UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, ~~2017~~2019

☐¨TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-16853

SBA COMMUNICATIONS CORPORATION

(Exact name of Registrant as specified in its charter)


Florida	65-0716501
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)


8051 Congress Avenue
Boca Raton, Florida	33487
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (561) 995-7670

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Class A Common Stock, $0.01 par value per share	SBAC	The NASDAQ Stock Market LLC
		(NASDAQ Global Select Market)

~~Securities registered pursuant to Section 12(g) of the Act:~~

~~None~~

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒x No ☐ ¨

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes ☒x No ☐¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large ~~accelerated filer~~Accelerated Filer	☒x	Accelerated filer	☐¨

Non-Accelerated filer	☐¨	Smaller reporting company	☐¨

		Emerging growth company	☐¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes ☐¨ No ☒ x

Indicate the number of shares outstanding of each issuer’s classes of common stock, as of the latest practicable date: ~~117,542,678~~112,601,008 shares of Class A common stock as of October ~~27, 2017.~~

31, 2019.

Table of Contents



		Page
PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements
	Consolidated Balance Sheets as of September 30, ~~2017~~2019 (unaudited) and December 31, ~~2016~~2018	1
	Consolidated Statements of Operations (unaudited) for the three and nine months ended September 30, ~~2017~~2019 and ~~2016~~2018	2
	Consolidated Statements of Comprehensive ~~Income (Loss)~~Loss (unaudited) for the three and nine months ended September 30, ~~2017~~2019 and ~~2016~~2018	3
	Consolidated Statement of Shareholders’ Deficit (unaudited) for the nine months ended September 30, ~~2017~~2019 and 2018	4
	Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, ~~2017~~2019 and ~~2016~~2018	5 6
	Condensed Notes to Consolidated Financial Statements (unaudited)	7 8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	23 29
Item3.	Quantitative and Qualitative Disclosures About Market Risk	44
~~Item 4.~~	~~Controls and Procedures~~	46
48
Item 4.	Controls and Procedures	51

PART II – OTHER INFORMATION

Item2.	Unregistered Sales of Equity Securities and Use of Proceeds	47
52
~~Item~~5.	~~Other Information~~	47

Item6.	Exhibits	48
52

~~SIGNATURES~~		49
SIGNATURES		53

Table of Contents

PART I – FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (in thousands, except par values)



	September 30,		December 31,		September 30,		December 31,
	2017		2016		2019		2018
ASSETS	(unaudited)				(unaudited)
Current assets:
Cash and cash equivalents	$	139,711	$	146,109	$	128,778	$	143,444
Restricted cash		30,168		36,786		27,502		32,464
Accounts receivable, net		87,417		78,344		122,725		111,035
Costs and estimated earnings in excess of billings on uncompleted contracts		12,508		11,127		28,303		23,785
Prepaid expenses and other current assets(1)		54,262		52,205		21,946		63,126
Total current assets		324,066		324,571		329,254		373,854
Property and equipment, net(1)		2,777,339		2,792,076		2,763,055		2,786,355
Intangible assets, net		3,550,710		3,656,924		3,261,885		3,331,465
Other assets		648,355		587,374
Right-of-use assets, net ⁽¹⁾						2,449,933		—
Other assets ⁽¹⁾						397,011		722,033
Total assets	$	7,300,470	$	7,360,945	$	9,201,138	$	7,213,707
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current liabilities:
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST,
AND SHAREHOLDERS' DEFICIT
Current Liabilities:
Accounts payable	$	32,429	$	28,320	$	35,130	$	34,308
Accrued expenses		85,052		61,129		63,151		63,665
Current maturities of long-term debt		773,289		627,157		24,000		941,728
Deferred revenue		101,168		101,098		112,382		108,054
Accrued interest		19,668		44,503		34,493		48,722
Other current liabilities		11,109		11,240
Current lease liabilities ⁽¹⁾						230,197		—
Other current liabilities⁽¹⁾						10,799		9,802
Total current liabilities		1,022,715		873,447		510,152		1,206,279
Long-term liabilities:
Long-term debt, net		8,185,512		8,148,426		9,821,502		8,996,825
Other long-term liabilities		350,041		334,993
Long-term lease liabilities⁽¹⁾						2,174,512		—
Other long-term liabilities⁽¹⁾						241,269		387,426
Total long-term liabilities		8,535,553		8,483,419		12,237,283		9,384,251
Redeemable noncontrolling interest						14,077		—
Shareholders' deficit:
Preferred stock - par value $.01, 30,000 shares authorized, no shares issued or outst.		—		—
Common stock - Class A, par value $.01, 400,000 shares authorized, 118,428
and 121,004 shares issued and outstanding at September 30, 2017
and December 31, 2016, respectively		1,184		1,210
Preferred stock - par value $0.01, 30,000 shares authorized, 0 shares issued or outstanding						—		—
Common stock - Class A, par value $0.01, 400,000 shares authorized, 112,604 shares and 112,433
shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively						1,126		1,124
Additional paid-in capital		2,148,273		2,010,520		2,446,369		2,270,326
Accumulated deficit		(4,064,805)		(3,637,467)		(5,387,091)		(5,136,368)
Accumulated other comprehensive loss, net		(342,450)		(370,184)		(620,778)		(511,905)
Total shareholders' deficit		(2,257,798)		(1,995,921)		(3,560,374)		(3,376,823)
Total liabilities and shareholders' deficit	$	7,300,470	$	7,360,945
Total liabilities, redeemable noncontrolling interests, and shareholders' deficit					$	9,201,138	$	7,213,707

(1)On January 1, 2019, the Company adopted ASU 2016-02 which requires lessees to recognize a right-of-use asset and a lease liability. Upon adoption, certain assets and liabilities were reclassified to Right-of-use assets, net and lease liabilities in accordance with provisions of ASU 2016-02. See Note 1 for further discussion.

The accompanying condensed notes are an integral part of these consolidated financial statements.

Table of Contents

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited) (in thousands, except per share amounts)


	For the three months				For the nine months				For the three months				For the nine months
	ended September 30,				ended September 30,				ended September 30,				ended September 30,
	2017		2016		2017		2016		2019		2018		2019		2018
Revenues:
Site leasing	$	408,538	$	388,168	$	1,209,089	$	1,144,461	$	468,572	$	435,260	$	1,379,758	$	1,295,686
Site development		25,407		23,151		75,513		72,159		38,975		31,961		121,229		86,160
Total revenues		433,945		411,319		1,284,602		1,216,620		507,547		467,221		1,500,987		1,381,846
Operating expenses:
Cost of revenues (exclusive of depreciation, accretion,
and amortization shown below):
Cost of site leasing		90,351		86,354		269,070		255,609		92,993		92,294		279,167		278,800
Cost of site development		21,117		19,114		62,713		59,021		30,516		24,447		92,606		67,693
Selling, general, and administrative ~~(2)~~(1)		32,559		32,255		100,177		110,326		42,272		34,908		148,755		106,901
Acquisition related adjustments and expenses		1,583		2,970		6,857		8,974
Acquisition and new business initiatives related
adjustments and expenses										4,692		2,995		9,669		9,171
Asset impairment and decommission costs		9,417		2,305		25,908		23,180		8,240		6,868		23,631		22,778
Depreciation, accretion, and amortization		161,907		160,111		480,457		479,635		174,987		167,703		517,590		502,659
Total operating expenses		316,934		303,109		945,182		936,745		353,700		329,215		1,071,418		988,002
Operating income		117,011		108,210		339,420		279,875		153,847		138,006		429,569		393,844
Other income (expense):
Interest income		2,505		3,101		8,648		7,704		1,311		2,006		4,692		4,972
Interest expense		(81,357)		(83,426)		(237,415)		(250,913)		(96,567)		(95,717)		(292,681)		(278,278)
Non-cash interest expense		(725)		(585)		(2,146)		(1,500)		(662)		(632)		(1,954)		(2,002)
Amortization of deferred financing fees		(4,957)		(5,445)		(16,603)		(16,035)		(5,157)		(4,980)		(15,333)		(15,265)
Loss from extinguishment of debt, net		—		(34,512)		(1,961)		(34,512)		(457)		—		(457)		(14,443)
Other income (expense), net		20,062		(1,139)		16,218		92,137		(33,551)		(24,518)		(21,296)		(110,175)
Total other expense		(64,472)		(122,006)		(233,259)		(203,119)
Income (loss) before provision for income taxes		52,539		(13,796)		106,161		76,756
Provision for income taxes		(3,378)		(1,574)		(10,167)		(5,780)
Total other income (expense), net										(135,083)		(123,841)		(327,029)		(415,191)
Income (loss) before income taxes										18,764		14,165		102,540		(21,347)
(Provision) benefit for income taxes										3,002		1,979		(22,813)		11,645
Net income (loss)	$	49,161	$	(15,370)	$	95,994	$	70,976		21,766		16,144		79,727		(9,702)
Net income (loss) per common share
Net (income) attributable to the noncontrolling interest										(87)		—		(87)		—
Net income (loss) attributable to SBA Communications
Corporation									$	21,679	$	16,144	$	79,640	$	(9,702)
Net income (loss) per common share attributable to SBA
Communications Corporation:
Basic	$	0.41	$	(0.12)	$	0.80	$	0.57	$	0.19	$	0.14	$	0.70	$	(0.08)
Diluted	$	0.41	$	(0.12)	$	0.79	$	0.56	$	0.19	$	0.14	$	0.69	$	(0.08)
Weighted average number of common shares
Basic		119,746		124,604		120,745		125,041		113,037		114,597		112,985		115,378
Diluted		121,026		124,604		121,727		125,761		115,184		116,114		114,824		115,378

~~(1)~~

Includes non-cash compensation of $9,213 and $7,970 for the three months ended September 30, 2017 and 2016, respectively, and $28,069 and $24,440 for the nine months ended September 30, 2017 and 2016, respectively.

~~(2)~~

~~Includes the impact of the $16,498 Oi reserve for the nine months ended September 30, 2016.~~

(1)Includes non-cash compensation of $12,281 and $10,261 for the three months ended September 30, 2019 and 2018, respectively, and $59,017 and $31,188 for the nine months ended September 30, 2019 and 2018, respectively.

The accompanying condensed notes are an integral part of these consolidated financial statements.

Table of Contents

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE ~~INCOME (LOSS)~~LOSS

(unaudited) (in thousands)



	For the three months				For the nine months				For the three months				For the nine months
	ended September 30,				ended September 30,				ended September 30,				ended September 30,

	2017		2016		2017		2016		2019		2018		2019		2018
Net income (loss)	$	49,161	$	(15,370)	$	95,994	$	70,976	$	21,766	$	16,144	$	79,727	$	(9,702)
Change in fair value of cash flow hedge										(10,811)		—		(62,404)		—
Foreign currency translation adjustments		36,472		(5,525)		27,734		131,659		(55,047)		(27,598)		(46,469)		(149,057)
Comprehensive income (loss)	$	85,633	$	(20,895)	$	123,728	$	202,635
Comprehensive loss										(44,092)		(11,454)		(29,146)		(158,759)
Comprehensive income attributable to noncontrolling interest										(87)		—		(87)		—
Comprehensive loss attributable to SBA Communications
Corporation									$	(44,179)	$	(11,454)	$	(29,233)	$	(158,759)

The accompanying condensed notes are an integral part of these consolidated financial statements.

‎

Table of Contents

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED ~~STATEMENT~~STATEMENTS OF SHAREHOLDERS’ DEFICIT

(unaudited) (in thousands)



								Accumulated											Accumulated
	Class A			Additional				Other				Class A			Additional				Other		Total
	Common Stock			Paid-In		Accumulated		Comprehensive				Common Stock			Paid-In		Accumulated		Comprehensive		Shareholders'
	Shares	Amount		Capital		Deficit		Loss		Total		Shares	Amount		Capital		Deficit		Loss, Net		Deficit

BALANCE, December 31, 2016	121,004	$	1,210	$	2,010,520	$	(3,637,467)	$	(370,184)	$	(1,995,921)
Net income	—		—		—		95,994		—		95,994
BALANCE, December 31, 2018												112,433	$	1,124	$	2,270,326	$	(5,136,368)	$	(511,905)	$	(3,376,823)
Net income attributable to SBA
Communications Corporation												—		—		—		25,989		—		25,989
Common stock issued in connection with
stock purchase/option plans	711		7		45,098		—		—		45,105	762		8		63,467		—		—		63,475
Non-cash stock compensation	—		—		29,347		—		—		29,347	—		—		23,722		—		—		23,722
Common stock issued in connection with
acquisitions	488		5		63,308		—		—		63,313	10		—		1,680		—		—		1,680
Change in fair value of cash flow hedge												—		—		—		—		(15,312)		(15,312)
Foreign currency translation adjustments												—		—		—		—		(4,544)		(4,544)
Impact of adoption of ASU 2016-02
related to leases												—		—		—		(20,968)		—		(20,968)
BALANCE, March 31, 2019												113,205	$	1,132	$	2,359,195	$	(5,131,347)	$	(531,761)	$	(3,302,781)
Net income attributable to SBA
Communications Corporation												—		—		—		31,973		—		31,973
Common stock issued in connection with
stock purchase/option plans												348		3		24,443		—		—		24,446
Non-cash stock compensation												—		—		24,747		—		—		24,747
Change in fair value of cash flow hedge												—		—		—		—		(36,281)		(36,281)
Repurchase and retirement of common stock	(3,775)		(38)		—		(523,332)		—		(523,370)	(463)		(4)		—		(94,568)		—		(94,572)
Foreign currency translation adjustments	—		—		—		—		27,734		27,734	—		—		—		—		13,122		13,122
BALANCE, September 30, 2017	118,428	$	1,184	$	2,148,273	$	(4,064,805)	$	(342,450)	$	(2,257,798)
BALANCE, June 30, 2019												113,090	$	1,131	$	2,408,385	$	(5,193,942)	$	(554,920)	$	(3,339,346)
Net income attributable to SBA
Communications Corporation												—		—		—		21,679		—		21,679
Common stock issued in connection with
stock purchase/option plans												208		2		24,986		—		—		24,988
Non-cash stock compensation												—		—		12,998		—		—		12,998
Change in fair value of cash flow hedge												—		—		—		—		(10,811)		(10,811)
Repurchase and retirement of common stock												(694)		(7)		—		(172,955)		—		(172,962)
Foreign currency translation adjustments												—		—		—		—		(55,047)		(55,047)
Payment of dividends on common stock												—		—		—		(41,873)		—		(41,873)
BALANCE, September 30, 2019												112,604	$	1,126	$	2,446,369	$	(5,387,091)	$	(620,778)	$	(3,560,374)

‎

Table of Contents



								Accumulated
	Class A			Additional				Other		Total
	Common Stock			Paid-In		Accumulated		Comprehensive		Shareholders'
	Shares	Amount		Capital		Deficit		Loss		Deficit

BALANCE, December 31, 2017	116,446	$	1,164	$	2,167,470	$	(4,388,288)	$	(379,460)	$	(2,599,114)
Net income attributable to SBA
Communications Corporation	—		—		—		31,545		—		31,545
Common stock issued in connection with
stock purchase/option plans	264		3		6,883		—		—		6,886
Non-cash stock compensation	—		—		10,636		—		—		10,636
Repurchase and retirement of common stock	(238)		(2)		—		(38,543)		—		(38,545)
Foreign currency translation adjustments	—		—		—		—		351		351
BALANCE, March 31, 2018	116,472	$	1,165	$	2,184,989	$	(4,395,286)	$	(379,109)	$	(2,588,241)
Net loss attributable to SBA
Communications Corporation	—		—		—		(57,391)		—		(57,391)
Common stock issued in connection with
stock purchase/option plans	238		2		20,791		—		—		20,793
Non-cash stock compensation	—		—		11,493		—		—		11,493
Repurchase and retirement of common stock	(1,878)		(19)		—		(306,960)		—		(306,979)
Foreign currency translation adjustments	—		—		—		—		(121,810)		(121,810)
BALANCE, June 30 2018	114,832	$	1,148	$	2,217,273	$	(4,759,637)	$	(500,919)	$	(3,042,135)
Net income attributable to SBA
Communications Corporation	—		—		—		16,144		—		16,144
Common stock issued in connection with
stock purchase/option plans	109		1		5,849		—		—		5,850
Non-cash stock compensation	—		—		10,671		—		—		10,671
Repurchase and retirement of common stock	(697)		(7)		—		(108,008)		—		(108,015)
Foreign currency translation adjustments	—		—		—		—		(27,598)		(27,598)
BALANCE, September 30, 2018	114,244	$	1,142	$	2,233,793	$	(4,851,501)	$	(528,517)	$	(3,145,083)

The accompanying condensed notes are an integral part of these consolidated financial statements.

