dissolution of
CCIC;

(3) the consummation of any transaction (including, without limitation,
any merger or consolidation) the result of which is that any "person" (as
defined above), other than the Principals and their Related Parties,
becomes the "beneficial owner" (as such term is defined in Rule 13d-3 and
Rule 13d-5 under the Exchange Act, except that a person shall be deemed to
have "beneficial ownership" of all securities that such person has the
right to acquire, whether such right is currently exercisable or is
exercisable only upon the occurrence of a subsequent condition), directly
or indirectly, of more than 50% of the Voting Stock of CCIC (measured by
voting power rather than number of shares); provided that transfers of
Equity Interests in CCIC between or among the beneficial owners of CCIC's
Equity Interests and/or Equity Interests in CTSH, in each case as of
November 20, 1997, will not be deemed to cause a Change of Control under
this clause (3) so long as no single Person together with its Affiliates
acquires a beneficial interest in more of the Voting Stock of CCIC than is
at the time collectively beneficially owned by the Principals and their
Related Parties;

(4) the first day on which a majority of the members of the board of
directors of CCIC are not Continuing Directors; or

(5) CCIC consolidates with, or merges with or into, any Person, or any
Person consolidates with, or merges with or into, CCIC, in any such event
pursuant to a transaction in which any of the outstanding Voting Stock of
CCIC is converted into or exchanged for cash, securities or other property,
other than any such transaction where (x) the Voting Stock of CCIC
outstanding immediately prior to such transaction is converted into or
exchanged for Voting Stock (other than Disqualified Stock) of the surviving
or transferee Person constituting a majority of the outstanding shares of
such Voting Stock of such surviving or transferee Person (immediately after
giving effect to such issuance) or (y) the Principals and their Related
Parties own a majority of such outstanding shares after such transaction.

"Consolidated Cash Flow" means, with respect to any Person for any period,
the Consolidated Net Income of such Person for such period plus:

(1) provision for taxes based on income or profits of such Person and its
Restricted Subsidiaries for such period, to the extent that such provision
for taxes was included in computing such Consolidated Net Income; plus

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(2) consolidated interest expense of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued and whether or not
capitalized (including, without limitation, amortization of debt issuance
costs and original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component of
all payments associated with Capital Lease Obligations, commissions,
discounts and other fees and charges incurred in respect of letter of
credit or bankers' acceptance financings, and net payments (if any)
pursuant to Hedging Obligations), to the extent that any such expense was
deducted in computing such Consolidated Net Income; plus

(3) depreciation, amortization (including amortization of goodwill and
other intangibles and other non-cash expenses (excluding any such non-cash
expense to the extent that it represents an accrual of or reserve for cash
expenses in any future period) of such Person and its Restricted
Subsidiaries for such period to the extent that such depreciation,
amortization and other non-cash expenses were deducted in computing such
Consolidated Net Income; minus

(4) non-cash items increasing such Consolidated Net Income for such
period (excluding any items that were accrued in the ordinary course of
business), in each case on a consolidated basis and determined in
accordance with GAAP.

"Consolidated Indebtedness" means, with respect to any Person as of any date
of determination, the sum, without duplication, of:

(1) the total amount of Indebtedness of such Person and its Restricted
Subsidiaries; plus

(2) the total amount of Indebtedness of any other Person, to the extent
that such Indebtedness has been Guaranteed by the referent Person or one or
more of its Restricted Subsidiaries; plus

(3) the aggregate liquidation value of all Disqualified Stock of such
Person and all preferred stock of Restricted Subsidiaries of such Person,
in each case, determined on a consolidated basis in accordance with GAAP.

"Consolidated Net Income" means, with respect to any Person for any period,
the aggregate of the Net Income of such Person and its Restricted Subsidiaries
for such period, on a consolidated basis, determined in accordance with GAAP;
provided that:

(1) the Net Income (but not loss) of any Person other than CCIC that is
not a Restricted Subsidiary or that is accounted for by the equity method
of accounting shall be included only to the extent of the amount of
dividends or distributions paid in cash to the referent Person or a
Restricted Subsidiary thereof;

(2) the Net Income of any Person acquired in a pooling of interests
transaction for any period prior to the date of such acquisition shall be
excluded;

(3) the cumulative effect of a change in accounting principles shall be
excluded; and

(4) the Net Income (but not loss) of any Unrestricted Subsidiary shall be
excluded whether or not distributed to CCIC or one of its Restricted
Subsidiaries.

"Consolidated Tangible Assets" means, with respect to CCIC, the total
consolidated assets of CCIC and its Restricted Subsidiaries, less the total
intangible assets of CCIC and its Restricted Subsidiaries, as shown on the most
recent internal consolidated balance sheet of CCIC and such Restricted
Subsidiaries calculated on a consolidated basis in accordance with GAAP.

"Continuing Directors" means, as of any date of determination, any member of
the board of directors of CCIC who:

(1) was a member of such board of directors on December 21, 1998;

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(2) was nominated for election or elected to such board of directors with
the approval of a majority of the Continuing Directors who were members of
such board of directors at the time of such nomination or election; or

(3) is a designee of a Principal or was nominated by a Principal.

"Credit Facilities" means one or more debt facilities (including, without
limitation, the Senior Credit Facility) or commercial paper facilities with
banks or other institutional lenders providing for revolving credit loans, term
loans, receivables financing (including through the sale of receivables to such
lenders or to special purpose entities formed to borrow from such lenders
against such receivables) or letters of credit, in each case, as amended,
restated, modified, renewed, refunded, replaced or refinanced in whole or in
part from time to time.

"Debt to Adjusted Consolidated Cash Flow Ratio" means, as of any date of
determination, the ratio of:

(1) the Consolidated Indebtedness of CCIC as of such date to

(2) the sum of

(a) the Consolidated Cash Flow of CCIC for the four most recent full
fiscal quarters ending immediately prior to such date for which
internal financial statements are available, less CCIC's Tower Cash
Flow for such four-quarter period, plus

(b) the product of four times CCIC's Tower Cash Flow for the most
recent quarterly period (such sum being referred to as "Adjusted
Consolidated Cash Flow"),

in each case determined on a pro forma basis after giving effect to all
acquisitions or dispositions of assets made by CCIC and its Subsidiaries from
the beginning of such four-quarter period through and including such date of
determination (including any related financing transactions) as if such
acquisitions and dispositions had occurred at the beginning of such four-
quarter period. For purposes of making the computation referred to above, (i)
acquisitions that have been made by CCIC or any of its Restricted Subsidiaries,
including through mergers or consolidations and including any related financing
transactions, during the reference period or subsequent to such reference
period and on or prior to the calculation date shall be deemed to have occurred
on the first day of the reference period and Consolidated Cash Flow for such
reference period shall be calculated without giving effect to clause (ii) of
the proviso set forth in definition of Consolidated Net Income, and (ii) the
Consolidated Cash Flow attributable to discontinued operations, as determined
in accordance with GAAP, and operations or businesses disposed of prior to
calculation date, shall be excluded.

"Default" means any event that is, or with the passage of time or the giving
of notice or both would be, an Event of Default.

"Designated Senior Debt" with respect to the exchange debentures means:

(1) any Indebtedness under or in respect of the Senior Credit Facility;

(2) any Indebtedness outstanding under the 10 5/8% discount notes
indenture; and

(3) any other Senior Debt permitted under the exchange indenture the
principal amount of which is $25.0 million or more and that has been
designated by CCIC in the instrument or agreement relating to the same as
"Designated Senior Debt".

"Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable, in each case, at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the Holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
date on which the exchangeable preferred stock

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or exchange debentures mature; provided, however, that any Capital Stock that
would constitute Disqualified Stock solely because the holders thereof have the
right to require CCIC to repurchase such Capital Stock upon the occurrence of a
Change of Control or an Asset Sale shall not constitute Disqualified Stock if
the terms of such Capital Stock provide that CCIC may not repurchase or redeem
any such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with the covenant described above under the caption "--
Certain Covenants--Restricted Payments".

"Eligible Indebtedness" means any Indebtedness other than (i) Indebtedness in
the form of, or represented by, bonds or other securities or any guarantee
thereof and (ii) Indebtedness that is, or may be, quoted, listed or purchased
and sold on any stock exchange, automated trading system or over-the-counter or
other securities market (including, without prejudice to the generality of the
foregoing, the market for securities eligible for resale pursuant to Rule 144A
under the Securities Act).

"Eligible Receivables" means the accounts receivable (net of any reserves and
allowances for doubtful accounts in accordance with GAAP) of CCIC and its
Restricted Subsidiaries that are not more than 60 days past their due date and
that were entered into in the ordinary course of business on normal payment
terms as shown on the most recent internal consolidated balance sheet of CCIC
and such Restricted Subsidiaries, all calculated on a consolidated basis in
accordance with GAAP.

"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).

"Exchange Date" means the date on which CCIC exchanges all but not less than
all of the exchangeable preferred stock for exchange debentures.

"Existing Indebtedness" means Indebtedness of CCIC and its Subsidiaries
(other than Indebtedness under the Senior Credit Facility) in existence on
December 21, 1998, until such amounts are repaid.

"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on December 21, 1998.

"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof), of all or any part of any Indebtedness.

"Hedging Obligations" means, with respect to any Person, the obligations of
such Person under:

(1) interest rate swap agreements, interest rate cap agreements and
interest rate collar agreements; and

(2) other agreements or arrangements designed to protect such Person
against fluctuations in interest rates or currency exchange rates.

"Indebtedness" means, with respect to any Person, any indebtedness of such
Person, whether or not contingent, in respect of:

(1) borrowed money;

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(2) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof);

(3) banker's acceptances;

(4) representing Capital Lease Obligations;

(5) the balance deferred and unpaid of the purchase price of any
property; or

(6) representing any Hedging Obligations,

except any such balance that constitutes an accrued expense or trade payable,
if and to the extent any of the foregoing indebtedness (other than letters of
credit and Hedging Obligations) would appear as a liability upon a balance
sheet of such Person prepared in accordance with GAAP, as well as all
Indebtedness of others secured by a Lien on any asset of such Person whether or
not such Indebtedness is assumed by such Person (the amount of such
Indebtedness as of any date being deemed to be the lesser of the value of such
property or assets as of such date or the principal amount of such Indebtedness
of such other Person so secured) and, to the extent not otherwise included, the
Guarantee by such Person of any Indebtedness of any other Person. The amount of
any Indebtedness outstanding as of any date shall be (i) the accreted value
thereof, in the case of any Indebtedness issued with original issue discount,
and (ii) the principal amount thereof, together with any interest thereon that
is more than 30 days past due, in the case of any other Indebtedness.

"Investments" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business),
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
If CCIC or any Restricted Subsidiary of CCIC sells or otherwise disposes of any
Equity Interests of any direct or indirect Subsidiary of CCIC or a Restricted
Subsidiary of CCIC issues any of its Equity Interests such that, in each case,
after giving effect to any such sale or disposition, such Person is no longer a
Restricted Subsidiary of CCIC, CCIC shall be deemed to have made an Investment
on the date of any such sale or disposition equal to the fair market value of
the Equity Interests of such Subsidiary not sold or disposed of in an amount
determined as provided in the final paragraph of the covenant described above
under the respective captions "--Certain Covenants--Restricted Payments".

"Joint Venture Operating Agreement" means the Crown Atlantic Holding Company
LLC Operating Agreement to be entered into by the Company and BAM,
substantially in the form attached to the Certificate of Designations.

"Lien" means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest or encumbrance of any kind in respect of such asset, whether
or not filed, recorded or otherwise perfected under applicable law (including
any conditional sale or other title retention agreement, any lease in the
nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement
under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).

"Net Income" means, with respect to any Person, the net income (loss) of such
Person, determined in accordance with GAAP and before any reduction in respect
of preferred stock dividends, excluding, however:

(1) any gain or loss, together with any related provision for taxes on
such gain or loss, realized in connection with (a) any Asset Sale
(including, without limitation, dispositions pursuant

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to sale and leaseback transactions) or (b) the disposition of any
securities by such Person or any of its Restricted Subsidiaries or the
extinguishment of any Indebtedness of such Person or any of its Restricted
Subsidiaries; and

(2) any extraordinary gain or loss, together with any related provision
for taxes on such extraordinary gain or loss.

"Net Proceeds" means the aggregate cash proceeds received by CCIC or any of
its Restricted Subsidiaries in respect of any Asset Sale (including, without
limitation, any cash received upon the sale or other disposition of any non-
cash consideration received in any Asset Sale), net of:

(1) the direct costs relating to such Asset Sale (including, without
limitation, legal, accounting and investment banking fees, and sales
commissions) and any relocation expenses incurred as a result thereof;

(2) taxes paid or payable as a result thereof (after taking into account
any available tax credits or deductions and any tax sharing arrangements);

(3) amounts required to be applied to the repayment of Indebtedness
(other than Indebtedness under a Credit Facility) secured by a Lien on the
asset or assets that were the subject of such Asset Sale;

(4) all distributions and other payments required to be made to minority
interest holders in Restricted Subsidiaries as a result of such Asset Sale;

(5) the deduction of appropriate amounts provided by the seller as a
reserve in accordance with GAAP against any liabilities associated with the
assets disposed of in such Asset Sale and retained by CCIC or any
Restricted Subsidiary after such Asset Sale; and

(6) without duplication, any reserves that CCIC's board of directors
determines in good faith should be made in respect of the sale price of
such asset or assets for post closing adjustments; provided that in the
case of any reversal of any reserve referred to in clause (5) or (6) above,
the amount so reserved shall be deemed to be Net Proceeds from an Asset
Sale as of the date of such reversal.

"Non-Recourse Debt" means Indebtedness:

(1) as to which neither CCIC nor any of its Restricted Subsidiaries (a)
provides credit support of any kind (including any undertaking, agreement
or instrument that would constitute Indebtedness), (b) is directly or
indirectly liable (as a guarantor or otherwise), or (c) constitutes the
lender;

(2) no default with respect to which (including any rights that the
holders thereof may have to take enforcement action against an Unrestricted
Subsidiary) would permit (upon notice, lapse of time or both) any holder of
any other Indebtedness of CCIC or any of its Restricted Subsidiaries to
declare a default on such other Indebtedness or cause the payment thereof
to be accelerated or payable prior to its stated maturity; and

(3) as to which the lenders have been notified in writing that they will
not have any recourse to the stock or assets of CCIC or any of its
Restricted Subsidiaries (except that this clause (3) will not apply to any
Indebtedness incurred by CTSH and its Subsidiaries prior to August 21,
1998).

"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.

"Permitted Business" means any business conducted by CCIC, its Restricted
Subsidiaries or CTSH and its Subsidiaries on December 21, 1998 and any other
business related, ancillary or complementary to any such business.

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"Permitted Investments" means:

(1) Liens securing Senior Debt;

(2) any Investment in CCIC or in a Restricted Subsidiary of CCIC;

(3) any Investment in Cash Equivalents;

(4) any Investment by the Company or any Restricted Subsidiary of CCIC in
a Person, if as a result of such Investment (i) such Person becomes a
Restricted Subsidiary of CCIC or (ii) such Person is merged, consolidated
or amalgamated with or into, or transfers or conveys substantially all of
its assets to, or is liquidated into, CCIC or a Restricted Subsidiary of
CCIC;

(5) any Restricted Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in
compliance with the covenant described above under the respective captions
"--Repurchase at the Option of Holders--Asset Sales";

(6) any acquisition of assets solely in exchange for the issuance of
Equity Interests (other than Disqualified Stock) of CCIC;

(7) receivables created in the ordinary course of business;

(8) loans or advances to employees made in the ordinary course of
business not to exceed $1.0 million at any one time outstanding;

(9) securities and other assets received in settlement of trade debts or
other claims arising in the ordinary course of business;

(10) purchases of additional Equity Interests in CTSH for cash pursuant
to the Governance Agreement as the same is in effect on December 21, 1998
for aggregate cash consideration not to exceed $20.0 million since December
21, 1998;

(11) the Investment of up to an aggregate of $100.0 million of the net
proceeds from the sale of the exchangeable preferred stock (i) to be used
to consummate the formation of the Crown Atlantic Holding Company LLC joint
venture with Bell Atlantic or (ii) if CCIC does not consummate the
formation of the Crown Atlantic Holding Company LLC joint venture with Bell
Atlantic, in one or more other Subsidiaries of CCIC (which may be
Unrestricted Subsidiaries of CCIC), each of which derives or expects to
derive a majority of its revenues from one or more Permitted Businesses
(each such Investment being measured as of the date made and without giving
effect to subsequent changes in value).

(12) Additional Investments with the net proceeds from the sale of the
exchangeable preferred stock in an aggregate amount equal to (x) the gross
proceeds from the sale of the exchangeable preferred stock, minus (y) the
aggregate amount of Investments made or permitted to be made pursuant to
clause (11) of this paragraph, minus (z) the aggregate amount of
Indebtedness incurred and/or Disqualified Stock issued pursuant to clause
(11) of the second paragraph under the caption "Certain Covenants--
Incurrence of Indebtedness and Issuance of Preferred Stock" (each such
Investment being measured as of the date made and without giving effect to
subsequent changes in value).

(13) other Investments in Permitted Businesses not to exceed an amount
equal to $10.0 million plus 10% of CCIC's Consolidated Tangible Assets at
any one time outstanding (each such Investment being measured as of the
date made and without giving effect to subsequent changes in value).

"Permitted Junior Securities" means Equity Interests in CCIC or debt
securities that are subordinated to all Senior Debt (and any debt securities
issued in exchange for Senior Debt) to substantially the same extent as, or to
a greater extent than, the exchange debentures are subordinated to Senior Debt
pursuant to the exchange indenture.

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"Permitted Refinancing Indebtedness" means any Indebtedness of CCIC or any of
its Restricted Subsidiaries or Disqualified Stock of CCIC issued in exchange
for, or the net proceeds of which are used to extend, refinance, renew,
replace, defease or refund other Indebtedness of CCIC or any of its Restricted
Subsidiaries (other than intercompany Indebtedness) or Disqualified Stock of
CCIC; provided that:

(1) the principal amount, initial accreted value or liquidation
preference, as applicable, of such Permitted Refinancing Indebtedness does
not exceed the principal amount, accreted value or liquidation preference,
as applicable, of, plus accrued interest or accumulated dividends on, the
Indebtedness or Disqualified Stock so extended, refinanced, renewed,
replaced, defeased or refunded (plus the amount of expenses and prepayment
premiums incurred in connection therewith);

(2) such Permitted Refinancing Indebtedness has a final maturity date
later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of,
the Indebtedness or Disqualified Stock being extended, refinanced, renewed,
replaced, defeased or refunded;

(3) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated in right of payment to the exchange
debentures, such Permitted Refinancing Indebtedness is subordinated in
right of payment to, the exchange debentures on terms at least as favorable
to the Holders of exchange debentures as those contained in the
documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; and

(4) such Indebtedness is incurred either by CCIC or by the Restricted
Subsidiary who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded or such Disqualified
Stock is issued by CCIC.

"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or agency or political subdivision thereof (including any
subdivision or ongoing business of any such entity or substantially all of the
assets of any such entity, subdivision or business).

"Principals" means Berkshire Fund III, Limited Partnership; Berkshire Fund
IV, Limited Partnership; Berkshire Investors LLC; Berkshire Partners LLC;
Centenial Fund IV, L.P.; Centenial Fund V, L.P.; Centenial Entrepreneurs Fund
V, L.P.; Nassau Capital Partners II, L.P.; NAS Partners I, L.L.C.; and TdF.

"Public Equity Offering" means an underwritten primary public offering of
common stock of CCIC pursuant to an effective registration statement under the
Securities Act.

"Related Party" with respect to any Principal means:

(1) any controlling stockholder, 80% (or more) owned Subsidiary of such
Principal; or

(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, members, partners, owners or Persons
beneficially holding an 80% or more controlling interest of which consist
of such Principal and/or such other Persons referred to in the immediately
preceding clause (1).

"Restricted Investment" means an Investment other than a Permitted
Investment.

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"Restricted Subsidiary" of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary.

"Senior Credit Facility" means that certain Amended and Restated Loan
Agreement, dated as of July 10, 1998, by and among Key Corporate Capital Inc.
and PNC Bank, National Association, as arrangers and agents for the financial
institutions listed therein, and Crown Communication Inc. and Crown Castle
International Corp. de Puerto Rico, including any related notes, guarantees,
collateral documents, instruments and agreements executed in connection
therewith, and in each case as amended, modified, renewed, refunded, replaced
or refinanced from time to time.

"Senior Debt" means:

(1) all Indebtedness outstanding under the Senior Credit Facility and all
Hedging Obligations (including guarantees thereof) with respect thereto of
CCIC, whether outstanding on December 21, 1998 or thereafter incurred;

(2) all Indebtedness outstanding under the 10 5/8% discount notes or any
Guarantees thereof, as the case may be;

(3) any other Indebtedness permitted to be incurred by CCIC or any of its
Restricted Subsidiaries under the terms of the certificate of designations
or the exchange indenture, as applicable, unless the instrument under which
such Indebtedness is incurred expressly provides that it is on a parity
with or subordinated in right of payment to the exchange debentures; and

(4) all Obligations with respect to the preceding clauses (1), (2) and
(3) (including any interest accruing subsequent to the filing of a petition
of bankruptcy at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable
law).

Notwithstanding anything to the contrary in the foregoing, Senior Debt will
not include:

(1) any liability for federal, state, local or other taxes owed or owing
by CCIC or the Restricted Subsidiaries;

(2) any Indebtedness of CCIC or any Restricted Subsidiary to any of its
Subsidiaries;

(3) any trade payables;

(4) any Indebtedness that is incurred in violation of the certificate of
designations or the exchange indenture, as applicable (but only to the
extent so incurred); or

(5) any Capitalized Lease Obligations.

"Significant Subsidiary" means, with respect to any Person, any Restricted
Subsidiary of such Person that would be a "significant subsidiary" of such
Person as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act, as such Regulation is in effect on the date
hereof, except that all references to "10 percent" in Rule 1-02(w)(1), (2) and
(3) shall mean "5 percent" and that all Unrestricted Subsidiaries of CCIC shall
be excluded from all calculations under Rule 1-02(w).

"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations
to repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.

"Strategic Equity Investment" means a cash contribution to the common equity
capital of CCIC or a purchase from CCIC of common Equity Interests (other than
Disqualified Stock), in either case by or from a Strategic Equity Investor and
for aggregate cash consideration of at least $50.0 million.

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"Strategic Equity Investor" means a Person engaged in a Permitted Business
whose Total Equity Market Capitalization exceeds $1.0 billion.

"Subsidiary" means, with respect to any Person:

(1) any corporation, association or other business entity of which more
than 50% of the total voting power of shares of Capital Stock entitled
(without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by such Person or one or more of the
other Subsidiaries of that Person (or a combination thereof); and

(2) any partnership (a) the sole general partner or the managing general
partner of which is such Person or a Subsidiary of such Person or (b) the
only general partners of which are such Person or of one or more
Subsidiaries of such Person (or any combination thereof).

"Total Equity Market Capitalization" of any Person means, as of any day of
determination, the sum of:

(1) the product of (A) the aggregate number of outstanding primary shares
of common stock of such Person on such day (which shall not include any
options or warrants on, or securities convertible or exchangeable into,
shares of common stock of such person) multiplied by (B) the average
closing price of such common stock listed on a national securities exchange
or the Nasdaq National Market System over the 20 consecutive business days
immediately preceding such day; plus

(2) the liquidation value of any outstanding shares of preferred stock of
such Person on such day.

"Tower Asset Exchange" means any transaction in which CCIC or one of its
Restricted Subsidiaries exchanges assets for Tower Assets and/or cash or Cash
Equivalents where the fair market value (evidenced by a resolution of the board
of directors set forth in an officers' certificate delivered to the transfer
agent and/or the exchange trustee, as appropriate) of the Tower Assets and cash
or Cash Equivalents received by CCIC and its Restricted Subsidiaries in such
exchange is at least equal to the fair market value of the assets disposed of
in such exchange.

"Tower Assets" means wireless transmission towers and related assets that are
located on the site of a transmission tower.

"Tower Cash Flow" means, for any period, the Consolidated Cash Flow of CCIC
and its Restricted Subsidiaries for such period that is directly attributable
to site rental revenue or license fees paid to lease or sublease space on
communication sites owned or leased by CCIC, all determined on a consolidated
basis and in accordance with GAAP. Tower Cash Flow will not include revenue or
expenses attributable to non-site rental services provided by CCIC or any of
its Restricted Subsidiaries to lessees of communication sites or revenues
derived from the sale of assets.

"Unrestricted Subsidiary" means (i) any Subsidiary of CCIC that is designated
by the board of directors as an Unrestricted Subsidiary pursuant to a board
resolution; but only to the extent that such Subsidiary:

(1) has no Indebtedness other than Non-Recourse Debt;

(2) is not party to any agreement, contract, arrangement or understanding
with CCIC or any Restricted Subsidiary of CCIC unless the terms of any such
agreement, contract, arrangement or understanding are no less favorable to
CCIC or such Restricted Subsidiary than those that might be obtained at the
time from Persons who are not Affiliates of CCIC;

(3) is a Person with respect to which neither CCIC nor any of its
Restricted Subsidiaries has any direct or indirect obligation (x) to
subscribe for additional Equity Interests or (y) to maintain

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or preserve such Person's financial condition or to cause such Person to
achieve any specified levels of operating results;

(4) has not guaranteed or otherwise directly or indirectly provided
credit support for any Indebtedness of CCIC or any of its Restricted
Subsidiaries; and

(5) has at least one director on its board of directors that is not a
director or executive officer of CCIC or any of its Restricted Subsidiaries
and has at least one executive officer that is not a director or executive
officer of CCIC or any of its Restricted Subsidiaries.

Any such designation by the board of directors shall be evidenced to the
transfer agent and the exchange trustee by filing with the transfer agent and
the exchange trustee a certified copy of the board resolution giving effect to
such designation and an officers' certificate certifying that such designation
complied with the foregoing conditions and was permitted by the covenant
described above under the respective captions"--Certain Covenants--Restricted
Payments". If, at any time, any Unrestricted Subsidiary would fail to meet the
foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of the certificate of
designations and the exchange indenture and any Indebtedness of that Subsidiary
shall be deemed to be incurred by a Restricted Subsidiary of CCIC as of such
date (and, if such Indebtedness is not permitted to be incurred as of such date
under the covenants described above under the respective captions "--Certain
Covenants--Incurrence of Indebtedness and Issuance of Preferred Stock," CCIC
shall be in default of such covenant). The board of directors of CCIC may at
any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary;
provided that the designation shall be deemed to be an incurrence of
Indebtedness by a Restricted Subsidiary of CCIC of any outstanding Indebtedness
of such Unrestricted Subsidiary and the designation shall only be permitted if
(i) such Indebtedness is permitted under the covenant described above under the
respective captions "--Certain Covenants--Incurrence of Indebtedness and
Issuance of Preferred Stock," calculated on a pro forma basis as if such
designation had occurred at the beginning of the four-quarter reference period,
and (ii) no Default would occur or be in existence following such designation.

"Voting Stock" of any Person as of any date means the Capital Stock of such
Person that is at the time entitled to vote in the election of the board of
directors of such Person.

"Weighted Average Life to Maturity" means, when applied to any Indebtedness
or series or class of preferred stock at any date, the number of years obtained
by dividing:

(1) the sum of the products obtained by multiplying (a) the amount of
each then remaining installment, sinking fund, serial maturity or other
required payments of principal or liquidation preference, including payment
at final maturity, in respect thereof, by (b) the number of years
(calculated to the nearest one-twelfth) that will elapse between such date
and the making of such payment; by

(2) the then outstanding principal amount of such Indebtedness or the
aggregate liquidation preference of the then outstanding preferred stock,
as the case may be.

"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person and one or more Wholly Owned Restricted
Subsidiaries of such Person.

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BOOK-ENTRY, DELIVERY AND FORM

The new preferred stock will be represented by one or more certificates in
registered, global form without interest coupons. The global certificates will
be deposited upon issuance with the transfer agent as custodian for DTC, in New
York, New York, and registered in the name of DTC or its nominee, in each case
for credit to an account of a direct or indirect participant in DTC as
described below.

Except as set forth below, the global certificates may be transferred, in
whole and not in part, only to another nominee of DTC or to a successor of DTC
or its nominee. Beneficial interests in the global certificates may not be
exchanged for exchangeable preferred stock in certificated form except in the
limited circumstances described below. See "--Depositary Procedures--Exchange
of Book-Entry Exchangeable Preferred Stocks for Certificated Securities."
Except in the limited circumstances described below, owners of beneficial
interests in the global certificates will not be entitled to receive physical
delivery of certificated securities (as defined below). Transfers of beneficial
interest in the global certificates will be subject to the applicable rules and
procedures of DTC and its direct or indirect participants, which may change
from time to time.

Initially, the exchange agent will act as paying agent and registrar. The
exchangeable preferred stock may be presented for registration of transfer and
exchange at the offices of the registrar.

Depository Procedures

The following description of the operations and procedures of DTC are
provided solely as a matter of convenience. These operations and procedures are
solely within the control of the respective settlement systems and are subject
to changes by them from time to time. We take no responsibility for these
operations and procedures and urges investors to contact the system or their
participants directly to discuss these matters.

DTC is a limited-purpose trust company created to hold securities for its
participating organizations, or participants, and to facilitate the clearance
and settlement of transactions in those securities between participants through
electronic book-entry changes in accounts of its participants. The participants
include securities brokers and dealers (including the initial purchasers),
banks, trust companies, clearing corporations and certain other organizations.
Access to DTC's system is also available to other entities such as banks,
brokers, dealers and trust companies that clear through or maintain a custodial
relationship with a participant, either directly or indirectly, the indirect
participants. Persons who are not participants may beneficially own securities
held by or on behalf of DTC only through the participants or the indirect
participants. The ownership interests in, and transfers of ownership interests
in, each security held by or on behalf of DTC are recorded on the records of
the participants and indirect participants.

Pursuant to procedures established by DTC:

(1) upon deposit of the global certificates, DTC will credit the accounts
of participants designated by the initial purchasers with portions of the
principal amount of the global certificates; and

(2) ownership of such interests in the global certificates will be shown
on, and the transfer of ownership thereof will be effected only through,
records maintained by DTC (with respect to the participants) or by the
participants and the indirect participants (with respect to other owners of
beneficial interest in the global certificates).

Investors in the global certificates may hold their interests therein
directly through DTC, if they are participants in such system, or indirectly
through organizations (including Euroclear and Cedel Bank) which are
participants in such system. Investors in the Regulation S global certificates
that do

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not tender in the exchange offer must initially hold their interests therein
through Euroclear or Cedel Bank, if they are participants in such systems, or
indirectly through organizations which are participants in such systems. After
the expiration of the restricted period (but not earlier), investors that do
not tender in the exchange offer may also hold interests in the Regulation S
global certificates through organizations other than Euroclear and Cedel Bank
that are participants in the DTC system. Euroclear and Cedel Bank will hold
interests in the Regulation S global certificates on behalf of their
participants through customers' securities accounts in their respective names
on the books of their respective depositaries, which are Morgan Guaranty Trust
Company of New York, Brussels office, as operator of Euroclear, and Citibank,
N.A. as operator of Cedel. The depositaries, in turn, will hold such interests
in the Regulation S global certificates in customers' securities accounts in
the depositaries' names on the books of DTC. All interests in a global
certificate, including those held through Euroclear or Cedel Bank, may be
subject to the procedures and requirements of DTC. Those interests held by
Euroclear or Cedel Bank may be also be subject to the procedures and
requirements of such system.

The laws of some states require that certain persons take physical delivery
in definitive form of securities that they own. Consequently, the ability to
transfer beneficial interest in a global certificate to such persons may be
limited to that extent. Because DTC can act only on behalf of participants,
which in turn act on behalf of indirect participants and certain banks, the
ability of a person having a beneficial interest in a global certificate to
pledge such interest to persons or entities that do not participate in the DTC
system, or otherwise take actions in respect of such interests, may be affected
by the lack of a physical certificate evidencing such interests. For certain
other restrictions on the transferability of the preferred stock or the
exchange debentures, as applicable, see "--Exchange of Book-Entry Securities
for Certificated Securities", "--Exchange of Certificated Securities for Book-
Entry Securities."

Because DTC can act only on behalf of participants, which in turn act on
behalf of indirect participants and certain banks, the ability of a person
having beneficial interests in a global certificate to pledge such interests to
persons or entities that do not participate in the DTC system, or otherwise
take actions in respect of such interests, may be affected by the lack of a
physical certificate evidencing such interests.

Except as described below, owners of interest in the global certificates will
not have exchangeable preferred stock or exchange debentures, as applicable,
registered in their names, will not receive physical delivery of exchangeable
preferred stock or exchange debentures, as applicable, in certificated form and
will not be considered the registered owners or "holders" thereof under the
certificate of designations or the exchange indenture, as applicable, for any
purpose.

Payments in respect of the principal of, and premium, if any, liquidated
damages, if any, and interest on a global certificate registered in the name of
DTC or its nominee will be payable to DTC in its capacity as the registered
holder under the certificate of designations or the exchange indenture, as
applicable. Under the terms of the certificate of designations and the exchange
indenture, we and the transfer agent or exchange trustee, as applicable, will
treat the persons in whose names the exchangeable preferred stock or exchange
debentures, as applicable, including the global certificates, are registered as
the owners thereof for the purpose of receiving such payments and for any and
all other purposes whatsoever. Consequently, neither we, the transfer agent or
the exchange trustee nor any of their respective agents has or will have any
responsibility or liability for:

(1) any aspect of DTC's records or any participant's or indirect
participant's records relating to or payments made on account of beneficial
ownership interest in the global certificates, or for maintaining,
supervising or reviewing any of DTC's records or any participant's or
indirect participant's records relating to the beneficial ownership
interests in the global certificates; or

177

(2) any other matter relating to the actions and practices of DTC or any
of its participants or indirect participants.

DTC's current practice, upon receipt of any payment in respect of securities
such as the exchangeable preferred stock (including dividends) or the exchange
debentures (including principal and interest), as applicable, is to credit the
accounts of the relevant participants with the payment on the payment date, in
amounts proportionate to their respective holdings in the principal amount of
beneficial interest in the relevant security as shown on the records of DTC
unless DTC has reason to believe it will not receive payment on such payment
date.

