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CRAVATH, SWAINE & MOORE LLP
WORLDWIDE PLAZA
825 EIGHTH AVENUE
NEW YORK, NY 10019
Telephone: (212) 474-1000
Facsimile: (212) 474-3700
Writer's Direct Dial Number:
(212) 474-1026
November 18, 2004
Crown Castle International Corp.
Schedule TO-I filed by Crown Castle on November 8, 2004
File No. 005-54549
Dear Mr. Panos:
On behalf of Crown Castle International Corp., a Delaware
corporation ("Crown Castle"), this letter responds to your letter dated
November 16, 2004 (the "Comment Letter"), providing comments on Crown Castle's
Schedule TO-I filed on November 8, 2004 (the "Schedule TO"), which included as
Exhibit (a)(1)(A) thereto the related Offer to Purchase for Cash, dated
November 8, 2004 (the "Offer to Purchase"), in respect of any and all of Crown
Castle's outstanding Convertible Senior Notes due 2010 (the "Convertible
Notes"). For your convenience, each comment set forth in the Comment Letter
has been reproduced below, followed by Crown Castle's response to such
comment. Capitalized terms defined in the Offer to Purchase and used in the
following responses without definition have the meanings specified in the
Offer to Purchase.
OFFER TO PURCHASE
SUMMARY, PAGE 1; MARKET AND RECENT PRICES FOR THE CONVERTIBLE NOTES, PAGE 13
1. The formula you have described does not necessarily correspond with prior
no-action relief or other interpretive positions that may exist with
respect to an issuer's ability to comply with Item 1004(a)(l)(ii). In
addition, it is not clear the extent to which the subject securities
trade at prices that are related to the trading price of Crown Castle's
common stock. Please advise us of the basis upon which the issuer relied
to conclude that this offer complies with Rule 13e-4(f)(l)(ii) and Rule
14e-1(b).
2
As discussed with the staff, the Offer is being conducted in a
manner consistent with the terms of the no-action relief granted by the staff
with respect to Rules 13e-4(d)(1), 13e-4(f)(1)(ii) and 14e-1(b) in TXU
Corporation, SEC No-Action Letter, 2004 SEC No-Act. LEXIS 734 (September 13,
2004) (the "TXU Letter"), and the related no-action letters as referenced
therein.1 In that regard, in connection with the Offer, Crown Castle will,
among other things, issue a press release to publicly announce the final cash
offer price as determined by the formula disclosed in the Offer to Purchase
prior to the opening of trading on the second trading day prior to expiration
of the Offer, and will file an amendment to the Schedule TO on the same date
setting forth such price.
The same correlation between the trading prices of the subject
securities at issue in the TXU Letter and the underlying exchange-traded
common stock that justified the use of a formula pricing mechanism in that
case is applicable to the Convertible Notes. While the Convertible Notes are
not traded on an exchange, and the pricing data with respect to the
Convertible Notes is relatively limited, Crown Castle has observed, and the
dealer manager for the Offer has confirmed that there exists, a significant
correlation between the trading prices of the Convertible Notes and the
underlying exchange-traded common stock into which it is convertible.
On the basis of this correlation and the adherence of the terms of
the Offer to the terms of the no-action relief granted in the TXU Letter,
Crown Castle respectfully submits that the Offer complies with Rules
13e-4(f)(1)(ii) and 14e-1(b).
CONDITIONS OF THE OFFER, PAGE 13
2. The disclosure indicates that once a condition is triggered, a failure to
exercise your right to terminate the offer will not constitute a waiver
of that condition. Please note that when a condition is triggered and the
offeror decides to proceed with the offer, we believe that this decision
constitutes a waiver of the triggered condition. Please revise your
disclosure to remove the implication that Crown Castle reserves the right
to conduct an illusory offer.
The intent of the referenced disclosure is to allow Crown Castle the
opportunity to identify a failed condition without risk of being deemed to
have waived such condition as a result of a good faith delay in determining
the underlying facts. Crown Castle will not, and does not believe that the
terms of the Offer give it the right to, arbitrarily delay enforcement of a
known failed condition, such that the Offer would be effectively illusory.
Crown Castle therefore respectfully submits that the disclosure, and Crown
__________________
1 Lazard Freres & Co., SEC No-Action Letter, 1995 WL 476257 (Aug. 11,
1995); Epicor Software Corporation, SEC No-Action Letter, 2004 WL 1126018
(May 21, 2004); AB Volvo, SEC No-Action Letter, 1997 SEC No-Act. LEXIS 1050
(May 16, 1997); Microsoft Corp., SEC No-Action Letter, 2003 WL 22358818 (Oct.
15, 2003).
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Castle's interpretation thereof, is consistent with the view expressed by the
staff on this point and that no amendment is necessary.
EXTENSION OF THE OFFER; TERMINATION; AMENDMENT
3. We note Crown Castle reserves the right to adjust the pricing formula as
well as the minimum and maximum price. Advise us whether or not Crown
Castle would consider adjusting the pricing formula or minimum or maximum
price points after the purchase price is fixed.
Crown Castle hereby advises the staff that it will not adjust the
pricing formula or the minimum or maximum price points after the purchase
price is fixed.
CLOSING COMMENTS
We are authorized by Crown Castle to acknowledge on its behalf each
of the following:
o That Crown Castle is responsible for the adequacy and accuracy of the
disclosure in its filings;
o That staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and
o That Crown Castle may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the federal
securities laws of the United States.
4
If you have any questions regarding the contents of this letter,
please contact me at the above number.
Respectfully,
By /s/ Stephen L. Burns
---------------------------
Name: Stephen L. Burns
Mr. Nicholas P. Panos, Esq.
Special Counsel
Office of Mergers & Acquisitions
Division of Corporate Finance
United States Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0303