‎

Table of Contents

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited) (in thousands)



	For the nine months
	ended September 30,				For the nine months ended September 30,
	2017		2016		2019		2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	95,994	$	70,976
Adjustments to reconcile net income to net cash provided by operating activities:
Net income (loss)					$	79,727	$	(9,702)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, accretion, and amortization		480,457		479,635		517,590		502,659
Non-cash asset impairment and decommission costs		22,316		19,050		22,816		22,146
Non-cash compensation expense		28,894		24,752		60,633		32,140
Amortization of deferred financing fees		16,603		16,035
Gain on remeasurement of U.S. dollar denominated intercompany loan		(11,649)		(88,964)
Provision for doubtful accounts (1)		1,498		20,516
Loss from extinguishment of debt, net		1,961		34,512
Deferred income tax expense (benefit)						5,988		(27,925)
Loss on remeasurement of U.S. dollar denominated intercompany loans						25,880		113,138
Other non-cash items reflected in the Statements of Operations		(2,481)		(3,418)		14,839		31,374
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable and costs and estimated earnings in excess of
billings on uncompleted contracts, net		(11,950)		(3,644)
AR and costs and est. earnings in excess of billings on uncompleted contracts, net						(13,909)		(4,655)
Prepaid expenses and other assets		(18,168)		(30,973)		669		(28,061)
Operating lease right-of-use assets, net						68,518		—
Accounts payable and accrued expenses		4,846		(4,263)		(2,521)		(2,496)
Accrued interest		(24,836)		(17,825)		(14,228)		(14,813)
Long-term lease liabilities						(64,057)		—
Other liabilities		7,987		10,842		3,039		10,338
Net cash provided by operating activities		591,472		527,231		704,984		624,143
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions		(161,007)		(191,402)		(283,701)		(403,835)
Capital expenditures		(106,310)		(104,320)		(111,381)		(104,966)
Purchase of investments						(528,915)		(99,823)
Proceeds from sale of investments						515,557		95,890
Other investing activities		(23,598)		(4,491)		(6,626)		(7,583)
Net cash used in investing activities		(290,915)		(300,213)		(415,066)		(520,317)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under Revolving Credit Facility		415,000		290,000		265,000		805,000
Repayments under Revolving Credit Facility		(375,000)		(140,000)		(590,000)		(725,000)
Repayment of Tower Securities		(610,000)		(550,000)		(920,000)		(755,000)
Proceeds from issuance of Tower Securities, net of fees		749,811		690,584		1,153,036		631,479
Repurchase and retirement of common stock, inclusive of fees		(523,370)		(202,349)
Proceeds from 2016 Senior Notes, net of fees		—		1,078,387
Payment for the redemption of 5.75% Senior Notes		—		(825,795)
Repurchase and retirement of common stock						(267,534)		(453,539)
Proceeds from employee stock purchase/stock option plans						112,909		33,678
Repayment of Term Loans						(18,000)		(1,941,000)
Proceeds from Term Loans, net of fees						—		2,377,264
Payment of dividends on common stock						(41,873)		—
Other financing activities		25,957		(7,293)		(1,119)		(4,071)
Net cash (used in) provided by financing activities		(317,602)		333,534
Net cash used in financing activities						(307,581)		(31,189)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash		3,537		13,760		(1,957)		(13,608)
NET CHANGE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH		(13,508)		574,312		(19,620)		59,029
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH:
Beginning of period		185,970		146,619		178,300		104,295
End of period	$	172,462	$	720,931	$	158,680	$	163,324

~~(1)~~

~~Includes the impact of the $16,498 Oi reserve for the nine months ended September 30, 2016.~~

The accompanying condensed notes are an integral part of these consolidated financial statements.

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SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)



	For the nine months
	ended September 30,				For the nine months ended September 30,
	2017		2016		2019		2018

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	262,257	$	268,997	$	306,810	$	293,372
Income taxes	$	11,323	$	8,133	$	14,860	$	16,525

SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES:
Assets acquired through capital leases	$	254	$	1,386
Right-of-use assets obtained in exchange for new operating lease liabilities					$	37,913	$	—
Operating lease modifications and reassessments					$	67,794	$	—
Right-of-use assets obtained in exchange for new finance lease liabilities					$	1,706	$	1,142
Common stock issued in connection with acquisitions	$	63,313	$	—	$	1,680	$	—
Consolidation of an equity method investment					$	71,990	$	—

The accompanying condensed notes are an integral part of these consolidated financial statements.

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SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.BASIS OF PRESENTATION

The accompanying consolidated financial statements should be read in conjunction with the Annual Report on Form 10-K for the fiscal year ended December 31, ~~2016~~2018 for SBA Communications Corporation and its subsidiaries (the “Company”). These financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X and, therefore, omit or condense certain footnotes and other information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States. In the opinion of the Company’s management, all adjustments (consisting of normal recurring accruals) considered necessary for fair financial statement presentation have been made. The results of operations for an interim period may not give a true indication of the results for the year. Certain reclassifications have been made to prior year amounts or balances to conform to the presentation adopted in the current year.

The preparation of financial statements requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. While the Company believes that such estimates are fair when considered in conjunction with the consolidated financial statements and accompanying notes, the actual amounts, when known, may vary from these estimates.

Foreign Currency Translation

~~The~~All assets and liabilities of foreign subsidiaries that do not utilize the U.S. dollar as its functional currency ~~for~~are translated at period-end exchange rates, while revenues and expenses are translated at monthly average exchange rates during the ~~Company’s Central American~~period. Unrealized remeasurement gains and losses are reported as foreign currency translation adjustments through Accumulated Other Comprehensive Loss in the Consolidated Statement of Shareholders’ Deficit.

For foreign subsidiaries where the U.S. dollar is the ~~U.S. dollar. Monetary~~functional currency, monetary assets and liabilities of such subsidiaries, which are not denominated in U.S. dollars, are remeasured at exchange rates in effect at the balance sheet date, and revenues and expenses are remeasured at monthly average rates prevailing during the year. Unrealized translation gains and losses are reported as other income (expense), net in the Consolidated ~~Statement~~Statements of Operations.

All assets and liabilities of foreign subsidiaries that do not utilize the U.S. dollar as its functional currency are translated at period-end rates of exchange, while revenues and expenses are translated at monthly average rates of exchange prevailing during the period. Unrealized remeasurement gains and losses are reported as foreign currency translation adjustments through Accumulated Other Comprehensive Loss in the accompanying Consolidated Statement of Shareholders’ Deficit.

Intercompany Loans Subject to Remeasurement

In accordance with ~~ASC~~Accounting Standards Codification (ASC) 830, the Company remeasures foreign denominated intercompany loans with the corresponding change in the balance being recorded in Other income (expense), net in the Consolidated Statement of Operations as settlement is anticipated or planned in the foreseeable future. The Company recorded ~~an $18.4~~a $21.0 million ~~gain~~loss and a ~~$3.2~~$17.1 million loss, net of taxes, on the remeasurement of intercompany loans for the three months ended September 30, ~~2017~~2019 and ~~2016,~~2018, respectively, and ~~an $11.6~~a $16.3 million ~~gain~~loss and ~~an $89.0~~a $74.7 million ~~gain~~loss, net of taxes, on the remeasurement of intercompany loans for the nine months ended September 30, ~~2017~~2019 and ~~2016,~~2018, respectively, due to changes in foreign exchange rates. As of September 30, 2019 and December 31, 2018, the aggregate amount outstanding under the intercompany loan agreements with the Company’s Brazilian subsidiary was $434.8 million and $536.9 million, respectively. As of September 30, ~~2017,~~2019, the aggregate amount outstanding ~~balance~~ under the intercompany loan agreement with ~~our Brazilian~~the Company’s South African subsidiary was ~~$433.3~~$58.9 million.

~~Accounting Pronouncements Recently Adopted~~Leases

In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business. The standard provides guidance to help entities determine whether transactions should be accounted for as acquisitions or disposals of assets or businesses. ASU 2017-01 provides revised guidance to determine when an acquisition meets the definition of a business or should be accounted for as an asset acquisition, likely resulting in more acquisitions being accounted for as asset acquisitions as opposed to business combinations. The Company adopted ~~this standard prospectively~~ASU No. 2016-02, Leases (“Topic 842”) using the modified retrospective adoption method with an effective date of January 1, ~~2017. Under this update, substantially all of~~2019. The consolidated financial statements for 2019 are presented under the ~~Company’s acquisitions~~new standard, while the comparative periods presented are ~~expected to qualify for asset acquisition treatment under ASC 360, Property, Plant,~~not adjusted and Equipment, rather than business combination treatment under ASC 805 Business Combinations. For asset acquisitions, external, direct transaction costs will be capitalized as a component of the cost of the asset acquired, while internal costs related to the asset acquisition will continue to be expensed as incurred. Additionally, earnout liabilities will be recognized at the time when the contingency is resolved or becomes payable and will increase the cost basis of the assets acquired. The adoption of ASU 2017-01 did not have a material impact on the Company’s unaudited consolidated financial statements and related disclosures.

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~~Recent Accounting Pronouncements Not Yet Adopted~~

In May 2014, the FASB released an updated standard regarding the recognition of revenue from contracts with customers, exclusive of those contracts within lease accounting. The core principle of the standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customersreported in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (1) identify the contractsaccordance with the customer; (2) identify the performance obligations in the contract; (3) determine the contract price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation.Company's historical accounting policy. This standard is effective for the Company in the first quarter of 2018. Early adoption is permitted. This standard is required to be applied retrospectively to each prior reporting period presented or with the cumulative effect being recognized at the date of initial application. The Company is evaluating the standard and does not expect a material financial statement impact upon adoption since the standard only affects the Company’s site development segment, which represents approximately 6% of the Company’s total revenues.

~~In February 2016, the FASB issued ASU 2016-02, Leases. The standard~~ requires all lessees to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments for all leases with a term greater than 12 months. The accounting for lessors remains largely unchanged from existing guidance. This standard is effective for annual and interim periods beginning after December 15, 2018 and requires a modified retrospective transition approach for all leases existing at, or entered into after, the beginning of the earliest comparative period presented. Early adoption is permitted; however, the Company does not currently plan to early adopt.payments. The Company has ~~established a cross functional project plan and is currently assessing~~elected not to separate nonlease components from the ~~impact~~associated lease component for all underlying classes of assets.

The adoption of the new lease standard had a significant impact on the Company’s Consolidated Balance Sheets resulting in the recognition of $2.6 billion of right-of-use assets, net, $226.0 million of current lease liabilities, and $2.3 billion of long-term lease liabilities. The right-of-use assets included $266.3 million of rent prepayments and financing lease right-of-use assets, net which were previously reported in Prepaid expenses and other current assets, Other assets, and Property, Plant and Equipment, net on the Consolidated Balance Sheets. In addition, the Company recognized a $21.0 million cumulative effect adjustment, net of tax, to

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Accumulated deficit on the Consolidated Balance Sheet related to the unamortized deferred lease costs incurred in prior periods which do not meet the definition of initial direct costs under Topic 842.

The adoption of Topic 842 did not have a significant impact on the Company’s lease classification or a material impact on its ~~consolidated financial statements. The Company expects this guidance to~~Consolidated Statements of Operations and liquidity. Additionally, the adoption of Topic 842 did not have a material impact on the Company’s debt covenant compliance under its ~~consolidated balance sheet due to~~current agreements.

The components of the ~~recognition of~~ right-of-use assets and lease liabilities ~~for its ground~~as of September 30, 2019 are as follows (in thousands):



Operating lease right-of-use assets, net	$	2,446,640
Financing lease right-of-use assets, net		3,293
Right-of-use assets, net	$	2,449,933

Current operating lease liabilities	$	229,210
Current financing lease liabilities		987
Current lease liabilities	$	230,197

Long-term operating lease liabilities	$	2,173,039
Long-term financing lease liabilities		1,473
Long-term lease liabilities	$	2,174,512

Operating Leases

Ground leases. The Company ~~does~~enters into long-term lease contracts for land that underlies its tower structures. Ground lease agreements generally include renewal options which can be exercised exclusively at the Company’s election. In making the determination of the period for which the Company is reasonably certain to remain on the site, the Company will assume optional renewals are reasonably certain of being exercised for the greater of: (1) a period sufficient to cover all tenants under their current committed term where the Company has provided rights to the tower not ~~expect~~to exceed the contractual ground lease terms including renewals, and (2) a period sufficient to recover the investment of significant leasehold improvements located on the site.

Substantially all leases provide for rent rate escalations. The most common provisions provide for fixed rent escalators which typically average 2-3% annually. The Company also has ground leases that include consumer price index escalators, particularly in its South American operations. Increases or decreases in lease payments that result from subsequent changes in the index or rate are accounted for as variable lease payments.

Office leases. The Company’s office leases consist of long-term leases for international, regional, and certain site development office locations. Office leases include a single lease component, lease of the office space and sometimes nonlease components such as common area maintenance expenses. The lease term for office leases are generally considered to be the contractually committed term.

Finance Leases

Vehicle leases. The Company leases vehicles that are used in its site development business. These leases are accounted for as financing leases and have lease terms that are contractually committed and do not include optional renewal terms.

Discount Rate

When available, the Company uses the rate implicit in the lease to discount lease payments to present value. However, the Company’s ground leases generally do not provide a readily determinable implicit rate. Therefore, the Company estimates the incremental borrowing rate to discount lease payments based on information available at lease commencement or upon a modification. The Company uses publicly available data for instruments with similar characteristics when calculating its incremental borrowing rates.

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Lease Cost

Variable lease payments include escalations based on standard cost of living indexes and are initially recognized using the prevailing index at the date of initial measurement or upon reassessment of the lease term. Subsequent changes in standard cost of living increases are recognized as variable lease costs. Variable lease payments also include contingent rent provisions.

The components of lease cost, lease term, and discount rate as of September 30, 2019 are as follows:



	For the three months		For the nine months
	ended September 30, 2019		ended September 30, 2019
	(in thousands)
Amortization of right-of-use assets	$	296	$	917
Interest on finance lease liabilities		28		82
Total finance lease cost		324		999
Operating lease cost ⁽¹⁾		66,059		200,881
Variable lease cost⁽¹⁾		10,190		27,356
Total lease cost	$	76,573	$	229,236

Weighted Average Remaining Lease Term as of September 30, 2019
Operating leases				17 years
Finance leases				3 years

Weighted Average Discount Rate as of September 30, 2019
Operating leases				6.1%
Finance leases				3.9%

			For the nine months
Other information:			ended September 30, 2019
Cash paid for amounts included in measurement of lease liabilities:
Cash flows from operating leases			$	177,960
Cash flows from finance leases			$	917

(1)For the three and nine months ended September 30, 2018, operating lease costs were $67.7 million and $205.3 million, respectively. For the three and nine months ended September 30, 2018, variable lease costs were $6.8 million and $20.3 million, respectively.

Tenant (Operating) Leases

The Company enters into long-term lease contracts with wireless service providers to lease antenna space on towers that it owns or operates. Each tenant lease relates to the lease or use of space at an individual site. Tenant leases are generally for an initial term of 5 to ten years with multiple 5 year renewal periods at the option of the tenant. Tenant leases typically contain specific rent escalators, which can be fixed or escalate in accordance with a standard cost of living index, including the renewal option periods.

Tenant lease agreements generally include renewal options which can be exercised exclusively at the tenant’s election. The only common exception is if the Company no longer has a right to the ground underlying the site, the lease agreements permit the Company to terminate the lease. Despite high frequency of renewal of options to extend the lease by its tenants, the Company has concluded that the exercise of a renewal option by a tenant is not reasonably certain of occurrence; therefore, only the current committed term is included in the determination of the lease term.

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Certain tenant leases provide for a reimbursement of costs incurred by the Company. The Company pays these costs directly and is not relieved of the primary obligation for the expenses. These reimbursements are recorded as revenue on the Statements of Operations.

Deferred Lease Costs

Prior to the adoption of ASU 2016-02, the Company deferred certain initial direct costs associated with the origination of tenant leases and lease amendments and amortized these costs over the remaining lease term. These costs included an allocation of a portion of the employees’ total compensation and payroll related benefits related to time spent performing those activities. Such deferred costs were approximately $2.8 million and $8.8 million for the three and nine months ended September 30, 2018. Amortization expense related to these deferred costs was $3.2 million and $9.3 million for the three and nine months ended September 30, 2018 and is included in cost of site leasing on the Consolidated Statements of Operations. As of December 31, 2018, unamortized deferred lease costs were $27.0 million.

ASU 2016-02, defines initial direct costs as incremental costs that would not have been incurred if the lease had not been obtained. These costs, including commissions paid related to the origination of specific tenant leases, will continue to be deferred and amortized over the remaining lease term. Upon adoption, the Company recognized a ~~material impact~~$21.0 million cumulative effect adjustment, net of tax, to Accumulated deficit on ~~its consolidated statement~~the Consolidated Balance Sheets. This adjustment reflects the recognition of ~~operations, nor does it expect accounting~~unamortized deferred lease costs incurred in prior periods which do not meet the definition of initial direct costs under Topic 842.

Initial direct costs were approximately $0.4 million and $1.6 million for ~~capital leases~~the three and nine months ended September 30, 2019. Amortization expense related to ~~change substantially.~~deferred initial direct costs was $0.4 million and $1.1 million for the three and nine months ended September 30, 2019. As of September 30, 2019, unamortized deferred initial direct costs were $4.3 million and were included in other assets on the Consolidated Balance Sheets.

2.FAIR VALUE MEASUREMENTS

Items Measured at Fair Value on a Recurring Basis— The Company’s earnout liabilities related to business combinations are measured at fair value on a recurring basis using Level 3 inputs and are recorded in Accrued expenses in the ~~accompanying~~ Consolidated Balance Sheets. Changes in estimates are recorded in Acquisition and new business initiatives related adjustments and expenses in the ~~accompanying~~ Consolidated ~~Statement~~Statements of Operations. The Company determines the fair value of earnouts (contingent consideration) and any subsequent changes in fair value using a discounted probability-weighted approach using Level 3 inputs. Level 3 valuations rely on unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. The fair value of the earnouts is reviewed quarterly and is based on the payments the Company expects to make based on historical internal observations related to the anticipated performance of the underlying assets. The Company’s estimate of the fair value of its obligation contained in various acquisitions prior to January 1, 2017 (adoption of ASU 2017-01) was $2.8 million and $4.1 million as of September 30, 2017 and December 31, 2016, respectively. The maximum potential obligation related to the performance targets for these various acquisitions was $4.2 million and $5.8 million as of September 30, 2017 and December 31, 2016, respectively. The maximum potential obligation related to the performance targets for acquisitions, ~~after January 1, 2017 was $7.9~~which have not been recorded on the Company’s Consolidated Balance Sheet, were $28.9 million and $14.0 million as of September 30, ~~2017.~~2019 and December 31, 2018, respectively.

The Company’s asset retirement obligations are measured at fair value on a recurring basis using Level 3 inputs and are recorded in Other long-term liabilities in the Consolidated Balance Sheets. The fair value of the asset retirement obligations is calculated using a discounted cash flow model.

Items Measured at Fair Value on a Nonrecurring Basis— The Company’s long-lived ~~assets, intangibles,~~ and ~~asset retirement obligations~~intangible assets are measured at fair value on a nonrecurring basis using Level 3 inputs. The Company considers many factors and makes certain assumptions when making this assessment, including but not limited to: general market and economic conditions, historical operating results, geographic location, lease-up potential and expected timing of lease-up. The fair value of the long-lived ~~assets, intangibles,~~ and ~~asset retirement obligations~~intangible assets is calculated using a discounted cash flow model.