Payments by the participants and the indirect participants to the beneficial
owners of exchangeable preferred stock or exchange debentures, as applicable,
will be governed by standing instructions and customary practices and will be
the responsibility of the participants or the indirect participants and will
not be the responsibility of DTC, the transfer agent, the exchange trustee or
us. None of us, the transfer agent or the exchange trustee will be liable for
any delay by DTC or any of its participants in identifying the beneficial
owners of the exchangeable preferred stock or exchange debentures, as
applicable, and we, the transfer agent and the exchange trustee may
conclusively rely on and will be protected in relying on instructions from DTC
or its nominee for all purposes.

Except for trades involving only Euroclear and Cedel Bank participants,
interests in the global certificates are expected to be eligible to trade in
DTC's Same-Day Funds Settlement System and secondary market trading activity in
such interests will, therefore, settle in immediately available funds, subject
in all cases to the rules and procedures of DTC and its participants. See "--
Same Day Settlement and Payment".

DTC will take any action permitted to be taken by a holder of exchangeable
preferred stock or exchange debentures, as applicable, only at the direction of
one or more participants to whose account DTC has credited the interests in the
global certificates and only in respect of such portion of the aggregate
principal amount of the exchangeable preferred stock or exchange debentures, as
applicable, as to which such participant or participants has or have given such
direction. However, if there is an event of default under the exchange
debentures, DTC reserves the right to exchange the global certificates for
legended securities in certificated form, and to distribute such certificates
to its participants.

Although DTC has agreed to the foregoing procedures to facilitate transfers
of interests in the global certificates among participants in DTC, Euroclear
and Cedel Bank, they are under no obligation to perform or to continue to
perform such procedures, and such procedures may be discontinued at any time.
None of the us, the transfer agent or the exchange trustee nor any of our or
respective agents will have any responsibility for the performance by DTC,
Euroclear or Cedel Bank or their respective participants or indirect
participants of their respective obligations under the rules and procedures
governing their operations.

Exchange of Book-Entry Certificates for Certificated Securities

A global certificate is exchangeable for definitive certificates in
registered certificated form if:

(1) DTC:

(a) notifies us that it is unwilling or unable to continue as
depositary for the global certificate and we fail to appoint a
successor depositary; or

(b) has ceased to be a clearing agency registered under the Exchange
Act and we fail to appoint a successor depositary;

(2) we, at our option, notify the exchange trustee in writing that it
elects to cause the issuance of the exchangeable preferred stock or
exchange debentures, as applicable, in certificate form; or

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(3) there shall have occurred and be continuing (a) a voting rights
triggering event with respect to the exchangeable preferred stock or (b) a
default or event of default with respect to the exchange debentures.

In addition, beneficial interests in a global certificate may be exchanged
for certificated certificates upon request but only upon prior written notice
given to the exchange trustee by or on behalf of DTC in accordance with the
exchange indenture. In all cases, certificated securities delivered in exchange
for any global certificate or beneficial interests therein will be registered
in the names, and issued in any approved denominations, requested by or on
behalf of the depositary (in accordance with its customary procedures) and will
bear the applicable restrictive legend referred to in "Notice to Investors,"
unless we determine otherwise in compliance with applicable law.

Exchange of Certificated Securities for Book-Entry Securities

Certificates issued in certificated form may not be exchanged for beneficial
interests in any global certificate unless the transferor first delivers to the
transfer agent or the exchange trustee, as applicable, a written certificate
(in the form provided in the certificate of designations or the exchange
indenture) to the effect that such transfer will comply with the appropriate
transfer restrictions applicable to such certificate.

Same Day Settlement and Payment

The certificate of designation or the exchange indenture, as applicable,
require that payments in respect of the certificates represented by the global
certificates (including liquidation preference, dividends, principal, premium,
interest and liquidated damages) be made by wire transfer of immediately
available funds to the accounts specified by the global certificate holder.
With respect to certificated securities, we will make all such payments by wire
transfer of immediately available funds to the accounts specified by the
holders thereof or, if no such account is specified, by mailing a check to each
such holder's registered address. The certificates represented by the global
certificates are expected to be eligible to trade in the PORTAL market and to
trade in the Depositary's Same-Day Funds Settlement System, and any permitted
secondary market trading activity in such Certificates will, therefore, be
required by the Depositary to be settled in immediately available funds. We
expect that secondary trading in any certificated certificates will also be
settled in immediately available funds.

Registration Rights and Liquidated Damages

Holders of the new preferred stock are not entitled to any registration
rights with respect to the new preferred stock. We and the initial purchasers
entered into the registration rights agreement for the benefit of the holders
of transfer restricted securities on the closing date. Pursuant to the
registration rights agreement, we agreed to file with the SEC the exchange
offer registration statement on the appropriate form under the Securities Act
with respect to the new preferred stock. The registration statement of which
this prospectus is a part constitutes the exchange offer registration
statement. The registration rights agreement provides that if (1) we are not
required to file the exchange offer registration statement or permitted to
consummate the exchange offer because the exchange offer is not permitted by
applicable law or SEC policy or (2) any holder of transfer restricted
securities notifies us prior to the 20th day following consummation of the
exchange offer that (A) it is prohibited by law or SEC policy from
participating in the exchange offer or (B) that it may not resell the new
preferred stock acquired by it in the exchange offer to the public without
delivering a prospectus and the prospectus contained in the exchange offer
registration statement is not appropriate or available for such resales or (C)
that it is a broker-dealer and owns preferred stock acquired directly from us
or our affiliate, we will file with the SEC a shelf registration statement to
cover resales of the preferred stock by the holders thereof, subject to such
holders satisfying certain

179

conditions relating to the provision of information in connection with the
shelf registration statement. We have agreed that we will use all commercially
reasonable efforts to cause any such shelf registration statement to be
declared effective as promptly as possible by the SEC. For purposes of the
foregoing, "transfer restricted securities" means each old preferred stock
until (1) the date on which such old preferred stock has been exchanged by a
person other than a broker-dealer for a new preferred stock in the exchange
offer, (2) following the exchange by a broker-dealer in the exchange offer of
an old preferred stock for a new preferred stock, the date on which such new
preferred stock is sold to a purchaser who receives from such broker-dealer on
or prior to the date of such sale a copy of the prospectus contained in the
exchange offer registration statement, (3) the date on which such old preferred
stock has been effectively registered under the Securities Act and disposed of
in accordance with the shelf registration statement or (4) the date on which
such old preferred stock is distributed to the public pursuant to Rule 144
under the Act.

The registration rights agreement provides that:

(1) we will file an exchange offer registration Statement with the SEC on
or prior to 60 days after the closing date,

(2) we will use all commercially reasonable efforts to have the exchange
offer registration statement declared effective by the SEC on or prior
to 150 days after the closing date,

(3) unless the exchange offer would not be permitted by applicable law or
SEC policy, we will commence the exchange offer and use our best
efforts to issue on or prior to 30 business days after the date on
which the exchange offer registration statement was declared effective
by the SEC, new preferred stock in exchange for all old preferred stock
tendered prior thereto in the exchange offer, and

(4) if obligated to file the shelf registration statement, we will use our
best efforts to file the shelf registration statement with the SEC on
or prior to 45 days after such filing obligation arises and to cause
the shelf registration to be declared effective by the SEC on or prior
to 90 days after such obligation arises. If (a) we fail to file any of
the registration statements required by the registration rights
agreement on or before the date specified for such filing, (b) any of
such registration statements is not declared effective by the SEC on or
prior to the date specified for such effectiveness, or (c) we fail to
consummate the exchange offer within 30 business days of the
effectiveness target date with respect to the exchange offer
registration statement, or (d) the shelf registration statement or the
exchange offer registration statement is declared effective but
thereafter ceases to be effective or usable in connection with resales
of transfer restricted securities during the periods specified in the
registration rights agreement (each such event referred to in clauses
(a) through (d) above a "Registration Default"), then we will pay
liquidated damages to each Holder of exchangeable preferred stock, with
respect to the first 90-day period immediately following the occurrence
of the first Registration Default in an amount equal to $.05 per week
per $1,000 of the liquidation preference of the exchangeable preferred
stock held by such holder. The amount of the liquidated damages will
increase by an additional $.05 per week per $1,000 of the liquidation
preference of the exchangeable preferred stock with respect to each
subsequent 90-day period until all Registration Defaults have been
cured, up to a maximum amount of liquidated damages for all
Registration Defaults of $.50 per week per $1,000 of the liquidation
preference of the exchangeable preferred stock. We will pay all accrued
liquidated damages on each interest payment date to the Holders of
record on the immediately preceding record date by wire transfer of
immediately available funds, in the case of the holder of global
preferred stock, and to holders of certificated securities by wire
transfer to the accounts specified by them or by mailing checks to
their registered addresses if no such accounts have been specified.
Following the cure of all Registration Defaults, the accrual of
liquidated damages will cease.

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DESCRIPTION OF CAPITAL STOCK

Our authorized capital stock consists of 600,000,000 shares of common stock,
par value $.01 per share, 90,000,000 shares of Class A common stock, par value
$.01 per share, and 10,000,000 shares of preferred stock, par value $.01 per
share. There are 94,905,902 shares of common stock outstanding, 11,340,000
shares of Class A common stock outstanding and 201,063 shares of 12 3/4% Senior
Exchangeable Preferred Stock due 2010.

Common Stock

Voting Rights

Each share of common stock is entitled to one vote. The common stock votes
together as a single class on all matters presented for a vote of the
stockholders, except as provided under the Delaware General Corporation Law.
All the outstanding shares of common stock are held by directors, executive
officers, other employees and our affiliates.

Dividends and Liquidation Rights

Each share of common stock is entitled to receive dividends if, as and when
declared by the board of directors out of funds legally available for that
purpose, subject to approval of certain holders of the senior convertible
preferred stock. In the event of our dissolution, after satisfaction of amounts
payable to our creditors and distribution of any preferential amounts to the
holders of outstanding senior convertible preferred stock, if any, holders of
common stock are entitled to share ratably in the assets available for
distribution to the stockholders.

Other Provisions

There are no preemptive rights to subscribe for any additional securities
which we may issue, and there are no redemption provisions or sinking fund
provisions applicable to the common stock.

Class A Common Stock

Voting Rights

Each share of Class A common stock is entitled to one vote for each such
share on all matters presented to the stockholders, except the election of
directors. The holders of the shares of Class A common stock vote, except as
provided under the Delaware General Corporation Law, together with the holders
of the common stock and any other class or series of our stock accorded such
general voting rights, as a single class.

TdF, the holder of all the shares of Class A common stock currently has the
right to elect two directors to our board of directors; however, if TdF's
ownership interest in us changes, so long as the ownership interest of the TdF
Group is at least 5%, holders of Class A common stock voting as a separate
class have the right to elect one director.

The holders of Class A common stock, subject to limitations described in "The
Roll-Up--Governance Agreement--Governance Limitations", have a veto over
certain significant actions, described in "Governance--Veto Rights", taken by
us.

Convertibility

Each share of Class A common stock is convertible, at the option of its
record holder, into one share of common stock at any time.

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In the event of any transfer of any share of Class A common stock to any
person other than an Affiliate (as defined in Rule 12b-2 of the Exchange Act),
such share of Class A common stock automatically converts, without any further
action, into one share of common stock. However, a holder of shares of Class A
common stock may pledge its shares to a financial institution under a bona fide
pledge of such shares of Class A common stock as collateral security for any
indebtedness or other obligation of any person due to the pledgee or its
nominee.

Further, each share of Class A common stock automatically converts into one
share of common stock on the first date on which the ownership interest of TdF
Group is less than 5%.

Dividends and Liquidation Rights

Holders of shares of Class A common stock are entitled to the same dividends
and liquidation rights as holders of shares of common stock.

Other Provisions

Under the governance agreement, so long as it remains qualified, TdF has
anti-dilutive rights in connection with maintaining a certain percentage of
voting power in us and, accordingly, we may not, subject to certain exceptions
relating primarily to compensation of directors and employees, issue, sell or
transfer additional securities (except for the initial public offering) unless
TdF is offered the right to purchase, at the same price, an amount such that it
would maintain such percentage of voting power in CCIC.

Preferred Stock

Under our certificate of incorporation, we may issue up to 10,000,000 shares
of preferred stock in one or more series. Our board of directors has the
authority, without any vote or action by the stockholders (other than any
rights of TdF under the governance agreement), to create one or more series of
preferred stock up to the limit of our authorized but unissued shares of
preferred stock and to fix their designations, preferences, rights,
qualifications, limitations and restrictions, including the voting rights,
dividend rights, dividend rate, conversion rights, terms of redemption
(including sinking fund provisions), redemption price or prices, liquidation
preferences and the number of shares constituting any series. See "Risk
Factors--We May Not Have Sufficient Funds to Repurchase the Exchangeable
Preferred Stock or the Exchange Debentures Upon a Change of Control".

Senior Preferred Warrants

In connection with the offering of the senior convertible preferred stock in
August 1997 and October 1997, we issued warrants to purchase an aggregate of
1,314,990 shares of common stock at a price of $7.50 per share.

Certificate of Incorporation and By-laws

Stockholders' rights and related matters are governed by the Delaware General
Corporation Law, and our certificate of incorporation and by-laws. Certain
provisions of our certificate of incorporation and by-laws, which are
summarized below, may have the effect, either alone or in combination with each
other, of discouraging or making more difficult a tender offer or takeover
attempt that is opposed by our board of directors but that a stockholder might
consider to be in its best interest. Such provisions may also adversely affect
prevailing market prices for the common stock. We believe that such provisions
are necessary to enable us to develop its business in a manner that will foster
its long-term growth without disruption caused by the threat of a takeover not
deemed by our board of directors to be in our best interests and those of our
stockholders.

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Classified Board of Directors and Related Provisions

Our certificate of incorporation provides that our directors, other than
those directors who may be elected by holders of any series of preferred stock
or holders of the Class A common stock, initially are to be divided into three
classes of directors, initially consisting of three, three and four directors.
One class of directors, initially consisting of three directors, will be
elected for a term expiring at the annual meeting of shareholders to be held in
1999, another class initially consisting of three directors will be elected for
a term expiring at the annual meeting of stockholders to be held in 2000, and
another class initially consisting of four directors shall be initially elected
for a term expiring at the annual meeting of stockholders in 2001. The
classified board provisions will prevent a party who acquires control of a
majority of our outstanding voting stock from obtaining control of our board of
directors until the second annual stockholders meeting following the date such
party obtains the controlling interest. Voting stock is defined in our
certificate of incorporation as the outstanding shares of our capital stock
entitled to vote in a general vote of our stockholders as a single class with
shares of our common stock, which shares of capital stock include the shares of
Class A common stock.

No Stockholder Action by Written Consent; Special Meeting

The certificate of incorporation prohibits stockholders (other than holders
of Class A common stock on matters such holders are entitled to vote on as a
separate class) from taking action by written consent in lieu of an annual or
special meeting and, thus, stockholders may only take action at an annual or
special meeting called in accordance with our by-laws. The by-laws provide that
special meetings of stockholders may only be called by our Secretary at the
direction of our board of directors under a resolution adopted by the board.

These provisions could have the effect of delaying consideration of a
stockholder proposal until the next annual meeting. The provisions would also
prevent the holders of a majority of the voting power of our capital stock
entitled to vote from unilaterally using the written consent procedure to take
stockholder action.

Advance Notice Requirements for Stockholder Proposals and Director Nominations

Our by-laws establish advance notice procedures with regard to stockholder
proposals and the nomination, other than by or at the direction of the board of
directors, of candidates for election as directors. These procedures provide
that the notice of stockholder proposals and stockholder nominations for the
election of directors at an annual meeting must be in writing and received by
our secretary no less than 90 days nor more than 120 days prior to the first
anniversary of the preceding year's annual meeting; provided, however, that for
the annual meeting to be held in 1999, the anniversary date shall be deemed to
be April 1, 1999; provided further that in the event that the date of the
annual meeting is advanced by more than 30 days, or delayed by more than 90
days, from such anniversary date, notice by the stockholder to be timely must
be delivered not earlier than the 120th day prior to such annual meeting and
not later than the close of business on the later of the 90th day prior to such
annual meeting or the 10th day following the day on which public disclosure of
the date of the annual meeting was made. The notice of nominations for the
election of directors must set forth certain information concerning the
stockholder giving the notice and each nominee.

By requiring advance notice of nominations by stockholders, the foregoing
procedures will afford our board of directors an opportunity to consider the
qualifications of the proposed nominees and, to the extent deemed necessary or
desirable by the board of directors, to inform stockholders about such
qualifications. By requiring advance notice of other proposed business, such
procedures will provide our board of directors with an opportunity to inform
stockholders, prior to such meetings, of any business proposed to be conducted
at such meetings, together with any recommendations as to the board of
directors' position regarding action to be taken on such business, so that
stockholders

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can better decide whether to attend such a meeting or to grant a proxy
regarding the disposition of any such business.

Dilution

Our certificate of incorporation provides that our board of directors is
authorized to create and issue, whether or not in connection with the issuance
and sale of any of its stock or other securities or property, rights entitling
the holders to purchase from us shares of stock or other securities of us or
any of other corporation, recognizing that, under certain circumstances, the
creation and issuance of such rights could have the effect of discouraging
third parties from seeking, or impairing their right to seek, to acquire a
significant portion of our outstanding securities, to engage in any transaction
which might result in a change of control of the corporation or to enter into
any agreement, arrangement or understanding with another party to accomplish
the foregoing or for the purpose of acquiring, holding, voting or disposing of
any of our securities.

Amendments

Our certificate of incorporation and by-laws provide that we may at any time
and from time to time, amend, alter, change or repeal any provision contained
in our certificate of incorporation or a preferred stock designation. However,
the affirmative vote of the holders of at least 80% of the voting power of the
then outstanding voting stock, voting together as a single class, is required
to amend, repeal or adopt any provision inconsistent with certain provisions of
our certificate of incorporation, including the provisions referred to above
relating to the classification of our board of directors, prohibiting
stockholder action by written consent, and prohibiting the calling of special
meetings by stockholders.

Our by-laws may be amended by either the holders of 80% of the voting power
of the Voting Stock or by the majority of the board; provided that the board
may alter, amend or repeal or adopt new by-laws in conflict with certain
provisions by a two-thirds vote of the entire board.

Rights Plan

Rights

Our board of directors has declared a dividend of one right for each
outstanding share of common stock and each outstanding share of Class A common
stock. Rights have been issued in connection with each outstanding share of
common stock and Class A common stock; and rights will be issued in connection
with common stock and Class A common stock issued subsequently until the
distribution date, and, in certain circumstances, for common stock and Class A
common stock issued after the distribution date referred to below. Each right,
when it becomes exercisable as described below, will entitle the registered
holder to purchase from us one one-thousandth (1/1000th) of a share of Series A
Participating Cumulative Preferred Stock at a price of $110.00 per (1/1000th)
of a share, subject to adjustment in certain circumstances. The description and
terms of the rights are set forth in a rights agreement between us and the
rights agent named therein. The rights will not be exercisable until the
distribution date and will expire on the tenth annual anniversary of the rights
agreement, unless earlier redeemed by us. Until a right is exercised, the
holder, as such, will have no rights as our stockholder, including the right to
vote or to receive dividends.

Distribution Date

Under the rights agreement, the "distribution date" is the earlier of:

(1) such time as we learn that a person or group (including any affiliate
or associate of such person or group) has acquired, or has obtained the
right to acquire, beneficial ownership of

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more than 15% of our outstanding voting securities (such person or group
being an "acquiring person"), subject to the exceptions relating to the
TDF Group and the Berkshire Group described in the paragraph below,
unless provisions preventing accidental triggering of the distribution
of the rights apply, and

(2) the close of business on such date, if any, as may be designated by our
board of directors following the commencement of, or first public
disclosure of an intent to commence, a tender or exchange offer for
more than 15% or more of the outstanding shares of voting securities.

Each member of the TdF group will not otherwise be considered an acquiring
person if:

(a) during the first five years following the adoption of the rights
agreement, the aggregate ownership interest of the TdF group does not
exceed 25% (or 30% if the board so elects) of the outstanding voting
securities or

(b) thereafter, the aggregate ownership interest of the TdF group does not
exceed the lesser of (1) 25% or 30%, as applicable, of the voting
securities then outstanding and (2) the greater of (x) the aggregate
interest of the TdF group as of the fifth anniversary of the rights
agreement and (y) 15% of the then outstanding voting securities.

Each member of the Berkshire group will not otherwise be deemed an acquiring
person if the aggregate ownership interest of the Berkshire group does not
exceed the greater of:

(a) the aggregate ownership interest of the Berkshire group upon the
execution of the rights agreement, reduced by an amount equal to any
disposition of voting securities following the date the rights
agreement is executed and

(b) 15% of the outstanding voting securities.

Triggering Event and Effect of Triggering Event

At such time as there is an acquiring person, the rights will entitle each
holder (other than such acquiring person) of a right to purchase, at the
purchase price, that number of one-thousandths (1/1000ths) of a preferred share
equivalent to the number of shares of common stock that at the time of such
event would have a market value of twice the purchase price.

In the event we are acquired in a merger or other business combination by an
acquiring person or an affiliate or associate of an acquiring person that is a
publicly traded corporation or 50% or more of our assets or assets representing
50% or more of our revenues or cash flow are sold, leased, exchanged or
otherwise transferred (in one or more transactions) to an acquiring person or
an affiliate or associate of an acquiring person that is a publicly traded
corporation, each right will entitle its holder (other than rights beneficially
owned by such acquiring person or its affiliates or associates) to purchase,
for the purchase price, that number of common shares of such corporation which
at the time of the transaction would have a market value or, in certain
circumstances, book value of twice the purchase price. In the event we are
acquired in a merger or other business combination by an acquiring person or an
affiliate or associate of an acquiring person that is not a publicly traded
entity or 50% or more of our assets or assets representing 50% or more of our
revenues or cash flow are sold, leased, exchanged or otherwise transferred (in
one or more transactions) to an acquiring person or affiliate or associate of
an acquiring person that is not a publicly traded entity, each right will
entitle its holder (subject to the next paragraph) to purchase, for the
purchase price, at such holder's option, (1) that number of shares of the
surviving corporation in the transaction with such entity (which surviving
corporation could be us) which at the time of the transaction would have a book
value of twice the purchase price, (2) that number of shares of the ultimate
parent of or entity controlling such surviving corporation which at the time of
the transaction would have a book value of twice the purchase price or (3) if
such entity has an affiliate which has publicly traded common

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shares, that number of common shares of such affiliate which at the time of the
transaction would have market value of twice the purchase price.

Any rights that are at any time beneficially owned by an acquiring person (or
any affiliate or associate of an acquiring person) will be null and void and
nontransferable and any holder of any such right (including any purported
transferee or subsequent holder) will be unable to exercise or transfer any
such right.

Redemption

At any time prior to the earlier of (i) such time as a person or group
becomes an acquiring person and (ii) the Expiration Date, our board of
directors may redeem the rights in whole, but not in part, at a price (in cash
or common stock or other securities of ours deemed by our board of directors to
be at least equivalent in value) of $.01 per right (which amount shall be
subject to adjustment as provided in the rights agreement). Immediately upon
the action of our board of directors ordering the redemption of the rights, and
without any further action and without any notice, the right to exercise the
rights will terminate and the only right of the holders of rights will be to
receive the redemption price.

In addition, at any time after there is an acquiring person, our board of
directors may elect to exchange each right for consideration per right
consisting of one-half of the securities that would be issuable at such time
upon exercise of one right under the terms of the rights agreement.

Amendment

At any time prior to the distribution date, we may, without the approval of
any holder of any rights, supplement or amend any provision of the rights
agreement (including the date on which the expiration date or distribution date
shall occur, the definition of acquiring person, the time during which the
rights may be redeemed or the terms of the preferred shares), except that no
supplement or amendment shall be made which reduces the redemption price (other
than under certain adjustments therein).

Certain Effects of the Rights Plan

The rights plan is designed to protect our stockholders in the event of
unsolicited offers to acquire us and other coercive takeover tactics which, in
the opinion of our board of directors, could impair its ability to represent
stockholder interests. The provisions of the rights plan may render an
unsolicited takeover of us more difficult or less likely to occur or might
prevent such a takeover, even though such takeover may offer our stockholders
the opportunity to sell their stock at a price above the prevailing market rate
and may be favored by a majority of our stockholders.

Section 203 of the Delaware General Corporation Law

Section 203 of the Delaware General Corporation Law prohibits certain
transactions between a Delaware corporation and an "interested stockholder",
which is defined as a person who, together with any affiliates and/or
associates of such person, beneficially owns, directly or indirectly, 15% or
more of the outstanding voting shares of a Delaware corporation. This provision
prohibits certain business combinations (defined broadly to include mergers,
consolidations, sales or other dispositions of assets having an aggregate value
of 10% or more of the consolidated assets of the corporation, and certain
transactions that would increase the interested stockholder's proportionate
share ownership in the corporation) between an interested stockholder and a
corporation for a period of three years after the date the interested
stockholder acquired its stock, unless:

(1) the business combination is approved by the corporation's board of
directors prior to the date the interested stockholder acquired shares;

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(2) the interested stockholder acquired at least 85% of the voting stock
of the corporation in the transaction in which it became an interested
stockholder; or

(3) the business combination is approved by a majority of the board of
directors and by the affirmative vote of two-thirds of the outstanding
voting stock owned by disinterested stockholders at an annual or
special meeting.

A Delaware corporation, under a provision in its certificate of incorporation
or by-laws, may elect not to be governed by Section 203 of the Delaware General
Corporation Law. We are subject to the restrictions imposed by Section 203.

Under certain circumstances, Section 203 makes it more difficult for a person
who could be an "interested stockholder" to effect various business
combinations with a corporation for a three-year period, although the
stockholders may elect to exclude a corporation from the restrictions imposed
thereunder. Our certificate of incorporation does not exclude us from the
restrictions imposed under Section 203 of the Delaware General Corporation Law.
It is anticipated that the provisions of Section 203 may encourage companies
interested in acquiring us to negotiate in advance with our board of directors,
since the stockholder approval requirement would be avoided if a majority of
the directors then in office approves, prior to the date on which a stockholder
becomes an interested stockholder, either the business combination or the
transaction which results in the stockholder becoming an interested
stockholder.

Limitations of Directors' Liability

Our certificate of incorporation provides that none of our directors will be
personally liable to us or our stockholders for monetary damages for breach of
fiduciary duty as a director except for liability:

(1) for any breach of the director's duty of loyalty to us or our
stockholders,

(2) for acts of omissions not in good faith or which involve intentional
misconduct or a knowing violation of law,

(3) under Section 174 of the Delaware General Corporation Law, or

(4) for any transaction from which the director derived an improper
personal benefit. The effect of these provisions will be to eliminate
our rights and our stockholders (through stockholders' derivatives
suits on behalf of us) to recover monetary damages against a director
for breach of fiduciary duty as a director (including breaches
resulting from grossly negligent behavior), except in the situations
described above.

These provisions will not limit the liability of directors under federal
securities laws and will not affect the availability of equitable remedies such
as an injunction or rescission based upon a director's breach of his duty of
care.

Transfer Agent

The Transfer Agent and Registrar for the common stock is ChaseMellon
Shareholder Services, L.L.C.

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DESCRIPTION OF CERTAIN INDEBTEDNESS

Senior Credit Facility

Under the amended and restated loan agreement dated as of July 10, 1998, two
wholly owned subsidiaries of CCIC, Crown Communication and Crown Castle
International Corp. de Puerto Rico, have entered into the senior credit
facility with a group of banks and other financial institutions led by Key
Corporate Capital Inc. and PNC Bank, National Association, as arrangers and
agents.

The senior credit facility provides for revolving credit loans in an
aggregate principal amount not to exceed $100.0 million, for working capital
needs, acquisitions and general corporate purposes. The senior credit facility
includes a $5.0 million sublimit available for the issuance of letters of
credit. As of March 1, 1999, Crown Communication and its subsidiaries had
unused borrowing availability under the senior credit facility of $54.0
million.

The loan commitment under the senior credit facility reduces by $5.0 million
commencing March 31, 2001 and by $5.0 million each calendar quarter thereafter
until December 31, 2004, when the senior credit facility matures. In addition,
the senior credit facility provides for mandatory reduction of the loan
commitment and mandatory prepayment with the:

(1) net proceeds of certain asset sales,

(2) net proceeds of certain required capital contributions to Crown
Communication by CCIC relating to the proceeds from the sale of equity,
convertible or debt securities, subject to certain exceptions,

(3) net proceeds of any unused insurance proceeds and

(4) a percentage of the excess cash flow of the Borrowers, commencing with
the calendar year ending December 31, 2000.

The borrowers' obligations under the senior credit facility are guaranteed by
each direct and indirect majority owned subsidiary of Crown Communication and
are also secured by (1) a pledge by the borrowers of all of the outstanding
capital stock of each of their respective direct subsidiaries and (2) a
perfected first priority security interest in substantially all of the personal
property of the borrowers and their subsidiaries. In addition, the senior
credit facility is guaranteed on a limited recourse basis by CCIC, limited in
recourse to the collateral pledged by CCIC (the capital stock of Crown
Communication).

The loans under the senior credit facility will interest, at the borrowers'
option, at either (A) a "base rate" equal to KeyCorp's prime lending rate plus
an applicable spread ranging from 0% to 1.5% (determined based on a leverage
ratio) or (B) a "LIBOR rate" plus an applicable spread ranging from 1.0% to
3.25% (determined based on a leverage ratio). Following the occurrence and
during the continuance of an event of default under the senior credit facility,
the loans bear interest at the "base rate" plus 3.5%.

The senior credit facility contains a number of covenants that, among other
things, restrict the ability of the borrowers and their respective subsidiaries
to:

. dispose of assets,

. incur additional indebtedness,

. incur guaranty obligations,

188

. pay subordinated indebtedness except in accordance with the subordination
provisions,

. pay dividends or make capital distributions,

. create liens on assets,

. enter into leases, make investments,

. make acquisitions,

. engage in mergers or consolidations,

. make capital expenditures,

. engage in certain transactions with subsidiaries and affiliates and

. otherwise restrict corporate activities.

In addition, the senior credit facility will require compliance with certain
financial covenants, including:

. requiring the borrowers and their respective subsidiaries to maintain a
maximum ratio of indebtedness to operating cash flow,

. a minimum ratio of operating cash flow to fixed charges;

. a minimum ratio of operating cash flow to projected debt service and

. a minimum ratio of operating cash flow to interest expense.

CCIC does not expect that such covenants will materially impact the ability of
the Borrowers and their respective subsidiaries to operate their respective
businesses.

Under the terms of the senior credit facility, Crown Communication is
entitled to pay dividends or make distributions to CCIC in order to permit CCIC
to pay its out-of-pocket costs for corporate development and overhead and to
pay cash interest on certain indebtedness of CCIC (including the 10 5/8%
discount notes); provided that the amount of such dividends or distributions
does not exceed (1) $6.0 million in any year ending on or prior to October 31,
2002 or (3) $33.0 million in any year thereafter. The senior credit facility
also allows Crown Communication to pay dividends or distribute cash to CCIC to
the extent required to pay taxes allocable to the borrowers and their
respective subsidiaries. All of the above-mentioned dividends or distributions,
however, including dividends or distributions that are intended to pay interest
on the 10 5/8% discount notes, may not be made by Crown Communication so long
as any default or event of default exists under the senior credit facility.

The senior credit facility contains customary events of default, including
the failure to pay principal when due or any interest or other amount that
becomes due within two days after the due date, any representation or warranty
being made by the borrowers that is incorrect in any material respect on or as
of the date made, a default in the performance of any negative covenants or a
default in the performance of certain other covenants or agreements for a
period of thirty days, default in certain other indebtedness, certain
insolvency events and certain change of control events. In addition, a default
under the 10 5/8% Notes Indenture will result in a default under the senior
credit facility.

Castle Transmission Credit Facility

Under the loan amendment agreement dated May 21, 1997, among Castle
Transmission, as borrower, CTSH, as guarantor, Credit Suisse First Boston, as
arranger and agent, and J.P. Morgan Securities Ltd., as co-arranger, Castle
Transmission's (Pounds)162.5 million term and revolving loan facilities were
amended to a (Pounds)64.0 million revolving loan facility.

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The Castle Transmission credit facility provides for revolving credit loans
in an aggregate principal amount not to exceed (Pounds)64.0 million to finance
capital expenditures in respect of digital terrestrial television with up to
(Pounds)46.5 million of such amount available for working capital needs and for
general corporate purposes. As of March 1, 1999, Castle Transmission and its
subsidiaries had unused borrowing availability under the Castle Transmission
credit facility of approximately (Pounds)24.0 million ($39.9 million).

The loan commitment under the Castle Transmission credit facility will be
automatically reduced to zero in three equal semi-annual installments
commencing on May 31, 2001 and ending on May 31, 2002, when the Castle
Transmission credit facility matures. In addition, the Castle Transmission
credit facility provides for mandatory cancellation of all or part of the loan
commitment and mandatory prepayment (1) with an amount equal to the net
proceeds of certain asset sales and (2) upon the completion of an initial
public offering or the listing on any stock exchange of the shares of Castle
Transmission, CTSH or CCIC.

Castle Transmission's and CTSH's obligations under the Castle Transmission
credit facility are secured by fixed and floating charges over all of their
respective assets. The loans under the Castle Transmission credit facility will
bear interest at a "LIBOR rate" plus 0.85% and a spread related to the lenders'
cost of making the Castle Transmission credit facility available to Castle
Transmission.

The Castle Transmission credit facility contains a number of covenants that,
among other things, restrict the ability of Castle Transmission to:

.dispose of assets,

.incur additional indebtedness,

.incur guaranty obligation,

.repay subordinated indebtedness except in accordance with the
subordination provision,

.pay dividends or make capital distribution,

.create liens on asset,

.make investment,

.make acquisition,

.engage in certain transactions with subsidiaries and affiliates and

.otherwise restrict corporate activities.

In addition, the Castle Transmission credit facility will require compliance
with certain financial covenants, including requiring Castle Transmission to
maintain a maximum ratio of indebtedness to EBITDA, a minimum ratio of EBITDA
to interest expense, and a minimum tangible net worth. CCIC does not expect
that such covenants will materially impact the ability of Castle Transmission
to operate its business.