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Asset impairment and decommission costs for all periods presented and the related impaired assets primarily relate to the Company’s site leasing operating segment. The following summarizes the activity of asset impairment and decommission costs (in thousands):

For the three months

For the nine months

ended September 30,

ended September 30,

2017

2016

2017

2016

Asset impairment (1)

$
4,128

$
6,673

$
10,162

$
14,138
Write-off of carrying value of decommissioned towers

4,496

3,587

12,143

11,449
Write-off and disposal of former corporate headquarters

—

—

—

2,346
Gain on sale of fiber assets (2)

—

(8,965)

—

(8,965)
Other third party decommission costs

793

1,010

3,603

4,212
Total asset impairment and decommission costs

$
9,417

$
2,305

$
25,908

$
23,180

~~(1)~~

Represents impairment charges resulting from the Company’s regular analysis of whether the future cash flows from certain towers are adequate to recover the carrying value of the investment in those towers.

~~(2)~~

~~Related to the sale of fiber assets acquired in the 2012 Mobilitie transaction.~~



	For the three months				For the nine months
	ended September 30,				ended September 30,
	2019		2018		2019		2018

Asset impairment ⁽¹⁾	$	5,742	$	2,909	$	13,326	$	13,291
Write-off of carrying value of decommissioned towers		2,241		3,561		9,405		7,932
Other (including third party decommission costs)		257		398		900		1,555
Total asset impairment and decommission costs	$	8,240	$	6,868	$	23,631	$	22,778

(1)Represents impairment charges resulting from the Company’s regular analysis of whether the future cash flows from certain towers are adequate to recover the carrying value of the investment in those towers.

Fair Value of Financial Instruments— The carrying values of cash and cash equivalents, accounts receivable, restricted cash, accounts payable, and short-term investments approximate their estimated fair values due to the ~~short~~shorter maturity of these instruments. Short-term investments consisted of $0.2 million in Treasury securities as of September 30, ~~2017~~2019 and December 31, ~~2016.~~2018. The Company’s estimate of the fair value of its held-to-maturity investments in treasury and corporate bonds, including current portion, are based primarily upon Level 1 reported market values. As of September 30, ~~2017~~2019 and December 31, ~~2016,~~2018, the carrying value and fair value of the held-to-maturity investments, including current portion, were ~~$0.7~~$0.2 million. ~~These amounts are~~The current portion is recorded in Prepaid ~~expenses~~ and other current assets ~~and Other assets~~ in the ~~accompanying~~ Consolidated Balance ~~Sheets.~~Sheets, while held-to-maturity investments are recorded in Other assets. As of September 30, 2019, in addition to the Treasury securities, the Company had $0.5 million of short-term investments. For the three months ended September 30, 2019, the Company purchased $235.0 million and sold $260.0 million of short-term investments. For the nine months ended September 30, 2019, the Company purchased and sold $515.0 million of short-term investments.

On February 1, 2019, the Company, through its wholly owned subsidiary, SBA Senior Finance II, LLC, entered into a four year interest rate swap on a portion of its 2018 Term Loan in order to reduce the Company’s exposure to fluctuations in interest rates. The interest rate swap has a $1.2 billion notional value receiving interest at one month LIBOR plus 200 basis points and paying a fixed rate of 4.495% per annum settled monthly. The Company designated this swap as a cash flow hedge.

On May 23, 2019, the Company, through its wholly owned subsidiary, SBA Senior Finance II, LLC, entered into a four year interest rate swap on a portion of its 2018 Term Loan. The interest rate swap has a $750.0 million notional value receiving interest at one month LIBOR plus 200 basis points and paying a fixed rate of 4.08% per annum settled monthly. The Company designated this swap as a cash flow hedge.

On a quarterly basis, the Company evaluates whether the swaps remain highly effective in offsetting changes in cash flows. As of September 30, 2019, the Company believes that the hedges remain highly effective and changes in the fair value were recorded in Accumulated other comprehensive loss, net on the Consolidated Balance Sheet. As of September 30, 2019, the fair value of the swaps using Level 2 inputs resulted in a liability of $62.4 million and was included within Other long-term liabilities on the Consolidated Balance Sheet. The Company is exposed to counterparty credit risk to the extent that a counterparty fails to meet the terms of a contract. The Company’s exposure is limited to the current value of the contract at the time the counterparty fails to perform.

The Company determines fair value of its debt instruments utilizing various Level 2 sources including quoted prices and indicative quotes (non-binding quotes) from brokers that require judgment to interpret market information including implied credit spreads for similar borrowings on recent trades or bid/ask prices. The fair value of the Revolving Credit Facility is considered to approximate the carrying value because the interest payments are based on Eurodollar rates that reset monthly or more frequently. The Company does not believe its credit risk has changed materially from the date the applicable Eurodollar Rate ~~plus 137.5 to 200.0 basis points~~ was set for the Revolving Credit ~~Facility.~~Facility (112.5 to 175.0 basis points). Refer to Note 10 for the fair values, principal balances, and carrying values of the Company’s debt instruments.

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3.RESTRICTED CASH

The cash, cash equivalents, and restricted cash balances on the ~~consolidated statement~~Consolidated Statements of ~~cash flows consists~~Cash Flows consist of the following:



	As of		As of
	September 30, 2019		December 31, 2018		Included on Balance Sheet

		(in thousands)
Cash and cash equivalents	$	128,778	$	143,444
Securitization escrow accounts		27,309		32,260	Restricted cash - current asset
Payment and performance bonds		193		204	Restricted cash - current asset
Surety bonds and workers compensation		2,400		2,392	Other assets - noncurrent
Total cash, cash equivalents, and restricted cash	$	158,680	$	178,300

As of

As of

September 30, 2017

December 31, 2016

Included on Balance Sheet

(in thousands)

Cash and cash equivalents

$
139,711

$
146,109

Securitization escrow accounts

29,929

36,607

Restricted cash - current asset
Payment and performance bonds

239

179

Restricted cash - current asset
Surety bonds and workers compensation

2,583

3,075

Other assets - noncurrent
Total cash, cash equivalents, and restricted cash

$
172,462

$
185,970

Pursuant to the terms of the Tower Securities (see Note 10), the Company is required to establish a securitization escrow account, held by the indenture trustee, into which all rents and other sums due on the towers that secure the Tower Securities are directly deposited by the lessees. These restricted cash amounts are used to fund reserve accounts for the payment of (1) debt service

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costs, (2) ground rents, real estate and personal property taxes and insurance premiums related to towers, (3) trustee and servicing expenses, and (4) management fees. The restricted cash in the securitization escrow account in excess of required reserve balances is subsequently released to the Borrowers (as defined in Note 10) monthly, provided that the Borrowers are in compliance with their debt service coverage ratio and that no event of default has occurred. All monies held by the indenture trustee are classified as restricted cash on the Company’s Consolidated Balance Sheets.

Payment and performance bonds relate primarily to collateral requirements for tower construction currently in process by the Company. Cash is pledged as collateral related to surety bonds issued for the benefit of the Company or its affiliates in the ordinary course of business and primarily related to the Company’s tower removal obligations. As of September 30, ~~2017~~2019 and December 31, ~~2016,~~2018, the Company had ~~$39.1~~$41.4 million and ~~$39.2~~$40.5 million in surety, payment and performance bonds, respectively, for which ~~it was only required to post $0.5 million in collateral as of December 31, 2016. As of September 30, 2017, no~~0 collateral was required to be posted. The Company periodically evaluates the collateral posted for its bonds to ensure that it meets the minimum requirements. As of September 30, ~~2017~~2019 and December 31, ~~2016,~~2018, the Company had also pledged ~~$2.5~~$2.3 million and $2.2 million, respectively, as collateral related to its workers compensation policy.

4.COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS

The Company’s costs and estimated earnings on uncompleted contracts are comprised of the following:



	As of		As of
	September 30, 2019		December 31, 2018

	(in thousands)
Costs incurred on uncompleted contracts	$	51,291	$	38,464
Estimated earnings		19,191		16,655
Billings to date		(43,403)		(31,952)
	$	27,079	$	23,167

These amounts are included in the Consolidated Balance Sheets under the following captions:



	As of		As of
	September 30, 2019		December 31, 2018

	(in thousands)
Costs and estimated earnings in excess of billings on uncompleted contracts	$	28,303	$	23,785
Billings in excess of costs and estimated earnings on
uncompleted contracts (included in Other current liabilities)		(1,224)		(618)
	$	27,079	$	23,167

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At September 30, 2019 and December 31, 2018, 8 customers comprised 96.5% and 96.3% of the contract assets, net of contract liabilities.

5.ACQUISITIONS

The following table summarizes the Company’s acquisition activity:



	For the three months				For the nine months
	ended September 30,				ended September 30,
	2019		2018		2019		2018

	(in thousands)
Acquisitions of towers and related intangible assets ^{(1) (2)}	$	99,173	$	110,464	$	224,585	$	372,054
Land buyouts and other assets ⁽³⁾		33,346		8,008		59,116		31,781
Total cash acquisition capital expenditures	$	132,519	$	118,472	$	283,701	$	403,835

(1)The nine months ended September 30, 2019 excludes $1.7 million of acquisition costs funded through the issuance of 10,000 shares of Class A common stock.

(2)On August 30, 2019, the Company acquired an additional interest of a previously unconsolidated joint venture in South Africa which resulted in the consolidation of the entity. The cash consideration is included herein. Furthermore, the three and nine months ended September 30, 2019 excludes $72.0 million associated with the consolidation of this entity.

(3)In addition, the Company paid $7.0 million and $6.7 million for ground lease extensions and term easements on land underlying the Company’s towers during the three months ended September 30, 2019 and 2018, respectively, and paid $13.1 million and $16.4 million for ground lease extensions and term easements on land underlying the Company’s towers during the nine months ended September 30, 2019 and 2018, respectively. The Company recorded these amounts in prepaid rent on its Consolidated Balance Sheets.

During the nine months ended September 30, 2019, the Company allocated the purchase price of 1,103 completed towers and related assets and liabilities consisting of $51.3 million of property and equipment, $286.7 million of intangible assets, and $41.4 million of other net liabilities assumed. All acquisitions in the three months ended September 30, 2019 were accounted for as asset acquisitions. All but 1 acquisition in the nine months ended September 30, 2019 were accounted for as asset acquisitions. During the three months ended March 31, 2019, the Company consummated an acquisition for $3.0 million in cash and $1.7 million in the Company’s Class A common stock, which was accounted for as a business combination.

Subsequent to September 30, 2019, the Company acquired 6 towers and related assets for $6.7 million in cash.

6.PREPAID EXPENSES AND OTHER CURRENT ASSETS AND OTHER ASSETS

The Company’s prepaid expenses and other current assets are comprised of the following:



	As of		As of		As of		As of
	September 30, 2017		December 31, 2016		September 30, 2019		December 31, 2018

		(in thousands)				(in thousands)
Prepaid land rent	$	30,932	$	33,975
Prepaid ground rent⁽¹⁾					$	1,497	$	34,276
Loan receivables						—		11,178
Marketable Securities						656		239
Prepaid real estate taxes						4,193		2,998
Other		23,330		18,230		15,600		14,435
Total prepaid expenses and other current assets	$	54,262	$	52,205	$	21,946	$	63,126

(1)Prepaid ground rent related to non-contingent rent provisions was reclassified to Right-of-use assets, net on the Consolidated Balance Sheets in the first quarter of 2019 due to the adoption of ASU 2016-02.

‎

5.~~ACQUISITIONS~~

~~The following table summarizes the Company’s cash acquisition capital expenditures:~~

For the three months

For the nine months

ended September 30,

ended September 30,

2017

2016

2017

2016

(in thousands)
Towers and related intangible assets (1)(2)

$
66,338

$
31,022

$
124,476

$
144,534
Land buyouts and other assets (3)

12,488

11,676

36,531

46,868
Total cash acquisition capital expenditures

$
78,826

$
42,698

$
161,007

$
191,402

~~(1)~~

~~The nine months ended September 30, 2017 excludes $63.3 million of acquisition costs funded through the issuance of 487,963 shares of Class A common stock.~~

~~(2)~~

~~The three and nine months ended September 30, 2017 exclude $21.0 million of acquisitions completed during the second quarter of 2017 which were not funded as of September 30, 2017.~~

~~(3)~~

In addition, the Company paid $2.4 million and $2.2 million for ground lease extensions and term easements on land underlying our towers during the three months ended September 30, 2017 and 2016, respectively, and paid $10.6 million and $8.7 million for ground lease extensions and term easements on land underlying our towers during the nine months ended September 30, 2017 and 2016, respectively. The Company recorded these amounts in prepaid rent on its Consolidated Balance Sheets.

For acquisitions which qualify as asset acquisitions, the aggregate purchase price is allocated on a relative fair value basis to towers and related intangible assets. The fair values of these net assets acquired are based on management’s estimates and assumptions, as well as other information compiled by management, including valuations that utilize customary valuation procedures

1014

Table of Contents

~~and techniques.~~

The ~~fair value estimates~~Company’s other assets are ~~based~~comprised of the following:



	As of		As of
	September 30, 2019		December 31, 2018

		(in thousands)
Prepaid ground rent⁽¹⁾	$	—	$	263,694
Straight-line rent receivable		326,220		322,073
Loan receivables		8,767		49,255
Deferred lease costs, net⁽¹⁾		4,342		27,020
Deferred tax asset - long term		16,981		18,330
Other		40,701		41,661
Total other assets	$	397,011	$	722,033

(1)Prepaid ground rent was reclassified from Other assets to Right-of-use assets, net on ~~available historical information and on future expectations and assumptions deemed reasonable by management at~~ the ~~time. If the actual results differ from the estimates and judgments used in these fair values, the amounts recorded~~Consolidated Balance Sheets in the ~~consolidated financial statements could be subject~~first quarter of 2019 and deferred lease costs of $23.3 million were written off to ~~a possible impairment~~Accumulated deficit on the Consolidated Balance Sheets in the first quarter of ~~the intangible assets, or require acceleration of the amortization expense of intangible assets in subsequent periods.~~

For business combinations, the estimates of the fair value of the assets acquired and liabilities assumed at the date of an acquisition are subject to adjustment during the measurement period (up to one year from the particular acquisition date). During the measurement period, the Company will adjust assets and/or liabilities if new information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have resulted in a revised estimated value of those assets and/or liabilities as of that date. The primary areas of the preliminary purchase price allocations that are not yet finalized relate2019 due to the ~~fair value~~adoption of ~~certain tangible and intangible assets acquired and liabilities assumed, including contingent consideration and any related tax impact.~~ASU 2016-02.

During the nine months ended September 30, 2017, the Company acquired 436 completed towers and related assets and liabilities consisting of $48.0 million of property and equipment, $160.0 million of intangible assets, and $0.2 million of working capital adjustments.

~~Subsequent to September 30, 2017, the Company acquired 35 towers and related assets for $24.4 million in cash.~~

6.~~INTANGIBLE ASSETS, NET~~

~~The following table provides the gross and net carrying amounts for each major class of intangible assets:~~

As of September 30, 2017

As of December 31, 2016

Gross carrying

Accumulated

Net book

Gross carrying

Accumulated

Net book

amount

amortization

value

amount

amortization

value

(in thousands)
Current contract intangibles

$
4,284,068

$
(1,612,010)

$
2,672,058

$
4,141,968

$
(1,401,025)

$
2,740,943
Network location intangibles

1,555,579

(676,927)

878,652

1,515,348

(599,367)

915,981
Intangible assets, net

$
5,839,647

$
(2,288,937)

$
3,550,710

$
5,657,316

$
(2,000,392)

$
3,656,924

All intangible assets noted above are included in the Company’s site leasing segment. The Company amortizes its intangible assets using the straight-line method over 15 years. Amortization expense relating to the intangible assets above was $96.8 million and $93.6 million for the three months ended September 30, 2017 and 2016, respectively, and $286.8 million and $276.4 million for the nine months ended September 30, 2017 and 2016, respectively.

7.PROPERTY AND EQUIPMENT, NET

Property and equipment, net ~~(including assets held under capital leases)~~ consists of the following:



	As of		As of
	September 30, 2019		December 31, 2018

	(in thousands)
Towers and related components	$	5,069,473	$	4,951,321
Construction-in-process ⁽¹⁾		36,814		35,756
Furniture, equipment, and vehicles ⁽²⁾		49,677		54,814
Land, buildings, and improvements		724,361		668,459
Total property and equipment		5,880,325		5,710,350
Less: accumulated depreciation ⁽²⁾		(3,117,270)		(2,923,995)
Property and equipment, net	$	2,763,055	$	2,786,355

As of

As of

September 30, 2017

December 31, 2016

(in thousands)
Towers and related components

$
4,691,935

$
4,563,756
Construction-in-process

36,429

38,926
Furniture, equipment, and vehicles

51,713

50,671
Land, buildings, and improvements

617,032

578,680
Total property and equipment

5,397,109

5,232,033
Less: accumulated depreciation

(2,619,770)

(2,439,957)
Property and equipment, net

$
2,777,339

$
2,792,076

~~Table of Contents~~

(1)Construction-in-process represents costs incurred related to towers that are under development and will be used in the Company’s site leasing operations.

(2)Financing lease right-of-use assets are included in the prior period but are included in Right-of-use assets, net on the Consolidated Balance Sheets for the current period.

Depreciation expense was ~~$65.0~~$71.4 million and ~~$66.4~~$67.5 million for the three months ended September 30, ~~2017~~2019 and ~~2016,~~2018, respectively, and ~~$193.2~~$210.1 million and ~~$202.8~~$200.6 million for the nine months ended September 30, ~~2017~~2019 and ~~2016,~~2018, respectively. At September 30, ~~2017~~2019 and December 31, ~~2016, non-cash~~2018, unpaid capital expenditures that are included in accounts payable and accrued expenses were ~~$7.5~~$11.8 million and ~~$7.0~~$12.4 million, respectively.