The Castle Transmission credit facility contains customary events of default,
including the failure to pay principal or any interest or any other amount that
becomes due within three business days after the due date, any representation
or warranty being made by Castle Transmission that is untrue or misleading on
the date made, a default in the performance of any of its covenants under the
Castle Transmission credit facility (unless, if such default is capable of
remedy, such default is cured within 14 days of Castle Transmission becoming
aware of such default), default in certain other indebtedness, certain
insolvency events and certain change of control events.

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On July 17, 1998, the lenders (acting through Credit Suisse First Boston, as
agent) under the Castle Transmission credit facility waived a provision in the
Castle Transmission credit facility that would have required the repayment of
the Castle Transmission credit facility concurrently with the listing of our
common stock.

The 10 5/8% Discount Notes

On November 20, 1997, we privately placed $251.0 million principal amount at
maturity ($150,010,150 initial accreted value) of our 10 5/8% Senior Discount
10 5/8% Notes due 2007. The 10 5/8% discount notes are our unsecured senior
obligations, and will rank equally in right of payment with all our existing
and future senior indebtedness and will be senior to our future subordinated
indebtedness. The 10 5/8% discount notes mature on November 15, 2007. The 10
5/8% discount notes will accrete in value until November 15, 2002. Thereafter,
cash interest will accrue on the 10 5/8% discount notes at the rate of 10.625%
per annum and will be payable semi-annually, commencing on May 15, 2003.

Except as stated below, the 10 5/8% discount notes are not redeemable prior
to November 15, 2002. Thereafter, the 10 5/8% discount notes are redeemable at
our option, in whole or in part, at any time or from time to time, at a premium
which is at a fixed percentage that declines to par on or after November 15,
2005, in each case together with accrued and unpaid interest, if any, to the
date of redemption. In the event we complete a public equity offering or
certain strategic equity investments prior to November 15, 2000, we may, at our
option, use all or a portion of the proceeds from such offering to redeem up to
35% of the original aggregate principal amount at maturity of the 10 5/8%
discount notes at a redemption price equal to 110.625% of the accreted value of
the 10 5/8% discount notes to be redeemed, plus accrued and unpaid interest, if
any, thereon to the redemption date, provided at least 65% of the original
aggregate principal amount at maturity of the 10 5/8% discount notes remains
outstanding after each such redemption.

Upon the occurrence of a change of control (as defined in the 10 5/8% notes
indenture), each holder of 10 5/8% discount notes has the right to require us
to purchase all or a portion of such holder's 10 5/8% discount notes at a price
equal to 101% of the aggregate principal amount, together with accrued and
unpaid interest to the date of purchase.

The 10 5/8% notes indenture contains certain covenants, including covenants
that limit:

(1) indebtedness,

(2) restricted payments,

(3) distributions from restricted subsidiaries,

(4) transactions with affiliates,

(5) sales of assets and subsidiary stock (including sale and leaseback
transactions),

(6) dividend and other payment restrictions affecting restricted
subsidiaries, and

(7) mergers or consolidations.

The Castle Transmission Bonds

On May 21, 1997, a subsidiary of Castle Transmission, issued (Pounds)125.0
million aggregate principal amount of its 9% Guaranteed Bonds due 2007. The
Castle Transmission bonds are listed on the Luxembourg Stock Exchange.

The Castle Transmission bonds constitute direct, general and unconditional
guaranteed obligations of the subsidiary of CTSH and rank equally with all
other present and future unsecured

191

and unsubordinated obligations of such subsidiary. The Castle Transmission
bonds are guaranteed jointly and severally by Castle Transmission and CTSH. The
Castle Transmission bonds will mature on March 30, 2007. Interest on the Castle
Transmission bonds is payable annually in arrears on March 30 in each year, the
first payment having been made on March 30, 1998.

The Castle Transmission bonds may be redeemed at our option in whole or in
part, at any time or from time to time, at the greater of their principal and
such price as will provide a gross redemption yield 0.5% per annum above the
gross redemption yield of the benchmark gilt plus, in either case, accrued and
unpaid interest.

Upon the occurrence of a put event (as defined in the trust deed), each
holder of Castle Transmission bonds has the right to require such subsidiary to
purchase all or a portion of such holder's Castle Transmission bonds at a price
equal to 101% of the aggregate principal amount, together with accrued and
unpaid interest to the date of purchase.

The trust deed contains certain covenants, including covenants that limit:

. indebtedness,

. restricted payments,

. distributions from restricted subsidiaries,

. transactions with affiliates,

. sales of assets and subsidiary stock,

. dividend and other payment restrictions affecting restricted
subsidiaries, and

. mergers or consolidations.

Joint Venture Credit Facility

Under the loan agreement dated as of March 31, 1999, Crown Atlantic Holding
Sub L.L.C. entered into the joint venture credit facility with Key Corporate
Capital, Inc. The joint venture credit facility provides for revolving credit
loans in an aggregate principal amount not to exceed $250.0 million, $180.0
million of which was drawn in connection with the formation of the joint
venture, and the balance of which will be used for acquisition and construction
of tower facilities, capital expenditures, working capital needs and general
corporate purposes. The borrowing base until September 30, 2001, is based on a
multiple of test operating cash flow. On September 30, 2001, the conversion
date, the borrowing base test will be eliminated and the amount of the facility
will be decreased to the borrowing base as of that date. The joint venture
credit facility includes a $25.0 million sublimit available for the issuance of
letters of credit.

The amount of the facility after the conversion date will be reduced on a
quarterly basis until March 31, 2006, when the joint venture credit facility
matures. The annual percentage reduction in this loan commitment is 3.0% in
2001 (two quarters), 7.5% in 2002, 22.5% in 2003,

In addition, the joint venture credit facility provides for mandatory
reduction of the loan commitment and mandatory prepayment with the:

(1) net proceeds of certain asset sales,

(2) 50% of capital contributions to Holdco subject to certain significant
exceptions including capital expenditures under the build-to-suit
agreement,
(3) net proceeds of any unused insurance proceeds and

192

(4) a percentage of the excess cash flow of the joint venture, commencing
with the calendar year ending December 31, 2001.

The joint venture's obligations under the joint venture credit facility are
secured by (1) a pledge of the membership interest in the joint venture and (2)
a perfected first priority security interest in the joint venture's interest in
tenant leases including the global lease. The joint venture credit facility
contractually permits the joint venture to pay maintenance, operating, ground
lease and other expenses and costs relating to the tower facilities out of the
tower rentals whether or not an event of default has occurred.

The loans under the joint venture credit facility will bear interest, at the
joint venture's option, at either (A) a "base rate" equal to KeyCorp's prime
lending rate plus an applicable spread ranging from 0% to 1.25% (determined
based on a leverage ratio) or (B) a "LIBOR rate" plus an applicable spread
ranging from 1.0% to 2.875% (determined based on a leverage ratio). The joint
venture must hedge approximately 50% of its variable interest rate obligations
for a period of two years. Following the occurrence of and during the
continuance of an event of default under the joint venture credit facility, the
loans will bear interest at the "base rate" plus 4.875%.

The joint venture credit facility will contain a number of covenants that,
among other things, restrict the ability of the joint venture to:

. dispose of assets,
. incur additional indebtedness,
. incur guaranty obligations,
. repay subordinated indebtedness except in accordance with the
subordination provisions,
. pay dividends or make capital distributions,
. create liens on assets,
. enter into leases,
. make investments,
. make acquisitions,
. engage in mergers or consolidations,
. make capital expenditures,
. engage in certain transactions with subsidiaries and affiliates and
otherwise restrict company activities.

In addition, the joint venture credit facility will require compliance with
certain financial covenants, including requiring the joint venture to maintain:

. a minimum ratio of operating cash flow to indebtedness,
. a minimum ratio of operating cash flow to fixed charges,
. a minimum ratio of operating cash flow to projected debt service and
. a minimum ratio of operating cash flow to interest expense.

The joint venture does not expect that such covenants will materially impact
its ability to operate its business.

The joint venture credit facility contains customary events of default,
including the failure to pay principal when due or any interest or other amount
that becomes due within two days after the due date, any representation or
warranty being made by the joint venture that is incorrect in any material
respect on or as of the date made, a default in the performance of any negative
covenants or a default in the performance of certain other covenants or
agreements (including the formation agreement) for a period of days, default in
certain other indebtedness, certain insolvency events and certain change of
control events. During the first two years of the joint venture credit
facility, capital contributions can cure an operating cash flow default and
certain other covenant and agreement defaults.

193

CCIC Term Loan Facility

Under a term loan agreement dated as of March 15, 1999, we entered into a
term loan credit facility with a group of banks and other financial
institutions led by Goldman Sachs Credit Partners L.P., Salomon Brothers
Holding Company Inc. and Credit Suisse First Boston. As of April 5, 1999, we
had borrowed $100.0 million under the term loan facility to fund or refinance
our escrow payments made in connection with the proposed Powertel acquisition
and the proposed BellSouth transaction. The following summary of the term loan
facility does not purport to be complete and is subject to, and is qualified in
its entirety by reference to, the provisions of the term loan facility.

The term loan facility provides for term loans in an aggregate principal
amount not to exceed $100.0 million. The loans under the term loan facility
mature on November 30, 2007 and bear interest at an increasing rate based on
LIBOR as set forth in the term loan agreement, but in no event shall the
interest on such loans exceed 16%. At any time we may, at our option, prepay
the term loans without penalty or premium. Subject to limited exceptions, the
term loan facility requires us to prepay the loans without penalty or premium
with the proceeds of:

(1) any offering of debt or equity securities,

(2) the incurrence of other debt (other than debt under the senior credit
facility),

(3) asset sales for cash consideration, or with a fair market value, in
excess of $1.0 million, and

(4) any recovery of amounts deposited in escrow in connection with the
proposed Powertel acquisition and the proposed BellSouth transaction.

The term loan agreement contains covenants substantially identical to the
covenants contained in our 10 5/8% discount notes. At any time on or after
March 16, 2000, the lenders under the term loan agreement may exchange their
term loans for an equal aggregate principal amount of the our Senior Exchange
Notes due 2007. These exchange notes will be issued under an indenture dated as
of March 15, 1999, between us and United States Trust Company of New York, as
trustee. These exchange notes will have the same maturity as the term loans and
will bear interest at the rate in effect for the term loans on the date of
exchange. The covenants contained in the exchange note indenture will be
substantially identical to the covenants contained in the certificate of
designations governing our exchangeable preferred stock, with additional
covenants restricting the incurrence of liens and sale-leaseback transactions.

194

CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS

The following discussion is a summary of certain U.S. federal income tax
consequences of the exchange offer to holders of old preferred stock, but is
not a complete analysis of all potential tax effects. The summary below is
based upon the Internal Revenue Code of 1986, as amended, regulations of the
Treasury Department, administrative rulings and pronouncements of the Internal
Revenue Service and judicial decisions, all of which are subject to change,
possibly with retroactive effect. This summary does not address all the U.S.
federal income tax consequences that may be applicable to particular holders,
including dealers in securities, financial institutions, insurance companies
and tax-exempt organizations. In addition, this summary does not consider the
effect of any foreign, state, local, gift, estate or other tax laws that may be
applicable to a particular holder. This summary applies only to a holder that
acquired old preferred stock at original issue for cash and holds old preferred
stock as a capital asset within the meaning of Section 1221 of the Code.
Holders of old preferred stock considering the exchange offer should consult
their own tax advisors concerning the U.S. federal income tax consequences in
light of their particular situations as well as any consequences arising under
the laws of any other taxing jurisdiction.

An exchange of old preferred stock for new preferred stock pursuant to the
exchange offer will not be treated as a taxable exchange or other taxable event
for U.S. federal income tax purposes. Accordingly, holders of old preferred
stock who exchange their old preferred stock for new preferred stock will not
recognize income, gain or loss for U.S. federal income tax purposes and any
such holder will have the same adjusted tax basis and holding period in the new
preferred stock as it had in the old preferred stock immediately before the
exchange.

The foregoing discussion of certain U.S. federal income tax considerations
does not consider the facts and circumstances of any particular holder's
situation or status. Accordingly, each holder of old preferred stock should
consult its own tax advisor regarding the tax consequences of the exchange
offer to it, including those under state, foreign and other tax laws.

PLAN OF DISTRIBUTION

Each broker-dealer that receives new preferred stock for its own account
pursuant to the exchange offer must acknowledge that it will deliver a
prospectus in connection with any resale of such new preferred stock. This
prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of new preferred stock received
in exchange for old preferred stock where such old preferred stock were
acquired as a result of market-making activities or other trading activities.
We have agreed that for a period of 180 days after the expiration date, we will
make available a prospectus meeting the requirements of the Preferred Stock Act
to any broker-dealer for use in connection with any such resale. In addition,
until , all dealers effecting transactions in the new preferred stock may be
required to deliver a prospectus.

We will not receive any proceeds from any sale of new preferred stock by
broker-dealers. New preferred stock received by broker-dealers for their own
account pursuant to the exchange offer may be sold from time to time in one or
more transactions in the over-the-counter market, in negotiated transactions,
through the writing of options on the new preferred stock or a combination of
such methods of resale, at market prices prevailing at the time of resale, at
prices related to such prevailing market prices or negotiated prices. Any such
resale may be made directly to purchasers or to or through brokers or dealers
who may receive compensation in the form of commissions or concessions from any
such broker-dealer or the purchasers of any such new preferred stock. Any
broker-dealer that resells new preferred stock that were received by it for its
own account pursuant to

195

the exchange offer and any broker or dealer that participates in a distribution
of such new preferred stock may be deemed to be an "underwriter" within the
meaning of the Preferred Stock Act and any profit on any such resale of new
preferred stock and any commissions or concessions received by any such persons
may be deemed to be underwriting compensation under the Preferred Stock Act.
The letter of transmittal states that by acknowledging that it will deliver and
by delivering a prospectus, a broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Preferred Stock Act.

LEGAL MATTERS

Certain legal matters will be passed upon for us by Cravath, Swaine & Moore,
New York, New York.

INDEPENDENT AUDITORS

The consolidated financial statements and schedule of CCIC at December 31,
1997 and 1998, and for each of the three years in the period ended December 31,
1998, the financial statements of the Home Service Transmission business of the
BBC at March 31, 1996 and for the year ended March 31, 1996 and the period from
April 1, 1996 to February 27, 1997 and the consolidated financial statements of
CTSH at March 31, 1997 and December 31, 1997 and for the period from February
28, 1997 to March 31, 1997 and the period from April 1, 1997 to December 31,
1997 have been included herein in reliance upon the report of KPMG LLP,
independent certified public accountants, appearing elsewhere herein, and upon
the authority of said firm as experts in accounting and auditing.

CERTAIN CURRENCY TRANSLATIONS

CTSH publishes its consolidated financial statements in pounds sterling. For
the convenience of the reader, this prospectus contains translations of certain
pound sterling amounts into U.S. dollars at specified rates, or, if not so
specified, at the noon buying rate in New York City for cable transfers in
pounds sterling as certified for customs purposes by the Federal Reserve Bank
of New York on December 31, 1998, of (Pounds)1.00 = $1.6628. No representation
is made that the pound sterling amounts have been, could have been or could be
converted into U.S. dollars at the rates indicated or any other rates. On March
15, 1999, the noon buying rate was (Pounds)1.00 = $1.6223.

AVAILABLE INFORMATION

We are subject to the informational requirements of the Securities Exchange
Act of 1934 and; therefore, we file reports and other information with the SEC.
Such reports and other information can be inspected and copied at the public
reference facilities maintained by the SEC at its offices at Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
SEC's Regional Offices at Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661, and Seven World Trade Center, 13th Floor, New York,
New York 10048. Copies of such materials can be obtained by mail from the
Public Reference Section of the SEC at 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. Such reports and other information concerning the
Company are also available for inspection at the offices of the Nasdaq National
Market, 1735 K Street, N.W., Washington, D.C. 20006. In addition, the SEC
maintains an Internet site at http://www.sec.gov that contains reports, proxy
and information statements and other information regarding registrants,
including CCIC, that file electronically with the SEC.

Anyone who receives this prospectus may obtain a copy of any of the
agreements summarized herein without charge by writing to Crown Castle
International Corp., 510 Bering Drive, Suite 500, Houston, TX 77057, Attention:
Secretary.

196

INDEX TO FINANCIAL STATEMENTS

CROWN CASTLE INTERNATIONAL CORP.
Report of KPMG LLP, Independent Certified Public Accountants.............. F-2
Consolidated Balance Sheet as of December 31, 1997 and 1998............... F-3
Consolidated Statement of Operations and Comprehensive Loss for each of
the three years in the period ended December 31, 1998.................... F-4
Consolidated Statement of Cash Flows for each of the three years in the
period ended December 31, 1998........................................... F-5
Consolidated Statement of Stockholders' Equity (Deficit) for each of the
three years in the period ended December 31, 1998........................ F-6
Notes to Consolidated Financial Statements for each of the three years in
the period ended December 31, 1998....................................... F-7
CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND THE BBC HOME SERVICE
TRANSMISSION BUSINESS
Report of KPMG, Chartered Accountants..................................... F-33
Profit and Loss Accounts of the BBC Home Service Transmission business for
the Year ended March 31, 1996 and the Period from April 1, 1996 to
February 27, 1997 and the Consolidated Profit and Loss Accounts of Castle
Transmission Services (Holdings) Ltd for the Period from February 28,
1997 to March 31, 1997 and for the Period from April 1, 1997 to December
31, 1997................................................................. F-34
Balance Sheet of the BBC Home Service Transmission business at March 31,
1996 and Consolidated Balance Sheets of Castle Transmission Services
(Holdings) Ltd at March 31, 1997 and at December 31, 1997................ F-35
Cash Flow Statements of the BBC Home Service Transmission business for the
Year ended March 31, 1996 and the Period from April 1, 1996 to February
27, 1997 and the Consolidated Cash Flow Statements of Castle Transmission
Services (Holdings) Ltd for the Period from February 28, 1997 to March
31, 1997 and for the Period from April 1, 1997 to December 31, 1997...... F-36
Reconciliation of Movements in Corporate Funding of the BBC Home Service
Transmission business for the Year ended March 31, 1996 and the Period
from April 1, 1996 to February 27, 1997 and Consolidated Reconciliation
of Movements in Shareholders' Funds of Castle Transmission Services
(Holdings) Ltd for the Period from February 28, 1997 to March 31, 1997
and for the Period from April 1, 1997 to December 31, 1997............... F-37
Notes to the Consolidated Financial Statements............................ F-38
BELL ATLANTIC MOBILE TOWER OPERATIONS
Report of KPMG LLP, Independent Certified Public Accountants.............. F-61
Statement of Net Assets as of December 31, 1998........................... F-62
Statements of Revenues and Direct Expenses for each of the two years in
the period ended December 31, 1998....................................... F-63
Notes to Financial Statements for each of the two years in the period
ended December 31, 1998.................................................. F-64
POWERTEL TOWER OPERATIONS
Report of KPMG LLP, Independent Certified Public Accountants.............. F-66
Statement of Net Assets as of December 31, 1998........................... F-67
Statement of Revenues and Direct Expenses for the year ended December 31,
1998..................................................................... F-68
Notes to Financial Statements for the year ended December 31, 1998........ F-69

F-1

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
Crown Castle International Corp.:

We have audited the accompanying consolidated balance sheets of Crown Castle
International Corp. and subsidiaries as of December 31, 1997 and 1998, and the
related consolidated statements of operations and comprehensive loss, cash
flows and stockholders' equity (deficit) for each of the years in the three-
year period ended December 31, 1998. These consolidated financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Crown
Castle International Corp. and subsidiaries as of December 31, 1997 and 1998,
and the results of their operations and their cash flows for each of the years
in the three-year period ended December 31, 1998, in conformity with generally
accepted accounting principles.

KPMG LLP

Houston, Texas
February 24, 1999

F-2

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(In thousands of dollars, except share amounts)

December 31,
--------------------
1997 1998
ASSETS -------- ----------

Current assets:
Cash and cash equivalents............................. $ 55,078 $ 296,450
Receivables:
Trade, net of allowance for doubtful accounts of $177
and $1,535 at December 31, 1997 and 1998,
respectively........................................ 9,264 32,130
Other................................................ 811 4,290
Inventories........................................... 1,322 6,599
Prepaid expenses and other current assets............. 681 2,647
-------- ----------
Total current assets................................. 67,156 342,116
Property and equipment, net............................. 81,968 592,594
Investments in affiliates............................... 59,082 2,258
Goodwill and other intangible assets, net of accumulated
amortization of $3,997 and $20,419 at December 31, 1997
and 1998, respectively................................. 152,541 569,740
Deferred financing costs and other assets, net of
accumulated amortization of $743 and $1,722 at December
31, 1997 and 1998, respectively........................ 10,644 16,522
-------- ----------
$371,391 $1,523,230
======== ==========

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Accounts payable...................................... $ 7,760 $ 46,020
Accrued interest...................................... -- 15,677
Accrued compensation and related benefits............. 1,792 5,188
Deferred rental revenues and other accrued
liabilities.......................................... 2,398 26,002
-------- ----------
Total current liabilities............................ 11,950 92,887
Long-term debt.......................................... 156,293 429,710
Other liabilities....................................... 607 22,823
-------- ----------
Total liabilities.................................... 168,850 545,420
-------- ----------
Commitments and contingencies (Note 12)
Minority interests -- 39,185
Redeemable preferred stock, $.01 par value; 10,000,000
shares authorized:
12 3/4% Senior Exchangeable Preferred Stock; shares
issued: December 31, 1997--none and December 31,
1998-- 200,000 (stated at mandatory redemption and
aggregate liquidation value)......................... -- 201,063
Senior Convertible Preferred Stock; shares issued:
December 31, 1997--657,495 and December 31, 1998--
none (stated at redemption value; aggregate
liquidation value of $68,916)........................ 67,948 --
Series A Convertible Preferred Stock; shares issued:
December 31, 1997--1,383,333 and December 31, 1998--
none (stated at redemption and aggregate liquidation
value)............................................... 8,300 --
Series B Convertible Preferred Stock; shares issued:
December 31, 1997--864,568 and December 31, 1998--
none (stated at redemption and aggregate liquidation
value)............................................... 10,375 --
Series C Convertible Preferred Stock; shares issued:
December 31, 1997--3,529,832 and December 31, 1998--
none (stated at redemption and aggregate liquidation
value)............................................... 74,126 --
-------- ----------
Total redeemable preferred stock..................... 160,749 201,063
-------- ----------
Stockholders' equity:
Common stock, $.01 par value; 690,000,000 shares
authorized:
Class A Common Stock; shares issued: December 31,
1997--1,041,565 and December 31, 1998--none.......... 2 --
Class B Common Stock; shares issued: December 31,
1997--9,367,165 and December 31, 1998--none.......... 19 --
Common Stock; shares issued: December 31, 1997--none
and December 31, 1998--83,123,873.................... -- 831
Class A Common Stock; shares issued: December 31,
1997--none and December 31, 1998--11,340,000 -- 113
Additional paid-in capital.............................. 58,248 795,153
Cumulative foreign currency translation adjustment...... 562 1,690
Accumulated deficit..................................... (17,039) (60,225)
-------- ----------
Total stockholders' equity........................... 41,792 737,562
-------- ----------
$371,391 $1,523,230
======== ==========

See notes to consolidated financial statements.

F-3

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands of dollars, except per share amounts)

Years Ended December 31,
--------------------------
1996 1997 1998
------ -------- --------

Net revenues:
Site rental and broadcast transmission........... $5,615 $ 11,010 $ 75,028
Network services and other....................... 592 20,395 38,050
------ -------- --------
6,207 31,405 113,078
------ -------- --------
Operating expenses:
Costs of operations (exclusive of depreciation
and amortization):
Site rental and broadcast transmission......... 1,292 2,213 26,254
Network services and other..................... 8 13,137 21,564
General and administrative....................... 1,678 6,824 23,571
Corporate development............................ 1,324 5,731 4,625
Non-cash compensation charges.................... -- -- 12,758
Depreciation and amortization.................... 1,242 6,952 37,239
------ -------- --------
5,544 34,857 126,011
------ -------- --------
Operating income (loss)............................ 663 (3,452) (12,933)
Other income (expense):
Equity in earnings (losses) of unconsolidated
affiliate....................................... -- (1,138) 2,055
Interest and other income (expense).............. 193 1,951 4,220
Interest expense and amortization of deferred
financing costs................................. (1,803) (9,254) (29,089)
------ -------- --------
Loss before income taxes and minority interests.... (947) (11,893) (35,747)
Provision for income taxes......................... (10) (49) (374)
Minority interests................................. -- -- (1,654)
------ -------- --------
Net loss........................................... (957) (11,942) (37,775)
Dividends on preferred stock....................... -- (2,199) (5,411)
------ -------- --------
Net loss after deduction of dividends on preferred
stock............................................. $ (957) $(14,141) $(43,186)
====== ======== ========
Net loss........................................... $ (957) $(11,942) $(37,775)
Other comprehensive income:
Foreign currency translation adjustments......... -- 562 1,128
------ -------- --------
Comprehensive loss................................. $ (957) $(11,380) $(36,647)
====== ======== ========
Loss per common share--basic and diluted........... $(0.27) $ (2.27) $ (1.02)
====== ======== ========
Common shares outstanding--basic and diluted (in
thousands)........................................ 3,503 6,238 42,518
====== ======== ========

See notes to consolidated financial statements.

F-4

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(In thousands of dollars)

Years Ended December 31,
---------------------------
1996 1997 1998
------- -------- --------

Cash flows from operating activities:
Net loss................................... $ (957) $(11,942) $(37,775)
Adjustments to reconcile net loss to net
cash provided by (used for) operating
activities:
Depreciation and amortization............. 1,242 6,952 37,239
Amortization of deferred financing costs
and discounts on long-term debt.......... 55 2,159 17,910
Non-cash compensation charges............. -- -- 12,758
Minority interests........................ -- -- 1,654
Equity in losses (earnings) of
unconsolidated affiliate................. -- 1,138 (2,055)
Changes in assets and liabilities,
excluding the effects of acquisitions:
Increase in accounts payable............. 323 1,824 15,373
Increase (decrease) in deferred rental
revenues and other liabilities.......... 219 (240) 5,847
Increase (decrease) in accrued interest.. 306 (396) 5,835
Decrease (increase) in receivables....... (1,695) 1,353 (7,450)
Increase in inventories, prepaid expenses
and other assets........................ (23) (1,472) (4,360)
------- -------- --------
Net cash provided by (used for)
operating activities................... (530) (624) 44,976
------- -------- --------
Cash flows from investing activities:
Capital expenditures....................... (890) (18,035) (138,759)
Acquisitions of businesses, net of cash
acquired.................................. (10,925) (33,962) (10,489)
Investments in affiliates.................. (2,101) (59,487) --
------- -------- --------
Net cash used for investing activities.. (13,916) (111,484) (149,248)
------- -------- --------
Cash flows from financing activities:
Proceeds from issuance of capital stock.... 10,503 139,867 339,929
Net borrowings (payments) under revolving
credit agreements......................... 11,000 (6,223) 9,212
Incurrence of financing costs.............. (180) (7,798) (3,010)
Purchase of capital stock.................. -- (2,132) (883)
Proceeds from issuance of long-term debt... -- 150,010 --
Principal payments on long-term debt....... (130) (113,881) --
------- -------- --------
Net cash provided by financing
activities............................. 21,193 159,843 345,248
------- -------- --------
Effect of exchange rate changes on cash..... -- -- 396
------- -------- --------
Net increase in cash and cash equivalents... 6,747 47,735 241,372
Cash and cash equivalents at beginning of
year....................................... 596 7,343 55,078
------- -------- --------
Cash and cash equivalents at end of year.... $ 7,343 $ 55,078 $296,450
======= ======== ========
Supplementary schedule of noncash investing and
financing activities:
Conversion of stockholder's Convertible
Secured Subordinated Notes to Series A
Convertible Preferred Stock............... -- $ 3,657 --
Amounts recorded in connection with
acquisitions (see Note 2):
Fair value of net assets acquired,
including goodwill and other intangible
assets................................... 10,958 197,235 431,453
Issuance of common stock.................. -- 57,189 420,964
Issuance of long-term debt................ -- 78,102 --
Assumption of long-term debt.............. -- 27,982 --
Amounts due to seller..................... 33 -- --
Supplemental disclosure of cash flow
information:
Interest paid.............................. $ 1,442 $ 7,533 $ 6,276
Income taxes paid.......................... -- 26 446

See notes to consolidated financial statements.

F-5

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

(In thousands of dollars, except share amounts)

Class A Class B Class A
Common Stock Common Stock Common Stock Common Stock
---------------------- ---------------------- ---------------------- ---------------------
Additional
Paid-In
Shares ($.01 Par) Shares ($.01 Par) Shares ($.01 Par) Shares ($.01 Par) Capital
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------

Balance, January
1, 1996.......... 1,350,000 $ 3 1,433,330 $ 3 -- $ -- -- $ -- $ 634
Issuances of
capital stock... -- -- 55,000 -- -- -- -- -- 128
Net loss........ -- -- -- -- -- -- -- -- --
---------- ------- ---------- -------- ---------- ---- ---------- ---- --------
Balance, December
31, 1996......... 1,350,000 3 1,488,330 3 -- -- -- -- 762
Issuances of
capital stock... -- -- 8,228,835 17 -- -- -- -- 57,696
Purchase of
capital stock... (308,435) (1) (350,000) (1) -- -- -- -- (210)
Foreign currency
translation
adjustments..... -- -- -- -- -- -- -- -- --
Dividends on
preferred
stock........... -- -- -- -- -- -- -- -- --
Net loss........ -- -- -- -- -- -- -- -- --
---------- ------- ---------- -------- ---------- ---- ---------- ---- --------
Balance, December
31, 1997......... 1,041,565 2 9,367,165 19 -- -- -- -- 58,248
Conversion of
preferred stock
to Common
Stock........... -- -- -- -- 38,517,865 385 -- -- 164,712
Conversion of
Class A Common
Stock and Class
B Common
Stock to Common
Stock........... (1,041,565) (2) (9,367,165) (19) 10,953,625 109 -- -- (88)
Issuances of
capital stock... -- -- -- -- 33,793,453 338 11,340,000 113 560,779
Purchase of
capital stock... -- -- -- -- (141,070) (1) -- -- (882)
Non-cash
compensation
charges......... -- -- -- -- -- -- -- -- 12,384
Foreign currency
translation
adjustments..... -- -- -- -- -- -- -- -- --
Dividends on
preferred
stock........... -- -- -- -- -- -- -- -- --
Net loss........ -- -- -- -- -- -- -- -- --
---------- ------- ---------- -------- ---------- ---- ---------- ---- --------
Balance, December
31, 1998......... -- $ -- -- $ -- 83,123,873 $831 11,340,000 $113 $795,153
========== ======= ========== ======== ========== ==== ========== ==== ========

Cumulative
Foreign
Currency
Translation Accumulated
Adjustment Deficit Total
----------- ----------- ---------

Balance, January
1, 1996.......... $ -- $ (21) $ 619
Issuances of
capital stock... -- -- 128
Net loss........ -- (957) (957)
----------- ----------- ---------
Balance, December
31, 1996......... -- (978) (210)
Issuances of
capital stock... -- -- 57,713
Purchase of
capital stock... -- (1,920) (2,132)
Foreign currency
translation
adjustments..... 562 -- 562
Dividends on
preferred
stock........... -- (2,199) (2,199)
Net loss........ -- (11,942) (11,942)
----------- ----------- ---------
Balance, December
31, 1997......... 562 (17,039) 41,792
Conversion of
preferred stock
to Common
Stock........... -- -- 165,097
Conversion of
Class A Common
Stock and Class
B Common
Stock to Common
Stock........... -- -- --
Issuances of
capital stock... -- -- 561,230
Purchase of
capital stock... -- -- (883)
Non-cash
compensation
charges......... -- -- 12,384
Foreign currency
translation
adjustments..... 1,128 -- 1,128
Dividends on
preferred
stock........... -- (5,411) (5,411)
Net loss........ -- (37,775) (37,775)
----------- ----------- ---------
Balance, December
31, 1998......... $1,690 $(60,225) $737,562
=========== =========== =========

See notes to consolidated financial statements.

F-6

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation

The consolidated financial statements include the accounts of Crown Castle
International Corp. and its majority and wholly owned subsidiaries,
collectively referred to herein as the "Company." All significant intercompany
balances and transactions have been eliminated in consolidation. Certain
reclassifications have been made to the prior year's financial statements to be
consistent with the presentation in the current year.

The Company owns, operates and manages wireless communications sites and
broadcast transmission networks. The Company also provides complementary
services to its customers, including network design, radio frequency
engineering, site acquisition, site development and construction, antenna
installation and network management and maintenance. The Company's
communications sites are located throughout the United States, in Puerto Rico
and in the United Kingdom. In the United States and Puerto Rico, the Company's
primary business is the leasing of antenna space to wireless operators under
long-term contracts. In the United Kingdom, the Company's primary business is
the operation of television and radio broadcast transmission networks; the
Company also leases antenna space to wireless operators in the United Kingdom.

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities as of the date of the financial statements,
and the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

Summary of Significant Accounting Policies

Cash Equivalents

Cash equivalents consist of highly liquid investments with original
maturities of three months or less.

Inventories

Inventories are stated at the lower of cost or market. Cost is determined
using the first-in, first-out (FIFO) method.

Property and Equipment

Property and equipment is stated at cost, net of accumulated depreciation.
Depreciation is computed utilizing the straight-line method at rates based upon
the estimated useful lives of the various classes of assets. Additions,
renewals and improvements are capitalized, while maintenance and repairs are
expensed. Upon the sale or retirement of an asset, the related cost and
accumulated depreciation are removed from the accounts and any gain or loss is
recognized.

In March 1995, the Financial Accounting Standards Board (the "FASB") issued
Statement of Financial Accounting Standards No. 121, Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of
("SFAS 121"). SFAS 121 requires that long-lived assets and certain identifiable
intangibles be reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. SFAS 121 was effective for fiscal years beginning after December
15, 1995. The adoption of SFAS 121 by the Company in 1996 did not have a
material impact on its consolidated financial statements.

F-7

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Goodwill and Other Intangible Assets

Goodwill and other intangible assets represents the excess of the purchase
price for an acquired business over the allocated value of the related net
assets (see Note 2). Goodwill is amortized on a straight-line basis over a
twenty year life. Other intangible assets (principally the value of existing
site rental contracts at Crown Communications) are amortized on a straight-line
basis over a ten year life. The carrying value of goodwill and other intangible
assets will be reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of the acquired assets may not
be recoverable. If the sum of the estimated future cash flows (undiscounted)
expected to result from the use and eventual disposition of an asset is less
than the carrying amount of the asset, an impairment loss is recognized.
Measurement of an impairment loss is based on the fair value of the asset.

Deferred Financing Costs

Costs incurred to obtain financing are deferred and amortized over the
estimated term of the related borrowing. At December 31, 1997, other accrued
liabilities includes $1,160,000 of such costs related to the issuance of the
Company's 10 5/8% Senior Discount Notes.

Revenue Recognition

Site rental revenues are recognized on a monthly basis under lease or
management agreements with terms ranging from 12 months to 25 years. Broadcast
transmission revenues are recognized on a monthly basis under transmission
contracts with terms ranging from 8 years to 12 years.

Network services revenues from site development, construction and antennae
installation activities are recognized under a method which approximates the
completed contract method. This method is used because these services are
typically completed in three months or less and financial position and results
of operations do not vary significantly from those which would result from use
of the percentage-of-completion method. These services are considered complete
when the terms and conditions of the contract or agreement have been
substantially completed. Costs and revenues associated with installations not
complete at the end of a period are deferred and recognized when the
installation becomes operational. Any losses on contracts are recognized at
such time as they become known.

Network services revenues from design, engineering, site acquisition, and
network management and maintenance activities are recognized under service
contracts with customers which provide for billings on a time and materials,
cost plus profit, or fixed price basis. Such contracts typically have terms
from six months to two years. Revenues are recognized as services are performed
with respect to the time and materials contracts. Revenues are recognized using
the percentage-of-completion method for cost plus profit and fixed price
contracts, measured by the percentage of contract costs incurred to date
compared to estimated total contract costs. Provisions for estimated losses on
uncompleted contracts are made in the period in which such losses are
determined.

Corporate Development Expenses

Corporate development expenses represent costs incurred in connection with
acquisitions and development of new business initiatives.

Income Taxes

The Company accounts for income taxes using an asset and liability approach,
which requires the recognition of deferred income tax assets and liabilities
for the expected future tax consequences

F-8

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

of events that have been recognized in the Company's financial statements or
tax returns. Deferred income tax assets and liabilities are determined based on
the temporary differences between the financial statement and tax bases of
assets and liabilities using enacted tax rates.

Per Share Information

Per share information is based on the weighted-average number of common
shares outstanding during each period for the basic computation and, if
dilutive, the weighted-average number of potential common shares resulting from
the assumed conversion of outstanding stock options, warrants and convertible
preferred stock for the diluted computation.

A reconciliation of the numerators and denominators of the basic and diluted
per share computations is as follows:

Years Ended December 31,
--------------------------
1996 1997 1998
------ -------- --------
(In thousands of
dollars,
except per share
amounts)

Net loss........................................ $ (957) $(11,942) $(37,775)
Dividends on preferred stock.................... -- (2,199) (5,411)
------ -------- --------
Net loss applicable to common stock for basic
and diluted computations....................... $ (957) $(14,141) $(43,186)
====== ======== ========
Weighted-average number of common shares
outstanding during the period for basic and
diluted computations (in thousands)............ 3,503 6,238 42,518
====== ======== ========
Loss per common share--basic and diluted........ $(0.27) $ (2.27) $ (1.02)
====== ======== ========

The calculations of common shares outstanding for the diluted computations
exclude the following potential common shares as of December 31, 1998: (i)
options to purchase 16,585,197 shares of common stock at exercise prices
ranging from $-0- to $17.625 per share; (ii) warrants to purchase 1,314,990
shares of common stock at an exercise price of $7.50 per share; and (iii)
shares of Castle Transmission Services (Holdings) Ltd ("CTI") stock which are
convertible into 17,443,500 shares of common stock. The inclusion of such
potential common shares in the diluted per share computations would be
antidilutive since the Company incurred net losses for each of the three years
in the period ended December 31, 1998.

Foreign Currency Translation

CTI uses the British pound sterling as the functional currency for its
operations. The Company translates CTI's results of operations using the
average exchange rate for the period, and translates CTI's assets and
liabilities using the exchange rate at the end of the period. The cumulative
effect of changes in the exchange rate is recorded as a translation adjustment
in stockholders' equity.

Financial Instruments

The carrying amount of cash and cash equivalents approximates fair value for
these instruments. The estimated fair value of the 10 % Senior Discount Notes
and the 9% Guaranteed Bonds is based on quoted market prices, and the estimated
fair value of the other long-term debt is determined based on the current rates
offered for similar borrowings. The estimated fair value of the interest rate

F-9

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

swap agreement is based on the amount that the Company would receive or pay to
terminate the agreement at the balance sheet date. The estimated fair values of
the Company's financial instruments, along with the carrying amounts of the
related assets (liabilities), are as follows:

December 31, 1997 December 31, 1998
------------------ ------------------
Carrying Fair Carrying Fair
Amount Value Amount Value
-------- -------- -------- --------
(In thousands of dollars)

Cash and cash equivalents............. $ 55,078 $ 55,078 $296,450 $296,450
Long-term debt........................ (156,293) (161,575) (429,710) (443,379)
Interest rate swap agreement.......... -- (97) -- (47)

The Company's interest rate swap agreement is used to manage interest rate
risk. The net settlement amount resulting from this agreement is recognized as
an adjustment to interest expense. The Company does not hold or issue
derivative financial instruments for trading purposes.

Stock Options

In October 1995, the FASB issued Statement of Financial Accounting Standards
No. 123, Accounting for Stock-Based Compensation ("SFAS 123"). SFAS 123
establishes alternative methods of accounting and disclosure for employee
stock-based compensation arrangements. The Company has elected to continue the
use of the "intrinsic value based method" of accounting for its employee stock
option plans (see Note 9). This method does not result in the recognition of
compensation expense when employee stock options are granted if the exercise
price of the options equals or exceeds the fair market value of the stock at
the date of grant. See Note 9 for the disclosures required by SFAS 123.

Recent Accounting Pronouncements

In June 1997, the FASB issued Statement of Financial Accounting Standards No.
130, Reporting Comprehensive Income ("SFAS 130"). SFAS 130 establishes
standards for the reporting and display of comprehensive income in a company's
financial statements. Comprehensive income includes all changes in a company's
equity accounts (including net income or loss) except investments by, or
distributions to, the company's owners. Items which are components of
comprehensive income (other than net income or loss) include foreign currency
translation adjustments, minimum pension liability adjustments and unrealized
gains and losses on certain investments in debt and equity securities. The
components of comprehensive income must be reported in a financial statement
that is displayed with the same prominence as other financial statements. SFAS
130 is effective for fiscal years beginning after December 15, 1997. The
Company has adopted the requirements of SFAS 130 in its financial statements
for 1998.

In June 1997, the FASB issued Statement of Financial Accounting Standards No.
131, Disclosures about Segments of an Enterprise and Related Information ("SFAS
131"). SFAS 131 establishes standards for the way that public companies report,
in their annual financial statements, certain information about their operating
segments, their products and services, the geographic areas in which they
operate and their major customers. SFAS 131 also requires that certain
information about operating segments be reported in interim financial
statements. SFAS 131 is effective for periods beginning after December 15,
1997. The Company has adopted the requirements of SFAS 131 in its financial
statements for the year ended December 31, 1998 (see Note 13).

F-10

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

In April 1998, the Accounting Standards Executive Committee of the American
Institute of Certified Public Accountants issued Statement of Position 98-5,
Reporting on the Costs of Start-Up Activities ("SOP 98-5"). SOP 98-5 requires
that costs of start-up activities be charged to expense as incurred and broadly
defines such costs. The Company has deferred certain costs incurred in
connection with potential business initiatives and new geographic markets, and
SOP 98-5 will require that such deferred costs be charged to results of
operations upon its adoption. SOP 98-5 is effective for fiscal years beginning
after December 15, 1998. The Company will adopt the requirements of SOP 98-5 as
of January 1, 1999. The cumulative effect of the change in accounting principle
for the adoption of SOP 98-5 will result in a charge to results of operations
in the Company's financial statements for the three months ending March 31,
1999; it is currently estimated that such charge will amount to approximately
$2,300,000.

In June 1998, the FASB issued Statement of Financial Accounting Standards No.
133, Accounting for Derivative Instruments and Hedging Activities ("SFAS 133").
SFAS 133 requires that derivative instruments be recognized as either assets or
liabilities in the consolidated balance sheet based on their fair values.
Changes in the fair values of such derivative instruments will be recorded
either in results of operations or in other comprehensive income, depending on
the intended use of the derivative instrument. The initial application of SFAS
133 will be reported as the effect of a change in accounting principle. SFAS
133 is effective for all fiscal quarters of fiscal years beginning after June
15, 1999. The Company will adopt the requirements of SFAS 133 in its financial
statements for the three months ending March 31, 2000. The Company has not yet
determined the effect that the adoption of SFAS 133 will have on its
consolidated financial statements.

2. Acquisitions

During the three years in the period ended December 31, 1998, the Company
consummated a number of business acquisitions which were accounted for using
the purchase method. Results of operations and cash flows of the acquired
businesses are included in the consolidated financial statements for the
periods subsequent to the respective dates of acquisition.

Motorola, Inc. ("Motorola")

On June 28, 1996, the Company acquired fifteen telecommunications towers and
related assets, and assets related to specialized mobile radio and microwave
services, from Motorola in Puerto Rico. The purchase price consisted of
$9,919,000 in cash. Motorola provided certain management services related to
these assets for a period of ninety days after the closing date. Management
fees for such services amounted to $57,000 for the year ended December 31,
1996.

Other Acquisitions

During 1996, the Company acquired a number of other telecommunications towers
and related equipment from various sellers. The aggregate total purchase price
for these acquisitions of $1,039,000 consisted of $1,006,000 in cash and a
$33,000 payable to a seller.

TEA Group Incorporated and TeleStructures, Inc. (collectively, "TEA")

On May 12, 1997, the Company acquired all of the common stock of TEA. TEA
provides telecommunications site selection, acquisition, design and development
services. The purchase price of $14,215,000 consisted of $8,120,000 in cash (of
which $2,001,000 was paid in 1996 as an option payment), promissory notes
payable to the former stockholders of TEA totaling $1,872,000, the assumption
of $1,973,000 in outstanding debt and 535,710 shares of the Company's Class B

F-11

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Common Stock valued at $2,250,000 (the estimated fair value of such common
stock on that date). The Company recognized goodwill of $9,568,000 in
connection with this acquisition. The Company repaid the promissory notes with
a portion of the proceeds from the issuance of its 10 5/8% Senior Discount
Notes (see Note 5).

Crown Communications ("CCM"), Crown Network Systems, Inc. ("CNS") and Crown
Mobile Systems, Inc. ("CMS") (collectively, "Crown")

On July 11, 1997, the Company entered into an asset purchase and merger
agreement with the owners of Crown. On August 15, 1997, such agreement was
amended and restated, and the Company acquired (i) substantially all of the
assets, net of outstanding liabilities, of CCM and (ii) all of the outstanding
common stock of CNS and CMS. Crown provides network services, which includes
site selection and acquisition, antenna installation, site development and
construction, network design and site maintenance, and owns and operates
telecommunications towers and related assets. The purchase price of
$185,021,000 consisted of $27,843,000 in cash, a short-term promissory note
payable to the former owners of Crown for $76,230,000, the assumption of
$26,009,000 in outstanding debt and 7,325,000 shares of the Company's Class B
Common Stock valued at $54,939,000 (the estimated fair value of such common
stock on that date). The Company recognized goodwill and other intangible
assets of $146,103,000 in connection with this acquisition. The Company
financed the cash portion of the purchase price with proceeds from the
issuance of redeemable preferred stock (see Note 8), and repaid the promissory
note with proceeds from the issuance of additional redeemable preferred stock
and borrowings under the Senior Credit Facility (see Note 5).

In 1997, the Company organized Crown Communication Inc. ("CCI," a Delaware
corporation) as a wholly owned subsidiary to own the net assets acquired from
CCM and the common stock of CNS and CMS. In January 1998, the Company merged
Castle Tower Corporation ("CTC," a wholly owned operating subsidiary) with and
into CCI, establishing CCI as the principal domestic operating subsidiary of
the Company.

CTI

On April 24, 1998, the Company entered into a share exchange agreement with
certain shareholders of CTI pursuant to which certain of CTI's shareholders
agreed to exchange their shares of CTI for shares of the
Company. On August 18, 1998, the exchange was consummated and the Company's
ownership of CTI increased from approximately 34.3% to 80%. The Company issued
20,867,700 shares of its Common Stock and 11,340,000 shares of its Class A
Common Stock, with such shares valued at an aggregate of $418,700,000 (based
on the price per share to the public in the Company's initial public offering
as discussed in Note 9). The Company recognized goodwill of $344,204,000 in
connection with this transaction, which was accounted for as an acquisition
using the purchase method. CTI's results of operations and cash flows are
included in the consolidated financial statements for the period subsequent to
the date the exchange was consummated.

Pro Forma Results of Operations (Unaudited)

The following unaudited pro forma summary presents consolidated results of
operations for the Company as if (i) the TEA and Crown acquisitions had been
consummated as of January 1, 1997 and (ii) the share exchange with CTI's
shareholders had been consummated as of January 1 for both 1997 and 1998.
Appropriate adjustments have been reflected for depreciation and amortization,

F-12

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

interest expense, amortization of deferred financing costs, income taxes and
certain nonrecurring income and expenses recorded by the Company in connection
with the investment in CTI in 1997 (see Note 4). The pro forma information does
not necessarily reflect the actual results that would have been achieved, nor
is it necessarily indicative of future consolidated results for the Company.

Years Ended December 31,
--------------------------
1997 1998
------------ ------------
(In thousands of dollars,
except per share amounts)

Net revenues................................. $ 180,936 $ 210,041
Net loss..................................... (34,601) (46,517)
Loss per common share--basic and diluted..... (0.60) (0.72)

Agreement with Nextel Communications, Inc. ("Nextel")

On July 11, 1997, the Company entered into an agreement with Nextel (the
"Nextel Agreement") whereby the Company has the option to purchase up to 50 of
Nextel's existing towers which are located in Texas, Florida and the
metropolitan areas of Denver, Colorado and Philadelphia, Pennsylvania. As of
February 24, 1999, the Company had purchased 49 of such towers for an aggregate
price of $11,019,000 in cash.

Millennium Communications Limited ("Millennium")

On October 8, 1998, the Company acquired all of the outstanding shares of
Millennium. Millennium develops, owns and operates telecommunications towers
and related assets in the United Kingdom. On the date of acquisition,
Millennium owned 102 tower sites. Millennium is being operated as a subsidiary
of CTI. The purchase price of $14,473,000 consisted of $9,813,000 in cash, the
repayment of $2,396,000 in outstanding debt and 358,678 shares of the Company's
common stock valued at $2,264,000 (the market value of such common stock on
that date).

Agreement with Bell Atlantic Mobile ("BAM")

On December 8, 1998, the Company entered into an agreement with BAM to form a
joint venture ("Crown Atlantic") to own and operate a significant majority of
BAM's towers. Upon formation of Crown Atlantic (which is currently expected to
occur in March 1999), (i) the Company will contribute to Crown Atlantic
$250,000,000 in cash and approximately 15.6 million shares of its Common Stock
in exchange for a 62.3% ownership interest in Crown Atlantic, (ii) Crown
Atlantic will borrow $180,000,000 under a committed $250,000,000 revolving
credit facility, and (iii) BAM will contribute to Crown Atlantic approximately
1,427 towers in exchange for a cash distribution of $380,000,000 from Crown
Atlantic and a 37.7% ownership interest in Crown Atlantic. Upon dissolution of
Crown Atlantic, BAM would receive (i) the shares of the Company's Common Stock
contributed to Crown Atlantic and (ii) a payment (either in cash or in shares
of the Company's Common Stock, at the Company's election) equal to 14.0% of the
fair market value of Crown Atlantic's other net assets; the Company would then
receive the remaining assets and liabilities of Crown Atlantic. The Company
will account for its investment in Crown Atlantic as an acquisition using the
purchase method, and will include Crown Atlantic's results of operations and
cash flows in the Company's consolidated financial statements for periods
subsequent to formation.

F-13

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

3. Property and Equipment

The major classes of property and equipment are as follows:

Estimated December 31,
Useful -----------------
Lives 1997 1998
---------- ------- --------
(In thousands of dollars)

Land and buildings......................... 0-50 years $ 1,930 $ 58,767
Telecommunications towers and broadcast
transmission equipment.................... 5-20 years 76,847 532,907
Transportation and other equipment......... 3-10 years 4,379 11,452
Office furniture and equipment............. 5-7 years 3,664 12,248
------- --------
86,820 615,374
Less: accumulated depreciation............. (4,852) (22,780)
------- --------
$81,968 $592,594
======= ========

Depreciation expense for the years ended December 31, 1997 and 1998 was
$2,886,000 and $20,638,000, respectively. Accumulated depreciation on
telecommunications towers and broadcast transmission equipment was $4,136,000
and $15,995,000 at December 31, 1997 and 1998, respectively. At December 31,
1998, minimum rentals receivable under existing operating leases for towers are
as follows: years ending December 31, 1999--$183,244,000; 2000--$187,311,000;
2001--$185,097,000; 2002--$179,641,000; 2003--$171,329,000; thereafter--
$667,731,000.

4. Investments in Affiliates

On February 28, 1997, the Company used a portion of the net proceeds from the
sale of the Series C Convertible Preferred Stock (see Note 8) to purchase an
ownership interest of approximately 34.3% in CTI (a company incorporated under
the laws of England and Wales). The Company led a consortium of investors which
provided the equity financing for CTI. The funds invested by the consortium
were used by CTI to purchase, through a wholly owned subsidiary, the domestic
broadcast transmission division of the British Broadcasting Corporation (the
"BBC"). The cost of the Company's investment in CTI amounted to approximately
$57,542,000. The Company accounted for its investment in CTI utilizing the
equity method of accounting prior to the consummation of the share exchange
agreement with CTI's shareholders in August 1998 (see Note 2).

In March 1997, as compensation for leading the investment consortium, the
Company received a fee from CTI amounting to approximately $1,165,000. This fee
was recorded as other income by the Company when received. In addition, the
Company received approximately $1,679,000 from CTI as reimbursement for costs
incurred prior to the closing of the purchase from the BBC.

In June 1997, as compensation for the successful completion of the investment
in CTI and certain other acquisitions and investments, the Company paid bonuses
to two of its executive officers totaling $913,000. These bonuses are included
in corporate development expenses on the Company's consolidated statement of
operations.

F-14

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Summarized financial information for CTI is as follows (for periods in which
the Company accounted for CTI utilizing the equity method):

December 31,
1997
-------------
(In thousands
of dollars)
-------------

Current assets.................................................... $ 37,510
Property and equipment, net....................................... 341,737
Goodwill, net..................................................... 76,029
---------
$ 455,276
=========
Current liabilities............................................... $ 48,103
Long-term debt.................................................... 237,299
Other liabilities................................................. 3,453
Redeemable preferred stock........................................ 174,944
Stockholders' equity (deficit).................................... (8,523)
---------
$ 455,276
=========

Ten Months
Ended Eight Months
December 31, Ended August
1997 31, 1998
------------ ------------
(In thousands of dollars)

Net revenues........................................ $103,531 $97,228
Operating expenses.................................. 86,999 78,605
-------- -------
Operating income.................................... 16,532 18,623
Interest and other income........................... 553 725
Interest expense and amortization of deferred
financing costs.................................... (20,404) (13,378)
Provision for income taxes.......................... -- --
-------- -------
Net income (loss)................................... $ (3,319) $ 5,970
======== =======

5. Long-term Debt

Long-term debt consists of the following:

December 31,
-------------------------
1997 1998
------------ ------------
(In thousands of dollars)

Senior Credit Facility........................... $ 4,700 $ 5,500
10 5/8% Senior Discount Notes due 2007, net of
discount........................................ 151,593 168,099
CTI Credit Facility.............................. -- 55,177
9% Guaranteed Bonds due 2007..................... -- 200,934
------------ ------------
$ 156,293 $ 429,710
============ ============

Senior Credit Facility

CTC had a credit agreement with a bank (as amended, the "Bank Credit
Agreement") which consisted of secured revolving lines of credit (the
"Revolving Credit Facility") and a $2,300,000 term note (the "Term Note"). On
January 17, 1997, the Bank Credit Agreement was amended to: (i) increase the
available borrowings under the Revolving Credit Facility to $50,000,000; (ii)
repay the

F-15

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Term Note, along with accrued interest thereon, with borrowings under the
Revolving Credit Facility; and (iii) extend the termination date for the Bank
Credit Agreement to December 31, 2003. Available borrowings under the Revolving
Credit Facility were generally to be used to construct new towers and to
finance a portion of the purchase price for towers and related assets. The
amount of available borrowings was determined based on the current financial
performance (as defined) of: (i) the assets to be acquired; and (ii) assets
acquired in previous acquisitions. In addition, up to $5,000,000 of borrowing
availability under the Revolving Credit Facility could be used for letters of
credit.

In October 1997, the Bank Credit Agreement was amended to (i) increase the
available borrowings to $100,000,000; (ii) include the lending bank under
Crown's bank credit agreement as a participating lender; and (iii) extend the
maturity date to December 31, 2004 (as amended, the "Senior Credit Facility").
On October 31, 1997, additional borrowings under the Senior Credit Facility,
along with the proceeds from the October issuance of Senior Preferred Stock
(see Note 8), were used to repay (i) the promissory note payable to the former
stockholders of Crown and (ii) the outstanding borrowings under Crown's bank
credit agreement (see Note 2). In November 1997, the Company repaid all of the
outstanding borrowings under the Senior Credit Facility with a portion of the
proceeds from the issuance of its 10 5/8% Senior Discount Notes (as discussed
below). Upon the merger of CTC into CCI in January 1998, CCI became the primary
borrower under the Senior Credit Facility. In December 1998, the Company again
repaid all of the outstanding borrowings under the Senior Credit Facility with
a portion of the proceeds from the issuance of its 12 3/4% Senior Exchangeable
Preferred Stock (see Note 8). As of December 31, 1998, approximately
$77,570,000 of borrowings was available under the Senior Credit Facility, of
which $5,000,000 was available for letters of credit. There were no letters of
credit outstanding as of December 31, 1998.

The amount of available borrowings under the Senior Credit Facility will
decrease by $5,000,000 at the end of each calendar quarter beginning on March
31, 2001 until December 31, 2004, at which time any remaining borrowings must
be repaid. Under certain circumstances, CCI may be required to make principal
prepayments under the Senior Credit Facility in an amount equal to 50% of
excess cash flow (as defined), the net cash proceeds from certain asset sales
or the net cash proceeds from certain sales of equity or debt securities by the
Company.

The Senior Credit Facility is secured by substantially all of the assets of
CCI and the Company's pledge of the capital stock of CCI and its subsidiaries.
In addition, the Senior Credit Facility is guaranteed by the Company.
Borrowings under the Senior Credit Facility bear interest at a rate per annum,
at the Company's election, equal to the bank's prime rate plus 1.5% or a
Eurodollar interbank offered rate (LIBOR) plus 3.25% (9.25% and 8.32%,
respectively, at December 31, 1998). The interest rate margins may be reduced
by up to 2.25% (non-cumulatively) based on a financial test, determined
quarterly. As of December 31, 1998, the financial test permitted a reduction of
1.5% in the interest rate margin for prime rate borrowings and 2.25% in the
interest rate margin for LIBOR borrowings. Interest on prime rate loans is due
quarterly, while interest on LIBOR loans is due at the end of the period (from
one to three months) for which such LIBOR rate is in effect. The Senior Credit
Facility requires CCI to maintain certain financial covenants and places
restrictions on CCI's ability to, among other things, incur debt and liens, pay
dividends, make capital expenditures, dispose of assets, undertake transactions
with affiliates and make investments.

10 5/8% Senior Discount Notes due 2007 (the "Notes")

On November 25, 1997, the Company issued $251,000,000 aggregate principal
amount of the Notes for cash proceeds of $150,010,000 (net of original issue
discount). The Company used a

F-16

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

portion of the net proceeds from the sale of the Notes to (i) repay all of the
outstanding borrowings, including accrued interest thereon, under the Senior
Credit Facility; (ii) repay the promissory notes payable, including accrued
interest thereon, to the former stockholders of TEA (see Note 2); (iii) repay
certain indebtedness, including accrued interest thereon, from a prior
acquisition; and (iv) repay outstanding installment debt assumed in connection
with the Crown acquisition (see Note 2).

The Notes will not pay any interest until May 15, 2003, at which time semi-
annual interest payments will commence and become due on each May 15 and
November 15 thereafter. The maturity date of the Notes is November 15, 2007.
The Notes are net of unamortized discount of $99,407,000 and $82,901,000 at
December 31, 1997 and 1998, respectively.

The Notes are redeemable at the option of the Company, in whole or in part,
on or after November 15, 2002 at a price of 105.313% of the principal amount
plus accrued interest. The redemption price is reduced annually until November
15, 2005, after which time the Notes are redeemable at par. Prior to November
15, 2000, the Company may redeem up to 35% of the aggregate principal amount of
the Notes, at a price of 110.625% of the accreted value thereof, with the net
cash proceeds from a public offering of the Company's common stock.

The Notes are senior indebtedness of the Company; however, they are unsecured
and effectively subordinate to the liabilities of the Company's subsidiaries,
which include outstanding borrowings under the Senior Credit Facility, the CTI
Credit Facility and the CTI Bonds. The indenture governing the Notes (the
"Indenture") places
restrictions on the Company's ability to, among other things, pay dividends and
make capital distributions, make investments, incur additional debt and liens,
issue additional preferred stock, dispose of assets and undertake transactions
with affiliates. As of December 31, 1998, the Company was effectively precluded
from paying dividends on its capital stock under the terms of the Indenture.

Reporting Requirements Under the Indenture (Unaudited)

The following information (as such capitalized terms are defined in the
Indenture) is presented solely as a requirement of the Indenture; such
information is not intended as an alternative measure of financial position,
operating results or cash flow from operations (as determined in accordance
with generally accepted accounting principles). Furthermore, the Company's
measure of the following information may not be comparable to similarly titled
measures of other companies.

F-17

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Upon consummation of the share exchange with CTI's shareholders (see Note 2),
which increased the Company's ownership interest in CTI to 80%, the Company
designated CTI as an Unrestricted Subsidiary. In addition, the net proceeds
from the Company's initial public offering of common stock (see Note 9) were
placed into a newly formed subsidiary that was also designated as an
Unrestricted Subsidiary. Prior to these transactions, the Company did not have
any Unrestricted Subsidiaries. Summarized financial information for (i) the
Company and its Restricted Subsidiaries and (ii) the Company's Unrestricted
Subsidiaries is as follows:

December 31, 1998
----------------------------------------------------
Company and
Restricted Unrestricted Consolidation Consolidated
Subsidiaries Subsidiaries Eliminations Total
------------ ------------ ------------- ------------
(In thousands of dollars)

Cash and cash
equivalents............ $ 41,785 $ 254,665 $ -- $ 296,450
Other current assets.... 19,585 26,081 -- 45,666
Property and equipment,
net.................... 165,205 427,389 -- 592,594
Investments in
Unrestricted
Subsidiaries........... 744,941 -- (744,941) --
Goodwill and other
intangible assets,
net.................... 143,729 426,011 -- 569,740
Other assets, net....... 15,440 3,340 -- 18,780
---------- ---------- --------- ----------
$1,130,685 $1,137,486 $(744,941) $1,523,230
========== ========== ========= ==========
Current liabilities..... $ 17,653 $ 75,234 $ -- $ 92,887
Long-term debt.......... 173,599 256,111 -- 429,710
Other liabilities....... 808 22,015 -- 22,823
Minority interests...... -- 39,185 -- 39,185
Redeemable preferred
stock.................. 201,063 -- -- 201,063
Stockholders' equity.... 737,562 744,941 (744,941) 737,562
---------- ---------- --------- ----------
$1,130,685 $1,137,486 $(744,941) $1,523,230
========== ========== ========= ==========

F-18

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Three Months Ended December 31, 1998 Year Ended December 31, 1998
-------------------------------------- --------------------------------------
Company and Company and
Restricted Unrestricted Consolidated Restricted Unrestricted Consolidated
Subsidiaries Subsidiaries Total Subsidiaries Subsidiaries Total
------------ ------------ ------------ ------------ ------------ ------------
(In thousands of dollars)

Net revenues............ $ 17,030 $43,787 $60,817 $ 55,023 $58,055 $113,078
Costs of operations
(exclusive of
depreciation and
amortization).......... 7,069 18,117 25,186 23,446 24,372 47,818
General and
administrative......... 6,883 1,666 8,549 21,153 2,418 23,571
Corporate development... 1,787 -- 1,787 4,625 -- 4,625
Non-cash compensation
charges................ 523 874 1,397 9,907 2,851 12,758
Depreciation and
amortization........... 4,879 15,255 20,134 16,921 20,318 37,239
-------- ------- ------- -------- ------- --------
Operating income
(loss)................. (4,111) 7,875 3,764 (21,029) 8,096 (12,933)
Equity in earnings of
unconsolidated
affiliate.............. -- -- -- 2,055 -- 2,055
Interest and other
income (expense)....... (285) 2,212 1,927 1,101 3,119 4,220
Interest expense and
amortization of
deferred financing
costs.................. (5,823) (5,685) (11,508) (21,727) (7,362) (29,089)
Provision for income
taxes (156) -- (156) (374) -- (374)
Minority interests...... -- (1,326) (1,326) -- (1,654) (1,654)
-------- ------- ------- -------- ------- --------
Net income (loss)....... $(10,375) $ 3,076 $(7,299) $(39,974) $ 2,199 $(37,775)
======== ======= ======= ======== ======= ========

Tower Cash Flow and Adjusted Consolidated Cash Flow for the Company and its
Restricted Subsidiaries is as follows:

(In
thousands
of
dollars)
---------

Tower Cash Flow, for the three months ended December 31, 1998...... $ 3,868
========
Consolidated Cash Flow, for the twelve months ended December 31,
1998.............................................................. $ 6,001
Less: Tower Cash Flow, for the twelve months ended December 31,
1998.............................................................. (14,811)
Plus: four times Tower Cash Flow, for the three months ended
December 31, 1998................................................. 15,472
--------
Adjusted Consolidated Cash Flow, for the twelve months ended
December 31, 1998................................................. $ 6,662
========

F-19

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

CTI Credit Facility

CTI has a credit agreement with a syndicate of banks (as amended, the "CTI
Credit Facility") which consists of a (Pounds)64,000,000 (approximately
$106,419,000) secured revolving line of credit. Available borrowings under the
CTI Credit Facility are generally to be used to finance capital expenditures
and for working capital and general corporate purposes. As of December 31,
1998, approximately $51,243,000 of borrowings was available under the CTI
Credit Facility.

The loan commitment under the CTI Credit Facility will be automatically
reduced to zero in three equal semi-annual installments beginning on May 31,
2001 until May 31, 2002, when the CTI Credit Facility matures. Under certain
circumstances, CTI may be required to make principal prepayments from the
proceeds of certain asset sales.

The CTI Credit Facility is secured by substantially all of CTI's assets.
Borrowings under the CTI Credit Facility bear interest at a rate per annum
equal to a Eurodollar interbank offered rate (LIBOR) plus 0.85% (approximately
6.99% at December 31, 1998). Interest is due at the end of the period (from one
to six months) for which such LIBOR rate is in effect. The CTI Credit Facility
requires CTI to maintain certain financial covenants and places restrictions on
CTI's ability to, among other things, incur debt and liens, pay dividends, make
capital expenditures, dispose of assets, undertake transactions with affiliates
and make investments.

9% Guaranteed Bonds due 2007 ("CTI Bonds")

CTI has issued (Pounds)125,000,000 (approximately $207,850,000) aggregate
principal amount of the CTI Bonds. Interest payments on the CTI Bonds are due
annually on each March 30. The maturity date of the CTI Bonds is March 30,
2007. The CTI Bonds are stated net of unamortized discount.

The CTI Bonds are redeemable, at the option of CTI, in whole or in part at
any time, at the greater of their principal amount and such a price as will
provide a gross redemption yield 0.5% per annum above the gross redemption
yield on the benchmark gilt plus, in either case, accrued and unpaid interest.
Under certain circumstances, each holder of the CTI Bonds has the right to
require CTI to repurchase all or a portion of such holder's CTI Bonds at a
price equal to 101% of their aggregate principal amount plus accrued and unpaid
interest.

The CTI Bonds are guaranteed by CTI; however, they are unsecured and
effectively subordinate to the outstanding borrowings under the CTI Credit
Facility. The trust deed governing the CTI Bonds places restrictions on CTI's
ability to, among other things, pay dividends and make capital distributions,
make investments, incur additional debt and liens, dispose of assets and
undertake transactions with affiliates.

Restricted Net Assets of Subsidiaries

Under the terms of the Senior Credit Facility, the CTI Credit Facility and
the CTI Bonds, the Company's subsidiaries are limited in the amount of
dividends which can be paid to the Company. For CCI, the amount of such
dividends is limited to (i) $6,000,000 per year until October 31, 2002, and
$33,000,000 per year thereafter, and (ii) an amount to pay income taxes
attributable to the Company's Restricted Subsidiaries. CTI is effectively
precluded from paying dividends. The restricted net assets of the Company's
subsidiaries totaled approximately $826,321,000 at December 31, 1998.

F-20

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Interest Rate Swap Agreement

The interest rate swap agreement had an outstanding notional amount of
$17,925,000 at January 29, 1997 (inception) and terminated on February 24,
1999. The Company paid a fixed rate of 6.28% on the notional amount and
received a floating rate based on LIBOR. This agreement effectively changed the
interest rate on $17,925,000 of borrowings under the Senior Credit Facility
from a floating rate to a fixed rate of 6.28% plus the applicable margin. The
Company does not believe there is any significant exposure to credit risk due
to the creditworthiness of the counterparty. In the event of nonperformance by
the counterparty, the Company's loss would be limited to any unfavorable
interest rate differential.