8.~~COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS~~

~~Costs~~
‎

Table of Contents

8.INTANGIBLE ASSETS, NET

The following table provides the gross and ~~estimated earnings on uncompleted contracts consist~~net carrying amounts for each major class of ~~the following:~~intangible assets:



	As of September 30, 2019						As of December 31, 2018
	Gross carrying		Accumulated		Net book		Gross carrying		Accumulated		Net book
	amount		amortization		value		amount		amortization		value

	(in thousands)
Current contract intangibles	$	4,564,516	$	(2,130,479)	$	2,434,037	$	4,394,416	$	(1,928,030)	$	2,466,386
Network location intangibles		1,713,590		(885,742)		827,848		1,669,859		(804,780)		865,079
Intangible assets, net	$	6,278,106	$	(3,016,221)	$	3,261,885	$	6,064,275	$	(2,732,810)	$	3,331,465

As of

As of

September 30, 2017

December 31, 2016

(in thousands)
Costs incurred on uncompleted contracts

$
31,845

$
34,577
Estimated earnings

11,255

11,185
Billings to date

(30,861)

(36,027)

$
12,239

$
9,735

~~These amounts~~All intangible assets noted above are included in the ~~accompanying Consolidated Balance Sheets under~~Company’s site leasing segment. Amortization expense relating to the ~~following captions:~~

As of

As of

September 30, 2017

December 31, 2016

(in thousands)
Costs and estimated earnings in excess of billings on uncompleted contracts

$
12,508

$
11,127
Billings in excess of costs and estimated earnings on

uncompleted contracts (included in Other current liabilities)

(269)

(1,392)

$
12,239

$
9,735

~~Eight customers comprised 82.3%~~intangible assets above was $103.5 million and 81.6% of the costs and estimated earnings in excess of billings on uncompleted contracts, net of billings in excess of costs and estimated earnings at September 30, 2017 and December 31, 2016, respectively.

9.~~EARNINGS PER SHARE~~

~~Basic earnings per share was computed by dividing net income from continuing operations attributable to common shareholders by the weighted-average number of shares of Common Stock outstanding~~$100.1 million for each respective period. Diluted earnings per share was calculated by dividing net income from continuing operations attributable to common shareholders by the weighted-average number of shares of Common Stock outstanding adjusted for any dilutive Common Stock equivalents, including unvested restricted stock and shares issuable upon exercise of stock options as determined under the “If-Converted” method and also Common Stock warrants as determined under the “Treasury Stock” method.

~~Table of Contents~~

~~The following table sets forth basic and diluted net income per common share for the three and nine months ended September 30, 2017 and 2016 (in thousands, except per share data):~~

For the three months

For the nine months

ended September 30,

ended September 30,

2017

2016

2017

2016
Numerator:

Net income (loss)

$
49,161

$
(15,370)

$
95,994

$
70,976
Denominator:

Basic weighted-average shares outstanding

119,746

124,604

120,745

125,041
Dilutive impact of stock options and restricted shares

1,280

—

982

720
Diluted weighted-average shares outstanding

121,026

124,604

121,727

125,761
Net income (loss) per common share:

Basic

$
0.41

$
(0.12)

$
0.80

$
0.57
Diluted

$
0.41

$
(0.12)

$
0.79

$
0.56

For the three and nine months ended September 30, 2017, the diluted weighted average number of common shares outstanding excluded an additional 11,674 and 1.8 million shares, respectively, issuable upon exercise of the Company’s stock options because the impact would be anti-dilutive.

~~For~~ the three months ended September 30, ~~2016, all potential common stock equivalents, including 4.5~~2019 and 2018, respectively, and $307.3 million ~~shares of stock options outstanding~~ and ~~0.3~~$301.7 million ~~shares of restricted stock units outstanding, were excluded as~~for the ~~effect would be anti-dilutive.~~

~~For the~~nine months ended September 30, ~~2016, the diluted weighted average number of common shares outstanding excluded an additional 2.2 million shares issuable upon exercise~~2019 and 2018, respectively.

9.ACCRUED EXPENSES

The Company’s accrued expenses are comprised of the ~~Company’s stock options because the impact would be anti-dilutive.~~following:



	As of		As of
	September 30, 2019		December 31, 2018

	(in thousands)
Salaries and benefits	$	14,864	$	16,015
Real estate and property taxes		10,474		7,928
Unpaid capital expenditures		11,781		12,387
Other		26,032		27,335
Total accrued expenses	$	63,151	$	63,665

1316

Table of Contents

10.DEBT

~~10.DEBT~~

The principal values, fair values, and carrying values of debt consist of the following (in thousands):

As of

As of

September 30, 2017

December 31, 2016

Maturity Date

Principal Balance

Fair Value

Carrying Value

Principal Balance

Fair Value

Carrying Value
2014 Senior Notes

July 15, 2022

$
750,000

$
772,500

$
738,547

$
750,000

$
763,125

$
736,992
2016 Senior Notes

Sep. 1, 2024

1,100,000

1,134,375

1,080,674

1,100,000

1,083,500

1,078,954
2012-1C Tower Securities

Dec. 11, 2017

��

—

—

610,000

610,165

607,157
2013-1C Tower Securities

April 10, 2018

425,000

423,959

424,049

425,000

423,381

422,768
2013-2C Tower Securities

April 11, 2023

575,000

586,103

568,339

575,000

563,322

567,545
2013-1D Tower Securities

April 10, 2018

330,000

330,234

329,240

330,000

334,521

328,225
2014-1C Tower Securities

Oct. 8, 2019

920,000

921,168

914,244

920,000

922,199

912,219
2014-2C Tower Securities

Oct. 8, 2024

620,000

623,181

613,253

620,000

608,921

612,641
2015-1C Tower Securities

Oct. 8, 2020

500,000

501,790

492,920

500,000

495,145

491,289
2016-1C Tower Securities

July 9, 2021

700,000

697,081

692,658

700,000

688,072

691,322
2017-1C Tower Securities

April 11, 2022

760,000

759,248

750,645

—

—

—
Revolving Credit Facility

Feb. 5, 2020

430,000

430,000

430,000

390,000

390,000

390,000
2014 Term Loan

Mar. 24, 2021

1,451,250

1,454,878

1,442,529

1,462,500

1,467,984

1,452,039
2015 Term Loan

June 10, 2022

488,750

489,361

481,703

492,500

494,347

484,432
Total debt

$
9,050,000

$
9,123,878

$
8,958,801

$
8,875,000

$
8,844,682

$
8,775,583
Less: current maturities of long-term debt

(773,289)

(627,157)
Total long-term debt, net of current maturities

$
8,185,512

$
8,148,426

~~Table of Contents~~



		As of						As of
		September 30, 2019						December 31, 2018
	Maturity Date	Principal ‎Balance		Fair Value		Carrying ‎Value		Principal ‎Balance		Fair Value		Carrying ‎Value
2014 Senior Notes	Jul. 15, 2022	$	750,000	$	757,500	$	742,993	$	750,000	$	735,000	$	741,273
2016 Senior Notes	Sep. 1, 2024		1,100,000		1,141,250		1,085,591		1,100,000		1,034,000		1,083,689
2017 Senior Notes	Oct. 1, 2022		750,000		763,125		744,392		750,000		712,500		743,099
2013-2C Tower Securities	Apr. 11, 2023		575,000		589,410		570,574		575,000		569,164		569,715
2014-1C Tower Securities	Oct. 8, 2019		—		—		—		920,000		914,241		917,728
2014-2C Tower Securities	Oct. 8, 2024		620,000		650,175		614,979		620,000		609,665		614,315
2015-1C Tower Securities	Oct. 8, 2020		500,000		502,500		497,493		500,000		496,640		495,737
2016-1C Tower Securities	Jul. 9, 2021		700,000		705,236		696,445		700,000		691,432		694,994
2017-1C Tower Securities	Apr. 11, 2022		760,000		766,300		754,546		760,000		744,496		753,028
2018-1C Tower Securities	Mar. 9, 2023		640,000		662,586		633,928		640,000		641,478		632,725
2019-1C Tower Securities	Jan. 12, 2025		1,165,000		1,165,501		1,153,140		—		—		—
Revolving Credit Facility	Apr. 11, 2023		—		—		—		325,000		325,000		325,000
2018 Term Loan	Apr. 11, 2025		2,370,000		2,372,963		2,351,421		2,388,000		2,262,630		2,367,250
Total debt		$	9,930,000	$	10,076,546	$	9,845,502	$	10,028,000	$	9,736,246	$	9,938,553
Less: current maturities of long-term debt							(24,000)						(941,728)
Total long-term debt, net of current maturities						$	9,821,502					$	8,996,825

The table below reflects cash and non-cash interest expense amounts recognized by debt instrument for the periods presented:



	For the three months ended September 30,								For the nine months ended September 30,
	2019				2018				2019				2018
	Cash		Non-cash		Cash		Non-cash		Cash		Non-cash		Cash		Non-cash
	Interest		Interest		Interest		Interest		Interest		Interest		Interest		Interest

	(in thousands)
2014 Senior Notes	$	9,141	$	201	$	9,141	$	191	$	27,422	$	596	$	27,422	$	567
2016 Senior Notes		13,406		265		13,406		252		40,219		786		40,219		748
2017 Senior Notes		7,500		—		7,500		—		22,500		—		22,500		—
2013 Tower Securities		5,396		—		5,396		—		16,188		—		20,267		—
2014 Tower Securities		11,439		—		12,785		—		37,009		—		38,354		—
2015-1C Tower Securities		3,985		—		3,985		—		11,954		—		11,954		—
2016-1C Tower Securities		5,090		—		5,090		—		15,271		—		15,271		—
2017-1C Tower Securities		6,096		—		6,096		—		18,269		—		18,268		—
2018-1C Tower Securities		5,570		—		5,570		—		16,711		—		12,502		—
2019-1C Tower Securities		1,671		—		—		—		1,671		—		—		—
Revolving Credit Facility		1,009		—		1,721		—		5,409		—		4,911		—
2014 Term Loan		—		—		—		—		—		—		15,550		146
2015 Term Loan		—		—		—		—		—		—		5,237		187
2018 Term Loan		26,243		196		25,096		189		79,959		572		46,303		354
Other		21		—		(69)		—		99		—		(480)		—
Total	$	96,567	$	662	$	95,717	$	632	$	292,681	$	1,954	$	278,278	$	2,002

Table of Contents

For the three months ended September 30,

For the nine months ended September 30,

2017

2016

2017

2016

Cash

Non-cash

Cash

Non-cash

Cash

Non-cash

Cash

Non-cash

Interest

Interest

Interest

Interest

Interest

Interest

Interest

Interest

(in thousands)
5.625% Senior Notes

$
—

$
—

$
7,031

$
—

$
—

$
—

$
21,094

—
5.75% Senior Notes

—

—

5,494

—

—

—

28,494

—
2014 Senior Notes

9,141

182

9,141

173

27,422

540

27,422

513
2016 Senior Notes

13,406

240

6,852

117

40,219

711

6,852

117
2010-2C Tower Securities

—

—

1,098

—

—

—

15,213

—
2012-1C Tower Securities

—

—

4,529

—

5,331

—

13,596

—
2013 Tower Securities

10,804

—

10,804

—

32,413

—

32,413

—
2014 Tower Securities

12,785

—

12,785

—

38,354

—

38,354

—
2015-1C Tower Securities

3,985

—

3,985

—

11,954

—

11,954

—
2016-1C Tower Securities

5,090

—

4,808

—

15,271

—

4,808

—
2017-1C Tower Securities

6,096

—

—

—

11,098

—

—

—
Revolving Credit Facility

2,673

—

667

—

6,848

—

2,245

—
2014 Term Loan

12,964

133

12,209

129

36,291

391

36,453

380
2015 Term Loan

4,366

170

4,111

166

12,221

504

12,275

490
Other

47

—

(88)

—

(7)

—

(260)

—
Total

$
81,357

$
725

$
83,426

$
585

$
237,415

$
2,146

$
250,913

$
1,500

Senior Credit Agreement

Revolving Credit Facility under the Senior Credit Agreement

~~The Revolving Credit Facility is governed by the Senior Credit Agreement.~~ The Revolving Credit Facility consists of a revolving loan under which up to ~~$1.0~~$1.25 billion aggregate principal amount may be borrowed, repaid and redrawn, based upon specific financial ratios and subject to the satisfaction of other customary conditions to borrowing. Amounts borrowed under the Revolving Credit Facility accrue interest, at SBA Senior Finance II’s election, at either ~~(i)~~(1) the Eurodollar Rate plus a margin that ranges from ~~137.5~~112.5 basis points to ~~200.0~~175.0 basis points or ~~(ii)~~(2) the Base Rate plus a margin that ranges from ~~37.5~~12.5 basis points to ~~100.0~~75.0 basis points, in each case based on the ratio of Consolidated ~~Total~~Net Debt to Annualized Borrower EBITDA, calculated in accordance with the Senior Credit Agreement. In addition, SBA Senior Finance II is required to pay a commitment fee of between 0.20% and 0.25% per annum on the amount of unused commitment. If not earlier terminated by SBA Senior Finance II, the Revolving Credit Facility will terminate on, and SBA Senior Finance II will repay all amounts outstanding on or before, ~~February 5, 2020.~~April 11, 2023. The proceeds available under the Revolving Credit Facility may be used for general corporate purposes. SBA Senior Finance II may, from time to time, borrow from and repay the Revolving Credit Facility. Consequently, the amount outstanding under the Revolving Credit Facility at the end of athe period may not be reflective of the total amounts outstanding during such period.

During the three months ended September 30, 2019, the Company borrowed $175.0 million and repaid $255.0 million of the outstanding balance under the Revolving Credit Facility. During the nine months ended September 30, ~~2017,~~2019, the Company borrowed ~~$315.0~~$265.0 million and ~~$415.0~~repaid $590.0 million ~~respectively, and repaid $35.0 million and $375.0 million, respectively,~~ of the outstanding balance under the Revolving Credit Facility. As of September 30, ~~2017,~~2019, there was no balance outstanding under the Revolving Credit Facility. In addition, SBA Senior Finance II was required to pay a commitment fee of 0.20% per annum on the amount of the unused commitment. As of September 30, 2019, SBA Senior Finance II was in compliance with the financial covenants contained in the Senior Credit Agreement.

Subsequent to September 30, 2017, the Company borrowed an additional $30.0 million and repaid $460.0 million of the outstanding balance under the Revolving Credit Facility. As of the date of this filing, no amount was outstanding under the Revolving Credit Facility.

~~Table of Contents~~

Term Loans under the Senior Credit Agreement

~~Repricing Amendment to the Senior Credit Agreement~~2014 Term Loan

~~On January 20, 2017, SBA Senior Finance II amended its Senior Credit Agreement, primarily to reduce the stated rate~~The 2014 Term Loan consisted of ~~interest applicable to its~~a senior secured term ~~loans. As amended, the senior secured term loans accrue~~loan with an initial aggregate principal amount of $1.5 billion that was scheduled to mature on March 24, 2021. The 2014 Term Loan accrued interest, at SBA Senior Finance II’s election, at either the Base Rate plus 125 basis points (with a ~~zero~~0 Base Rate floor) or the Eurodollar Rate plus 225 basis points (with a ~~zero~~0 Eurodollar Rate floor).

The 2014 Term Loan was originally issued at 99.75% of par value. Principal payments on the 2014 Term Loan commenced on September 30, 2014 and were being made in quarterly installments on the last day of each March, June, September, and December in an amount equal to $3.8 million. The Company incurred deferred financing fees of approximately $14.1 million in relation to this transaction, which were being amortized through the maturity date.

During the three months ended March 31, 2018, the Company repaid $3.8 million of principal on the 2014 Term Loan. On April 11, 2018, the Company repaid the remaining $1,443.8 million outstanding principal balance of the 2014 Term Loan with proceeds from the 2018 Term Loan. In connection with the repayment, the Company expensed $5.8 million of net deferred financing fees and $1.7 million of discount related to the debt.

2015 Term Loan

The ~~2014~~2015 Term Loan consisted of a senior secured term loan with an initial aggregate principal amount of $500.0 million that was scheduled to mature on June 10, 2022. The 2015 Term Loan accrued interest, at SBA Senior Finance II’s election at either the Base Rate plus 125 basis points (with a 0 Base Rate floor) or the Eurodollar Rate plus 225 basis points (with a 0 Eurodollar Rate floor). The 2015 Term Loan was originally issued at 99.0% of par value. Principal payments on the 2015 Term Loan commenced on September 30, 2015 and were being made in quarterly installments on the last day of each March, June, September, and December in an amount equal to $1.3 million. The Company incurred deferred financing fees of approximately $5.5 million in relation to this transaction, which were being amortized through the maturity date.

During the three months ended March 31, 2018, the Company repaid $1.3 million of principal on the 2015 Term Loan. On April 11, 2018, the Company repaid the remaining $486.3 million outstanding principal balance of the 2015 Term Loan with proceeds from the 2018 Term Loan. In connection with the repayment, the Company expensed $3.2 million of net deferred financing fees and $3.1 million of discount related to the debt.

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2018 Term Loan

On April 11, 2018, the Company, through its wholly owned subsidiary, SBA Senior Finance II LLC, obtained a new term loan (the “2018 Term Loan”) under the amended and restated Senior Credit Agreement. The 2018 Term Loan consists of a senior secured term loan with an initial aggregate principal amount of ~~$1.5~~$2.4 billion that matures on ~~March 24, 2021. Prior to the reduction in the term loan interest rates as discussed above, the 2014~~April 11, 2025. The 2018 Term Loan ~~accrued~~accrues interest, at SBA Senior Finance II’s election at either the Base Rate plus ~~150~~100 basis points (with a 0 Base Rate ~~floor of 1.75%)~~floor) or the Eurodollar Rate plus ~~250~~200 basis points (with a 0 Eurodollar Rate ~~floor of 0.75%)~~floor). The ~~2014~~2018 Term Loan was issued at 99.75% of par value. As of September 30, ~~2017,~~2019, the ~~2014~~2018 Term Loan was accruing interest at ~~3.49%~~4.05% per annum. Principal payments on the ~~2014~~2018 Term Loan commenced on September 30, ~~2014~~2018 and are being made in quarterly installments on the last day of each March, June, September, and December in an amount equal to ~~$3.8~~$6.0 million. ~~SBA Senior Finance II has the ability to prepay any or all amounts under the 2014 Term Loan.~~ The Company incurred deferred financing fees of approximately ~~$14.1~~$16.8 million in relation to this transaction, which are being amortized through the maturity date. The proceeds from the 2018 Term Loan were used (1) to retire the outstanding $1.93 billion in aggregate principal amount of the 2014 Term Loan and 2015 Term Loan, (2) to pay down the existing outstanding balance under the Revolving Credit Facility, and (3) for general corporate purposes.