6. Income Taxes

The provision for income taxes consists of the following:

Years Ended December
31,
------------------------
1996 1997 1998
----- ------- --------
(In thousands of
dollars)

Current:
State............................................ $ -- $ -- $ 365
Puerto Rico...................................... 10 49 9
----- ------- --------
$ 10 $ 49 $ 374
===== ======= ========

A reconciliation between the provision for income taxes and the amount
computed by applying the federal statutory income tax rate to the loss before
income taxes is as follows:

Years Ended December
31,
------------------------
1996 1997 1998
----- ------- --------
(In thousands of
dollars)

Benefit for income taxes at statutory rate......... $(322) $(4,044) $(12,154)
Stock-based compensation........................... -- -- 2,844
Amortization of intangible assets.................. -- 478 604
State and foreign taxes, net of federal tax
benefit........................................... -- -- 247
Expenses for which no federal tax benefit was
recognized........................................ 5 28 151
Puerto Rico taxes.................................. 10 49 9
Acquisition costs.................................. -- -- (675)
Foreign earnings not subject to tax................ -- -- (584)
Changes in valuation allowances.................... 315 3,650 9,944
Other.............................................. 2 (112) (12)
----- ------- --------
$ 10 $ 49 $ 374
===== ======= ========

F-21

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

The components of the net deferred income tax assets and liabilities are as
follows:

December 31,
---------------------------
1997 1998
------------ -------------
(In thousands of dollars)

Deferred income tax liabilities:
Property and equipment........................... $ 2,487 $ 6,045
Puerto Rico earnings............................. 75 84
Intangible assets................................ 276 --
Other............................................ 38 --
------------ -------------
Total deferred income tax liabilities.......... 2,876 6,129
------------ -------------
Deferred income tax assets:
Net operating loss carryforwards................. 6,800 19,071
Noncompete agreement............................. 37 464
Intangible assets................................ -- 351
Accrued liabilities.............................. -- 68
Other............................................ -- 45
Receivables allowance............................ 6 41
Valuation allowances............................. (3,967) (13,911)
------------ -------------
Total deferred income tax assets, net.......... 2,876 6,129
------------ -------------
Net deferred income tax liabilities................ $ -- $ --
============ =============

Valuation allowances of $3,967,000 and $13,911,000 were recognized to offset
net deferred income tax assets as of December 31, 1997 and 1998, respectively.

At December 31, 1998, the Company has net operating loss carryforwards of
approximately $56,000,000 which are available to offset future federal taxable
income. These loss carryforwards will expire in 2010 through 2018. The
utilization of the loss carryforwards is subject to certain limitations.

7. Minority Interests

Minority interests represent the minority stockholder's interest in CTI.

8. Redeemable Preferred Stock

Exchangeable Preferred Stock

On December 16, 1998, the Company issued 200,000 shares of its 12 3/4% Senior
Exchangeable Preferred Stock due 2010 (the "Exchangeable Preferred Stock") at a
price of $1,000 per share (the liquidation preference per share). The net
proceeds received by the Company from the sale of such shares amounted to
approximately $193,000,000 (after underwriting discounts of $7,000,000 but
before other expenses of the offering, which amounted to approximately
$8,059,000). A portion of the net proceeds was used to repay outstanding
borrowings under the Senior Credit Facility of $73,750,000, and the remaining
net proceeds are currently invested in short-term investments.

The holders of the Exchangeable Preferred Stock are entitled to receive
cumulative dividends at the rate of 12 3/4% per share, compounded quarterly on
each March 15, June 15, September 15 and December 15 of each year, beginning on
March 15, 1999. On or before December 15, 2003, the

F-22

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Company has the option to pay dividends in cash or in additional shares of
Exchangeable Preferred Stock. After December 15, 2003, dividends are payable
only in cash.

The Company is required to redeem all outstanding shares of Exchangeable
Preferred Stock on December 15, 2010 at a price equal to the liquidation
preference plus accumulated and unpaid dividends. On or after December 15,
2003, the shares are redeemable at the option of the Company, in whole or in
part, at a price of 106.375% of the liquidation preference. The redemption
price is reduced on an annual basis until December 15, 2007, at which time the
shares are redeemable at the liquidation preference. Prior to December 15,
2001, the Company may redeem up to 35% of the Exchangeable Preferred Stock, at
a price of 112.75% of the liquidation preference, with the net proceeds from
certain public equity offerings. The shares of Exchangeable Preferred Stock are
exchangeable, at the option of the Company, in whole but not in part, for 12
3/4% Senior Subordinated Exchange Debentures due 2010.

The Company's obligations with respect to the Exchangeable Preferred Stock
are subordinate to all indebtedness of the Company (including the Notes), and
are effectively subordinate to all debt and liabilities of the Company's
subsidiaries (including the Senior Credit Facility, the CTI Credit Facility and
the CTI Bonds). The certificate of designations governing the Exchangeable
Preferred Stock places restrictions on the Company's ability to, among other
things, pay dividends and make capital distributions, make investments, incur
additional debt and liens, issue additional preferred stock, dispose of assets
and undertake transactions with affiliates.

Senior Preferred Stock

In August 1997, the Company issued 292,995 shares of its Senior Convertible
Preferred Stock (the "Senior Preferred Stock") at a price of $100 per share.
The net proceeds received by the Company from the sale of such shares amounted
to approximately $29,266,000, most of which was used to pay the cash portion of
the purchase price for Crown (see Note 2). In October 1997, the Company issued
an additional 364,500 shares of its Senior Preferred Stock at a price of $100
per share. The net proceeds received by the Company from the sale of such
shares amounted to $36,450,000. This amount, along with borrowings under the
Senior Credit Facility, was used to repay the promissory note from the Crown
acquisition (see Note 2).

The holders of the Senior Preferred Stock were entitled to receive cumulative
dividends at the rate of 12.5% per share, compounded annually. At the option of
the holder, each share of Senior Preferred Stock (plus any accrued and unpaid
dividends) was convertible, at any time, into shares of the Company's common
stock at a conversion price of $7.50 (subject to adjustment in the event of an
underwritten public offering of the Company's common stock). At the date of
issuance of the Senior Preferred Stock, the Company believes that its
conversion price represented the estimated fair value of the common stock on
that date. In July 1998, all of the shares of Senior Preferred Stock were
converted into shares of common stock (see Note 9).

The purchasers of the Senior Preferred Stock were also issued warrants to
purchase an aggregate 1,314,990 shares of the Company's common stock at an
exercise price of $7.50 per share (subject to adjustment in the event of an
underwritten public offering of the Company's common stock). The warrants are
exercisable, in whole or in part, at any time until August and October of 2007.
At the date of issuance of the warrants, the Company believes that the exercise
price represented the estimated fair value of the common stock on that date. As
such, the Company has not assigned any value to the warrants in its
consolidated financial statements.

F-23

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Series Preferred Stock

The holders of the Company's Series A Convertible Preferred Stock (the
"Series A Preferred Stock"), the Series B Convertible Preferred Stock (the
"Series B Preferred Stock") and the Series C Convertible Preferred Stock (the
"Series C Preferred Stock") (collectively, the "Series Preferred Stock") were
entitled to receive dividends, if and when declared, at the same rate as
dividends were declared and paid with respect to the Company's common stock.
Each of the outstanding shares of Series Preferred Stock was automatically
converted into five shares of common stock upon consummation of the Company's
initial public offering (see Note 9).

In February and April of 1997, the Company issued 3,529,832 shares of its
Series C Preferred Stock at a price of $21.00 per share. The net proceeds
received by the Company from the sale of the Series C Preferred Stock amounted
to approximately $74,024,000. A portion of this amount was used to purchase the
ownership interest in CTI (see Note 4).

9. Stockholders' Equity

Common Stock

On August 18, 1998, the Company consummated its initial public offering of
common stock at a price to the public of $13.00 per share (the "IPO"). The
Company sold 12,320,000 shares of its common stock and received proceeds of
$151,043,000 (after underwriting discounts of $9,117,000 but before other
expenses of the IPO, which amounted to approximately $4,116,000). The net
proceeds from the IPO are currently invested in short-term investments.

In anticipation of the IPO, the Company (i) amended and restated the 1995
Stock Option Plan to, among other things, authorize the issuance of up to
18,000,000 shares of common stock pursuant to awards made thereunder and (ii)
approved an amendment to its certificate of incorporation to increase the
number of authorized shares of common and preferred stock to 690,000,000 shares
and 10,000,000 shares, respectively, and to effect a five-for-one stock split
for the shares of common stock then outstanding. The effect of the stock split
has been presented retroactively in the Company's consolidated financial
statements for all periods presented.

In July 1998, all of the holders of the Company's Senior Convertible
Preferred Stock converted such shares into an aggregate of 9,629,200 shares of
the Company's common stock. Upon consummation of the IPO, all of the holders of
the Company's then-existing shares of Class A Common Stock, Class B Common
Stock, Series A Convertible Preferred Stock, Series B Convertible Preferred
Stock and Series C Convertible Preferred Stock converted such shares into an
aggregate of 39,842,290 shares of the Company's common stock.

In March 1997, the Company repurchased, and subsequently retired, 814,790
shares of its common stock from a member of the Company's Board of Directors at
a cost of approximately $3,422,000. Of this amount, $1,311,000 was recorded as
compensation cost and is included in corporate development expense on the
Company's consolidated statement of operations. In August 1998, the Company
repurchased, and subsequently retired, 141,070 shares of its common stock from
a former employee at a cost of approximately $883,000.

Class A Common Stock

Upon consummation of the share exchange agreement with CTI's shareholders
(see Note 2), an affiliate of CTI's remaining minority shareholder received all
of the currently outstanding shares of the

F-24

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Company's Class A Common Stock. Each share of Class A Common Stock is
convertible, at the option of its holder at any time, into one share of Common
Stock. The holder of the Class A Common Stock is entitled to one vote per share
on all matters presented to a vote of the Company's shareholders, except with
respect to the election of directors. The holder of the Class A Common Stock,
voting as a separate class, has the right to elect up to two members of the
Company's Board of Directors. The shares of Class A Common Stock also provide
certain governance and anti-dilutive rights.

Compensation Charges Related to Stock Option Grants

During the period from April 24, 1998 through July 15, 1998, the Company
granted options to employees and executives for the purchase of 3,236,980
shares of its common stock at an exercise price of $7.50 per share. Of such
options, options for 1,810,730 shares vested upon consummation of the IPO and
the remaining options for 1,426,250 shares will vest at 20% per year over five
years, beginning one year from the date of grant. In addition, the Company has
assigned its right to repurchase shares of its common stock from a stockholder
(at a price of $6.26 per share) to two individuals (including a newly-elected
director) with respect to 100,000 of such shares. Since the granting of these
options and the assignment of these rights to repurchase shares occurred
subsequent to the date of the share exchange agreement with CTI's shareholders
and at prices substantially below the price to the public in the IPO, the
Company has recorded a non-cash compensation charge related to these options
and shares based upon the difference between the respective exercise and
purchase prices and the price to the public in the IPO. Such compensation
charge will total approximately $18,400,000, of which approximately $10,600,000
was recognized upon consummation of the IPO (for such options and shares which
vested upon consummation of the IPO), and the remaining $7,800,000 is being
recognized over five years (approximately $1,600,000 per year) through the
second quarter of 2003. An additional $1,600,000 in non-cash compensation
charges will be recognized through the third quarter of 2001 for stock options
issued to certain members of CTI's management prior to the consummation of the
share exchange.

Stock Options

In 1995, the Company adopted the Crown Castle International Corp. 1995 Stock
Option Plan (as amended, the "1995 Stock Option Plan"). Up to 18,000,000 shares
of the Company's common stock were reserved for awards granted to certain
employees, consultants and non-employee directors of the Company and its
subsidiaries or affiliates. These options generally vest over periods of up to
five years from the date of grant (as determined by the Company's Board of
Directors) and have a maximum term of ten years from the date of grant.

Upon consummation of the share exchange agreement with CTI's shareholders
(see Note 2), the Company adopted each of the various CTI stock option plans.
All outstanding options to purchase shares of CTI under such plans have been
converted into options to purchase shares of the Company's common stock. Up to
4,392,451 shares of the Company's common stock were reserved for awards granted
under the CTI plans, and these options generally vest over periods of up to
three years from the date of grant.

F-25

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

A summary of awards granted under the various stock option plans is as
follows for the years ended December 31, 1996, 1997 and 1998:

1996 1997 1998
------------------- -------------------- ---------------------
Weighted- Weighted- Weighted-
Average Average Average
Number of Exercise Number of Exercise Number of Exercise
Shares Price Shares Price Shares Price
--------- --------- --------- --------- ---------- ---------

Options outstanding at
beginning of year...... 825,000 $0.53 1,050,000 $0.89 3,694,375 $4.69
Options granted......... 225,000 2.22 3,042,500 5.46 9,024,720 10.02
Options outstanding
under CTI stock option
plans.................. -- -- -- -- 4,367,202 2.74
Options exercised....... -- -- (363,125) 0.53 (216,650) 4.89
Options forfeited....... -- -- (35,000) 1.20 (284,450) 5.72
--------- --------- ----------
Options outstanding at
end of year............ 1,050,000 0.89 3,694,375 4.69 16,585,197 7.06
========= ========= ==========
Options exercisable at
end of year............ 721,250 0.43 728,875 2.49 7,615,649 4.75
========= ========= ==========

In November 1996, options which were granted in 1995 for the purchase of
690,000 shares were modified such that those options became fully vested. In
August 1998, certain outstanding options became fully or partially vested upon
consummation of the IPO. A summary of options outstanding as of December 31,
1998 is as follows:

Weighted-
Average
Number of Remaining Number of
Exercise Options Contractual Options
Prices Outstanding Life Exercisable
-------- ----------- ----------- -----------

$ -0- to $ 0.40 677,108 7.0 years 494,709
1.20 to 1.60 123,750 7.1 years 123,750
2.37 to 3.09 3,316,600 7.8 years 2,266,600
4.01 to 6.00 2,607,621 8.2 years 1,833,960
7.50 to 7.77 5,694,692 9.3 years 2,821,630
10.04 to 12.50 450,426 9.9 years --
13.00 3,590,000 9.6 years 75,000
17.63 125,000 10.0 years --
---------- ---------
16,585,197 9.1 years 7,615,649
========== =========

The weighted-average fair value of options granted during the years ended
December 31, 1996, 1997 and 1998 was $0.50, $1.30 and $4.54, respectively. The
fair value of each option was estimated on the date of grant using the Black-
Scholes option-pricing model and the following weighted-average assumptions
about the options (the minimum value method was used prior to the IPO):

Years Ended December 31,
-----------------------------
1996 1997 1998
--------- --------- ---------

Risk-free interest rate......................... 6.4% 6.1% 5.38%
Expected life................................... 4.0 years 4.5 years 3.6 years
Expected volatility............................. 0% 0% 0% to 30%
Expected dividend yield......................... 0% 0% 0%

F-26

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

The exercise prices for options granted during the years ended December 31,
1996 and 1997 were equal to or in excess of the estimated fair value of the
Company's common stock at the date of grant. As such, no compensation cost was
recognized for stock options during those years (see Note 1 and "Compensation
Charges Related to Stock Option Grants"). If compensation cost had been
recognized for stock options based on their fair value at the date of grant,
the Company's pro forma net loss for the years ended December 31, 1996, 1997
and 1998 would have been $973,000 ($0.28 per share), $12,586,000 ($2.37 per
share) and $75,660,000 ($1.91 per share), respectively. The pro forma effect of
stock options on the Company's net loss for those years may not be
representative of the pro forma effect for future years due to the impact of
vesting and potential future awards.

Shares Reserved For Issuance

At December 31, 1998, the Company had the following shares reserved for
future issuance:

Common Stock:
Class A Common Stock........................................... 11,340,000
Shares of CTI stock which are convertible into common stock.... 17,443,500
Stock option plans............................................. 21,812,676
Warrants....................................................... 1,314,990
----------
51,911,166
==========

10. Employee Benefit Plans

The Company and its subsidiaries have various defined contribution savings
plans covering substantially all employees. Depending on the plan, employees
may elect to contribute up to 20% of their eligible compensation. Certain of
the plans provide for partial matching of such contributions. The cost to the
Company for these plans amounted to $98,000 and $197,000 for the years ended
December 31, 1997 and 1998, respectively.

CTI has a defined benefit plan which covers all of its employees hired on or
before March 1, 1997. Employees hired after that date are not eligible to
participate in this plan. The net periodic pension cost attributable to this
plan for the four months ended December 31, 1998 was $1,115,000. As of December
31, 1998, (i) the accumulated benefit obligation under this plan amounted to
$13,635,000 (all of which was vested); (ii) the projected benefit obligation
amounted to $15,298,000; (iii) the fair value of the plan's assets amounted to
$15,848,000; and (iv) the prepaid pension cost attributable to this plan
amounted to $1,704,000.

11. Related Party Transactions

The Company leases office space in a building formerly owned by its Chief
Executive Officer. Lease payments for such office space amounted to $50,000 and
$130,000 for the years ended December 31, 1996 and 1997, respectively.

Included in other receivables at December 31, 1997 and 1998 are amounts due
from employees of the Company totaling $499,000 and $368,000, respectively.

12. Commitments and Contingencies

At December 31, 1998, minimum rental commitments under operating leases are
as follows: years ending December 31, 1999--$19,721,000; 2000--$19,456,000;
2001--$19,298,000; 2002--

F-27

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

$19,293,000; 2003--$18,996,000; thereafter--$112,848,000. Rental expense for
operating leases was $277,000, $1,712,000 and $9,620,000 for the years ended
December 31, 1996, 1997 and 1998, respectively.

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 that may be incurred, 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.

13. Operating Segments and Concentrations of Credit Risk

Operating Segments

The Company's reportable operating segments for 1998 are (i) the domestic
operations of CCI and (ii) the United Kingdom operations of CTI. Financial
results for the Company are reported to management and the Board of Directors
in this manner, and much of the Company's current debt financing is structured
along these geographic lines. In addition, the Company's financial performance
is evaluated by outside securities analysts based on these operating segments.
See Note 1 for a description of the primary revenue sources from these two
segments.

As discussed in Note 2, CTI's results of operations are included in the
Company's consolidated financial statements beginning in 1998. Prior to that
time, the domestic operations of CCI represented the Company's only reportable
segment.

F-28

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

The measurement of profit or loss currently used to evaluate the results of
operations for the Company and its operating segments is earnings before
interest, taxes, depreciation and amortization ("EBITDA"). The Company defines
EBITDA as operating income (loss) plus depreciation and amortization and non-
cash compensation charges. EBITDA is not intended as an alternative measure of
operating results or cash flow from operations (as determined in accordance
with generally accepted accounting principles), and the Company's measure of
EBITDA may not be comparable to similarly titled measures of other companies.
There are no significant revenues resulting from transactions between the
Company's operating segments. Total assets for the Company's operating segments
are determined based on the separate consolidated balance sheets for CCI and
CTI. The results of operations and financial position for CTI reflect
appropriate adjustments for their presentation in accordance with generally
accepted accounting principles in the United States. The financial results for
the Company's operating segments are as follows:

Year Ended December 31, 1998
-------------------------------------------
Corporate
Office Consolidated
CCI CTI and Other Total
-------- -------- --------- ------------
(In thousands of dollars)

Net revenues:
Site rental and broadcast
transmission................... $ 22,541 $ 52,487 $ -- $ 75,028
Network services and other...... 31,471 5,568 1,011 38,050
-------- -------- -------- ----------
54,012 58,055 1,011 113,078
-------- -------- -------- ----------
Costs of operations (exclusive of
depreciation and amortization)... 23,076 24,372 370 47,818
General and administrative........ 17,929 2,418 3,224 23,571
Corporate development............. -- -- 4,625 4,625
-------- -------- -------- ----------
EBITDA............................ 13,007 31,265 (7,208) 37,064
Non-cash compensation charges..... 132 2,851 9,775 12,758
Depreciation and amortization..... 16,202 20,318 719 37,239
-------- -------- -------- ----------
Operating income (loss)........... (3,327) 8,096 (17,702) (12,933)
Equity in earnings of
unconsolidated affiliate -- -- 2,055 2,055
Interest and other income
(expense)........................ (253) 294 4,179 4,220
Interest expense and amortization
of deferred financing costs...... (4,476) (7,362) (17,251) (29,089)
Provision for income taxes........ (374) -- -- (374)
Minority interests................ -- (1,654) -- (1,654)
-------- -------- -------- ----------
Net loss.......................... $ (8,430) $ (626) $(28,719) $ (37,775)
======== ======== ======== ==========
Capital expenditures.............. $ 84,911 $ 50,224 $ 3,624 $ 138,759
======== ======== ======== ==========
Total assets (at year end)........ $332,555 $887,938 $302,737 $1,523,230
======== ======== ======== ==========
Investments in affiliates (at year
end)............................. $ -- $ -- $ 2,258 $ 2,258
======== ======== ======== ==========

F-29

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31,
-----------------------------------------------------------------
1996 1997
------------------------------- ---------------------------------
Corporate Corporate
Office Consolidated Office Consolidated
CCI and Other Total CCI and Other Total
------- --------- ------------ -------- --------- ------------
(In thousands of dollars)

Net revenues:
Site rental and
broadcast
transmission......... $ 5,615 $ -- $ 5,615 $ 11,010 $ -- $ 11,010
Network services and
other................ 592 -- 592 20,066 329 20,395
------- ------- ------- -------- -------- --------
6,207 -- 6,207 31,076 329 31,405
------- ------- ------- -------- -------- --------
Costs of operations
(exclusive of
depreciation and
amortization).......... 1,300 -- 1,300 15,350 -- 15,350
General and
administrative......... 1,678 -- 1,678 6,675 149 6,824
Corporate development... 75 1,249 1,324 1,864 3,867 5,731
------- ------- ------- -------- -------- --------
EBITDA.................. 3,154 (1,249) 1,905 7,187 (3,687) 3,500
Depreciation and
amortization 1,242 -- 1,242 6,925 27 6,952
------- ------- ------- -------- -------- --------
Operating income
(loss)................. 1,912 (1,249) 663 262 (3,714) (3,452)
Equity in earnings
(losses) of
unconsolidated
affiliate.............. -- -- -- -- (1,138) (1,138)
Interest and other
income (expense)....... 22 171 193 (77) 2,028 1,951
Interest expense and
amortization of
deferred financing
costs.................. (1,803) -- (1,803) (4,660) (4,594) (9,254)
Credit (provision) for
income taxes........... (59) 49 (10) -- (49) (49)
------- ------- ------- -------- -------- --------
Net income (loss)....... $ 72 $(1,029) $ (957) $ (4,475) $ (7,467) $(11,942)
======= ======= ======= ======== ======== ========
Capital expenditures.... $ 890 $ -- $ 890 $ 17,200 $ 835 $ 18,035
======= ======= ======= ======== ======== ========
Total assets (at year
end)................... $250,911 $120,480 $371,391
======== ======== ========
Investments in
affiliates (at year
end)................... $ -- $ 59,082 $ 59,082
======== ======== ========

F-30

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Geographic Information

A summary of net revenues by country, based on the location of the Company's
subsidiary, is as follows:

Years Ended December
31,
-----------------------
1996 1997 1998
------ ------- --------
(In thousands of
dollars)

United States....................................... $5,050 $29,076 $ 51,807
Puerto Rico......................................... 1,157 2,329 2,470
------ ------- --------
Total domestic operations......................... 6,207 31,405 54,277
------ ------- --------
United Kingdom...................................... -- -- 58,055
Other foreign countries............................. -- -- 746
------ ------- --------
Total for all foreign countries................... -- -- 58,801
------ ------- --------
$6,207 $31,405 $113,078
====== ======= ========

A summary of long-lived assets by country of location is as follows:

December 31,
-------------------
1997 1998
-------- ----------
(In thousands of
dollars)

United States........................................... $237,125 $ 310,953
Puerto Rico............................................. 10,145 14,473
-------- ----------
Total domestic operations............................. 247,270 325,426
-------- ----------
United Kingdom.......................................... 56,965 855,560
Other foreign countries................................. -- 128
-------- ----------
Total for all foreign countries....................... 56,965 855,688
-------- ----------
$304,235 $1,181,114
======== ==========

Major Customers

For the years ended December 31, 1996, 1997 and 1998, CCI had revenues from a
single customer amounting to $2,634,000, $5,998,000 and $14,168,000,
respectively. For the year ended December 31, 1998, consolidated net revenues
includes $33,044,000 from a single customer of CTI.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations
of credit risk are primarily cash and cash equivalents and trade receivables.
The Company mitigates its risk with respect to cash and cash equivalents by
maintaining such deposits at high credit quality financial institutions and
monitoring the credit ratings of those institutions.

The Company derives the largest portion of its revenues from customers in the
wireless telecommunications industry. In addition, the Company has
concentrations of operations in certain geographic areas (primarily the United
Kingdom, Pennsylvania, Texas, New Mexico, Arizona and Puerto Rico). The Company
mitigates its concentrations of credit risk with respect to trade receivables
by actively monitoring the creditworthiness of its customers. Historically, the
Company has not incurred any significant credit related losses.

F-31

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

14. Quarterly Financial Information (Unaudited)

Summary quarterly financial information for the years ended December 31, 1997
and 1998 is as follows:

Three Months Ended
-------------------------------------------
March 31 June 30 September 30 December 31
-------- ------- ------------ -----------
(In thousands of dollars, except per
share amounts)

1997:
Net revenues................. $ 1,994 $ 4,771 $11,481 $13,159
Operating income (loss)...... (1,293) (921) 61 (1,299)
Net loss..................... (443) (1,706) (4,001) (5,792)
Loss per common share--basic
and diluted................. (0.13) (0.51) (0.62) (0.69)
1998:
Net revenues................. $11,837 $11,530 $28,894 $60,817
Operating income (loss)...... (2,494) (2,197) (12,006) 3,764
Net loss..................... (6,606) (6,426) (17,444) (7,299)
Loss per common share--basic
and diluted................. (0.79) (0.78) (0.33) (0.09)

15. Subsequent Events (Unaudited)

BellSouth Mobility Inc. and BellSouth Telecommunications Inc. ("BellSouth")

In March 1999, the Company entered into an agreement with BellSouth to
acquire the operating rights for approximately 1,850 of their towers. The
transaction is structured as a lease agreement and will be treated as a sale of
the towers for tax purposes. The Company will pay BellSouth consideration of
$610,000,000, consisting of $430,000,000 in cash and $180,000,000 in shares of
its common stock. The Company will account for this transaction as a purchase
of tower assets. The transaction is expected to close over a period of up to
eight months beginning in the second quarter of 1999. Upon entering into the
agreement, the Company placed $50,000,000 into an escrow account. In order to
fund this escrow deposit, the Company borrowed $45,000,000 under the Senior
Credit Facility.

Powertel, Inc. ("Powertel")

In March 1999, the Company entered into an agreement with Powertel to
purchase approximately 650 of their towers and related assets. The purchase
price for these towers will be $275,000,000 in cash. The Company will account
for this transaction as an acquisition using the purchase method. Upon entering
into the agreement, the Company placed $50,000,000 into an escrow account. The
Company funded this escrow deposit with borrowings under a $100,000,000 loan
agreement provided by a syndicate of investment banks. The remaining
$50,000,000 of borrowings under this loan agreement were used to repay the
amount drawn under the Senior Credit Facility in connection with the BellSouth
escrow deposit.

Proposed Securities Offerings

The Company intends to offer shares of its common stock and debt securities
in concurrent underwritten public offerings. The proceeds from such offerings
would be used to repay amounts drawn under the loan agreement in connection
with the BellSouth and Powertel transactions, and to pay the remaining purchase
price for such transactions. Any securities will only be offered by means of a
prospectus forming a part of a registration statement filed with the Securities
and Exchange Commission. There can be no assurance that such securities
offerings can be successfully completed.

F-32

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

INDEPENDENT AUDITORS' REPORT

To the Shareholders and Board of Directors
of Castle Transmission Services (Holdings) Ltd:

We have audited the accompanying balance sheet of the BBC Home Service
Transmission business ("Home Service") at March 31, 1996 and the consolidated
balance sheets of Castle Transmission Services (Holdings) Ltd and its
subsidiaries ("Castle Transmission") at March 31, 1997 and December 31, 1997
and the profit and loss accounts, cash flow statements and reconciliations of
movements in corporate funding for Home Service for the year ended March 31,
1996 and the period from April 1, 1996 to February 27, 1997 and the related
consolidated profit and loss accounts, cash flow statements and reconciliations
of movements in shareholders' funds for Castle Transmission for the period from
February 28, 1997 to March 31, 1997 and the period from April 1, 1997 to
December 31, 1997. These financial statements are the responsibility of Castle
Transmission's and Home Service's management. Our responsibility is to express
an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards in the United Kingdom, which do not differ in any material respect
from generally accepted auditing standards in the United States. Those
standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free from material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Home Service at March 31, 1996
and the consolidated financial position of Castle Transmission at March 31,
1997 and December 31, 1997 and the results of operations and cash flows of Home
Service for the year ended March 31, 1996 and for the period from April 1, 1996
to February 27, 1997 and of Castle Transmission for the period from February
28, 1997 to March 31, 1997 and for the period from April 1, 1997 to December
31, 1997 in conformity with generally accepted accounting principles in the
United Kingdom.

Generally accepted accounting principles in the United Kingdom vary in
certain respects from generally accepted accounting principles in the United
States. Application of generally accepted accounting principles in the United
States would have affected results of operations for the year ended March 31,
1996 and the period from April 1, 1996 to February 27, 1997 for Home Service
and the period from February 28, 1997 to March 31, 1997 and from April 1, 1997
to December 31, 1997 for Castle Transmission and shareholders' equity at
March 31, 1996 for Home Service and at March 31, 1997 and December 31, 1997 for
Castle Transmission to the extent summarised in Note 27 to these financial
statements.

KPMG
Chartered Accountants
Registered Auditor
London, England

March 31, 1998

F-33

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

CONSOLIDATED PROFIT AND LOSS ACCOUNTS

Castle Transmission Services
BBC Home Service Transmission (Holdings) Ltd
-------------------------------------- --------------------------------------
Period Period Period
from April 1, Two from from April 1, Eight
1996 Months February 28, 1997 Months
Year Ended to Ended 1997 to Ended
March 31, February 27, February 27, to March 31, December 31, August 31,
Note 1996 1997 1997 1997 1997 1998
------ ----------- ------------- ------------ ------------ ------------- -----------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000
(Unaudited) (Unaudited)

Turnover................ 3 70,367 70,614 12,805 6,433 56,752 59,033
Changes in stocks and
work in progress....... (635) (554) (150) 340 747 (1,279)
Own work capitalised.... 4,653 3,249 308 170 1,127 2,440
Raw materials and
consumables............ 14 (1,155) (387) (446) (2,410) (281)
Other external charges.. (34,750) (26,191) (4,130) (1,668) (13,811) (14,900)
Staff costs............. 4 (17,197) (16,131) (3,104) (1,421) (14,345) (16,032)
Depreciation and other
amounts written off
tangible and intangible
assets................. 5 (12,835) (13,038) (2,464) (1,819) (16,854) (15,594)
Other operating
charges................ (1,832) (2,792) (181) (344) (2,430) (2,175)
------- ------- ------- ------ ------- -------
(62,582) (56,612) (10,108) (5,188) (47,976) (47,821)
Operating profit........ 7,785 14,002 2,697 1,245 8,776 11,212
Other interest
receivable and similar
income................. -- -- -- 49 288 440
Interest payable and
similar charges........ 7 -- -- -- (969) (12,419) (9,507)
------- ------- ------- ------ ------- -------
Profit/(loss) on
ordinary activities
before and after
taxation............... 3-6, 8 7,785 14,002 2,697 325 (3,355) 2,145
Additional finance cost
of non-equity shares... -- -- -- (318) (2,862) --
------- ------- ------- ------ ------- -------
Retained profit/(loss)
for the period......... 7,785 14,002 2,697 7 (6,217) 2,145
======= ======= ======= ====== ======= =======

Neither BBC Home Service nor Castle Transmission have any recognised gains or
losses other than those reflected in the profit and loss accounts.

The accompanying notes are an integral part of these consolidated financial
statements.

F-34

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

CONSOLIDATED BALANCE SHEETS

BBC Home Service Castle Transmission Services
Transmission (Holdings) Ltd
---------------- ------------------------------------------
At March 31, At March 31, At December 31, At August 31,
1996 1997 1997 1998
Note ---------------- ------------ --------------- -------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000
(Unaudited)

Fixed assets
Intangible............ 9 -- 46,573 46,056 44,404
Tangible.............. 10 202,592 206,162 206,134 229,124
------- -------- -------- --------
202,592 252,735 252,190 273,528
Current assets
Stocks................ 11 1,750 807 1,340 2,620
Debtors............... 12 4,714 10,344 13,230 11,639
Amounts owed by group
undertakings......... -- -- -- 1,273
Cash at bank and in
hand................. -- 9,688 8,152 9,198
------- -------- -------- --------
6,464 20,839 22,722 24,730
Creditors: amounts fall-
ing due within one
year................... 13 (6,627) (14,820) (29,139) (36,514)
------- -------- -------- --------
Net current
assets/(liabilities)... (163) 6,019 (6,417) (11,784)
------- -------- -------- --------
Total assets less
current liabilities.... 202,429 258,754 245,773 261,744
Creditors: amounts
falling due after more
than one year.......... 14 -- (154,358) (143,748) (149,535)
Provisions for liabili-
ties and charges....... 15 -- (1,723) (2,157) (2,461)
------- -------- -------- --------
Net assets.............. 202,429 102,673 99,868 109,748
======= ======== ======== ========
Capital and reserves
Corporate funding..... 202,429 -- -- --
Called up share capi-
tal.................. 16 -- 102,348 102,898 108,303
Profit and loss ac-
count................ 17 -- 325 (3,030) 1,445
------- -------- -------- --------
202,429 102,673 99,868 109,748
======= -------- -------- --------
Shareholders'
funds/(deficit)
Equity................ 109 (6,107) 109,748
Non-equity............ 102,564 105,975 --
-------- -------- --------
102,673 99,868 109,748
======== ======== ========

The accompanying notes are an integral part of these consolidated financial
statements.

F-35

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

CONSOLIDATED CASH FLOW STATEMENTS

Castle Transmission Services
BBC Home Service Transmission (Holdings) Ltd
---------------------------------------- ----------------------------------------
Period from Period from Eight
Year Period from Two Months February 28, April 1, Months
Ended April 1, 1996 Ended 1997 1997 Ended
March 31, to February 27, February 27, to March 31, to December 31, August 31,
1996 1997 1997 1997 1997 1998
Note ----------- --------------- ------------ ------------ --------------- -----------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000
(Unaudited) (Unaudited)

Cash inflow from
operating activities... 21 24,311 26,427 5,161 5,756 27,983 37,302
Returns on investment
and servicing of
finance................ 22 -- -- -- (885) (2,428) (10,076)
Capital expenditure and
financial investments.. 22 (17,190) (20,092) (711) (748) (14,361) (36,135)
Acquisitions and
disposals.............. 22 -- -- -- (251,141) (307) --
------- ------- ------ -------- -------- --------
Cash inflow/(outflow)... 7,121 6,335 4,450 (247,018) 10,887 (8,909)
Financing............... 22
Net (decrease) in
corporate funding...... (7,121) (6,335) (4,450) -- -- --
Issuance of shares...... -- -- -- 102,348 550 5,405
Increase/(decrease) in
debt................... -- -- -- 154,358 (12,973) 5,000
Capital element of
finance
lease rentals.......... -- -- -- -- -- (450)
------- ------- ------ -------- -------- --------
(7,121) (6,335) (4,450) 256,706 (12,423) 9,955
------- ------- ------ -------- -------- --------
Increase/(decrease) in
cash................... -- -- -- 9,688 (1,536) 1,046
======= ======= ====== ======== ======== ========
Reconciliation of net
cash flow to movement
in net debt............ 23
Increase/(decrease) in
cash in the period..... -- -- -- 9,688 (1,536) 1,046
Cash (inflow)/outflow
from
(increase)/decrease in
debt................... -- -- -- (154,358) 12,973 (4,550)
------- ------- ------ -------- -------- --------
Change in net debt
resulting from cash
flow................... -- -- -- (144,670) 11,437 (3,504)
New finance leases...... -- -- -- -- (711) (797)
Amortisation of bank
loan issue costs....... -- -- -- -- (2,087) (159)
Amortisation of
Guaranteed Bonds....... -- -- -- -- (55) (179)
------- ------- ------ -------- -------- --------
Movement in net debt in
the period............. -- -- -- (144,670) 8,584 (4,639)
Net debt at beginning of
the period............. -- -- -- -- (144,670) (136,086)
------- ------- ------ -------- -------- --------
Net debt at end of the
period................. -- -- -- (144,670) (136,086) (140,725)
======= ======= ====== ======== ======== ========

The accompanying notes are an integral part of these consolidated financial
statements.

F-36

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

CONSOLIDATED RECONCILIATION OF MOVEMENTS IN CORPORATE
FUNDING/SHAREHOLDERS' FUNDS

Castle Transmission Services
BBC Home Service Transmission (Holdings) Ltd
---------------------------------------- ----------------------------------------
Two Period from Eight
Year Period from Months February 28, Period from Months
Ended April 1, 1996 Ended 1997 April 1, 1997 Ended
March 31, to February 27, February 27, to March 31, to December 31, August 31,
1996 1997 1997 1997 1997 1998
----------- --------------- ------------ ------------ --------------- -----------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000
(Unaudited) (Unaudited)

Profit/(loss) for the
period................. 7,785 14,002 2,697 325 (3,355) 2,145
Net (decrease) in
corporate funding...... (7,121) (6,335) (4,450) -- -- --
New share capital
subscribed............. -- -- -- 102,348 550 5,405
Charge on share option
arrangements........... -- -- -- -- -- 2,330
------- ------- ------- ------- ------- -------
Net
additions/(deductions)
to corporate
funding/shareholders'
funds.................. 664 7,667 (1,753) 102,673 (2,805) 9,880
Opening corporate
funding/shareholders'
funds.................. 201,765 202,429 211,849 -- 102,673 99,868
------- ------- ------- ------- ------- -------
Closing corporate
funding/shareholders'
funds.................. 202,429 210,096 210,096 102,673 99,868 109,748
======= ======= ======= ======= ======= =======

The accompanying notes are an integral part of these consolidated financial
statements.

F-37

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1 Basis of preparation

As used in the financial statements and related notes, the terms "Castle
Transmission" or "the Group" refers to the operations of Castle Transmission
Services (Holdings) Ltd and its subsidiaries, Castle Transmission International
Ltd ("CTI") which is the successor business and Castle Transmission (Finance)
plc ("CTF"). The term "Home Service" refers to the operations of the Home
Service Transmission business of the British Broadcasting Corporation ("BBC")
which was the predecessor business.

These consolidated financial statements have been prepared in accordance with
generally accepted accounting principles ("GAAP") applicable in the United
Kingdom (UK) and comply with the financial reporting standards of the Institute
of Chartered Accountants in England and Wales. A summary of the differences
between UK GAAP and United States (US) GAAP as applicable to Castle
Transmission is set out in Note 27.

Castle Transmission Services (Holdings) Ltd (the "Company") was incorporated
on August 27, 1996 and did not trade in the period to February 27, 1997. CTI
was incorporated by the BBC on May 9, 1996 and did not trade in the period to
February 27, 1997. On February 27, 1997, the assets and liabilities of Home
Service were transferred to CTI. On February 28, 1997 CTI was acquired by the
Company. During the period between August 27, 1996 and February 27, 1997 Castle
Transmission did not trade and received no income and incurred no expenditure.
Accordingly the first consolidated profit and loss account for Castle
Transmission represents the trading of Castle Transmission for the period from
February 28, 1997 to March 31, 1997. CTF was incorporated April 9, 1997.

The financial statements for the year ended March 31, 1996 and the period
from April 1, 1996 to February 27, 1997 represent the profit and loss accounts,
balance sheet, cash flow statements and reconciliations of movements in
corporate funding of Home Service. They have been prepared from the separate
financial records and management accounts of Home Service.

Home Service was charged a management fee by the BBC representing an
allocation of certain costs including pension, information technology,
occupancy and other administration costs which were incurred centrally by the
BBC but which were directly attributable to Home Service. Management believes
such allocation is reasonable. Such costs are based on the pension arrangement
and the cost structure of the BBC and are not necessarily representative of
such costs of Castle Transmission under separate ownership.

Home Service did not incur any costs in relation to financing as necessary
funding was provided from the BBC through the corporate funding account. No
interest is charged by the BBC on such funds because there is no debt at BBC
which is attributable to Home Service.

Home Service was not a separate legal entity and therefore was not directly
subject to taxation on its results. The BBC is a not-for-profit organisation
and is not subject to taxation except to the extent of activities undertaken
with the objective of making a profit, including all external activities
(principally site sharing and commercial projects). The tax charge attributable
to Home Service has been calculated as if Home Service were under separate
ownership since April 1, 1994 and as if all of its results of operations were
subject to normal taxation.

Redundancy costs were incurred by the BBC which related to Home Service
staff. The redundancy costs amounted to (Pounds)1.1m in 1996 and (Pounds)0.6m
in the period from April 1, 1996 to February 27, 1997. The redundancy
programmes were controlled by the BBC and the costs were not recharged to Home
Service. No adjustment has been made in the Home Service financial statements

F-38

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

for these costs because any costs incurred would have been reflected in the
cost base of Home Service, and as described in note 25 would have been off-set
by an increase in turnover from the BBC.

The consolidated financial statements for the two months ended February 27,
1997 and as of and for the eight months ended August 31, 1998 are unaudited;
however, in the opinion of all the directors, all adjustments (consisting of
normal recurring adjustments) necessary for a fair presentation have been made.
Accounting measurements at interim dates inherently involve greater reliance on
estimates than at year end. Operating results for the eight month period ended
August 31, 1998 are not necessarily indicative of the results that may be
expected for the year ending December 31, 1998.

2 Accounting policies

The following accounting policies have been applied consistently in dealing
with items which are considered material in relation to the financial
statements of Home Service and the consolidated financial statements of Castle
Transmission.

Basis of consolidation

The consolidated financial statements include the financial statements of the
Company and its subsidiaries made up to March 31, 1997 and December 31, 1997
after elimination of all significant inter-company accounts and transactions.
The acquisition method of accounting has been adopted. Under this method, the
results of subsidiaries acquired or disposed of in the period are included in
the consolidated profit and loss account from the date of acquisition or up to
the date of disposal.

Goodwill

Purchased goodwill on acquisitions (representing the excess of the fair value
of the consideration given over the fair value of the separable net assets
acquired) is capitalised and amortised over 20 years, the period over which the
Directors consider that the Group will derive economic benefits.

Tangible fixed assets and depreciation

Depreciation is provided to write off the cost or valuation less the
estimated residual value of tangible fixed assets by equal instalments over
their estimated useful economic lives as follows:

Land and buildings

Home Service Castle Transmission
-------------- -------------------

Freehold and long leasehold buildings... 50 years 50 years
Freehold and long leasehold improve-
ments.................................. 20 years 20 years
Short leasehold land and buildings...... Unexpired term Unexpired term
No depreciation is provided on freehold
land...................................

Plant and equipment

Home Service Castle Transmission
------------ -------------------

Transmitters and power plant............... 25 years 20 years
Electric and mechanical infrastructure..... 10-20 years 10-20 years
Other plant and machinery.................. 3-10 years 3-10 years
Computer equipment......................... 5 years 5 years
Motor vehicles............................. -- 3 years

F-39

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Strategic spares, which comprise those spares that are vital to the operation
of the transmission system, are included in the capitalised value of the asset
to which they relate and are depreciated over the life of the asset.

Assets under construction are included within fixed assets. The associated
labour costs are capitalised using a predetermined labour rate, and any over or
under recoveries are recognised in the profit and loss account in the period in
which they arise.

Foreign currencies

Transactions in foreign currencies are translated at the rate of exchange
ruling at the date of the transaction. Monetary assets and liabilities, to the
extent that they are denominated in foreign currency, are retranslated at the
rate of exchange ruling at the balance sheet date and gains or losses are
included in the profit and loss account.

Leases

Where the Company enters into a lease which entails taking substantially all
the risks and rewards of ownership of an asset, the lease is treated as a
"finance lease'. The asset is recorded in the balance sheet as a tangible fixed
asset and is depreciated over its useful life or term of the lease, whichever
is shorter. Future instalments under such leases, net of finance charges, are
included within creditors. Rentals payable are apportioned between the finance
element, which is charged to the profit and loss account, and the capital
element which reduces the outstanding obligation for future instalments.

Operating lease rentals are charged to the profit and loss account on a
straight line basis over the period of the lease.

Pensions

The pension costs charged in the period include costs incurred, at the agreed
employer's contribution rate. See note 20 for further details.

Stocks

Stocks held are general maintenance spares and manufacturing stocks. Stocks
are stated at the lower of weighted average cost and net realisable value.

Work in progress

For individual projects, the fees on account and project costs are recorded
in work in progress. When a project is complete, the project balances are
transferred to turnover and cost of sales as appropriate, and the net profit is
recognised. Where the payments on account are in excess of project costs, these
are recorded as payments on account.

Provision is made for any losses as soon as they are foreseen.

Taxation

The charge for taxation is based on the result for the period and takes into
account taxation deferred because of timing differences between the treatment
of certain items for taxation and accounting purposes. Provision is made for
deferred tax only to the extent that it is probable that an actual liability
will crystallise.

F-40

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Turnover

Turnover represents the amounts (excluding value added tax) derived from the
provision of transmission and maintenance contracts, site sharing arrangements
and commercial projects. Revenue is recognised on the basis of contracts or as
services are provided to customers.

Issue costs

Costs incurred in raising funds are deducted from the amount raised and
amortised over the life of the debt facility on a constant yield basis.

3 Analysis of turnover

Home Service Castle Transmission
------------------------ ------------------------------
Period from Period from
April 1, Period from April 1,
Year Ended 1996 to February 28, 1997 1997 to
March 31, February 27, to March 31, December 31,
1996 1997 1997 1997
----------- ------------ ----------------- ------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

By activity
BBC..................... 45,704 49,903 3,982 35,640
Other--non BBC.......... 24,663 20,711 2,451 21,112
------ ------ ----- ------
70,367 70,614 6,433 56,752
====== ====== ===== ======

4 Staff numbers and costs

The average number of persons employed by the Group (including directors)
during the period, analysed by category was as follows:

Operational staff....... 381 357 313 289
Project staff........... 154 125 108 97
Management, finance,
personnel and other
support services....... 53 70 69 89
------ ------ ----- ------
588 552 490 475
====== ====== ===== ======

The aggregate payroll costs of these persons were as follows:

Wages and salaries...... 15,517 14,579 1,189 12,087
Social security costs... 1,159 1,061 76 768
Other pension costs..... 521 491 156 1,490
------ ------ ----- ------
17,197 16,131 1,421 14,345
====== ====== ===== ======

F-41

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

5 Profit/(loss) on ordinary activities before taxation

Home Service Castle Transmission
------------------------- ------------------------------
Period from Period from
April 1, Period from April 1,
Years Ended 1996 to February 28, 1997 1997 to
March 31, February 27, to March 31, December 31,
1996 1997 1997 1997
----------- ------------- ----------------- ------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

Profit (loss) on
ordinary activities
before taxation is
stated after charging:
Depreciation and other
amounts written off
tangible fixed assets:
Owned................... 12,835 13,038 1,624 14,953
Leased.................. -- -- -- 147
Goodwill amortisation... -- -- 195 1,754
Hire of plant and
machinery--rentals
payable under operating
leases................. 112 53 79
Hire of other assets--
under operating
leases................. 396 36 530
====== ====== ===== ======

The information in respect of hire of plant and machinery and other assets
under operating leases is not available for the year ended March 31, 1996.

6 Remuneration of directors

There were no directors of Home Service.

The directors of Castle Transmission received no emoluments for the period
February 28, 1997 to March 31, 1997 and (Pounds)277,000 for the period April 1,
1997 to December 31, 1997. The amounts paid to third parties in respect of
directors' services were (Pounds)2,000 for the period from February 28, 1997 to
March 31, 1997 and (Pounds)23,000 for the period from April 1, 1997 to December
31, 1997.

The aggregate emoluments of the highest paid director were (Pounds)170,000.
The highest paid director is not a member of any Group pension scheme.

Pension entitlements

On retirement the directors participating in the Group defined benefit scheme
are entitled to 1/60th of their final pensionable salary for each year of
service.

F-42

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

7 Interest payable and similar charges

Home Service Castle Transmission
---------------------------- ------------------------------
Period from
Period from Period from April 1,
Year Ended April 1, 1996 to February 28, 1997 1997 to
March 31, February 27, to March 31, December 31,
1996 1997 1997 1997
----------- ---------------- ----------------- ------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

On bank loans and
overdrafts............. -- -- 934 3,315
On all other loans...... -- -- -- 6,934
Finance charges payable
in respect of finance
leases and hire
purchase contracts..... -- -- -- 28
Finance charges
amortised in respect of
bank loans (see note
14).................... -- -- 35 2,087
Finance charges
amortised in respect of
the Bonds.............. -- -- -- 55
--- --- --- ------
-- -- 969 12,419
=== === === ======

8 Taxation

Home Service

There is no tax charge in respect of the results of Home Service for the year
ended March 31, 1996 or for the period from April 1, 1996 to February 27, 1997.
As a separate legal entity subject to normal taxation, Home Service would have
capital allowances available as discussed below which would result in taxable
losses for all periods. Deferred tax assets have not been recognised on such
tax losses as management has concluded that it is not likely that the deferred
tax asset would be realised.

Castle Transmission

There is no tax charge in respect of the period from February 28, 1997 to
March 31, 1997 and April 1, 1997 to December 31, 1997. Based on an agreement
with the Inland Revenue Service, Castle Transmission will have capital
allowances available on capital expenditure incurred by Home Service and the
BBC prior to the acquisition of approximately (Pounds)179 million. The
accelerated tax deductions associated with such capital allowances result in a
taxable loss for both periods. Deferred tax assets have not been recognised on
such tax losses as management has concluded that it is not likely that the
deferred tax asset would be realised based on the limited operating history of
Castle Transmission.

F-43

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

9 Intangible assets

Castle Transmission

As at As at
March 31, December 31,
1997 1997
----------- ------------
(Pounds)000 (Pounds)000

Goodwill
Cost
At beginning of period............................. -- 46,768
Arising on acquisition of Home Service............. 46,768 --
Adjustment to the allocation of fair value arising
on acquisition of Home Service (see notes 18 and
24)............................................... -- 1,237
------ ------
At end of the period............................... 46,768 48,005
====== ======
Amortisation
At beginning of period............................. -- 195
Charged in period.................................. 195 1,754
------ ------
At end of the period............................... 195 1,949
====== ======
Net book value
At end of the period............................... 46,573 46,056
====== ======

10 Tangible fixed assets

Home Service

Land and Plant and Computer Assets under
buildings machinery equipment construction Total
----------- ----------- ----------- ------------ -----------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

(i) Year ended March 31,
1996
Cost or valuation
At April 1, 1995........ 26,789 178,205 1,337 22,309 228,640
Additions............... -- 111 40 17,928 18,079
Disposals............... -- -- (1,325) -- (1,325)
Transfers............... 474 13,354 -- (13,828) --
------ ------- ------ ------- -------
At March 31, 1996....... 27,263 191,670 52 26,409 245,394
------ ------- ------ ------- -------
Depreciation
At April 1, 1995........ 7,291 22,671 441 -- 30,403
Charge for period....... 819 12,008 8 -- 12,835
On disposal............. -- -- (436) -- (436)
------ ------- ------ ------- -------
At March 31, 1996....... 8,110 34,679 13 -- 42,802
------ ------- ------ ------- -------
Net book value
At March 31, 1996....... 19,153 156,991 39 26,409 202,592
====== ======= ====== ======= =======

F-44

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

(ii) Period ended
February 27, 1997
Cost or valuation
At April 1, 1996........ 27,263 191,670 52 26,409 245,394
Additions............... -- 24 179 14,283 14,486
Disposals............... -- (1,816) -- (1,718) (3,534)
Transfers............... 2,585 23,972 252 (26,809) --
Transfer between
business units......... 10,824 (2,061) (4) 612 9,371
------ ------- --- ------- -------
At February 27, 1997.... 40,672 211,789 479 12,777 265,717
------ ------- --- ------- -------
Depreciation
At April 1, 1996........ 8,110 34,679 13 -- 42,802
Charge for period....... 807 12,158 73 -- 13,038
On disposal............. -- (1,816) -- -- (1,816)
Transfers............... 46 (108) 62 -- --
Transfers between
business units......... 2,185 (137) (1) -- 2,047
------ ------- --- ------- -------
At February 27, 1997.... 11,148 44,776 147 -- 56,071
------ ------- --- ------- -------
Net book value
At February 27, 1997.... 29,524 167,013 332 12,777 209,646
====== ======= === ======= =======

The transfers between business units reflect transactions made between the
predecessor business and other business units of the BBC, in preparation for
the sale of Home Service. These include the transfer of the head office at
Warwick into the books of Home Service prior to the sale.

Castle Transmission

(i) Period ended March
31, 1997
Cost
On acquisition.......... 30,373 163,556 332 12,777 207,038
Additions............... -- 56 -- 692 748
Transfers............... 17 59 -- (76) --
------ ------- --- ------- -------
At March 31, 1997....... 30,390 163,671 332 13,393 207,786
------ ------- --- ------- -------
Depreciation
On acquisition.......... -- -- -- -- --
Charge for period....... 86 1,529 9 -- 1,624
------ ------- --- ------- -------
At March 31, 1997....... 86 1,529 9 -- 1,624
------ ------- --- ------- -------
Net book value
At March 31, 1997....... 30,304 162,142 323 13,393 206,162
====== ======= === ======= =======
(ii) Period ended
December 31, 1997
Cost
At April 1, 1997........ 30,390 163,671 332 13,393 207,786
Addition................ 10 3,602 582 10,878 15,072
Transfers............... 651 12,772 -- (13,423) --
------ ------- --- ------- -------
At December 31, 1997.... 31,051 180,045 914 10,848 222,858
------ ------- --- ------- -------
Depreciation
At April 1, 1997........ 86 1,529 9 -- 1,624
Charge for period....... 847 13,975 278 -- 15,100
------ ------- --- ------- -------
At December 31, 1997.... 933 15,504 287 -- 16,724
------ ------- --- ------- -------
Net book value
At December 31, 1997.... 30,118 164,541 627 10,848 206,134
====== ======= === ======= =======

F-45

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

The net book value of land and buildings comprises:

Home Service Castle Transmission
------------ ----------------------------
At March 31, At March 31, At December 31,
1996 1997 1997
------------ ------------ ---------------
(Pounds)000 (Pounds)000 (Pounds)000

Freehold........................... 16,268 21,558 21,375
Long leasehold..................... 1,540 7,468 7,472
Short leasehold.................... 1,345 1,278 1,271
------ ------ ------
19,153 30,304 30,118
====== ====== ======

Included within fixed assets are the following assets held under finance
leases:

Motor vehicles..................... -- -- 270
Computer equipment................. -- -- 441
--- --- ---
-- -- 711
=== === ===

11 Stocks

Home Service Castle Transmission
------------ ------------------------------------------
At March 31, At March 31, At December 31, At August 31,
1996 1997 1997 1998
------------ ------------ --------------- -------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000
(Unaudited)

Work in progress (see
note 13)............... -- -- 274 1,421
Spares and manufacturing
stocks................. 1,750 807 1,066 1,199
----- --- ----- -----
1,750 807 1,340 2,620
===== === ===== =====

12 Debtors

Trade debtors..................... 3,780 7,503 10,250
Other debtors..................... 212 2,259 2,200
Prepayments and accrued income.... 722 582 780
----- ------ ------
4,714 10,344 13,230
===== ====== ======

13 Creditors: amounts falling due within one year

Payments on account.............. 426 347 --
Obligations under finance leases
and hire purchase contracts..... -- -- 490
Trade creditors.................. 872 4,123 1,916
Other creditors.................. -- 1,519 2,153
Accruals and deferred income..... 5,329 8,831 24,580
----- ------ ------
6,627 14,820 29,139
===== ====== ======

F-46

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Payments on account (and work in progress) relate to commercial projects and
are shown net in the financial statements. The gross billings amount to
(Pounds)3,222,000 in 1996, (Pounds)3,836,000 in March 1997 and
(Pounds)2,458,000 in December 1997. The related gross costs amounted to
(Pounds)2,796,000 in 1996, (Pounds)3,489,000 in March 1997 and
(Pounds)2,732,000 in December 1997.

14 Creditors: amounts falling due after more than one year

Castle Transmission
------------------------------------------
At March 31, At December 31, At August 31,
1997 1997 1998
------------ --------------- -------------
(Pounds)000 (Pounds)000 (Pounds)000
(Unaudited)

Guaranteed Bonds................ -- 120,582 120,761
Bank loans and overdrafts....... 154,358 22,945 28,104
Obligations under finance leases
and hire purchase contracts.... -- 221 670
------- ------- -------
154,358 143,748 149,535
======= ======= =======
Debts can be analysed as falling
due:
in one year or less, or on de-
mand........................... -- --
between one and two years....... 7,244 59
between two and five years...... 29,160 162
in five years or more........... 117,954 143,527
------- -------
154,358 143,748
======= =======

On May 21, 1997, CTF issued and Castle Transmission guaranteed,
(Pounds)125,000,000 9 percent Guaranteed Bonds due 2007 (the "Guaranteed
Bonds"). The Guaranteed Bonds are redeemable at their principal amount, unless
previously redeemed or purchased and cancelled, on March 30, 2007.

The Guaranteed Bonds may be redeemed in whole but not in part, at the option
of CTF, at their principal amount plus accrued interest if, as a result of
certain changes in the laws and regulations of the United Kingdom, CTF or
Castle Transmission becomes obliged to pay additional amounts.

The Guaranteed Bonds may be redeemed in whole or in part, at the option of
CTF, at any time at the higher of their principal amount and such a price as
will provide a gross redemption yield 0.50 percent per annum above the gross
redemption yield on the benchmark gilt plus (in either case) accrued interest.

Bondholders may, in certain circumstances including but not limited to a
change in control of CTF, or the early termination of the agreement between CTI
and the BBC relating to the domestic analogue transmission of radio and
television programmes by CTI, require the Guaranteed Bonds to be redeemed at
101 percent of their principal amount plus accrued interest.

The Guaranteed Bonds were issued at an issue price of 99.161 percent. The
Guaranteed Bonds are shown net of unamortised discount and issue costs.
Interest accrues from the date of issue and is payable in arrears on March 30
each year commencing March 30, 1998.

On February 28, 1997 the Group entered into term and revolving loan
facilities with a syndicate of banks. There are three facilities. Facility A
and Facility B are (Pounds)122,500,000 and (Pounds)35,000,000 term loan
facilities. Facility A is repayable in instalments, the last of which is due in
June 2004, and Facility B is repayable in two instalments in December 2004 and
June 2005. These facilities were made available to finance the amount owed to
the BBC on the acquisition of the Home Service transmission business and were
drawn down in full on February 28, 1997.

F-47

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

The third facility, Facility C, is a (Pounds)5,000,000 revolving loan
facility maturing in June 2005 under which advances are to be made to the Group
to finance its working capital requirements and for general corporate purposes.
This facility was undrawn at March 31, 1997.

Borrowings under the facilities are secured by fixed and floating charges
over substantially all of the assets and undertakings of the Group and bear
interest at 2.25 percent above LIBOR for Facility B and between 0.875 percent
and 1.75 percent above LIBOR (depending on the annualised debt coverage and the
outstanding percentage of the facilities) for Facilities A and C.

The net proceeds of the Guaranteed Bonds were used to repay substantially all
of the amounts outstanding under Facilities A, B and C. The remaining balance
of Facilities A, B and C was replaced by a (Pounds)64,000,000 revolving loan
facility maturing in May 2002 (the "New Facility"), under which advances will
be made to CTI to finance its working capital requirements and finance capital
expenditures in respect of Digital Terrestrial Television.

Borrowings under the New Facility are secured by fixed and floating charges
over substantially all of the assets and undertakings of Castle Transmission
and bear interest at LIBOR plus the applicable margin plus cost rate.

Included within bank loans and overdrafts is an amount of (Pounds)3,142,000
at March 31, 1997 and (Pounds)1,055,000 at December 31, 1997 representing
finance costs deferred to future accounting periods in accordance with FRS4. As
a result of the issuance of the Guaranteed Bonds and the New Facility, the
remaining deferred financing costs of (Pounds)1,930,000, relating to Facilities
A, B and C were charged to the profit and loss account during the period from
April 1, 1997 to December 31, 1997.

15 Provision for liabilities and charges

Castle Transmission
----------------------------
At March 31, At December 31,
1997 1997
------------ ---------------
(Pounds)000 (Pounds)000

On acquisition/at the start of the period.......... 1,723 1,723
Fair value adjustments (see note 24)............... -- 1,016
Established in the period (see below).............. -- 417
Utilised in the period............................. -- (999)
----- -----
At the end of the period........................... 1,723 2,157
===== =====

Home Service did not make any provisions for liabilities and charges. On the
acquisition by Castle Transmission, a provision was established for costs
associated with the split of the BBC transmission business between Home Service
and World Service comprising redundancy costs and costs relating to the
relocation and reorganisation of shared sites. No payments or additional
provisions were made in the one month period and the balance on acquisition and
at March 31, 1997 was (Pounds)1,723,000.

As a result of the completion of the fair value exercise this provision was
reduced by (Pounds)234,000 and a further provision was made of
(Pounds)1,250,000 in respect of a contingent liability for wind loading fees
that existed at February 27, 1997. See notes 18 and 24 for further details.

A further provision of (Pounds)417,000, in respect of these wind loading
fees, was charged to the profit and loss account during the period from April
1, 1997 to December 31, 1997.

F-48

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

16 Share capital

At March 31, At December 31,
1997 1997 At March 31, At December 31,
Number of Number of 1997 1997
shares shares (Pounds)000 (Pounds)000
-------------- --------------- ------------ ---------------

Authorised
Equity: Ordinary Shares
of 1 pence each........ 11,477,290 11,477,290 115 115
Non-equity: Redeemable
Preference Shares of 1
pence each............. 11,465,812,710 11,465,812,710 114,658 114,658
-------------- -------------- ------- -------
11,477,290,000 11,477,290,000 114,773 114,773
============== ============== ======= =======
Allotted, called up and
fully paid
Equity: Ordinary Shares
of 1 pence each........ 10,234,790 10,289,790 102 103
Non-equity: Redeemable
Preference Shares of 1
pence each............. 10,224,555,210 10,279,500,210 102,246 102,795
-------------- -------------- ------- -------
10,234,790,000 10,289,790,000 102,348 102,898
============== ============== ======= =======

On incorporation the Company had an authorised share capital of 100 Ordinary
Shares of (Pounds)1 each of which 1 share was allotted, called up and fully
paid.

On January 23, 1997, the 100 issued and unissued Ordinary Shares of (Pounds)1
each were subdivided into Ordinary Shares of 1 pence each and the authorised
share capital of the Company was increased to (Pounds)114,772,900 by the
creation of 11,467,290 additional Ordinary Shares of 1 pence each and by the
creation of 11,465,812,710 Redeemable Preference Shares of 1 pence each.

On February 28, 1997 the Company issued for cash 10,234,690 Ordinary Shares
of 1 pence each at par and 10,224,555,210 Redeemable Preference Shares of 1
pence each at par.

On September 19, 1997 a further 55,000 Ordinary Shares of 1 pence each and
54,945,000 Redeemable Preference Shares of 1 pence each were issued at par for
cash. These shares were issued to certain members of the management team.
Management believes that this sale price reflects the fair value of the shares
at that date.

The Redeemable Preference Shares are redeemable on December 31, 2050. The
Company may also redeem any number of Redeemable Preference Shares at any time
by giving at least two business days' notice in writing to the holders. In
addition, the Company shall redeem in full all the Redeemable Preference Shares
on or before the earlier or any listing or sale of 87.5 percent or more of the
issued share capital. No premium is payable on redemption.

The holders of the Redeemable Preference Shares are entitled to receive a
dividend in respect of periods from January 1, 2004 at a rate of 5 percent per
annum. Dividends shall accrue on a daily basis and shall, unless the Company is
prohibited from paying dividends by the Companies Act 1985 or is not permitted
by any financing agreement to which it is a party to pay such dividend, become
a debt due from and payable to the holders of the Redeemable Preference Shares
on January 1 of each year beginning January 1, 2005.

In accordance with FRS4: Capital Instruments, a finance cost has been
calculated to result in a constant rate of return over the period and carrying
amount for these Redeemable Preference Shares and has been included in the
profit and loss account as an appropriation.

F-49

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

On a winding up of the Company, the holders of the Redeemable Preference
Shares would be entitled, in priority to any payment to the holders of the
Ordinary Shares, to receive an amount equal to the nominal amount paid up on
each Redeemable Preference Share together with all arrears and accruals of the
preferential dividend payable thereon, whether or not such dividend has become
due and payable.

The holders of the Redeemable Preference Shares have no right to vote at any
general meeting of the Company.

At December 31, 1997 two of the shareholders held share warrants which
entitled them to a maximum of 772,500 Ordinary Shares and 771,727,500
Redeemable Preference Shares issued at par. These are subject to adjustment in
accordance with the conditions set out in the warrant instrument which relate
to any reorganisation of the Company's share capital. The rights under the
share warrants can be exercised by giving 7 days' notice to the Company. The
rights lapse on the earliest of the following dates: the date of a listing of
any part of the share capital on the Official List of the London Stock Exchange
or any other stock exchange; the date of any sale of 85 percent or more of the
issued share capital of the Company; the date on which the Company goes into
liquidation; and February 28, 2007.

17 Reserves

Castle
Transmission
-----------------------------------
Period from Period from
February 28, 1997 April 1, 1997 to
to March 31, 1997 December 31, 1997
----------------- -----------------
(Pounds)000 (Pounds)000

Profit and loss account
At the start of the period............. -- 325
Retained profit/(loss) for the period.. 7 (6,217)
Additional finance cost of non-equity
shares................................ 318 2,862
--- ------
At the end of the period............... 325 (3,030)
=== ======

18 Acquisition

On February 28, 1997 the Company acquired the entire share capital of CTI.
CTI had itself acquired the assets and liabilities of Home Service on February
27, 1997, with the intention of CTI's ensuing disposal to the Company.

As the two transactions were enacted for the purpose of the sale and purchase
of Home Service, a provisional fair value exercise was performed by CTI on the
acquisition of the trade and net assets of Home Service on 27 February 1997,
giving rise to acquisition goodwill of (Pounds)39.6 million.

The fair value exercise was only provisional at March 31, 1997 as the elapsed
time had not been sufficient to form a final judgement on the fair value
adjustments. The fair value exercise has now been finalised and as a result
goodwill has been increased by (Pounds)1.2 million. See note 24.

The consideration paid for the acquisition of the shares of CTI by the
Company amounted to (Pounds)45 million plus fees of (Pounds)7.5 million.
(Pounds)7.2 million had been paid or accrued at March 31, 1997, which gave rise
to additional goodwill of (Pounds)7.5 million.

F-50

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

In addition, the BBC was paid (Pounds)199 million by CTI as a repayment of
the loan made by the BBC on the transfer of the assets and liabilities of Home
Service. The total consideration paid by the Group amounted to (Pounds)244
million (excluding fees), which resulted in total goodwill in the Consolidated
Financial Statements of (Pounds)48 million. This goodwill has been capitalised
and will be written off over 20 years, the period over which the Directors
consider that the Group will derive economic benefits.