During the three and nine months ended September 30, ~~2017,~~2019, the Company repaid ~~$3.8~~$6.0 million and ~~$11.3~~$18.0 million, respectively, of principal on the ~~2014~~2018 Term Loan. As of September 30, ~~2017,~~2019, the ~~2014~~2018 Term Loan had a principal balance of ~~$1,451.3 million.~~$2.4 billion.

~~2015 Term Loan~~

~~The 2015 Term Loan consists of a senior secured term loan with an initial aggregate principal amount of $500.0 million that matures on June 10, 2022. Prior to~~On February 1, 2019, the reduction in the term loan interest rates as discussed above, the 2015 Term Loan accrued interest, at SBA Senior Finance II’s election, at either the Base Rate plus 150 basis points (with a Base Rate floor of 1.75%) or the Eurodollar Rate plus 250 basis points (with a Eurodollar Rate floor of 0.75%). The 2015 Term Loan was issued at 99.0% of par value. As of September 30, 2017, the 2015 Term Loan was accruing interest at 3.49% per annum. Principal payments on the 2015 Term Loan commenced on September 30, 2015 and are being made in quarterly installments on the last day of each March, June, September, and December in an amount equal to $1.3 million.Company, through its wholly owned subsidiary, SBA Senior Finance II, LLC, entered into a four year interest rate swap on a portion of its 2018 Term Loan in order to reduce the Company’s exposure to fluctuations in interest rates. The interest rate swap has ~~the ability to prepay any or all amounts under the 2015 Term Loan. The Company incurred deferred financing fees~~a $1.2 billion notional value receiving interest at one month LIBOR plus 200 basis points and paying a fixed rate of ~~approximately $5.5 million in relation to this transaction, which are being amortized through the maturity date.~~4.495% per annum settled monthly.

~~During the three and nine months ended September 30, 2017,~~On May 23, 2019, the Company, ~~repaid $1.3 million and $3.8 million~~through its wholly owned subsidiary, SBA Senior Finance II, LLC, entered into a four year interest rate swap on a portion of ~~principal on the 2015 Term Loan. As of September 30, 2017, the 2015~~its 2018 Term Loan ~~had~~in order to reduce the Company’s exposure to fluctuations in interest rates. The interest rate swap has a ~~principal balance~~$750.0 million notional value receiving interest at one month LIBOR plus 200 basis points and paying a fixed rate of ~~$488.8 million.~~4.08% per annum settled monthly.

Secured Tower Revenue Securities

~~2012-1C~~2013 Tower Securities

On ~~August 9, 2012,~~April 18, 2013, the Company, through a New York common law trust (the “Trust”), issued $610.0 million of Secured Tower Revenue Securities Series 2012-1C (the “2012-1C Tower Securities”), which had an anticipated repayment date of December 11, 2017 and a final maturity date of December 9, 2042. The fixed interest rate of the 2012-1C Tower Securities was 2.933% per annum, payable monthly. The Company incurred deferred financing fees of $14.9 million in relation to this transaction, which were being amortized through the anticipated repayment date of the 2012-1C Tower Securities.

On April 17, 2017, the Company repaid in full the 2012-1C Tower Securities with proceeds from the 2017-1C Tower Securities. In connection with the prepayment, the Company expensed $2.0 million of net deferred financing fees.

~~The sole asset of the Trust consists of a non-recourse mortgage loan made in favor of those entities that are borrowers on the mortgage loan (the “Borrowers”).~~

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~~2013 Tower Securities~~

~~On April 18, 2013, the Company, through the Trust, issued~~ $425.0 million of 2.240% Secured Tower Revenue Securities Series 2013-1C, which ~~have~~had an anticipated repayment date of April 10, 2018 and a final maturity date of April 9, 2043 (the “2013-1C Tower Securities”), $575.0 million of 3.722% Secured Tower Revenue Securities Series 2013-2C, which have an anticipated repayment date of April 11, 2023 and a final maturity date of April 9, 2048 (the “2013-2C Tower Securities”), and $330.0 million of 3.598% Secured Tower Revenue Securities Series 2013-1D, which ~~have~~had an anticipated repayment date of April 10, 2018 and a final maturity date of April 9, 2043 (the “2013-1D Tower Securities”) (collectively the “2013 Tower Securities”). The aggregate $1.33 billion of 2013 Tower Securities ~~have~~had a blended interest rate of 3.218% per annum, payable monthly. The Company incurred ~~deferred~~ financing fees of ~~$25.5~~$11.0 million in relation to this transaction, which ~~are~~were being amortized through the anticipated repayment date of each of the 2013 Tower Securities.

On March 9, 2018, the Company repaid the entire aggregate principal amount of the 2013-1C Tower Securities and 2013-1D Tower Securities in connection with the issuance of the 2018-1C Tower Securities (as defined below).

2014 Tower Securities

On October 15, 2014, the Company, through the Trust, issued $920.0 million of 2.898% Secured Tower Revenue Securities Series 2014-1C, which ~~have~~had an anticipated repayment date of October 8, 2019 and a final maturity date of October 11, 2044 (the “2014-1C Tower Securities”) and $620.0 million of 3.869% Secured Tower Revenue Securities Series 2014-2C, which have an anticipated repayment date of October 8, 2024 and a final maturity date of October 8, 2049 (the “2014-2C Tower Securities”) (collectively the “2014 Tower Securities”). The aggregate $1.54 billion of 2014 Tower Securities ~~have~~had a blended interest rate of 3.289% per annum, payable monthly. The Company incurred ~~deferred~~ financing fees of $22.5 million in relation to this transaction, which ~~are~~were being amortized through the anticipated repayment date of each of the 2014 Tower Securities.

On September 13, 2019, the Company repaid the entire aggregate principal amount of the 2014-1C Tower Securities in connection with the issuance of the 2019-1C Tower Securities (as defined below).

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2015-1C Tower Securities

On October 14, 2015, the Company, through the Trust, issued $500.0 million of Secured Tower Revenue Securities Series 2015-1C, which have an anticipated repayment date of October 8, 2020 and a final maturity date of October 10, 2045 (the “2015-1C Tower Securities”). The fixed interest rate of the 2015-1C Tower Securities is 3.156% per annum, payable monthly. The Company incurred ~~deferred~~ financing fees of $11.2 million in relation to this transaction, which are being amortized through the anticipated repayment date of the 2015-1C Tower Securities.

2016-1C Tower Securities

On July 7, 2016, the Company, through the Trust, issued $700.0 million of Secured Tower Revenue Securities Series 2016-1C, which have an anticipated repayment date of July 9, 2021 and a final maturity date of July 10, 2046 (the “2016-1C Tower Securities”). The fixed interest rate of the 2016-1C Tower Securities is 2.877% per annum, payable monthly. ~~Net proceeds from this offering were used to prepay the full $550.0 million outstanding on the 2010-2C Tower Securities and for general corporate purposes.~~ The Company incurred ~~deferred~~ financing fees of $9.5 million in relation to this transaction, which are being amortized through the anticipated repayment date of the 2016-1C Tower Securities.

2017-1C Tower Securities

On April 17, 2017, the Company, through the Trust, issued $760.0 million of Secured Tower Revenue Securities Series 2017-1C, which have an anticipated repayment date of April 11, 2022 and a final maturity date of April 9, 2047 (the “2017-1C Tower Securities”). The fixed interest rate on the 2017-1C Tower Securities is 3.168% per annum, payable monthly. Net proceeds from this offering were used to prepay the entire $610.0 million aggregate principal amount, as well as accrued and unpaid interest, of the 2012-1C Tower Securities and for general corporate purposes. The Company incurred ~~deferred~~ financing fees of $10.2 million in relation to this transaction, which are being amortized through the anticipated repayment date of the 2017-1C Tower Securities.

In addition, to satisfy certain risk retention requirements of Regulation RR promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), SBA Guarantor, LLC, a wholly owned subsidiary, ~~of the Company,~~ purchased $40.0 million of Secured Tower Revenue Securities Series 2017-1R issued by the Trust, which have an anticipated repayment date of April 11, 2022 and a final maturity date of April 9, 2047 (the “2017-1R Tower Securities”). The fixed interest rate on the 2017-1R Tower Securities is 4.459% per annum, payable monthly. Principal and interest payments made on the 2017-1R Tower Securities eliminate in consolidation.

2018-1C Tower Securities

On March 9, 2018, the Company, through the Trust, issued $640.0 million of Secured Tower Revenue Securities Series 2018-1C, which have an anticipated repayment date of March 9, 2023 and a final maturity date of March 9, 2048 (the “2018-1C Tower Securities”). The fixed interest rate on the 2018-1C Tower Securities is 3.448% per annum, payable monthly. The Company incurred financing fees of $8.6 million in relation to this transaction, which are being amortized through the anticipated repayment date of the 2018-1C Tower Securities.

In addition, to satisfy certain risk retention requirements of Regulation RR promulgated under the Exchange Act, SBA Guarantor, LLC, a wholly owned subsidiary, purchased $33.7 million of Secured Tower Revenue Securities Series 2018-1R issued by the Trust. These securities have an anticipated repayment date of March 9, 2023 and a final maturity date of March 9, 2048 (the “2018-1R Tower Securities”). The fixed interest rate on the 2018-1R Tower Securities is 4.949% per annum, payable monthly. Principal and interest payments made on the 2018-1R Tower Securities eliminate in consolidation.

2019-1C Tower Securities

On September 13, 2019, the Company, through the Trust, issued $1.165 billion of Secured Tower Revenue Securities Series 2019-1C, which have an anticipated repayment date of January 12, 2025 and a final maturity date of January 12, 2050 (the “2019-1C Tower Securities”). The fixed interest rate on the 2019-1C Tower Securities is 2.836% per annum, payable monthly. Net proceeds from this offering were used to repay the entire aggregate principal amount of the 2014-1C Tower Securities ($920.0 million), as well as accrued and unpaid interest, amounts outstanding on the Revolving Credit Facility, and any remaining amount was used for general corporate purposes. The Company has incurred deferred financing fees of $12.0 million to date in relation to this transaction, which are being amortized through the anticipated repayment date of the 2019-1C Tower Securities.

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“2019-1R Tower Securities”). The fixed interest rate on the 2019-1R Tower Securities is 4.213% per annum, payable monthly. Principal and interest payments made on the 2019-1R Tower Securities eliminate in consolidation.

In connection with the issuance of the ~~2017-1C~~2019-1C Tower Securities, the non-recourse mortgage loan was increased by ~~$800.0 million (or~~$1.2 billion (but increased by a net of ~~$190.0~~$306.4 million after giving effect to prepayment of the loan components relating to the ~~2012-1C~~2014-1C Tower Securities). The new loan, after eliminating the risk retention securities, accrues interest at the same rate as the ~~2017-1C~~2019-1C Tower ~~Securities; however, it~~Securities and is subject to all other material terms of the existing mortgage loan, including collateral and interest rate after the anticipated repayment date.

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Debt Covenants and Terms of the Tower Revenue Securities

As of September 30, ~~2017,~~2019, the ~~Borrowers~~entities that are borrowers on the mortgage loan (the “Borrowers”) met the debt service coverage ratio required by the mortgage loan agreement and were in compliance with all other covenants as set forth in the agreement.

The sole asset of the Trust consists of a non-recourse mortgage loan made in favor of the Borrowers.

Senior Notes

2014 Senior Notes

On July 1, 2014, the Company issued $750.0 million of unsecured senior notes due July 15, 2022 (the “2014 Senior Notes”). The 2014 Senior Notes accrue interest at a rate of 4.875% per annum and were issued at 99.178% of par value. Interest on the 2014 Senior Notes is due semi-annually on January 15 and July 15 of each year. The Company incurred ~~deferred~~ financing fees of $11.6 million in relation to this transaction, which are being amortized through the maturity date.

The 2014 Senior Notes are subject to redemption in whole or in part at the redemption prices set forth in the indenture agreement plus accrued and unpaid interest. The Company may redeem the 2014 Senior Notes during the twelve-month period beginning on the following dates at the following redemption prices: July 15, 2019 at 101.219% or July 15, 2020 until maturity at 100.000% of the principal amount of the 2014 Senior Notes to be redeemed on the redemption date plus accrued and unpaid interest.

2016 Senior Notes

On August 15, 2016, the Company issued $1.1 billion of unsecured senior notes due September 1, 2024 (the “2016 Senior Notes”). The 2016 Senior Notes accrue interest at a rate of 4.875% per annum and were issued at 99.178% of par value. Interest on the 2016 Senior Notes is due semi-annually on March 1 and September 1 of each year, beginning on March 1, 2017. The Company incurred ~~deferred~~ financing fees of $12.8 million in relation to this transaction, which are being amortized through the maturity date. ~~Net proceeds from this offering~~The 2016 Senior Notes are subject to redemption in whole or in part on or after September 1, 2019 at the redemption prices set forth in the indenture agreement plus accrued and ~~cash~~unpaid interest. The Company may redeem the 2016 Senior Notes during the twelve-month period beginning on ~~hand were used to redeem $800.0 million,~~ the ~~aggregate~~following dates at the following redemption prices: September 1, 2019 at 103.656%, September 1, 2020 at 102.438%, September 1, 2021 at 101.219%, or September 1, 2022 until maturity at 100.000%, of the principal amount ~~outstanding,~~ of ~~Telecommunications’ 5.75%~~the 2016 Senior Notes to be redeemed on the redemption date plus accrued and ~~$250.0 million of the Company’s 5.625% Senior Notes and pay the associated call premiums.~~unpaid interest.

2017 Senior Notes

On October 13, 2017, the Company issued $750.0 million of unsecured senior notes due October 1, 2022 (the “2017 Senior Notes”). The 2017 Senior Notes accrue interest at a rate of 4.0% per annum. Interest on the 2017 Senior Notes is due semi-annually on April 1 and October 1 of each year, beginning on April 1, 2018. The Company incurred ~~deferred~~ financing fees of ~~$8.2~~$8.9 million in relation to this transaction, which are being amortized through the maturity date. ~~Net~~

The 2017 Senior Notes are subject to redemption in whole or in part on or after October 1, 2019 at the redemption prices set forth in the indenture agreement plus accrued and unpaid interest. Prior to October 1, 2020, the Company may, at its option, redeem up to 35% of the aggregate principal amount of the 2017 Senior Notes originally issued at a redemption price of 104.000% of the principal amount of the 2017 Senior Notes to be redeemed on the redemption date plus accrued and unpaid interest with the net proceeds ~~from this offering were used~~of certain equity offerings. The Company may redeem the 2017 Senior Notes during the twelve-month period beginning on the following dates at the following redemption prices: October 1, 2019 at 102.000%, October 1, 2020 at 101.000%, or October 1, 2021 until maturity at 100.000%, of the principal amount of the 2017 Senior Notes to ~~repay $460.0 million outstanding under~~be redeemed on the ~~Revolving Credit Facility~~redemption date plus accrued and ~~for general corporate purposes.~~unpaid interest.

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11.SHAREHOLDERS’ EQUITY

Common Stock ~~equivalents~~Equivalents

The Company has ~~potential common stock equivalents (see Note 12) related to its~~ outstanding stock options and restricted stock ~~units. These potential common stock equivalents~~units which were considered in the Company’s diluted earnings per share calculation (see Note 9)15).

Stock Repurchases

On June 4, 2015, the Company’s Board of Directors authorized a stock repurchase plan. This plan authorized the Company to purchase, from time to time, up to $1.0 billion of the Company’s outstanding Class A common stock through open market repurchases in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, and/or in privately negotiated transactions at management’s discretion based on market and business conditions, applicable legal requirements and other factors.

~~On January 12, 2017,~~July 29, 2019, the Company’s Board of Directors authorized a new $1.0 billion stock repurchase plan, replacing the prior plan authorized on ~~June 4, 2015,~~February 16, 2018 which had a remaining authorization of ~~$150.0~~$110.0 million. This new plan authorizes the Company to purchase, from time to time, up to $1.0 billion of the Company’s outstanding Class A common stock through open market repurchases in compliance with Rule 10b-18 under the ~~Securities~~ Exchange Act ~~of 1934, as amended,~~ and/or in privately negotiated transactions at management’s discretionbased on market and business conditions, applicable legal requirements and other factors. Shares repurchased will be retired. The new plan has no time deadline and will continue until otherwise modified or terminated by the Company’s Board of Directors at any time in its sole discretion.

During the three months ended September 30, ~~2017,~~2019, the Company repurchased ~~2.7~~0.7 million shares of its Class A common stock under ~~this~~its existing stock repurchase plan for ~~$383.9~~$175.7 million, at an average price per share of ~~$141.17.~~$249.04. During the nine months ended September 30, ~~2017,~~2019, the Company repurchased ~~3.9 million shares of its Class A common stock under this plan for $538.9 million, at an average price per share of $139.16. Shares repurchased were retired.~~

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~~Subsequent to September 30, 2017, the Company repurchased 0.8~~1.2 million shares of its Class A common stock for ~~$111.1~~$270.3 million, at an average price per share of ~~$147.19.~~$231.20. Shares repurchased were retired. As of the date of this filing, the Company had ~~$350.0~~$824.3 million of authorization remaining under the current stock repurchase plan.