19 Commitments

(a) Capital commitments at the end of the financial period for which no
provision has been made, were as follows:

Contracted........................ 4,192 4,785 11,431
Authorised but not contracted..... 7,969 6,490 89,729
===== ===== ======

(b) Annual commitments under non-cancellable operating leases were as
follows:

Castle
Transmission
-----------------------
At December 31,
1997
-----------------------
Land and
buildings Other
----------- -----------
(Pounds)000 (Pounds)000

Operating leases which expire:
Within one year...................................... 90 159
In the second to fifth years inclusive............... 343 385
Over five years...................................... 235 --
--- ---
668 544
=== ===

20 Pension scheme

Home Service

Home Service participated in a multi-employer pension scheme operated by the
BBC. The scheme is a defined benefit scheme whereby retirement benefits are
based on the employees' final remuneration and length of service and is funded
through a separate trustee administered scheme. Contributions to the scheme are
based on pension costs for all members of the scheme across the BBC and are
made in accordance with the recommendations of independent actuaries who value
the scheme at regular intervals, usually triennially. Pension scheme assets are
not apportioned between different parts of the BBC.

The pension rate charged to Home Service was 4.5 percent for the year ended
March 31, 1996 and for the period from April 1, 1996 to February 27, 1997. This
charge took into account the surplus shown by the last actuarial valuation of
the BBC scheme. Amounts charged were as follows: (Pounds)521,000 in 1996 and
(Pounds)491,000 in the period from April 1, 1996 to February 27, 1997.

F-51

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Castle Transmission

The pension charge is not comparable between Home Service and Castle
Transmission due to the former having a reduced charge as a result of the
surplus in the BBC Pension scheme.

Under the terms of the sale agreement Castle Transmission was temporarily
participating in the BBC Pension scheme until July 31, 1997. From August 1,
1997 the Group was committed under the sale agreement to establish its own
pension scheme.

In respect of past service benefits, members were able to choose between
transferring past service benefits to the Group scheme or leaving them in the
BBC Pension scheme. To the extent that past service benefits were transferred,
the BBC Pension scheme made a full transfer payment to the Group scheme
calculated in accordance with the actuarial basis as set out in the sale
agreement.

The pension charge for the period from February 28, 1997 to March 31, 1997
included in the accounts represented contributions payable to the BBC Pension
scheme and amounted to (Pounds)156,000. Contributions are calculated at the
employers' contribution rate of 17.7 per cent of pensionable salary. The
contribution rate has been determined by a qualified actuary and is specified
in the sale agreement.

At August 1, 1997 Castle Transmission established its own pension scheme.
This is a defined benefit scheme and assets were transferred from the BBC
Pension scheme to the extent that members chose to transfer past benefits. From
August 1, the Castle Transmission Pension Scheme will be liable in respect of
future pension benefits. The pension charge for the period from April 1, 1997
to December 31, 1997 was (Pounds)1,490,000.

There were no outstanding or prepaid contributions at either the beginning or
end of the financial periods.

The Group also established a defined contribution scheme which will have a
backdated start date of August 1, 1997. This scheme will be open to employees
joining the Group after March 1, 1997. The defined benefit scheme will not be
open to these employees. The pensionable charge for the period from April 1,
1997 to December 31, 1997 represents contributions under this scheme amounting
to (Pounds)nil.

21 Reconciliation of operating profit to operating cash flows

Home Service Castle Transmission
--------------------------- ---------------------------------
Period from Period from Period from
Year Ended April 1, 1996 February 28, 1997 April 1, 1997
March 31, to February 27, to March 31, to December 31,
1996 1997 1997 1997
----------- --------------- ----------------- ---------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

Operating profit........ 7,785 14,002 1,245 8,776
Depreciation and
amortisation charge.... 12,835 13,038 1,819 16,854
(Increase)/Decrease in
stocks................. (678) 294 (2) (746)
Decrease/(Increase) in
debtors................ 2,571 (258) (5,372) (2,937)
Increase/(Decrease) in
creditors.............. 1,798 (649) 8,066 6,036
------ ------ ------ ------
Cash inflow from
operating activities... 24,311 26,427 5,756 27,983
====== ====== ====== ======

F-52

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

22 Analysis of cash flows for headings noted in the cash flow statement

Home Service Castle Transmission
---------------------------- ---------------------------------
Period from Period from Period from
Year Ended April 1, 1996 to February 28, 1997 April 1, 1997
March 31, February 27, to March 31, to December 31,
1996 1997 1997 1997
----------- ---------------- ----------------- ---------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

Returns on investment
and servicing of
finance
Interest received....... -- -- 49 242
Interest paid........... -- -- (934) (2,670)
------- ------- -------- --------
Net cash outflow for
returns on investment
and servicing of
finance................ -- -- (885) (2,428)
======= ======= ======== ========
Capital expenditure and
financial investments
Purchase of tangible
fixed assets........... (18,079) (21,810) (748) (14,361)
Proceeds on disposal of
tangible fixed assets.. 889 1,718 -- --
------- ------- -------- --------
Net cash outflow for
capital expenditure and
financial investments.. (17,190) (20,092) (748) (14,361)
======= ======= ======== ========
Acquisitions and
disposals
Purchase of subsidiary
undertaking (see note
24).................... -- -- (52,141) (307)
Amount paid to BBC on
acquisition............ -- -- (199,000) --
------- ------- -------- --------
Net cash outflow for
acquisition and
disposals.............. -- -- (251,141) (307)
======= ======= ======== ========
Financing
Issue of shares......... -- -- 102,348 550
Increase/(decrease) in
corporate funding...... (7,121) (6,335) -- --
Debt due beyond a year:
Facility A (net of issue
costs)................. -- -- 120,056 --
Facility B (net of issue
costs)................. -- -- 34,302 --
Repayment of Facility A
and B.................. -- -- -- (157,500)
New Facility............ -- -- -- 24,000
Guaranteed Bonds........ -- -- -- 120,527
------- ------- -------- --------
Net cash
inflow/(outflow) from
financing.............. (7,121) (6,335) 256,706 (12,423)
======= ======= ======== ========

F-53

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

23 Analysis of net debt due after one year

Other
At February 27, non-cash At March 31,
1997 Cashflow changes 1997
--------------- ----------- ----------- ---------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

Cash at bank and in
hand................... -- 9,688 -- 9,688
Debt due after 1 year... -- (154,358) -- (154,358)
-------- -------- ------ --------
-- (144,670) -- (144,670)
======== ======== ====== ========

Other
At March 31, non-cash At December 31,
1997 Cashflow changes 1997
--------------- ----------- ----------- ---------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

Cash at bank and in
hand................... 9,688 (1,536) -- 8,152
Finance leases.......... -- -- (711) (711)
Debt due after 1 year... (154,358) 12,973 (2,142) (143,527)
-------- -------- ------ --------
(144,670) 11,437 (2,853) (136,086)
======== ======== ====== ========

24 Purchase of subsidiary undertaking

At March 31, Fair value At December 31,
1997 adjustments 1997
------------ ----------- ---------------
(Pounds)000 (Pounds)000 (Pounds)000

Net assets acquired:
Tangible fixed assets........... 207,038 -- 207,038
Stocks.......................... 119 134 253
Debtors......................... 4,972 (97) 4,875
Creditors--trade................ (6,033) 49 (5,984)
--owed to BBC on
acquisition.............. (199,000) -- (199,000)
Provisions (see note 15)........ (1,723) (1,016) (2,739)
-------- ------ --------
Adjusted net assets acquired.... 5,373 (930) 4,443
Goodwill........................ 46,768 1,237 48,005
-------- ------ --------
Cost of acquisition including
related fees................... 52,141 307 52,448
======== ====== ========
Satisfied by:
Cash............................ 52,141 307 52,448
======== ====== ========

The total consideration paid by Castle Transmission included the assumption
and subsequent repayment of (Pounds)199 million paid to the BBC, see note 18.

Fair value adjustments

The fair value adjustments result from the completion of the fair value
exercise performed by CTI on the acquisition of Home Service and the under
accrual of fees by the Company, in relation to the acquisition of CTI, at March
31, 1997. The (Pounds)1,237,000 increase in goodwill relates predominantly to
the provision of (Pounds)1,250,000 in respect of a dispute over wind loading
fees. This dispute was an

F-54

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

existing contingent liability at the date of acquisition and consequently
provision has been made against the fair value of the assets and liabilities of
Home Service at February 27, 1998.

25 Related party disclosures

Home Service

Throughout the year ended March, 31 1996 and the period from April 1, 1996 to
February 27, 1997, Home Service entered into a number of transactions with
other parts of the BBC. Substantially all of these transactions are exempt from
the disclosure provisions of FRS 8 "Related Party Disclosures" as they have
been undertaken between different parts of the BBC, and are eliminated in the
consolidated accounts of the BBC. However, brief details of the nature of these
transactions are set out below.

The majority of Home Service's income arises from trading with other parts of
the BBC. Prices are set at BBC group level on the basis of cost budgets
prepared by Home Service. The aggregate value of such sales in each of the
years covered by the combined financial statements is given in Note 3.

Administrative costs include expenses re-charged to Home Service by the BBC.
These re-charges related to costs incurred centrally in respect of pension,
information technology, occupancy and other administration costs. These charges
amounted to (Pounds)5.8 million in 1996 and (Pounds)1.2 million in the period
between April 1, 1996 and February 27, 1997. The reduced charge for the period
to February 27, 1997 is a result of more functions being carried out by
employees of Home Service in preparation for the change to a stand alone
entity.

In addition, re-charges were also made for distribution costs relating to
telecommunication links between the BBC and the transmitting stations and these
were then internally re-charged to other parts of the BBC. The charges amounted
to (Pounds)5.6 million in 1996 and (Pounds)6.4 million in the period between
April 1, 1996 and February 27, 1997.

Castle Transmission

The Shareholders of Castle Transmission are:

Crown Castle International Corp. ("CCIC", formerly Castle Tower Holding
Corp.), Candover Investments plc and funds managed by it ("Candover"),
TeleDiffusion de France International S.A ("TdF") and Berkshire Partners LLC
and funds managed by it ("Berkshire"). They are considered to be related
parties as they are the consortium who own 99 percent of the shares of the
Company.

F-55

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THF BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Castle Transmission paid fees to shareholders in respect of expenses incurred
during the acquisition and success fees. Castle Transmission also has
management agreements with CCIC (for commercial and financial advice and
training and consultancy) and TdF (for technical advice and consulting), these
agreements run for five years from February 28, 1997. Fees are payable on the
basis of an annual fee for agreed services provided to Castle Transmission,
together with fees on a commercial arm's length basis for any additional
services provided. In addition Castle Transmission has agreed to reimburse
shareholders' expenses in relation to attendance at board meetings. The amounts
paid and accrued by the Company during the period were as follows:

Total amounts
payable at
Amounts Amounts Amounts March 31,
Related party expensed capitalised paid 1997
------------- ----------- ----------- ----------- -------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

CCIC....................... 20 1,763 1,763 20
Candover................... 1 244 244 1
TdF........................ -- 129 -- 129
Berkshire.................. 1 315 316 --
--- ----- ----- ---
22 2,451 2,323 150
=== ===== ===== ===

Total amounts Total amounts
payable at payable at
March 31, Amounts Amounts Amounts December 31,
Related party 1997 expensed capitalised paid 1997
------------- ------------- ----------- ----------- ----------- -------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000

CCIC.................... 20 253 -- 246 27
Candover................ 1 16 -- 13 4
TdF..................... 129 -- -- 129 --
Berkshire............... -- 55 -- 43 12
--- --- --- --- ---
150 324 -- 431 43
=== === === === ===

Ongoing BBC relationship

At the time of the acquisition of Home Service, Castle Transmission entered
into a ten year transmission contract with the BBC for the provision of
domestic terrestrial analogue television and radio transmission services
expiring on March 31, 2007. Thereafter, the contract continues until terminated
by twelve months notice by either party on March 31 in any contract year from
and including March 31, 2007. It may also be terminated early if certain
conditions are met.

The contract provides for charges of approximately (Pounds)46 million to be
payable by the BBC to Castle Transmission for the year to March 31, 1998.
Castle Transmission's charges for subsequent years of the contract are largely
determined by a formula which escalates the majority of the charges by a factor
which is 1% below the rate of increase in the Retail Price Index over the
previous calendar year. Those elements of the charges which are subject to the
escalation formula for the contract year commencing April 1, 1998 amount to
approximately (Pounds)46 million.

26 Post balance sheet events

On January 23, 1998, the Board of Directors adopted: (i) the All Employee
Share Option Scheme; (ii) the Management Share Option Scheme; and (iii)
individual share option arrangements for certain directors of the Company.

F-56

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

The All Employee Share Option Scheme provides for an unlimited number of
shares to be granted to all employees of the Company. The Board may select any
number of individuals to apply for the grant of an option. Not later than
thirty days following the date by which an application must be made, the Board
may grant to each applicant the number of options specified in his application.
These options may be exercised at the earliest of the third anniversary of the
date of grant, in the event of a flotation or in the event of a take-over,
reconstruction, liquidation or option exchange as set out in the Scheme rules.
For options granted under this scheme the option price and the number of shares
will not change during the life of the option.

Under the terms of the Management Share Option Scheme and the individual
share option arrangements, share options may be granted to employees or
directors of the Company as determined by the Board of Directors up to a
maximum of 460,000 Ordinary Shares and 459,540,000 Redeemable Preference
Shares. Options will vest over periods of up to four years and have a maximum
term of up to nine years. For options over 223,333 Ordinary Shares and
223,110,000 Redeemable Preference Shares, the option price and the number of
shares will not change during the life of the option. The remaining options are
subject to certain performance criteria.

On January 23, 1998 and January 30, 1998 the Company granted options to
purchase an aggregate of 460,000 Ordinary Shares and 459,540,000 Redeemable
Preference Shares under the terms of the individual share option arrangements
and the Management Share Option Scheme, respectively. The weighted average
price for such options is 1.16 pence for Ordinary Shares and 1.16 pence for
Redeemable Preference Shares. The weighted average vesting period for such
options is 1.13 years. Any accounting charge resulting from a difference
between the fair value of the rights to the shares at the date of grant and the
amount of consideration to be paid for the shares will be charged to the profit
and loss account in the year to December 31, 1998 and subsequent years
according to the vesting provisions of the arrangements. Where the options are
subject to performance criteria, the amount initially recognised will be based
on a reasonable expectation of the extent to which these criteria will be met
and will be subject to subsequent adjustments as necessary to deal with changes
in the probability of performance criteria being met.

Update of post balance sheet events (Unaudited)

On March 23, 1998, the Company granted options to purchase an aggregate of
40,750 Ordinary Shares and 40,709,250 Redeemable Preference Shares under the
terms of the All Employee Share Option Scheme. The price for such options is
1.00 pence for both Ordinary Shares and Redeemable Preference Shares. The
vesting period for such options is three years.

The accounting charge related to all share options included within the
unaudited consolidated financial statements for the eight months ended August
31, 1998 is (Pounds)2,330,000.

On April 23, 1998, the Board of Directors adopted share option arrangements
for certain individuals. On that same date, the Company granted options to
purchase 60,000 Ordinary Shares and 59,940,000 Redeemable Preference Shares
under the terms of such share option arrangements. These options will vest over
a period of four years and have a maximum term of six years. The weighted
average price of such options is 1.75 pence for both Ordinary Shares and
Redeemable Preference Shares. The weighted average vesting period for such
options is two years.

On July 1, 1998 and July 15, 1998, CCIC granted options to purchase 59,932
ordinary shares in CCIC to employees of CTI under terms of individual share
option arrangements. The weighted

F-57

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

average price for such options is $37.54. These options vested on August 18,
1998. The accounting charge related to these options included in the unaudited
consolidated financial statements for the eight months ended August 31, 1998 is
(Pounds)978,000.

On July 15, 1998, the Board of Directors of the Company resolved that the
Management Share Option Scheme would not be subject to any performance criteria
and would vest on a time basis only.

An August 11, 1998, the Company granted options to purchase 15,690 Ordinary
Shares and 15,674,310 Redeemable Preference Shares under the terms of the
Management Share Option Scheme. The weighted average price for such options is
2.5 pence for both Ordinary Shares and Redeemable Preference Shares. The
weighted average vesting period for such options is 2.7 years.

On August 21, 1998, the Company issued 515,000 Ordinary Shares and
514,485,000 Redeemable Preference Shares to CCIC for cash at par under the
terms of the warrant. In addition, CCIC subscribed for 10,210 Ordinary Shares
and 10,199,790 Redeemable Preference Shares for cash at a premium of 1.5 pence
per share.

On August 21, 1998, the Company became an 80% owned subsidiary of CCIC. On
that same date, (i) all issued and unissued Redeemable Preference Shares were
redesignated as Ordinary Shares; and (ii) all existing options to purchase
shares in the Company were converted into options to purchase shares in CCIC at
the rate of 7 shares in CCIC for every 1000 shares in the Company.

27 Summary of differences between United Kingdom and United States generally
accepted accounting principles

These consolidated financial statements have been prepared in accordance with
UK GAAP, which differ in certain respects from US GAAP. The differences that
affect Home Service and Castle Transmission are set out below:

(a) Tangible fixed assets

During 1993 Home Service revalued upwards its investments in certain
identifiable tangible fixed assets. Such upward revaluation is not permissible
under US GAAP. Rather, depreciated historical cost must be used in financial
statements prepared in accordance with US GAAP.

In the period between April 1, 1996 and February 27, 1997 there were a number
of transfers of fixed assets to and from other parts of the BBC as explained in
note 10. For US GAAP purposes these transfers have been accounted for under the
as-if-pooling-of-interests method for transactions between entities under
common control.

(b) Deferred taxation

Under UK GAAP, deferred taxes are accounted for to the extent that it is
considered probable that a liability or asset will crystallise in the
foreseeable future. Under US GAAP, deferred taxes are accounted for on all
timing differences and a valuation allowance is established in respect of those
deferred tax assets where it is more likely than not that some portion will
remain unrealised. Deferred tax also arises in relation to the tax effect of
other US GAAP adjustments.

F-58

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THF BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

The Group accounts for costs of pensions under the rules set out in the UK
accounting standards. US GAAP is more prescriptive in respect of actuarial
assumptions and the allocation of costs to accounting periods.

(d) Capitalised interest

Under US GAAP, interest incurred during the construction periods of tangible
fixed assets is capitalised and depreciated over the life of the assets.

(e) Redeemable preference shares

Under UK GAAP, preference shares with mandatory redemption features or
redeemable at the option of the security holder are classified as a component
of total shareholders' funds. US GAAP requires such redeemable preference
shares to be classified outside of shareholders' funds.

(f) Cash flow statement

Under US GAAP various items would be reclassified within the consolidated
cash flow statement. In particular, interest received, interest paid and
taxation would be part of net cash flows from operating activities, and
dividends paid would be included within net cash flow from financing. In
addition, under US GAAP, acquisitions and disposals would be included as
investing activities.

Movements in those current investments which are included under the heading
of cash under US GAAP form part of the movements entitled "Management of
liquid resources" in the consolidated cash flow statements.

Summary combined statements of cash flows for Castle Transmission prepared
in accordance with US GAAP are set out below:

Home Service Castle Transmission
---------------------------------------- ----------------------------------------
Two Period from Eight
Year Period from Months February 28, Period from Months
Ended April 1, 1996 Ended 1997 April 1, 1997 Ended
March 31, to February 27, February 27, to March 31, to December 31, August 31,
1996 1997 1997 1997 1997 1998
----------- --------------- ------------ ------------ --------------- -----------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000
(Unaudited) (Unaudited)

Net cash provided by
operating activities... 24,311 28,146 5,161 4,871 25,555 27,226
Net cash used by
investing activities... (17,190) (21,811) (711) (52,889) (14,668) (36,135)
Net cash (used)/provided
by financing
activities............. (7,121) (6,335) (4,450) 57,706 (12,423) 9,955
------- ------- ------ ------- ------- -------
Net increase/(decrease)
in cash and cash
equivalents............ -- -- -- 9,688 (1,536) 1,046
Cash and cash
equivalents at
beginning of period.... -- -- -- -- 9,688 8,152
------- ------- ------ ------- ------- -------
Cash and cash
equivalents at end of
period................. -- -- -- 9,688 8,152 9,198
======= ======= ====== ======= ======= =======

F-59

CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD AND SUBSIDIARIES AND
THE BBC HOME SERVICE TRANSMISSION BUSINESS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

The following is a summary of the approximate effect on Home Service's and
Castle Transmission's net profit and corporate funding/shareholders' funds of
the application of US GAAP.

Home Service Castle Transmission
---------------------------------------- ---------------------------------------------
Two Eight
Year Period from Months Period from Period from Months
Ended April 1, 1996 Ended February 28, 1997 April 1, 1997 Ended
March 31, to February 27, February 27, to March 31, to December 31, August 31,
1996 1997 1997 1997 1997 1998
----------- --------------- ------------ ----------------- --------------- -----------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000
(Unaudited) (Unaudited)

Net profit/(loss) as
reported in the profit
and loss accounts...... 7,785 14,002 2,697 325 (3,355) 2,145
US GAAP adjustments:
Depreciation
adjustment on
tangible fixed
assets............... 3,707 3,993 726 -- -- --
Pensions.............. -- -- -- -- 65 108
Capitalised interest.. -- -- -- 78 801 1,385
------ ------ ----- ---- ------ -----
Net income/(loss) under
US GAAP................ 11,492 17,995 3,423 403 (2,489) 3,638
Additional finance cost
of
non-equity shares...... -- -- -- (318) (2,862) --
------ ------ ----- ---- ------ -----
Net income/(loss)
attributable to
ordinary shareholders
under US GAAP.......... 11,492 17,995 3,423 85 (5,351) 3,638
====== ====== ===== ==== ====== =====

Home Service Castle Transmission
------------ -----------------------------------------
At March 31,
------------------------ At December 31, At August 31,
1996 1997 1997 1998
------------ ----------- --------------- -------------
(Pounds)000 (Pounds)000 (Pounds)000 (Pounds)000
(Unaudited)

Corporate
funding/shareholders'
funds as reported in
the balance sheets..... 202,429 102,673 99,868 109,748
US GAAP adjustments:
Depreciation
adjustment on
tangible fixed
assets............... (35,945) -- -- --
Pensions.............. -- -- 65 173
Capitalised interest.. -- 78 879 2,264
Redeemable preference
shares (including ad-
ditional finance cost
of non-equity
shares).............. -- (102,564) (105,975) --
------- -------- -------- -------
Corporate
funding/shareholders'
funds/(deficit) under
US GAAP................ 166,484 187 (5,163) 112,185
======= ======== ======== =======

F-60

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and
Stockholders of Crown Castle
International Corp.:

We have audited the accompanying statement of net assets of Bell Atlantic
Mobile Tower Operations as of December 31, 1998, and the related statements of
revenues and direct expenses for each of the years in the two-year period ended
December 31, 1998. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the statement of net assets and the related
statements of revenues and direct expenses are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the statement of net assets and the related statements of
revenues and direct expenses. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall presentation of the statement of net assets and the
related statements of revenues and direct expenses. We believe that our audit
provides a reasonable basis for our opinion.

The statements of net assets and revenues and direct expenses were prepared
for the purpose of complying with the rules and regulations of the Securities
and Exchange Commission. As discussed in note 1, such statements do not reflect
certain corporate overhead expenses incurred by Bell Atlantic Mobile, the
contributor of the net assets, on behalf of the tower operations.

In our opinion, the statements referred to above present fairly, in all
material respects, the net assets of Bell Atlantic Mobile Tower Operations as
of December 31, 1998, and the related revenues and direct expenses for each of
the years in the two-year period ended December 31, 1998, in conformity with
generally accepted accounting principles.

KPMG LLP

March 4, 1998

F-61

BELL ATLANTIC MOBILE
TOWER OPERATIONS

STATEMENT OF NET ASSETS
(In thousands of dollars)

December 31, 1998

Property and equipment, net............................................ $83,557
-------
Net Assets......................................................... $83,557
=======

See notes to financial statements.

F-62

BELL ATLANTIC MOBILE
TOWER OPERATIONS

STATEMENTS OF REVENUES AND DIRECT EXPENSES
(In thousands of dollars)

Years ended December 31,
--------------------------
1997 1998
------------ ------------

Site rental revenues............................... $ 6,480 $ 11,183
Costs of operations................................ 15,131 14,941
Depreciation and amortization...................... 7,221 6,278
------------ ------------
Loss from Tower Operations....................... $ (15,872) $ (10,036)
============ ============

See notes to financial statements.

F-63

BELL ATLANTIC MOBILE TOWER OPERATIONS
NOTES TO FINANCIAL STATEMENTS
(In thousands of dollars)

1. Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation

On December 8, 1998 Crown Castle International Corp. ("CCIC") and Bell
Atlantic Mobile and certain entities controlled by Bell Atlantic Mobile ("BAM")
entered into a formation agreement in order to create Crown Atlantic Company
LLC ("Crown Atlantic"). Under the terms of the agreement, BAM will contribute
tower structures and certain related assets while CCIC will contribute cash and
shares of its common stock to Crown Atlantic and its parent company,
respectively. The tower structures and related assets consist of the tower
facilities that were previously part of BAM's cellular operations. Their
locations span New York, New England, Philadelphia, Pittsburgh, Washington-
Baltimore and certain areas in the Southeast and Southwest.

Under the formation agreement, Crown Atlantic will assume all obligations of
BAM as landlord, licensor or tenant relating to the tower space leases with
respect to the period after the closing date. Crown Atlantic will also assume
all obligations of BAM subsequent to the closing date relating to the operation
of the towers and any contracts entered into by BAM during the ordinary course
of business of BAM relating to the towers but only to the extent that such
contracts were chosen to be included in the obligations assumed by Crown
Atlantic. Under the terms of the formation agreement, Crown Atlantic did not
assume certain liabilities as defined in the actual terms of the formation
agreement.

The accompanying statement of net assets reflects the assets to be
contributed by BAM to Crown Atlantic pursuant to the formation agreement. The
statement of net assets reflects BAM's historical carrying values of the
contributed assets, adjusted to exclude certain assets which will not be
contributed as part of the formation agreement.

The accompanying statements of revenue and direct expenses reflect operations
related to the tower assets to be contributed by BAM to Crown Atlantic per the
formation agreement. Certain direct and indirect operating costs of BAM have
been allocated and included in the costs of operations. The allocated amounts
totaled $3,501 and $3,694 for the years ended December 31, 1997 and 1998,
respectively. Such allocations are based on determinations that management
believes are reasonable, but may not be necessarily indicative of such costs
incurred by Crown Atlantic in the future. The statements of revenues and direct
expenses do not include allocated costs related to general corporate overhead,
interest expense and income taxes and therefore may not be indicative of future
operations.

The accompanying statement of net assets and the related statements of
revenues and direct expenses were prepared for the purpose of complying with
the requirements of the Securities and Exchange Commission and are not intended
to be a complete presentation of Bell Atlantic Mobile's assets and liabilities
or revenues and expenses.

Summary of Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities as of the date of the financial statements
and the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

F-64

BELL ATLANTIC MOBILE TOWER OPERATIONS
NOTES TO FINANCIAL STATEMENTS--(Continued)
(In thousands of dollars)

Revenue Recognition

Site rental revenues are recognized on a monthly basis under lease or
management agreements. Site rental revenues represent charges for tower usage
billed to third party customers under lease arrangements.

2. Property and Equipment

Property and equipment are stated at historical costs. Depreciation of
property and equipment is provided on the straight-line method over the
estimated useful lives of the assets. Property and equipment at December 31,
1998 consisted of the following:

Estimated
Useful Lives
------------

Land..................................................... $ 21,798
Telecommunication towers and related equipment........... 12 years 97,035
--------
118,833
Less: accumulated depreciation........................... (35,276)
--------
$ 83,557
========

3. Commitments

At December 31, 1998, minimum rental commitments under operating leases are
as follows:

Years ending December 31,
1999................................................................... 12,235
2000................................................................... 10,200
2001................................................................... 8,118
2002................................................................... 5,512
2003................................................................... 2,762

4. Site Rental Revenues

At December 31, 1998, minimum amounts receivable under third party lease
agreements are as follows:

Years ending December 31,
1999................................................................... 12,214
2000................................................................... 11,948
2001................................................................... 10,952
2002................................................................... 6,997
2003................................................................... 2,207

F-65

INDEPENDENT AUDITORS' REPORT

The Board of Directors and Stockholders of
Crown Castle International Corp.

We have audited the accompanying statement of net assets of Powertel Tower
Operations as of December 31, 1998, and the related statement of revenues and
direct expenses for the year then ended. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the statement of net assets and the related
statement of revenues and direct expenses are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the statement of net assets and the related statement of
revenues and direct expenses. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall presentation of the statement of net assets and the
related statement of revenues and direct expenses. We believe that our audits
provide a reasonable basis for our opinion.

The statements of net assets and revenues and direct expenses were prepared
for the purpose of complying with the rules and regulations of the Securities
and Exchange Commission. As discussed in note 1, such statements do not reflect
certain corporate overhead expenses incurred by Powertel, Inc., the owner of
the net assets, on behalf of the tower operations.

In our opinion, the statements referred to above present fairly, in all
material respects, the net assets of Powertel Tower Operations as of December
31, 1998, and the related revenues and direct expenses for the year then ended
in conformity with generally accepted accounting principles.

KPMG LLP

February 5, 1999

F-66

POWERTEL TOWER OPERATIONS

STATEMENT OF NET ASSETS

(In thousands of dollars)

DECEMBER 31, 1998

Prepaid expenses and other current assets............................. $ 2,031
Property and equipment, net........................................... 121,490
--------
Total assets........................................................ 123,521
Deferred revenues..................................................... 309
--------
Net assets.......................................................... $123,212
========

See notes to financial statements.

F-67

POWERTEL TOWER OPERATIONS

STATEMENT OF REVENUES AND DIRECT EXPENSES

(In thousands of dollars)

YEAR ENDED DECEMBER 31, 1998

Site rental revenues................................................. $ 1,865
Cost of operations................................................... 6,167
Depreciation......................................................... 7,534
--------
Loss from tower operations......................................... $(11,836)
========

See notes to financial statements.

F-68

POWERTEL TOWER OPERATIONS

NOTES TO FINANCIAL STATEMENTS

(In thousands of dollars)

1. Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation

On March 15, 1999, Crown Castle International Corp. ("CCIC") and Powertel,
Inc. ("Powertel") entered into an asset purchase agreement, whereby Powertel
will sell tower structures and certain related assets to CCIC. The tower
structures and related assets consist of the tower facilities that were
previously part of Powertel's PCS and cellular operations. Their locations span
Atlanta, Georgia; Jacksonville, Florida; Memphis, Tennessee; Jackson,
Mississippi; and Birmingham, Alabama and certain areas in Kentucky and
Tennessee.

The accompanying statement of net assets reflects the assets to be sold by
Powertel to CCIC pursuant to the asset purchase agreement. The statement of net
assets reflects Powertel's historical carrying values of the tower assets,
adjusted to exclude certain assets which will not be contributed as part of the
asset purchase agreement.

The accompanying statement of revenues and direct expenses reflects
operations related to the tower assets to be sold by Powertel to CCIC per the
asset purchase agreement. The statement of revenues and direct expenses does
not include allocated costs related to general corporate overhead, interest
expense and income taxes and therefore may not be indicative of future
operations.

The accompanying statement of net assets and the related statement of
revenues and direct expenses were prepared for the purpose of complying with
the requirements of the Securities and Exchange Commission and are not intended
to be a complete presentation of Powertel's assets and liabilities or revenues
and expenses.

Summary of Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities as of the date of the financial statements
and the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

Revenue Recognition

Site rental revenues are recognized on a monthly basis under lease
agreements. Site rental revenues represent charges for tower usage billed to
third party customers under lease arrangements. Revenue amounts received in
advance are deferred and recognized over the term of the lease agreement.

F-69

POWERTEL TOWER OPERATIONS

NOTES TO FINANCIAL STATEMENTS--(Continued)

(In thousands of dollars)

2. Property and Equipment

Estimated
Useful Lives
------------

Land $ 859
Telecommunication towers and related equipment........... 15 years 134,757
--------
135,616
Less: accumulated depreciation .......................... (14,126)
--------
$121,490
========

3. Commitments

At December 31, 1998, minimum rental commitments under operating leases are
as follows:

Year ending December 31,
1999................................................................... $4,120
2000................................................................... 4,093
2001................................................................... 3,276
2002................................................................... 1,929
2003................................................................... 626
Thereafter............................................................. 185

4. Site Rental Revenues

At December 31, 1998, minimum amounts receivable under third party lease
agreements are as follows:

Year ending December 31,
1999................................................................... $2,690
2000................................................................... 2,677
2001................................................................... 2,610
2002................................................................... 2,131
2003................................................................... 948
Thereafter............................................................. 485

F-70

$200,000,000

[LOGO] CROWN
CASTLE
INTERNATIONAL

CROWN CASTLE INTERNATIONAL CORP.

Offer to Exchange all Outstanding 12 3/4% Senior Exchangeable Preferred Stock
due 2010 for
12 3/4% Senior Exchangeable Preferred Stock due 2010, which have been
Registered under the Securities Act of 1933

----------------
Prospectus
, 1999
----------------

PART II

INFORMATION NOT REQUIRED IN THE PROSPECTUS

Item 20. Indemnification of Directors and Officers

Section 145 of the General Corporation Law of the State of Delaware ("DGCL")
provides that a corporation has the power to indemnify any director or officer,
or former director or officer, who was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation) against the expenses
(including attorney's fees), judgments, fines or amounts paid in settlement
actually and reasonably incurred by them in connection with the defense of any
action by reason of being or having been directors or officers, if such person
shall have acted in good faith and in a manner reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding; provided that such person had no reasonable
cause to believe his conduct was unlawful, except that, if such action shall be
in the right of the corporation, no such indemnification shall be provided as
to any claim, issue or matter as to which such person shall have been judged to
have been liable to the corporation unless and to the extent that the Court of
Chancery of the State of Delaware (the "Court of Chancery"), or any court in
such suit or action was brought, shall determine upon application that, in view
of all of the circumstances of the case, such person is fairly and reasonably
entitled to indemnify for such expenses as such court shall deem proper.

Accordingly, the Restated Certificate of Incorporation of the Company (filed
herewith as Exhibit 3.1) provide that the Company shall, to the maximum extent
permitted under the DGCL indemnify each person who is or was a director or
officer of the Company. The Company may, by action of the Board of Directors,
indemnify other employees and agents of the Corporation, directors, officers,
employees or agents of a subsidiary, and each person serving as a director,
officer, partner, member, employee or agent or another corporation,
partnership, limited liability company, joint venture, trust or other
enterprise, at the request of the Company, with the same scope and effect as
the indemnification of directors and officers of the Company. Notwithstanding
the foregoing, the Company shall be required to indemnify any person seeking
indemnification in connection with a proceeding (or part thereof) initiated by
such person only if such proceeding (or part thereof) was authorized by the
Board of Directors or is a proceeding to enforce such person's claim to
indemnification pursuant to the rights granted by the Restated Certificate of
Incorporation or otherwise by the Company. The Company may also enter into one
or more agreements with any person which provide for indemnification greater or
different than that provided in the Restated Certificate of Incorporation.

Furthermore, a director of the Company shall not be liable to the Company or
its stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability (1) for any breach of the director's duty of
loyalty to the Company or its stockholders, (2) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (3) under Section 174 of the DGCL, or (4) for any transaction from which
the director derived an improper personal benefit.

The Company's By-laws provide that each person who was or is made a party or
is threatened to be made a party to or is involved in any manner in any
threatened, pending or completed action, suit, or proceeding, whether civil,
criminal, administrative or investigative ("Proceeding"), by reason of the fact
that he or she or a person of whom he or she is the legal representative is or
was a director or officer of the Company or, while a director or officer of the
Company, a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise shall be indemnified and
held harmless by the Company to the fullest extent permitted by the DGCL. Such
indemnification shall continue as to a person who has ceased to be a director
or officer and shall inure to the benefit of his or her heirs, executors and
administrators; provided, however, that the

II-1

Company shall indemnify any such person seeking indemnification in connection
with a Proceeding (or part thereof) initiated by such person only if such
Proceeding (or part thereof) was authorized by the Board of Directors or is a
Proceeding to enforce such person's claim to indemnification pursuant to the
rights granted by the Company's By-laws. The Company shall pay the expenses
incurred by any person described in the first two sentences of this paragraph
in defending any such Proceeding in advance of its final disposition upon, to
the extent such an undertaking is required by applicable law, receipt of an
undertaking by or on behalf of such person to repay such amount if it shall
ultimately be determined that such person is not entitled to be indemnified by
the Company as authorized in the Company's By-laws or otherwise.

The Company's By-laws further provide that the indemnification and the
advancement of expenses incurred in defending a Proceeding prior to its final
disposition provided by, or granted pursuant to, the Company's By-laws shall
not be exclusive of any other right which any person may have or hereafter
acquire under any statute, provision of the Restated Certificate of
Incorporation, other provision of the Company's By-laws or otherwise. The
Company may also maintain insurance, at its expense, to protect itself and any
person who is or was a director, officer, partner, member, employee or agent of
the Company or a subsidiary or of another corporation, partnership, limited
liability company, joint venture, trust or other enterprise against any
expense, liability or loss, whether or not the Company would have the power to
indemnify such person against such expense, liability or loss under the DGCL.

The Company's By-laws further provide that the Company may, to the extent
authorized from time to time by the Board of Directors, grant rights to
indemnification, and rights to be paid by the Company the expenses incurred in
defending any Proceeding in advance of its final disposition, to any person who
is or was an employee or agent (other than a director or officer) of the
Company or a subsidiary thereof and to any person who is or was serving at the
request of the Company or a subsidiary thereof as a director, officer, partner,
member, employee or agent of another corporation, partnership, limited
liability company, joint venture, trust or other enterprise, including service
with respect to employee benefit plans maintained or sponsored by the Company
or a subsidiary thereof, to the fullest extent of the provisions of the
Company's By-laws with respect to the indemnification and advancement of
expenses of directors and officers of the Company.

Item 21. Exhibits and Financial Statement Schedules

(a) Exhibits

Exhibit
No. Description of Exhibit
------- ----------------------

**2.1 Asset Purchase and Merger Agreement among Crown Network Systems, Inc.,
Crown Mobile Systems, Inc., Robert A. Crown, Barbara Crown and Castle
Acquisition Corp. I, Castle Acquisition Corp. II, Castle Tower Holding
Corp. dated July 11, 1997

**2.2 First Amended and Restated Asset Purchase and Merger Agreement among
Crown Network Systems, Inc., Crown Mobile Systems, Inc., Robert A.
Crown, Barbara Crown and Castle Acquisition Corp. I, Castle
Acquisition Corp. II, Castle Tower Holding Corp. dated July 11, 1997,
as amended and restated on August 14, 1997

**2.3 Stock Purchase Agreement by and between Castle Tower Holding Corp.,
Bruce W. Neurohr, Charles H. Jones, Ronald J. Minnich, Ferdinand G.
Neurohr and Terrel W. Pugh dated May 12, 1997 ("TEA Stock Purchase
Agreement")

***2.4 Share Exchange Agreement among Castle Transmission Services (Holdings)
Ltd., Crown Castle International Corp., T 1 Diffusion de France
International S.A., Digital Future Investments B.V. and certain
shareholders of Castle Transmission Services (Holdings) Ltd. dated as
of April 24, 1998

II-2

Exhibit
No. Description of Exhibit
-------- ----------------------

+3.1 Restated Certificate of Incorporation of Crown Castle International
Corp. dated August 21, 1998

+3.2 Amended and Restated By-laws of Crown Castle International Corp.
dated August 21, 1998

+3.3 Certificate of Designations, Preferences and Relative, Participating,
Optional and other Special Rights of Preferred Stock and
Qualifications, Limitations and Restrictions thereof of 12 3/4%
Senior Exchangeable Preferred Stock due 2010 and 12 3/4% Series B
Senior Exchangeable Preferred Stock due 2010 of Crown Castle
International Corp.

**4.1 Indenture dated as of November 25, 1997 between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee (including exhibits).

**4.2 Amended and Restated Stockholders Agreement among Castle Tower
Holding Corp., Edward C. Hutcheson, Jr., Ted B. Miller, Jr., Robert
A. Crown and Barbara Crown and the persons listed on Schedule I
thereto dated August 15, 1997

**4.3 Article Fourth of Certificate of Incorporation of Castle Tower
Holding Corp. (included in Exhibits 3.1 and 3.3)

**4.4 Trust Deed related to (Pounds)125,000,000 9 percent. Guaranteed Bonds
due 2007 among Castle Transmission (Finance) PLC, as Issuer, Castle
Transmission International Ltd. and Castle Transmission Services
(Holdings) Ltd., as Guarantors, and The Law Debenture Trust
Corporation p.l.c., as Trustee, dated May 21, 1997

**4.5 First Supplemental Trust Deed related to (Pounds)125,000,000 9
percent Guaranteed Bonds due 2007 among Castle Transmission (Finance)
PLC, as Issuer, Castle Transmission International Ltd. and Castle
Transmission Services (Holdings) Ltd., as Guarantors, and The Law
Debenture Trust Corporation p.l.c., as Trustee, dated October 17,
1997

***4.6 Specimen Certificate of Common Stock
+4.7 Indenture dated as of December 21, 1998 between Crown Castle
International Corp. and the United States Trust Company, as Trustee
(including exhibits)

*5 Opinion of Cravath, Swaine & Moore.

**10.1 Registration Rights Agreement by and among Crown Castle International
Corp. and Lehman Brothers Inc. and Credit Suisse First Boston
Corporation dated as of November 25, 1997

***10.2 Amended and Restated Loan Agreement by and among Crown Communication
Inc., Crown Castle International Corp. de Puerto Rico, Key Corporate
Capital Inc. and certain lenders dated July 10, 1998

**10.8 Amended and Restated Limited Holdco Guaranty by Crown Castle
International Corp., in favor of KeyBank National Association, as
Agent, dated November 25, 1997

**10.9 Memorandum of Understanding regarding Management and Governance of
Castle Tower Holding Corp. and Crown Communications, Inc. dated
August 15, 1997

**10.10 Site Commitment Agreement between Nextel Communications, Inc. and
Castle Tower Corporation dated July 11, 1997

**10.11 Independent Contractor Agreement by and between Crown Network
Systems, Inc. and Sprint Spectrum L.P. dated July 8, 1996, including
addendum dated November 12, 1997

**10.12 Independent Contractor Agreement between Crown Network Systems, Inc.
and Powerfone, Inc. d/b/a Nextel Communications dated September 30,
1996

**10.13 Independent Contractor Agreement by and between APT Pittsburgh
Limited Partnership and Crown Network Systems, Inc. dated December 3,
1996

II-3

Exhibit
No. Description of Exhibit
-------- ----------------------

**10.14 Master Lease Agreement between Sprint Spectrum, L.P. and Robert Crown
d/b/a Crown Communications dated June 11, 1996 ("Sprint Master Lease
Agreement")

**10.15 First Amendment to Sprint Master Lease Agreement, dated July 5, 1996
(included in Exhibit 10.14)

**10.16 Second Amendment to Sprint Master Lease Agreement, dated January 27,
1997 (included in Exhibit 10.14)

**10.17 Master Lease Agreement between Powerfone, Inc. d/b/a Nextel
Communications and Robert A. Crown d/b/a Crown Communications dated
October 3, 1996

**10.18 Master Lease Agreement between APT Pittsburgh Limited Partnership and
Robert Crown d/b/a Crown Communications dated December 3, 1996

**10.19 Master Tower Lease Agreement between Cellco Partnership d/b/a Bell
Atlantic NYNEX Mobile, Pittsburgh SMSA, L.P. and Pennsylvania RSN No.
6(II) and Robert A. Crown d/b/a Crown Communications dated December
29, 1995, as amended by a letter agreement dated as of October 28,
1997

**10.20 Master Tower Lease Agreement between Cellco Partnership d/b/a Bell
Atlantic NYNEX Mobile, Pittsburgh SMSA, L.P. and Pennsylvania RSN No.
6(II) and Robert A. Crown d/b/a Crown Communications dated December
29, 1995, as amended by a letter agreement dated as of October 28,
1997

**10.21 Castle Tower Holding Corp. 1995 Stock Option Plan (Third Restatement)

**10.22 Services Agreement between Castle Transmission International Ltd.
(formerly known as Castle Transmission Services Ltd.) and Castle
Tower Holding Corp. dated February 28, 1997

**10.23 Shareholders Agreement among Berkshire Fund IV Investment Corp.,
Berkshire Investors LLC, Berkshire Partners LLC, Candover Investments
PLC, Candover (Trustees) Limited, Candover Partners Limited (as
general partner for four limited partnerships), Castle Tower Holding
Corp., T 1 Diffusion de France International S.A., and Diohold
Limited (now known as Castle Transmission Services (Holdings) Ltd.)
dated January 23, 1997

**10.24 First Amendment to Amended and Restated Stockholders Agreement by and
among Crown Castle International Corp., Edward C. Hutcheson, Jr., Ted
B. Miller, Jr., Robert A. Crown and Barbara Crown and the persons
listed as Investors dated January 28, 1998

**10.25 Third Amendment to Sprint Master Lease Agreement, dated February 12,
1998

+10.26 Stockholders Agreement between Crown Castle International Corp. and
certain stockholders listed on Schedule 1 thereto, dated as of August
21, 1998 as amended by Amendment No. 1, dated as of the 12th day of
November, 1998

***10.27 Agreement among Castle Transmission Services (Holdings) Ltd., Digital
Future Investments B.V., Berkshire Partners LLC and certain
shareholders of Castle Transmission Services (Holdings) Ltd. for the
sale and purchase of certain shares of Castle Transmission Services
(Holdings) Ltd., for the amendment of the Shareholders Agreement in
respect of Castle Transmission Services (Holdings) Ltd. and for the
granting of certain options dated April 24, 1998

+10.28 Governance Agreement among Crown Castle International Corp.,
TeleDiffusion de France International S.A. and Digital Future
Investments B.V., dated as of August 21, 1998

II-4

Exhibit
No. Description of Exhibit
-------- ----------------------

+10.29 Form of Severance Agreement entered into between Crown Castle
International Corp. and Ted Miller, George Reese, John Gwyn, Charles
Green, Alan Rees, Blake Hawk and David Ivy

+10.30 Shareholders Agreement among Crown Castle International Corp., T 1
Diffusion de France International S.A. and Castle Transmission
Services (Holdings) Limited dated August 1998

***10.31 Site Sharing Agreement between National Transcommunications Limited
and The British Broadcasting Corporation dated September 10, 1991

***10.32 Transmission Agreement between The British Broadcasting Corporation
and Castle Transmission Services Limited dated February 27, 1997

***10.33 Digital Terrestrial Television Transmission Agreement between The
British Broadcasting Corporation and Castle Transmission
International Ltd. dated February 10, 1998

***10.34 Agreement for the Provision of Digital Terrestrial Television
Distribution and Transmission Services between British Digital
Broadcasting plc and Castle Transmission International Ltd. dated
December 18, 1997

***10.35 Loan Amendment Agreement among Castle Transmission International,
Castle Transmission Services (Holdings) Ltd. and certain lenders
dated May 21, 1997

***10.36 Crown Castle International Corp. 1995 Stock Option Plan (Fourth
Restatement)

***10.37 Contract between British Telecommunications PLC and Castle
Transmission International Inc. for the Provision of Digital
Terrestrial Television Network Distribution Service dated May 13,
1998

***10.38 Site Marketing Agreement dated June 25, 1998 between BellSouth
Mobility Inc. and Crown Communication Inc.

***10.39 Commitment Agreement between the British Broadcasting Corporation,
Castle Tower Holding Corp., T 1 Diffusion de France International
S.A. and T 1 Diffusion de France S.A.

+10.40 Amended and Restated Services Agreement between Castle Transmission
International Limited and T 1 Diffusion de France S.A. dated August
1998

***10.41 Castle Transmission Services (Holdings) Ltd. All Employee Share
Option Scheme dated as of January 23, 1998

***10.42 Rules of the Castle Transmission Services (Holdings) Ltd. Bonus Share
Plan

+10.43 Employee Benefit Trust between Castle Transmission Services
(Holdings) Ltd. and Castle Transmission (Trustees) Limited

***10.44 Castle Transmission Services (Holdings) Ltd. Unapproved Share Option
Scheme dated as of January 23, 1998

***10.45 Amending Agreement between the British Broadcasting Corporation and
Castle Transmission International Limited dated July 16, 1998

+10.46 Rights Agreement dated as of August 21, 1998, between Crown Castle
International Corp. and Chasemellon Shareholder Services, L.L.C.

***10.47 Deed of Grant of Option between Castle Transmission Series (Holdings)
Ltd. and George Reese dated January 23, 1998

***10.48 Deed of Grant of Option between Castle Transmission Services
(Holdings) Ltd. and David Ivy dated January 23, 1998

II-5

Exhibit
No. Description of Exhibit
----------- ----------------------

***10.49 Deed of Grant of Option between Castle Transmission Services
(Holdings) Ltd. and David Ivy dated April 23, 1998

***10.50 Deed of Grant of Option between Castle Transmission Services
(Holdings) Ltd. and Ted B. Miller, Jr., dated April 23, 1998

***10.51 Deed of Grant of Option between Castle Transmission Services
(Holdings) Ltd. and Ted B. Miller, Jr., dated January 23, 1998

***10.52 Memorandum Regarding Proposed Initial Public Offering and Certain
Transitional Changes Affecting Management dated July 2, 1998,
between Crown Castle International Corp. and Robert A. and Barbara
A. Crown

***10.53 Services Agreement dated July 2, 1998, by and between Crown Castle
International Corp. and Robert A. and Barbara A. Crown

+10.56 Registration Rights Agreement dated as of December 21, 1998 by and
among Crown Castle International Corp. and Lehman Brothers,
Salomon Smith Barney and Goldman, Sachs & Co.

****10.57 Formation Agreement relating to the formation of Crown Atlantic
Company LLC, Crown Atlantic Holding Sub LLC, and Crown Atlantic
Holding Company LLC dated December 1998 (including exhibits)

*****10.58 Letter of Agreement between Crown Castle International Corp. and
BellSouth Mobility Inc. dated March 5, 1999 (including the Form of
Sublease)

******10.59 Asset Purchase Agreement among Crown Castle International Corp.,
CCP Inc., Powertel Atlanta Towers, LLC, Powertel Birmingham
Towers, LLC, Powertel Jacksonville Towers, LLC, Powertel Kentucky
Towers, LLC, Powertel Memphis Towers, LLC and Powertel, Inc. dated
March 15, 1999

+10.60 Framework Agreement between One2One and Castle Transmission
International Ltd. dated March 5, 1999

+10.61 Indenture between Crown Castle International Corp. and United
States Trust Company of New York dated March 15, 1999
+10.62 Registration Rights Agreement among Crown Castle International
Corp. and Goldman Sachs Credit Partners LP, Salomon Brothers
Holding Company Inc. and Credit Suisse First Boston dated March
15, 1999
+10.63 Escrow Agreement among Crown Castle International Corp., Goldman
Sachs Credit Partners LP, Salomon Brothers Holding Company Inc.,
Credit Suisse First Boston and United States Trust Company of New
York dated March 15, 1999
+10.64 Term Loan Agreement among Crown Castle International Corp. and
Goldman Sachs Credit Partners LP, Salomon Brothers Holding Company
Inc. and Credit Suisse First Boston dated March 15, 1999
+11 Computation of Net Loss per Common Share

+12 Computation of Ratio of Earnings to Fixed Charges

+21 Subsidiaries of Crown Castle International Corp.

23.1 Consent of KPMG LLP

*23.2 Consent of Cravath, Swaine & Moore (included in Exhibit 5)
+27.1 Financial Data Schedule

II-6

- --------
+ Previously filed.
* To be filed by amendment.
** Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-4 previously filed by the
Registrant (Registration No. 333-43873).
*** Incorporated by reference to the exhibits with the corresponding exhibit
numbers in the Registration Statement on Form S-1 previously filed by the
Registrant (Registration No. 333-57283).
**** Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated December 9, 1998.
***** Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated March 8, 1999.
****** Incorporated by reference to the exhibit previously filed by the
Registrant on Form 8-K (Registration No. 0-24737) dated March 15, 1999.

Schedule I--Condensed Financial Information of Registrant

All other schedules are omitted because they are not applicable or because
the required information is contained in the financial statements or notes
thereto included in this Registration Statement.

Item 22. Undertakings

The undersigned Registrant hereby undertakes that insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to
directors, officers and controlling persons of the Registrant pursuant to the
foregoing provisions described under Item 20 above, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted against the Registrant by such director,
officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.

The undersigned Registrant hereby undertakes (i) to respond to requests for
information that are incorporated by reference into the Prospectus pursuant to
Item 4, 10(b), 11, or 13 of Form S-4, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This undertaking also includes documents filed
subsequent to the effective date of the Registration Statement through the date
of responding to the request.

The undersigned Registrant hereby undertakes to supply by means of a post-
effective amendment all information concerning a transaction, and the company
being acquired involved therein, that was not the subject of and included in
the Registration Statement when it became effective.

The undersigned Registrant hereby undertakes as follows: that prior to any
public reoffering of the securities registered hereunder through use of a
prospectus which is a part of this Registration Statement, by any person or
party who is deemed to be an underwriter within the meaning of Rule 145(c), the
undersigned undertakes that such reoffering prospectus will contain the
information called for by the applicable registration form with respect to
reofferings by persons who may be deemed underwriters, in addition to the
information called for by the other Items of the applicable form.

II-7

The undersigned Registrant hereby undertakes that every prospectus: (i) that
is filed pursuant to the immediately preceding paragraph or (ii) that purports
to meet the requirements of Section 10(a)(3) of the Securities Act of 1933 and
is used in connection with an offering of securities subject to Rule 415, will
be filed as a part of an amendment to the registration statement and will not
be used until such amendment is effective, and that, for purposes of
determining any liability under the Securities Act of 1933, each such post-
effective amendment shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.

II-8

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Houston, State of Texas,
on this 21st day of April, 1999

Crown Castle International Corp.,

/s/ Charles C. Green, III
by: _________________________________
Name: Charles C. Green, III
Title: Executive Vice President
and Chief Financial Officer

Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities indicated
on this 21st day of April, 1999.

Signature Title
--------- -----

* Chief Executive Officer and Vice Chairman of the
______________________________________ Board (Principal Executive Officer)
Ted B. Miller, Jr.

* President and Director
______________________________________
David L. Ivy

/s/ Charles C. Green, III Executive Vice President and Chief Financial
______________________________________ Officer (Principal Financial Officer)
Charles C. Green, III

* Vice President, Chief Accounting Officer and
______________________________________ Corporate Controller (Principal Accounting
Wesley D. Cunningham Officer)

* Chairman of the Board
______________________________________
Carl Ferenbach

* Director
______________________________________
Michel Azibert

* Director
______________________________________
Bruno Chetaille

* Director
______________________________________
Robert A. Crown

II-9

Signature Title
--------- -----

* Director
______________________________________
Bruno Chetaille

* Director
______________________________________
Robert A. Crown

* Director
______________________________________
Randall A. Hack
* Director
______________________________________
Robert F. McKenzie

* Director
______________________________________
William A. Murphy

* Director
______________________________________
Jeffrey H. Schutz

/s/ Charles C. Green, III
______________________________________
Charles C. Green, III
Attorney-in-Fact

II-10

CROWN CASTLE INTERNATIONAL CORP.

SCHEDULE I--CONDENSED FINANCIAL INFORMATION OF REGISTRANT

BALANCE SHEET (Unconsolidated)
(In thousands of dollars, except share amounts)

December 31,
--------------------
1997 1998
-------- ----------

ASSETS
Current assets:
Cash and cash equivalents............................... $ 53,092 $ 37,907
Receivables and other current assets.................... 424 957
Advances to subsidiaries, net........................... 2,611 13,711
-------- ----------
Total current assets.................................. 56,127 52,575
Property and equipment, net of accumulated depreciation
of $27 and $875 at December 31, 1997 and 1998,
respectively............................................ 808 4,255
Investment in subsidiaries............................... 232,229 1,041,788
Investments in affiliates................................ 59,082 2,258
Deferred financing costs and other assets, net of
accumulated amortization of $69 and $814 at December 31,
1997 and 1998, respectively............................. 7,075 7,227
-------- ----------
$355,321 $1,108,103
-------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and other accrued liabilities.......... $ 1,187 $ 1,379
-------- ----------
Total current liabilities............................. 1,187 1,379
Long-term debt........................................... 151,593 168,099
-------- ----------
Total liabilities..................................... 152,780 169,478
-------- ----------
Redeemable preferred stock, $.01 par value; 10,000,000
shares authorized:
12 3/4% Senior Exchangeable Preferred Stock; shares
issued: December 31, 1997--none
and December 31, 1998--200,000 (stated at mandatory
redemption and aggregate
liquidation value)..................................... -- 201,063
Senior Convertible Preferred Stock; shares issued:
December 31, 1997--657,495 and
December 31, 1998--none (stated at redemption value;
aggregate liquidation value of $68,916)................ 67,948 --
Series A Convertible Preferred Stock; shares issued:
December 31, 1997--1,383,333 and December 31, 1998--
none (stated at redemption and aggregate liquidation
value)................................................. 8,300 --
Series B Convertible Preferred Stock; shares issued:
December 31, 1997--864,568 and December 31, 1998--none
(stated at redemption and aggregate liquidation
value)................................................. 10,375 --
Series C Convertible Preferred Stock; shares issued:
December 31, 1997--3,529,832 and December 31, 1998--
none (stated at redemption and aggregate liquidation
value)................................................. 74,126 --
-------- ----------
Total redeemable preferred stock.................... 160,749 201,063
-------- ----------
Stockholders' equity:
Common stock, $.01 par value; 690,000,000 shares
authorized:
Class A Common Stock; shares issued: December 31,
1997--1,041,565 and
December 31, 1998--none.............................. 2 --
Class B Common Stock; shares issued: December 31,
1997--9,367,165 and
December 31, 1998--none.............................. 19 --
Common Stock; shares issued: December 31, 1997--none
and
December 31, 1998--83,123,873........................ -- 831
Class A Common Stock; shares issued: December 31,
1997--none and
December 31, 1998--11,340,000........................ -- 113
Additional paid-in capital.............................. 58,248 795,153
Cumulative foreign currency translation adjustment...... 562 1,690
Accumulated deficit..................................... (17,039) (60,225)
-------- ----------
Total stockholders' equity............................ 41,792 737,562
-------- ----------
$355,321 $1,108,103
-------- ----------

See notes to consolidated financial statements and accompanying notes.

S-1

CROWN CASTLE INTERNATIONAL CORP.

SCHEDULE I--CONDENSED FINANCIAL INFORMATION OF REGISTRANT--(Continued)

STATEMENT OF OPERATIONS (Unconsolidated)
(In thousands of dollars)

Years Ended December 31,
---------------------------
1996 1997 1998
------- -------- --------

Other revenues.................................... $ -- $ 329 $ 399
Interest and other income......................... 171 2,028 1,354
General and administrative expenses............... -- (149) (2,975)
Corporate development expenses.................... (1,249) (3,867) (4,404)
Non-cash compensation charges..................... -- -- (9,775)
Depreciation and amortization..................... -- (27) (720)
Interest expense and amortization of deferred
financing costs.................................. -- (4,594) (17,251)
------- -------- --------
Loss before income taxes and equity in earnings
(losses) of subsidiaries and unconsolidated
affiliate........................................ (1,078) (6,280) (33,372)
Credit (provision) for income taxes............... 49 (49) --
Equity in earnings (losses) of subsidiaries....... 72 (4,475) (6,458)
Equity in earnings (losses) of unconsolidated
affiliate........................................ -- (1,138) 2,055
------- -------- --------
Net loss.......................................... (957) (11,942) (37,775)
Dividends on preferred stock...................... -- (2,199) (5,411)
------- -------- --------
Net loss after deduction of dividends on preferred
stock............................................ $ (957) $(14,141) $(43,186)
======= ======== ========

See notes to consolidated financial statements and accompanying notes.

S-2

CROWN CASTLE INTERNATIONAL CORP.

SCHEDULE I--CONDENSED FINANCIAL INFORMATION OF REGISTRANT--(Continued)

STATEMENT OF CASH FLOWS (Unconsolidated)
(In thousands of dollars)

Years Ended December 31,
-----------------------------
1996 1997 1998
------- --------- ---------

Cash flows from operating activities:
Net loss...................................... $ (957) $ (11,942) $ (37,775)
Adjustments to reconcile net loss to net cash
used for operating activities:
Amortization of deferred financing costs and
discount on long-term debt................. -- 1,652 17,251
Non-cash compensation charges............... -- -- 9,775
Equity in losses (earnings) of
subsidiaries............................... (72) 4,475 6,458
Depreciation and amortization............... -- 27 720
Equity in losses (earnings) of
unconsolidated affiliate................... -- 1,138 (2,055)
Increase (decrease) in accounts payable and
other accrued liabilities.................. 130 (103) 1,352
Decrease (increase) in receivables and other
assets..................................... (1,122) 551 (1,413)
------- --------- ---------
Net cash used for operating activities.... (2,021) (4,202) (5,687)
------- --------- ---------
Cash flows from investing activities:
Investment in subsidiaries.................... -- (89,989) (332,065)
Net advances to subsidiaries.................. (288) (2,223) (11,100)
Capital expenditures.......................... -- (835) (3,624)
Investments in affiliates..................... (2,101) (59,487) --
------- --------- ---------
Net cash used for investing activities.... (2,389) (152,534) (346,789)
------- --------- ---------
Cash flows from financing activities:
Proceeds from issuance of capital stock....... 10,503 139,867 339,929
Incurrence of financing costs................. -- (5,908) (1,755)
Purchase of capital stock..................... -- (2,132) (883)
Proceeds from issuance of long-term debt...... -- 150,010 --
Principal payments on long-term debt.......... -- (78,102) --
------- --------- ---------
Net cash provided by financing
activities............................... 10,503 203,735 337,291
------- --------- ---------
Net increase (decrease) in cash and cash
equivalents.................................... 6,093 46,999 (15,185)
Cash and cash equivalents at beginning of year.. -- 6,093 53,092
------- --------- ---------
Cash and cash equivalents at end of year........ $ 6,093 $ 53,092 $ 37,907
======= ========= =========
Supplementary schedule of noncash investing and
financing activities:
Issuance of long-term debt in connection with
acquisitions................................. $ -- $ 78,102 $ --
Issuance of common stock in connection with
acquisitions................................. -- 57,189 420,964
Conversion of subsidiary's Convertible Secured
Subordinated Notes to Series A Convertible
Preferred Stock.............................. -- 3,657 --
Supplemental disclosure of cash flow
information:
Interest paid................................. $ -- $ 2,943 $ --
Income taxes paid............................. -- -- --

See notes to consolidated financial statements and accompanying notes.

S-3

CROWN CASTLE INTERNATIONAL CORP.

SCHEDULE I--CONDENSED FINANCIAL INFORMATION OF REGISTRANT--(Continued)

NOTES TO FINANCIAL STATEMENTS (Unconsolidated)

1. Investment in Subsidiaries

The Company's investment in subsidiaries is presented in the accompanying
unconsolidated financial statements using the equity method of accounting.
Under the terms of the Senior Credit Facility, the CTI Credit Facility and the
CTI Bonds, the Company's subsidiaries are limited in the amount of dividends
which can be paid to the Company. For CCI, the amount of such dividends is
limited to (i) $6,000,000 per year until October 31, 2002, and $33,000,000 per
year thereafter, and (ii) an amount to pay income taxes attributable to the
Company's Restricted Subsidiaries. CTI is effectively precluded from paying
dividends. The restricted net assets of the Company's subsidiaries totaled
approximately $826,321,000 at December 31, 1998.

2. Long-term Debt

Long-term debt consists of the Company's 10 5/8% Senior Discount Notes due
2007.

3. Income Taxes

Income taxes reported in the accompanying unconsolidated financial statements
are determined by computing income tax assets and liabilities on a consolidated
basis, for the Company and members of its consolidated federal income tax
return group, and then reducing such consolidated amounts for the amounts
recorded by the Company's subsidiaries on a separate tax return basis.

S-4

EXHIBIT INDEX

Exhibit
No. Description of Exhibit
-------- ----------------------

**2.1 Asset Purchase and Merger Agreement among Crown Network Systems,
Inc., Crown Mobile Systems, Inc., Robert A. Crown, Barbara Crown and
Castle Acquisition Corp. I, Castle Acquisition Corp. II, Castle Tower
Holding Corp. dated July 11, 1997

***2.4 Share Exchange Agreement among Castle Transmission Services
(Holdings) Ltd., Crown Castle International Corp., T 1 Diffusion de
France International S.A., Digital Future Investments B.V. and
certain shareholders of Castle Transmission Services (Holdings) Ltd.
dated as of April 24, 1998

+3.1 Restated Certificate of Incorporation of Crown Castle International
Corp. dated August 21, 1998

+3.2 Amended and Restated By-laws of Crown Castle International Corp.
dated August 21, 1998

**4.1 Indenture dated as of November 25, 1997 between Crown Castle
International Corp. and United States Trust Company of New York, as
Trustee (including exhibits).

**4.3 Article Fourth of Certificate of Incorporation of Castle Tower
Holding Corp. (included in Exhibits 3.1 and 3.3)

***4.6 Specimen Certificate of Common Stock
+4.7 Indenture dated as of December 21, 1998 between Crown Castle
International Corp. and the United States Trust Company, as Trustee
(including exhibits)

*5 Opinion of Cravath, Swaine & Moore.

**10.1 Registration Rights Agreement by and among Crown Castle International
Corp. and Lehman Brothers Inc. and Credit Suisse First Boston
Corporation dated as of November 25, 1997

***10.2 Amended and Restated Loan Agreement by and among Crown Communication
Inc., Crown Castle International Corp. de Puerto Rico, Key Corporate
Capital Inc. and certain lenders dated July 10, 1998

Exhibit
No. Description of Exhibit
-----------------------------

**10.8 Amended and Restated Limited Holdco Guaranty by Crown Castle
International Corp., in favor of KeyBank National Association, as
Agent, dated November 25, 1997

**10.9 Memorandum of Understanding regarding Management and Governance of
Castle Tower Holding Corp. and Crown Communications, Inc. dated August
15, 1997

**10.10 Site Commitment Agreement between Nextel Communications, Inc. and
Castle Tower Corporation dated July 11, 1997

**10.11 Independent Contractor Agreement by and between Crown Network Systems,
Inc. and Sprint Spectrum L.P. dated July 8, 1996, including addendum
dated November 12, 1997

**10.12 Independent Contractor Agreement between Crown Network Systems, Inc.
and Powerfone, Inc. d/b/a Nextel Communications dated September 30,
1996

**10.13 Independent Contractor Agreement by and between APT Pittsburgh Limited
Partnership and Crown Network Systems, Inc. dated December 3, 1996

**10.14 Master Lease Agreement between Sprint Spectrum, L.P. and Robert Crown
d/b/a Crown Communications dated June 11, 1996 ("Sprint Master Lease
Agreement")

**10.15 First Amendment to Sprint Master Lease Agreement, dated July 5, 1996
(included in Exhibit 10.14)

**10.16 Second Amendment to Sprint Master Lease Agreement, dated January 27,
1997 (included in Exhibit 10.14)

**10.17 Master Lease Agreement between Powerfone, Inc. d/b/a Nextel
Communications and Robert A. Crown d/b/a Crown Communications dated
October 3, 1996

**10.18 Master Lease Agreement between APT Pittsburgh Limited Partnership and
Robert Crown d/b/a Crown Communications dated December 3, 1996

**10.21 Castle Tower Holding Corp. 1995 Stock Option Plan (Third Restatement)

**10.22 Services Agreement between Castle Transmission International Ltd.
(formerly known as Castle Transmission Services Ltd.) and Castle Tower
Holding Corp. dated February 28, 1997

**10.23 Shareholders Agreement among Berkshire Fund IV Investment Corp.,
Berkshire Investors LLC, Berkshire Partners LLC, Candover Investments
PLC, Candover (Trustees) Limited, Candover Partners Limited (as
general partner for four limited partnerships), Castle Tower Holding
Corp., T 1 Diffusion de France International S.A., and Diohold Limited
(now known as Castle Transmission Services (Holdings) Ltd.) dated
January 23, 1997