~~Registration~~Dividends

On September 25, 2019, the Company paid a cash dividend of ~~Additional Shares~~

~~The Company filed a shelf registration statement~~$0.37 per share, or an aggregate amount of $41.9 million, to shareholders of record at the close of business on ~~Form S-4 with~~August 28, 2019. On October 25, 2019, the ~~Securities and Exchange Commission registering 4.0 million~~Company’s Board of Directors declared another quarterly cash dividend of $0.37 per share on shares of ~~its~~the Company’s Class A common ~~stock in 2007. These shares may~~stock. The dividend will be ~~issued in connection with acquisitions~~payable on December 19, 2019 to shareholders of ~~wireless communication towers or antenna sites and related assets or companies that own wireless communication towers, antenna sites, or related assets. During~~record at the ~~year ended December 31, 2016, the Company did not issue any shares~~close of its Class A common stock pursuant to this registration statement in connection with acquisitions. During the nine months ended September 30, 2017, the Company issued 487,963 shares of Class A common stock under this registration statement. As of September 30, 2017, the Company had approximately 1.2 million shares of Class A common stock remaining under this registration statement.business on November 21, 2019.

12.STOCK-BASED COMPENSATION

Stock Options

The Company records compensation expense for employee stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option-pricing model with the assumptions included in the table below. The Company uses a combination of historical data and historical volatility to establish the expected volatility, as well as to estimate the expected option life. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the estimated life of the option. The following assumptions were used to estimate the fair value of options granted using the Black-Scholes option-pricing model:



	For the nine months ended
	September 30,
	2019	2018

Risk free interest rate	1.37% - 2.47%	2.57% - 2.87%
Dividend yield	1.3%	0.7%
Expected volatility	20%	22%
Expected lives	4.6 years	4.6 years

‎

For the nine months ended

September 30,

2017

2016

Risk free interest rate

1.70% - 1.97%

1.11% - 1.43%
Dividend yield

0.0%

0.0%
Expected volatility

20%

20%
Expected lives

4.6 years

4.7 years

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The following table summarizes the Company’s activities with respect to its stock option plans for the nine months ended September 30, ~~2017~~2019 as follows (dollars and ~~number of~~ shares in thousands, except for per share data):

Weighted-

Weighted-

Average

Average

Remaining

Number

Exercise Price

Contractual

Aggregate

of Shares

Per Share

Life (in years)

Intrinsic Value
Outstanding at December 31, 2016

4,447

$
93.09

Granted

1,171

$
115.41

Exercised

(615)

$
78.64

Canceled

(62)

$
105.44

Outstanding at September 30, 2017

4,941

$
100.03

4.6

$
217,485
Exercisable at September 30, 2017

2,076

$
87.74

3.3

$
116,910
Unvested at September 30, 2017

2,865

$
108.93

5.5

$
100,575



		Weighted-		Weighted-Average
		Average		Remaining
	Number	Exercise Price		Contractual	Aggregate
	of Shares	Per Share		Life (in years)	Intrinsic Value
Outstanding at December 31, 2018	4,816	$	114.48
Granted	1,068	$	183.41
Exercised	(1,290)	$	103.43
Forfeited/canceled	(56)	$	139.03
Outstanding at September 30, 2019	4,538	$	133.55	4.4	$	488,143
Exercisable at September 30, 2019	1,939	$	109.35	3.0	$	255,552
Unvested at September 30, 2019	2,599	$	151.62	5.4	$	232,591

The weighted-average per share fair value of options granted during the nine months ended September 30, ~~2017~~2019 was ~~$23.88.~~$33.99. The total intrinsic value for options exercised during the nine months ended September 30, ~~2017~~2019 was ~~$30.9~~$129.6 million.

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Restricted Stock Units

The following table summarizes the Company’s restricted stock unit activity for the nine months ended September 30, ~~2017:~~ 2019:



		Weighted-Average
	Number of	Grant Date Fair
	Shares	Value per Share
	(in thousands)
Outstanding at December 31, 2018	324	$	128.69
Granted	134	$	185.31
Vested	(130)	$	125.71
Forfeited/canceled	(11)	$	150.07
Outstanding at September 30, 2019	317	$	153.20

During 2018, the Board of Directors adopted a retirement policy applicable to all employees receiving equity as part of their compensation plan. This policy was effective January 1, 2019. Historically, all unvested outstanding equity awards were forfeited upon termination of employment and any options that were vested but unexercised would be forfeited 90 days after the termination of employment. The new retirement policy allows employees that meet certain conditions to vest or continue vesting in outstanding equity awards following retirement and extends the time the employee has to exercise vested and outstanding awards. As a result of this policy, stock compensation expense related to the adoption of the policy resulted in an acceleration of unrecognized stock compensation expense of approximately $11.2 million and $7.3 million in the first and second quarter of 2019, respectively.

Weighted-

Average

Grant Date

Number of

Fair Value per

Shares

Share

(in thousands)

Outstanding at December 31, 2016

291

$
101.74
Granted

171

$
116.52
Vested

(122)

$
98.75
Forfeited/canceled

(10)

$
109.83
Outstanding at September 30, 2017

330

$
110.27

13.INCOME TAXES

The primary ~~reason~~reasons for the difference inbetween the Company’s effective tax rate and the U.S. statutory rate ~~is a result of~~are the Company’s REIT election and the ~~Company having a~~Company’s full valuation allowance on the ~~U.S.~~ net deferred tax assets of the U.S. taxable REIT ~~subsidiaries~~subsidiary (“~~TRSs”~~TRS”). The Company has concluded that it is not more likely than not that its deferred tax assets will be realized and has recorded a full valuation allowance. A foreign tax provision is recognized because certain ~~international~~foreign subsidiaries of the Company have profitable operations or are in a net deferred tax liability position.

The Company elected to be taxed as a REIT commencing with its taxable year ended December 31, 2016. As a REIT, the Company generally will be entitled to a deduction for dividends that it pays, and therefore, not subject to U.S. federal corporate income tax on that portion of its net income that it distributes to its shareholders. As a REIT, the Company will continue to pay U.S.

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federal income tax on earnings, if any, from assets and operations held through its TRSs. These assets and operations currently consist primarily of the Company’s site development services and its international operations. The Company’s international operations would continue to be subject, as applicable, to foreign taxes in the jurisdictions in which those operations are located. The Company may also be subject to a variety of taxes, including payroll taxes and state, local, and foreign income, property, and other taxes on its assets and operations. The Company’s determination as to the timing and amount of future dividend distributions will be based on a number of factors, including REIT distribution requirements, its existing federal net operating losses (“NOLs”) of approximately ~~$1.1 billion~~$755.4 million as of December 31, ~~2016,~~2018, the Company’s financial condition, earnings, debt covenants, and other possible uses of such funds. The Company may use these NOLs to offset its REIT taxable income, and thus any required distributions to shareholders may be reduced or eliminated until such time as the NOLs have been fully utilized.

14.SEGMENT DATA

The Company operates principally in ~~two~~2 business segments: site leasing and site development. The Company’s site leasing business includes two reportable segments, domestic site leasing and international site leasing. The Company’s business segments are strategic business units that offer different services. They are managed separately based on the fundamental differences in their operations. The site leasing segment includes results of the managed and sublease businesses. The site development segment includes the results of both consulting and construction related activities. The Company’s Chief Operating Decision Maker utilizes segment operating profit and operating income as his two measures of segment profit in assessing performance and allocating resources at the reportable segment level. The Company has applied the aggregation criteria to operations within the international site leasing segment on a basis that is consistent with management’s review of information and performance evaluations of the individual markets in this region.

‎

2024

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Revenues, cost of revenues (exclusive of depreciation, accretion and amortization), capital expenditures (including assets acquired through the issuance of shares of the Company’s Class A common stock) and identifiable assets pertaining to the segments in which the Company continues to operate are presented below.



	Domestic Site		Int'l Site		Site
	Leasing		Leasing		Development		Other		Total

For the three months ended September 30, 2019	(in thousands)
Revenues	$	374,705	$	93,867	$	38,975	$	—	$	507,547
Cost of revenues ⁽²⁾		63,836		29,157		30,516		—		123,509
Operating profit		310,869		64,710		8,459		—		384,038
Selling, general, and administrative		21,840		8,626		4,183		7,623		42,272
Acquisition and new business initiatives related
adjustments and expenses		2,717		1,975		—		—		4,692
Asset impairment and decommission costs		6,027		2,213		—		—		8,240
Depreciation, amortization and accretion		132,650		40,208		660		1,469		174,987
Operating income (loss)		147,635		11,688		3,616		(9,092)		153,847
Other expense (principally interest expense
and other income (expense))								(135,083)		(135,083)
Income before income taxes										18,764
Cash capital expenditures ⁽³⁾		67,951		101,776		357		1,060		171,144

For the three months ended September 30, 2018
Revenues	$	353,502	$	81,758	$	31,961	$	—	$	467,221
Cost of revenues ⁽²⁾		66,862		25,432		24,447		—		116,741
Operating profit		286,640		56,326		7,514		—		350,480
Selling, general, and administrative		17,763		6,734		3,934		6,477		34,908
Acquisition and new business initiatives related
adjustments and expenses		1,887		1,108		—		—		2,995
Asset impairment and decommission costs		2,801		4,067		—		—		6,868
Depreciation, amortization and accretion		129,246		36,310		646		1,501		167,703
Operating income (loss)		134,943		8,107		2,934		(7,978)		138,006
Other expense (principally interest expense
and other income (expense))								(123,841)		(123,841)
Income before income taxes										14,165
Cash capital expenditures ⁽³⁾		33,794		120,176		425		666		155,061

‎

Domestic Site

Int'l Site

Site

Not Identified

Leasing

Leasing

Development

by Segment

Total

For the three months ended September 30, 2017

(in thousands)
Revenues

$
328,395

$
80,143

$
25,407

$
—

$
433,945
Cost of revenues (2)

65,226

25,125

21,117

—

111,468
Operating profit

263,169

55,018

4,290

—

322,477
Selling, general, and administrative

16,945

6,658

3,826

5,130

32,559
Acquisition related adjustments and expenses

962

621

—

—

1,583
Asset impairment and decommission costs

7,898

1,554

(35)

—

9,417
Depreciation, amortization and accretion

125,142

34,548

605

1,612

161,907
Operating income (loss)

112,222

11,637

(106)

(6,742)

117,011
Other expense (principally interest expense

and other income (expense))

(64,472)

(64,472)
Income before provision for income taxes

52,539
Cash capital expenditures (3)

57,352

57,507

372

724

115,955

For the three months ended September 30, 2016

Revenues

$
319,109

$
69,059

$
23,151

$
—

$
411,319
Cost of revenues (2)

65,353

21,001

19,114

—

105,468
Operating profit

253,756

48,058

4,037

—

305,851
Selling, general, and administrative

19,206

5,277

3,128

4,644

32,255
Acquisition related adjustments and expenses

335

2,635

—

—

2,970
Asset impairment and decommission costs

1,974

331

—

—

2,305
Depreciation, amortization and accretion

126,059

31,453

997

1,602

160,111
Operating income (loss)

106,182

8,362

(88)

(6,246)

108,210
Other expense (principally interest expense

and other income (expense))

(122,006)

(122,006)
Loss before provision for income taxes

(13,796)
Cash capital expenditures (3)

52,589

23,057

320

704

76,670

2125

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							Not				Domestic Site		Int'l Site		Site
	Domestic Site		Int'l Site		Site		Identified by				Leasing		Leasing		Development		Other		Total
	Leasing		Leasing		Development		Segment		Total

For the nine months ended September 30, 2017	(in thousands)
For the nine months ended September 30, 2019											(in thousands)
Revenues	$	974,850	$	234,239	$	75,513	$	—	$	1,284,602	$	1,106,722	$	273,036	$	121,229	$	—	$	1,500,987
Cost of revenues (2)		195,903		73,167		62,713		—		331,783		194,525		84,642		92,606		—		371,773
Operating profit		778,947		161,072		12,800		—		952,819		912,197		188,394		28,623		—		1,129,214
Selling, general, and administrative		53,147		19,007		11,495		16,528		100,177		77,926		22,624		16,774		31,431		148,755
Acquisition related adjustments and expenses		4,300		2,557		—		—		6,857
Acquisition and new business initiatives related
adjustments and expenses												4,698		4,971		—		—		9,669
Asset impairment and decommission costs		22,746		2,956		206		—		25,908		18,476		5,155		—		—		23,631
Depreciation, amortization and accretion		373,262		100,388		1,968		4,839		480,457		394,308		117,197		1,900		4,185		517,590
Operating income (loss)		325,492		36,164		(869)		(21,367)		339,420		416,789		38,447		9,949		(35,616)		429,569
Other expense (principally interest expense
and other income (expense))								(233,259)		(233,259)								(327,029)		(327,029)
Income before provision for income taxes										106,161
Income before income taxes																				102,540
Cash capital expenditures (3)		160,814		103,609		692		2,456		267,571		242,660		149,704		2,165		2,259		396,788

For the nine months ended September 30, 2016
For the nine months ended September 30, 2018
Revenues	$	951,181	$	193,280	$	72,159	$	—	$	1,216,620	$	1,041,892	$	253,794	$	86,160	$	—	$	1,381,846
Cost of revenues (2)		196,027		59,582		59,021		—		314,630		199,633		79,167		67,693		—		346,493
Operating profit		755,154		133,698		13,138		—		901,990		842,259		174,627		18,467		—		1,035,353
Selling, general, and administrative (4)		55,141		30,727		9,960		14,498		110,326
Acquisition related adjustments and expenses		3,533		5,441		—		—		8,974
Selling, general, and administrative												55,047		20,242		11,943		19,669		106,901
Acquisition and new business initiatives related
adjustments and expenses												5,242		3,929		—		—		9,171
Asset impairment and decommission costs		19,359		1,476		—		2,345		23,180		15,971		6,475		332		—		22,778
Depreciation, amortization and accretion		384,208		88,111		2,661		4,655		479,635		382,490		113,550		1,936		4,683		502,659
Operating income (loss)		292,913		7,943		517		(21,498)		279,875		383,509		30,431		4,256		(24,352)		393,844
Other expense (principally interest expense
and other income (expense))								(203,119)		(203,119)								(415,191)		(415,191)
Income before provision for income taxes										76,756
Loss before income taxes																				(21,347)
Cash capital expenditures (3)		232,558		60,125		1,792		2,633		297,108		287,711		218,739		1,345		2,148		509,943



	Domestic Site		Int'l Site		Site
	Leasing		Leasing		Development		Other ⁽¹⁾		Total

Assets	(in thousands)
As of September 30, 2019	$	6,261,128	$	2,766,050	$	79,773	$	94,187	$	9,201,138
As of December 31, 2018	$	5,035,826	$	2,042,800	$	60,775	$	74,306	$	7,213,707

(1)Assets in Other consist primarily of general corporate assets.

(2)Excludes depreciation, amortization, and accretion.

(3)Includes cash paid for capital expenditures and acquisitions and financing leases.

Other than Brazil, no foreign country represented a material amount of the Company’s total revenues in any of the periods presented. Site leasing revenue in Brazil was $168.6 million and $167.1 million for the nine months ended September 30, 2019 and

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2018, respectively. Total long-lived assets in Brazil were $915.5 million and $1,031.6 million as of September 30, 2019 and December 31, 2018, respectively.

15.EARNINGS PER SHARE

Basic earnings per share was computed by dividing net income (loss) attributable to common shareholders by the weighted-average number of shares of Common Stock outstanding for each respective period. Diluted earnings per share was calculated by dividing net income (loss) attributable to common shareholders by the weighted-average number of shares of Common Stock outstanding adjusted for any dilutive Common Stock equivalents, including unvested restricted stock and shares issuable upon exercise of stock options as determined under the “Treasury Stock” method.

The following table sets forth basic and diluted net income (loss) per common share attributable to common shareholders for the three and nine months ended September 30, 2019 and 2018 (in thousands, except per share data):

Domestic Site

Int'l Site

Site

Not Identified

Leasing

Leasing

Development

by Segment (1)

Total

Assets

(in thousands)
As of September 30, 2017

$
5,247,946

$
1,929,355

$
44,976

$
78,193

$
7,300,470
As of December 31, 2016

$
5,396,394

$
1,839,703

$
43,769

$
81,079

$
7,360,945



	For the three months				For the nine months
	ended September 30,				ended September 30,
	2019		2018		2019		2018
Numerator:
Net income (loss) attributable to SBA
Communications Corporation	$	21,679	$	16,144	$	79,640	$	(9,702)
Denominator:
Basic weighted-average shares outstanding		113,037		114,597		112,985		115,378
Dilutive impact of stock options and restricted shares		2,147		1,517		1,839		—
Diluted weighted-average shares outstanding		115,184		116,114		114,824		115,378
Net income (loss) per common share attributable to SBA
Communications Corporation:
Basic	$	0.19	$	0.14	$	0.70	$	(0.08)
Diluted	$	0.19	$	0.14	$	0.69	$	(0.08)

For the three and nine months ended September 30, 2019, the diluted weighted average number of common shares outstanding excluded an additional 8,091 and 18,277 shares issuable upon exercise of the Company’s stock options because the impact would be anti-dilutive.

For the three months ended September 30, 2018, the diluted weighted average number of common shares outstanding excluded an additional 0.9 million shares issuable upon exercise of the Company’s stock options because the impact would be anti-dilutive.

For the nine months ended September 30, 2018, all potential common stock equivalents, including 5.2 million shares of stock options outstanding and 0.3 million shares of restricted stock units outstanding, were excluded as the effect would be anti-dilutive.

‎

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16. COMMITMENTS AND CONTINGENCIES

The Company is obligated under various non-cancelable operating leases for land, office space, equipment and site leases. In addition, the Company is obligated under various non-cancelable financing leases for vehicles. The annual minimum lease payments, including fixed rate escalations, as of September 30, 2019 are as follows (in thousands):



	Finance Leases		Operating Leases
The remainder of 2019	$	348	$	59,102
2020		924		237,623
2021		745		239,390
2022		529		240,539
2023		59		240,594
Thereafter		—		3,086,003
Total minimum lease payments		2,605		4,103,251
Less: amount representing interest		(145)		(1,701,002)
Present value of future payments		2,460		2,402,249
Less: current obligations		(987)		(229,210)
Long-term obligations	$	1,473	$	2,173,039

Tenant (Operating) Leases

The annual minimum tower lease income to be received for tower space rental under non-cancelable operating leases, including fixed rate escalations, as of September 30, 2019 is as follows:



	(in thousands)
The remainder of 2019	$	426,237
2020		1,561,995
2021		1,320,941
2022		1,070,375
2023		865,317
Thereafter		2,259,217
Total	$	7,504,082

17. REDEEMABLE NONCONTROLLING INTEREST

In August 2019, the Company acquired an additional interest of a previously unconsolidated joint venture in South Africa which operated under the name Atlas Tower South Africa (“Atlas SA”). As a result of the transaction, the Company has consolidated the results of the entity into its financial statements. The incremental investment is reflected within Acquisitions on the Consolidated Statement of Cash Flows. As of the acquisition date, the fair market value of the 6% noncontrolling interest was $14.0 million. The fair value assigned to the redeemable noncontrolling interest is estimated using Level 3 inputs based on unobservable inputs.

In connection with the acquisition of the additional interest in Atlas SA, the parties agreed to both a put option exercisable by the noncontrolling interest holder and a call option exercisable by the Company. The put option allows the noncontrolling interest holder to sell its 6% noncontrolling interest to the Company for an amount to be determined using a formulaic approach. The call option allows the Company to purchase the remaining 6% minority interest using the same formulaic approach. Both the put and call options can be exercised on or after August 30, 2020. As the put option is outside of the Company’s control, the estimated redemption value of the minority interest is presented as a redeemable noncontrolling interest outside of permanent equity on the Consolidated Balance Sheets.

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The Company allocates income and losses to the noncontrolling interest holder based on the applicable membership interest percentage. At each reporting period, the redeemable noncontrolling interest is recognized at the higher of (1) the initial carrying amount of the noncontrolling interest as adjusted for accumulated income or loss attributable to the noncontrolling interest holder, or (2) the contractually-defined redemption value as of the balance sheet date. Adjustments to the carrying amount of redeemable noncontrolling interest are charged against retained earnings (or additional paid-in capital if there are no retained earnings).

The components of the redeemable noncontrolling interest as of September 30, 2019 are as follows (in thousands):

~~(1)~~

~~Assets not identified by segment consist primarily of general corporate assets.~~

~~(2)~~

~~Excludes depreciation, amortization, and accretion.~~

BALANCE, December 31, 2018

~~(3)~~

~~Includes cash paid for capital expenditures and acquisitions and vehicle capital lease additions.~~—

Purchase of noncontrolling interest	~~(4)~~		~~International site leasing includes~~13,990
Net income attributable to the ~~impact of the $16,498 Oi reserve for the nine months ended~~noncontrolling interest			87
BALANCE, September 30, ~~2016.~~2019		$	14,077

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

We are a leading independent owner and operator of wireless communications infrastructure, including tower structures, rooftops and other structures that support antennas used for wireless communications, which we collectively refer to as “towers” or “sites.” Our principal operations are in the United States and its territories. In addition, we own and operate towers in South America, Central America, Canada, and ~~Canada.~~South Africa. Our primary business line is our site leasing business, which contributed ~~98.7%~~97.5% of our total segment operating profit for the nine months ended September 30, ~~2017.~~2019. In our site leasing business, we (1) lease antenna space to wireless service providers on towers that we own or operate and (2) manage rooftop and tower sites for property owners under various contractual arrangements. As of September 30, ~~2017,~~2019, we owned ~~26,764~~30,904 towers, a substantial portion of which have been built by us or built by other tower owners or operators who, like us, have built such towers to lease space to multiple wireless service providers. ~~We also managed or leased approximately 5,300 actual or potential sites, approximately 500 of which were revenue producing as of September 30, 2017.~~ Our other business line is our site development business, through which we assist wireless service providers in developing and maintaining their own wireless service networks.

Site Leasing ~~Services~~

Our primary focus is the leasing of antenna space on our multi-tenant towers to a variety of wireless service providers under long-term lease contracts in the United States, Canada, Central America, South America, and South ~~America.~~Africa. As of September 30, ~~2017,~~2019, (1) no U.S. state or territory accounted for more than 10% of our total tower portfolio by tower count, and (2) no U.S. state or territory accounted for more than 10% of our total revenues for the nine months ended September 30, ~~2017.~~2019. In addition, as of September 30, ~~2017,~~2019, approximately ~~27.6%~~27.7% of our total towers are located in Brazil and less than 3% of our total towers are located in any of our other international markets (each country is considered a market). We derive site leasing revenues primarily from wireless service provider tenants, including AT&T, T-Mobile, Sprint, Verizon Wireless, ~~Sprint,~~ Oi S.A., Telefonica, Claro, and TIM. Wireless service providers enter into tenant leases with us, each of which relates to the lease or use of space at an individual site. In the United States and Canada, our tenant leases are generally for an initial term of ~~five~~5 to ten years with ~~five 5-year~~multiple 5 year renewal periods at the option of the tenant. These tenant leases typically contain specific rent escalators, which average 3-4% per year, including the renewal option periods. Tenant leases in South Africa and our Central ~~American~~ and South American markets typically have an initial term of ten years with multiple ~~five-year~~5 year renewal periods. In Central America, we have similar rent escalators to that of leases in the United States and Canada while our leases in South America and South Africa escalate in accordance with a standard cost of living index. Site leases in South America typically provide for a fixed rental amount and a pass through charge for the underlying ground lease rent.

In our Central American markets and Ecuador, significantly all of our revenue, expenses, and capital expenditures arising from our new build activities are denominated in U.S. dollars. Specifically, most of our ground leases, tenant leases, and tower-related expenses are due and paid in U.S. dollars. In our Central American markets, our local currency obligations are principally limited to (1) permitting and other local fees, (2) utilities, and (3) taxes. In Brazil, Canada, Chile, and Colombia, significantly all of our revenue, expenses, and capital expenditures, including tenant leases, ground leases, and other tower-related expenses are denominated in local currency. In Argentina and Peru, our revenue, expenses, and capital expenditures, including tenant leases, ground leases, and other tower-related expenses are denominated in a mix of local currency and U.S. dollars.

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Cost of site leasing revenue primarily consists of:

~~Rental payments~~

Cash and non-cash rental expense on ground leases and other underlying property interests;

Property taxes;

Site maintenance and monitoring costs (exclusive of employee related costs);

Utilities;

Property insurance; and

Lease initial direct cost amortization.

In the United States, Canada, Central America, and South America, ground ~~leases and other underlying property interests;~~

Straight-line rent adjustment for the difference between rental payments made and the expense recorded as if the payments had been made evenly throughout the lease term (which may include renewal terms) of the underlying property interests;

~~Property taxes;~~

~~Site maintenance and monitoring costs (exclusive of employee related costs);~~

~~Utilities;~~

~~Property insurance; and~~

~~Deferred lease origination cost amortization.~~

~~Ground~~ leases are generally for an initial term of ~~five~~5 years or more with multiple 5 year renewal ~~terms of five-year~~ periods at our ~~option and~~option. In South Africa, ground leases are generally for an initial term of ten years with three 10 year renewal periods at our option. Ground leases provide for rent escalators which typically average 2-3% annually, or in our South American markets and South Africa, adjust in accordance with a standard cost of living index. As of September 30, ~~2017,~~2019, approximately ~~70%~~72% of our tower structures were located on parcels of land that we own, land subject to perpetual easements, or

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parcels of land in which we have a leasehold interest that extends beyond 20 years. For any given tower, costs are relatively fixed over a monthly or an annual time period. As such, operating costs for owned towers do not generally increase as a result of adding additional customers to the tower. The amount of property taxes varies from site to site depending on the taxing jurisdiction and the height and age of the tower. The ongoing maintenance requirements are typically minimal and include replacing lighting systems, painting a tower, or upgrading or repairing an access road or fencing.

In our Central American markets and Ecuador, significantly all of our revenue, expenses, and capital expenditures arising from our new build activities are denominated in U.S. dollars. Specifically, most of our ground leases, tenant leases, and tower-related expenses are paid in U.S. dollars. In our Central American markets, our local currency obligations are principally limited to (1) permitting and other local fees, (2) utilities, and (3) taxes. In Brazil, Canada, Chile, and South Africa significantly all of our revenue, expenses, and capital expenditures, including tenant leases, ground leases, and other tower-related expenses are denominated in local currency. In Colombia, Argentina, and Peru, our revenue, expenses, and capital expenditures, including tenant leases, ground leases, and other tower-related expenses are denominated in a mix of local currency and U.S. dollars.

As indicated in the table below, our site leasing business generates substantially all of our total segment operating profit. For information regarding our operating segments, see Note 14 of our Condensed Notes to ~~Consolidated Financial Statements~~consolidated financial statements included in this quarterly report.



	For the three months ended				For the nine months ended				For the three months ended				For the nine months ended
	September 30,				September 30,				September 30,				September 30,

Segment operating profit as a percentage of total	2017		2016		2017		2016		2019		2018		2019		2018

Domestic site leasing		81.6%		83.0%		81.8%		83.7%		80.9%		81.8%		80.8%		81.3%
International site leasing		17.1%		15.7%		16.9%		14.8%		16.9%		16.1%		16.7%		16.9%
Total site leasing		98.7%		98.7%		98.7%		98.5%		97.8%		97.9%		97.5%		98.2%

We believe that the site leasing business continues to be attractive due to its long-term contracts, built-in rent escalators, high operating margins, and low customer churn (which refers to when a customer does not renew its lease or cancels its lease prior to the end of its term) other than in connection with customer consolidation or cessation of a particular technology. We believe that over the long-term, site leasing revenues will continue to grow as wireless service providers lease additional antenna space on our towers due to increasing minutes of network use and data transfer, network expansion and network coverage requirements. During the remainder of ~~2017,~~2019, we expect organic site leasing revenue ~~growth~~ in both our domestic and international segments to ~~be consistent with our growth~~increase over 2018 levels due in ~~2016 and the nine months ended September 30, 2017.~~part to wireless carriers deploying unused spectrum. We believe our site leasing business is characterized by stable and long-term recurring revenues, predictable operating costs and minimal non-discretionary capital expenditures. Due to the relatively young age and mix of our tower portfolio, we expect future expenditures required to maintain these towers to be minimal. Consequently, we expect to grow our cash flows by (1) adding tenants to our towers at minimal incremental costs by using existing tower capacity or requiring wireless service providers to bear all or a portion of the cost of tower modifications and (2) executing monetary amendments as wireless service providers add or upgrade their equipment. Furthermore, because our towers are strategically positioned, ~~and our customers typically do not relocate,~~ we have historically experienced low tenant lease terminations as a percentage of revenue other than in connection with customer consolidation or cessations of a specific technology (e.g. ~~iDEN,~~ MetroPCS, Leap, Clearwire, and ~~Cricket)~~iDEN).

Site Development ~~Services~~

Our site development business, which is conducted in the United States only, is complementary to our site leasing business and provides us the ability to keep in close contact with the wireless service providers who generate substantially all of our site leasing revenue and to capture ancillary revenues that are generated by our site leasing activities, such as antenna and equipment installation at our tower locations. Site development ~~services~~ revenues are earned primarily from providing a full range of end to end services to wireless service providers or companies providing development or project management services to wireless service providers. Our services include: (1) network pre-design; (2) site audits; (3) identification of potential locations for towers and antennas on existing infrastructure; (4) support in leasing of the location; (5) assistance in obtaining zoning approvals and permits; (6) tower and related

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site construction; (7) antenna installation; and (8) radio equipment installation, commissioning, and maintenance. We provide site development services at our towers and at towers owned by others on a local basis, through regional, market, and project offices. The market offices are responsible for all site development operations.

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Capital Allocation Strategy

Our capital allocation strategy is ~~to prioritize~~aimed at increasing shareholder value through investment in quality assets that meet our return criteria, ~~and then~~ stock repurchases when we believe our stock price is below its intrinsic ~~value. A primary goal~~value and by returning cash generated by our operations in the form of a cash dividend distribution. While the addition of a cash dividend to our capital allocation strategy ishas provided us with a new tool to ~~increase~~return value to our shareholders, we will also continue to make investments focused on increasing our Adjusted Funds From Operations per share. To achieve this, we expect ~~we would~~to continue to deploy capital ~~between~~to portfolio growth and stock repurchases, subject to compliance with REIT distribution requirements, available funds and market conditions, while maintaining our target leverage levels. Key elements of our capital allocation strategy include:

Portfolio Growth.We intend to continue to grow our tower portfolio, domestically and internationally, through tower acquisitions and the construction of new ~~towers.~~towers that meet our internal return on invested capital criteria.

Stock Repurchase Program.We currently utilize stock repurchases as part of our capital allocation policy when we believe our share price is below its intrinsic value. We believe that share repurchases, when purchased at the right price, will facilitate our goal of increasing our Adjusted Funds From Operations per share.

Dividend. Commencing in the third quarter of 2019, we added dividends as an additional component of our strategy of returning value to shareholders. We do not expect our dividend to require any changes in our leverage and, we believe, it will allow us to continue to focus on building and buying quality assets and opportunistically buying back our stock. While the timing and amount of future dividends will be subject to approval by our Board of Directors, we believe that our future cash flow generation will permit us to grow our cash dividend in the future.

Critical Accounting Policies and Estimates

We have identified the policies and significant estimation processes listed in the Annual Report on Form 10-K as critical to our business operations and the understanding of our results of operations. The listing is not intended to be a comprehensive list. In many cases, the accounting treatment of a particular transaction is specifically dictated by accounting principles generally accepted in the United States, with no need for management’s judgment in their application. In other cases, management is required to exercise judgment in the application of accounting principles with respect to particular transactions. The impact and any associated risks related to these policies on our business operations is discussed throughout “Management’s Discussion and Analysis of Financial Condition and Results of Operations” where such policies affect reported and expected financial results. For a detailed discussion on the application of these and other accounting policies, see Note 2 of our ~~Consolidated Financial Statements~~consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2018. Our preparation of our financial statements requires us to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of our financial statements, and the reported amounts of revenue and expenses during the reporting periods. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. There can be no assurance that actual results will not differ from those estimates and such differences could be significant.

~~Acquisitions~~ Lease Accounting

In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business. The standard provides guidance to help entities determine whether transactions should be accounted for as acquisitions or disposals of assets or businesses. ASU 2017-01 provides revised guidance to determine when an acquisition meets the definition of a business or when the acquisition should be accounted for as an asset acquisition. We adopted ~~this standard~~ASU No. 2016-02, Leases (“Topic 842”) using the modified retrospective adoption method with an effective date of January 1, ~~2017~~2019. This standard requires all lessees to recognize a right-of-use asset and ~~all changes will be accounted for prospectively.~~a lease liability, initially measured at the present value of the lease payments. The adoption of ~~ASU 2017-01~~the new lease standard had a significant impact on our Consolidated Balance Sheets but did not have a significant impact on our lease classification or a material impact on our Consolidated Statements of Operations and liquidity. Additionally, the adoption of Topic 842 did not have a material impact on our ~~unaudited~~debt covenant compliance under our current agreements. We have elected to not separate nonlease components from the associated lease component for all underlying classes of assets.

In order to calculate our lease liability, we make certain assumptions related to lease term and discount rate. For lease terms, we evaluate renewal options. For the discount rate, we use the rate implicit in the lease when available to discount lease payments to present value. However, our ground leases generally do not provide a readily determinable implicit rate. Therefore, we estimate the incremental borrowing rate to discount lease payments based on the lease term and lease currency. We use publicly available data for instruments with similar characteristics when calculating our incremental borrowing rates. For a further discussion on lease accounting, refer to Note 1 of our Condensed Notes to consolidated financial statements ~~and related disclosures.~~

Under the new standard, our acquisitions will generally qualify for asset acquisition treatment under ASC 360, Property, Plant, and Equipment, rather than business combination treatment under ASC 805 Business Combinations. For acquisitions which qualify as asset acquisitions, the aggregate purchase price is allocated on a relative fair value basis to towers and related intangible assets. For asset acquisitions, external, direct transaction costs will be capitalized as a component of the cost of the asset acquired. We will continue to expense internal acquisition costs as incurred.

We account for business combinations under the acquisition method of accounting. The assets and liabilities acquired are recorded at fair market value at the date of each acquisition and the results of operations of the acquired assets are included with those from the dates of the respective acquisitions. We continue to evaluate all acquisitions for a period not to exceed one year after the applicable closing date of each transaction to determine whether any additional adjustments are needed to the allocation of the purchase price paid for the assets acquired and liabilities assumed as a result of information available at the acquisition date.in this quarterly report.

The fair values of net assets acquired are based on management’s estimates and assumptions, as well as other information compiled by management, including valuations that utilize customary valuation procedures and techniques. The fair value estimates are based on available historical information and on future expectations and assumptions deemed reasonable by management at the

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time. If the actual results differ from the estimates and judgments used in these fair values, the amounts recorded in the consolidated financial statements could be subject to a possible impairment of the intangible assets, or require acceleration of the amortization expense of intangible assets in subsequent periods.

The intangible assets represent the value associated with the current leases at the acquisition date (“Current contract intangibles”) and future tenant leases anticipated to be added to the towers (“Network location intangibles”) and were calculated using the discounted values of the current or future expected cash flows. The intangible assets are estimated to have a useful life consistent with the useful life of the related tower assets, which is typically 15 years.

In connection with certain acquisitions, we may agree to pay contingent consideration (or earnouts) in cash or stock if the communication sites or businesses that are acquired meet or exceed certain performance targets over a period of one to three years after they have been acquired. We accrue for contingent consideration in connection with business combinations at fair value as of the date of the acquisition. All subsequent changes in fair value of contingent consideration payable in cash are recorded through Consolidated Statements of Operations. Contingent consideration in connection with asset acquisitions will be recognized at the time when the contingency is resolved or becomes payable and will increase the cost basis of the assets acquired.

~~REIT Conversion~~

We believe that our business has been operated in a manner that complies with the REIT rules since January 1, 2016, and as a result, we made the election to be subject to tax as a REIT commencing with our taxable year ended December 31, 2016. A REIT is an entity that qualifies for special treatment for U.S. federal income tax purposes because, among other things, it derives most of its income from real estate-based sources and makes a special election under the Code. We operate as a REIT that principally invests in, and derives most of its income from the ownership, operation and leasing of, towers. As a REIT, we generally will be entitled to a deduction for dividends that we pay and therefore not subject to U.S. federal corporate income tax on that portion of our net income that we distribute to our shareholders. However, we will continue to pay U.S. federal income tax on earnings, if any, from assets and operations held through taxable REIT subsidiaries (“TRSs”). These assets and operations currently consist primarily of our site development services and our international operations. Our international operations will continue to be subject, as applicable, to foreign taxes in the jurisdictions in which those operations are located. We may also be subject to a variety of taxes, including payroll taxes and state, local and foreign income, property and other taxes on our assets and operations.

As a REIT, we will generally be required to distribute at least 90% of our REIT taxable income after the utilization of any available net operating losses (“NOLs”) (determined without regard to the dividends paid deduction and excluding net capital gain) each year to our shareholders. In addition to the REIT distribution requirements, our determination as to the timing and amount of future dividend distributions will be based on a number of factors, including investment opportunities around our core business, the availability of our existing federal NOLs of approximately $1.1 billion as of December 31, 2016 that are attributes of the REIT, our financial condition, earnings, debt covenants, and other possible uses of such funds. We may use these NOLs to offset our REIT taxable income, and thus any required distributions to shareholders may be reduced or eliminated until such time as the NOLs have been fully utilized.

RESULTS OF OPERATIONS

This report presents our financial results and other financial metrics after eliminating the impact of changes in foreign currency exchange rates. We believe that providing these financial results and metrics on a constant currency basis, which are non-GAAP measures, gives management and investors the ability to evaluate the performance of our business without the impact of foreign currency exchange rate fluctuations. We eliminate the impact of changes in foreign currency exchange rates by dividing the current period’s financial results by the average monthly exchange rates of the prior year period, as well as by eliminating the impact of the remeasurement of our intercompany loans.

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Three Months Ended September 30, ~~2017~~2019 Compared to Three Months Ended September 30, ~~2016~~ 2018

Revenues and Segment Operating Profit:



	For the three months ended								Constant		For the three months ended								Constant
	September 30,				Foreign		Constant		Currency		September 30,				Foreign		Constant		Currency
	2017		2016		Currency Impact		Currency Change		% Change		2019		2018		Currency Impact		Currency Change		% Change

Revenues	(in thousands)										(in thousands)
Domestic site leasing	$	328,395	$	319,109	$	—	$	9,286		2.9%	$	374,705	$	353,502	$	—	$	21,203		6.0%
International site leasing		80,143		69,059		1,521		9,563		13.8%		93,867		81,758		(649)		12,758		15.6%
Site development		25,407		23,151		—		2,256		9.7%		38,975		31,961		—		7,014		21.9%
Total	$	433,945	$	411,319	$	1,521	$	21,105		5.1%	$	507,547	$	467,221	$	(649)	$	40,975		8.8%
Cost of Revenues
Domestic site leasing	$	65,226	$	65,353	$	—	$	(127)		(0.2%)	$	63,836	$	66,862	$	—	$	(3,026)		(4.5%)
International site leasing		25,125		21,001		531		3,593		17.1%		29,157		25,432		(223)		3,948		15.5%
Site development		21,117		19,114		—		2,003		10.5%		30,516		24,447		—		6,069		24.8%
Total	$	111,468	$	105,468	$	531	$	5,469		5.2%	$	123,509	$	116,741	$	(223)	$	6,991		6.0%
Operating Profit
Domestic site leasing	$	263,169	$	253,756	$	—	$	9,413		3.7%	$	310,869	$	286,640	$	—	$	24,229		8.5%
International site leasing		55,018		48,058		990		5,970		12.4%		64,710		56,326		(426)		8,810		15.6%
Site development		4,290		4,037		—		253		6.3%		8,459		7,514		—		945		12.6%

Revenues

Domestic site leasing revenues increased ~~$9.3~~$21.2 million for the three months ended September 30, ~~2017,~~2019, as compared to the prior year, primarily due to (1) revenues from 161 towers acquired and 28 towers built since July 1, 2018 and (2) organic site leasing growth, primarily from monetary lease amendments for additional equipment added to our towers as well as new leases and contractual rent escalators, partially offset by lease non-renewals primarily by MetroPCS, Leap, Clearwire, and Sprint iDEN.

International site leasing revenues increased $12.1 million for the three months ended September 30, 2019, as compared to the prior year. On a constant currency basis, international site leasing revenues increased $12.8 million. These changes were primarily due to (1) revenues from 1,700 towers acquired and 488 towers built since July 1, 2018 and (2) organic site leasing growth from new leases, amendments, and contractual escalators. Site leasing revenue in Brazil represented 12.1% of total site leasing revenue for the period. No other individual international market represented more than 3% of our total site leasing revenue.

Site development revenues increased $7.0 million for the three months ended September 30, 2019, as compared to prior year, as a result of increased carrier activity primarily driven by network related projects by Sprint and T-Mobile.

Operating Profit

Domestic site leasing segment operating profit increased $24.2 million for the three months ended September 30, 2019, as compared to the prior year, primarily due to additional profit generated by (1) towers acquired and built since July 1, 2018 and organic

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site leasing growth as noted above, (2) continued control of our site leasing cost of revenue, and (3) the positive impact of our ground lease purchase program.

International site leasing segment operating profit increased $8.4 million for the three months ended September 30, 2019, as compared to the prior year. On a constant currency basis, international site leasing segment operating profit increased $8.8 million. These changes were primarily due to additional profit generated by (1) towers acquired and built since July 1, 2018 and organic site leasing growth as noted above and (2) the positive impact of our ground lease purchase program.

Site development segment operating profit increased $0.9 million for the three months ended September 30, 2019, as compared to the prior year, primarily due to an increase in revenue from increased carrier activity primarily driven by network related projects by Sprint and T-Mobile partially offset by a change in the mix of work performed.

Selling, General, and Administrative Expenses:



	For the three months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Domestic site leasing	$	21,840	$	17,763	$	—	$	4,077		23.0%
International site leasing		8,626		6,734		(110)		2,002		29.7%
Total site leasing	$	30,466	$	24,497	$	(110)	$	6,079		24.8%
Site development		4,183		3,934		—		249		6.3%
Other		7,623		6,477		—		1,146		17.7%
Total	$	42,272	$	34,908	$	(110)	$	7,474		21.4%

Selling, general, and administrative expenses increased $7.4 million for the three months ended September 30, 2019, as compared to the prior year. On a constant currency basis, selling, general, and administrative expenses increase $7.5 million. These changes were primarily as a result of increases in personnel costs, noncash compensation, benefits, and other support-related costs.

Acquisition and New Business Initiatives Related Adjustments and Expenses:



	For the three months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Domestic site leasing	$	2,717	$	1,887	$	—	$	830		44.0%
International site leasing		1,975		1,108		(31)		898		81.0%
Total	$	4,692	$	2,995	$	(31)	$	1,728		57.7%

Acquisition and new business initiatives related adjustments and expenses increased $1.7 million, on an actual and constant currency basis, for the three months ended September 30, 2019, as compared to the prior year. These changes were primarily as a result of incremental costs incurred in support of new business initiatives.

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Asset Impairment and Decommission Costs:



	For the three months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Domestic site leasing	$	6,027	$	2,801	$	—	$	3,226		115.2%
International site leasing		2,213		4,067		(12)		(1,842)		(45.3%)
Total	$	8,240	$	6,868	$	(12)	$	1,384		20.2%

Asset impairment and decommission costs increased $1.4 million for the three months ended September 30, 2019, as compared to the prior year. This change was primarily as a result of a $2.8 million increase in impairment charges resulting from our regular analysis of whether the future cash flows from certain towers are adequate to recover the carrying value of the investment in those towers, partially offset by a $1.4 million decrease in the impairment charge recorded due to less sites decommissioned in the third quarter of 2019 compared to the prior year period.

Depreciation, Accretion, and Amortization Expense:



	For the three months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Domestic site leasing	$	132,650	$	129,246	$	—	$	3,404		2.6%
International site leasing		40,208		36,310		(313)		4,211		11.6%
Total site leasing	$	172,858	$	165,556	$	(313)	$	7,615		4.6%
Site development		660		646		—		14		2.2%
Other		1,469		1,501		—		(32)		(2.1%)
Total	$	174,987	$	167,703	$	(313)	$	7,597		4.5%

Depreciation, accretion, and amortization expense increased $7.3 million for the three months ended September 30, 2019, as compared to the prior year. On a constant currency basis, depreciation, accretion, and amortization expense increased $7.6 million. These changes were primarily due to an increase in the number of towers we acquired and built since July 1, 2018, partially offset by the impact of assets that became fully depreciated since the prior year period.

Operating Income (Expense):



	For the three months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Domestic site leasing	$	147,635	$	134,943	$	—	$	12,692		9.4%
International site leasing		11,688		8,107		40		3,541		43.7%
Total site leasing	$	159,323	$	143,050	$	40	$	16,233		11.3%
Site development		3,616		2,934		—		682		23.2%
Other		(9,092)		(7,978)		—		(1,114)		14.0%
Total	$	153,847	$	138,006	$	40	$	15,801		11.4%

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Domestic site leasing operating income increased $12.7 million for the three months ended September 30, 2019, as compared to the prior year, primarily due to higher segment operating profit, partially offset by increases in selling, general, and administrative expenses, depreciation, accretion, and amortization expense, and asset impairment and decommission costs.

International site leasing operating income increased $3.6 million for the three months ended September 30, 2019, as compared to the prior year. On a constant currency basis, international site leasing operating income increased $3.5 million. These changes were primarily due to higher segment operating profit and a decrease in asset impairment and decommission costs, partially offset by increases in depreciation, accretion, and amortization expenses and selling, general, and administrative expenses.

Site development operating income increased $0.7 million for the three months ended September 30, 2019, as compared to the prior year, primarily due to higher segment operating profit, partially offset by increases in selling, general, and administrative expenses.

Other Income (Expense):



	For the three months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Interest income	$	1,311	$	2,006	$	(4)	$	(691)		(34.4%)
Interest expense		(96,567)		(95,717)		—		(850)		0.9%
Non-cash interest expense		(662)		(632)		—		(30)		4.7%
Amortization of deferred financing fees		(5,157)		(4,980)		—		(177)		3.6%
Loss from extinguishment of debt, net		(457)		—		—		(457)		—%
Other (expense) income, net		(33,551)		(24,518)		(5,994)		(3,039)		NM
Total	$	(135,083)	$	(123,841)	$	(5,998)	$	(5,244)		5.4%

Interest expense increased $0.9 million for the three months ended September 30, 2019, as compared to the prior year. These changes were due to a higher average principal amount of cash-interest bearing debt outstanding as compared to the prior year, partially offset by a lower weighted average interest rate as compared to the prior year.

Other (expense) income, net includes a $31.9 million loss on the remeasurement of U.S. dollar denominated intercompany loans with foreign subsidiaries for the three months ended September 30, 2019, while the prior year period included a $25.9 million loss.

(Provision) Benefit for Income Taxes:



	For the three months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
(Provision) benefit for income taxes	$	3,002	$	1,979	$	2,417	$	(1,394)		20.5%

Benefit for income taxes increased $1.0 million for the three months ended September 30, 2019, as compared to the prior year. On a constant currency basis, provision for income taxes increased $1.4 million. This change was primarily due an increase in foreign income and withholding taxes partially offset by a decrease in state taxes.

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Net Income:



	For the three months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Net income	$	21,766	$	16,144	$	(3,541)	$	9,163		27.5%

Net income increased $5.6 million for the three months ended September 30, 2019, as compared to the prior year. This change was primarily due to increases in operating income and a benefit for income taxes, partially offset by fluctuations in foreign currency exchange rates including changes recorded on the remeasurement of the U.S. dollar denominated intercompany loans with foreign subsidiaries (net of the tax impact).

Nine Months Ended September 30, 2019 Compared to Nine Months Ended September 30, 2018

Revenues and Segment Operating Profit:



	For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

Revenues	(in thousands)
Domestic site leasing	$	1,106,722	$	1,041,892	$	—	$	64,830		6.2%
International site leasing		273,036		253,794		(15,589)		34,831		13.7%
Site development		121,229		86,160		—		35,069		40.7%
Total	$	1,500,987	$	1,381,846	$	(15,589)	$	134,730		9.8%
Cost of Revenues
Domestic site leasing	$	194,525	$	199,633	$	—	$	(5,108)		(2.6%)
International site leasing		84,642		79,167		(5,276)		10,751		13.6%
Site development		92,606		67,693		—		24,913		36.8%
Total	$	371,773	$	346,493	$	(5,276)	$	30,556		8.8%
Operating Profit
Domestic site leasing	$	912,197	$	842,259	$	—	$	69,938		8.3%
International site leasing		188,394		174,627		(10,313)		24,080		13.8%
Site development		28,623		18,467		—		10,156		55.0%

Revenues

Domestic site leasing revenues increased $64.8 million for the nine months ended September 30, 2019, as compared to the prior year, due to (i) revenues from ~~248~~415 towers acquired and 6048 towers built since ~~July~~January 1, ~~2016~~2018 and (ii) organic site leasing growth, primarily from monetary lease amendments for additional equipment added to our towers as well as new leases and contractual rent escalators, partially offset by lease non-renewals primarily by MetroPCS, Leap, Clearwire, and ~~Cricket.~~Sprint iDEN.

International site leasing revenues increased ~~$11.1~~$19.2 million for the ~~three~~nine months ended September 30, ~~2017,~~2019, as compared to the prior year. On a constant currency basis, international site leasing revenues increased ~~$9.6~~$34.8 million. These changes were primarily due to (i) revenues from ~~560~~2,004 towers acquired and ~~439~~622 towers built since ~~July~~January 1, ~~2016,~~2018 and (ii) organic site leasing growth from new leases, amendments, and contractual ~~escalators, and (iii) an increase in reimbursable pass-through expenses.~~escalators. Site leasing revenue in Brazil represented ~~13.5%~~12.2% of total site leasing revenue for the period. No other individual international market represented more than 3% of our total site leasing revenue.

Site development revenues increased ~~$2.3~~$35.1 million for the ~~three~~nine months ended September 30, ~~2017,~~2019, as compared to the prior year, as a result of increased carrier ~~activity.~~activity primarily driven by network related projects by Sprint and T-Mobile.

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Operating Profit

Domestic site leasing segment operating profit increased ~~$9.4~~$69.9 million for the ~~three~~nine months ended September 30, ~~2017,~~2019, as compared to the prior year, primarily due to additional profit generated by (i) towers acquired and built since ~~July~~January 1, ~~2016~~2018 and organic site leasing growth as noted above, (ii) continued control of our site leasing cost of revenue, and (iii) the positive impact of our ground lease purchase program.

International site leasing segment operating profit increased ~~$7.0~~$13.8 million for the ~~three~~nine months ended September 30, ~~2017,~~2019, as compared to the prior year. On a constant currency basis, international site leasing segment operating profit increased ~~$6.0~~$24.1 million. These changes were ~~primarily due to towers acquired and built since July 1, 2016 and organic site leasing growth as noted above, partially offset by increases in cost of revenues.~~

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Site development segment operating profit increased $0.3 million for the three months ended September 30, 2017, as compared to the prior year, primarily due to increased revenue, partially offset by lower margins due to a change in the mix of work performed.

~~Selling, General, and Administrative Expenses:~~

For the three months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Domestic site leasing

$
16,945

$
19,206

$
—

$
(2,261)

(11.8%)
International site leasing

6,658

5,277

121

1,260

23.9%
Total site leasing

$
23,603

$
24,483

$
121

$
(1,001)

(4.1%)
Site development

3,826

3,128

—

698

22.3%
Not identified by segment

5,130

4,644

—

486

10.5%
Total

$
32,559

$
32,255

$
121

$
183

0.6%

Selling, general, and administrative expenses increased $0.3 million for the three months ended September 30, 2017, as compared to the prior year. On a constant currency basis, selling, general, and administrative expenses increased $0.2 million. These changes were primarily as a result of increases in non-cash compensation, personnel, salaries, benefits, and other support costs particularly in connection with our international expansion, partially offset by a decrease in the provision for doubtful accounts associated with our domestic site leasing business.

~~Acquisition Related Adjustments and Expenses:~~

For the three months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Domestic site leasing

$
962

$
335

$
—

$
627

187.2%
International site leasing

621

2,635

(12)

(2,002)

(76.0%)
Total

$
1,583

$
2,970

$
(12)

$
(1,375)

(46.3%)

Acquisition related adjustments and expenses decreased $1.4 million, on an actual and constant currency basis, for the three months ended September 30, 2017, as compared to the prior year. These changes were primarily as a result of a reduction in third party acquisition costs expensed in the current year as compared to the prior year.

~~Asset Impairment and Decommission Costs:~~

For the three months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Domestic site leasing

$
7,898

$
1,974

$
—

$
5,924

300.1%
International site leasing

1,554

331

66

1,157

349.5%
Total site leasing

$
9,452

$
2,305

$
66

$
7,081

307.2%
Site development

(35)

—

—

(35)

—%
Total

$
9,417

$
2,305

$
66

$
7,046

305.7%

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Asset impairment and decommission costs increased $7.1 million for the three months ended September 30, 2017, as compared to the prior year. On a constant currency basis, asset impairment and decommission costs increased $7.0 million. These changes were primarily as a result of a $9.0 million gain on the sale of fiber assets recorded in the prior year period, partially offset by a $2.5 million decrease in impairment charges from the prior year associated with our regular analysis of whether the future cash flows are adequate to recover the carrying value of the investment.

~~Depreciation, Accretion, and Amortization Expenses:~~

For the three months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Domestic site leasing

$
125,142

$
126,059

$
—

$
(917)

(0.7%)
International site leasing

34,548

31,453

662

2,433

7.7%
Total site leasing

$
159,690

$
157,512

$
662

$
1,516

1.0%
Site development

605

997

—

(392)

(39.3%)
Not identified by segment

1,612

1,602

—

10

0.6%
Total

$
161,907

$
160,111

$
662

$
1,134

0.7%

Depreciation, accretion, and amortization expense increased $1.8 million for the three months ended September 30, 2017, as compared to the prior year. On a constant currency basis, depreciation, accretion, and amortization expense increased $1.1 million. These changes were primarily due to additional international site leasing depreciation associated with the increase in the number of towers we acquired and built since July 1, 2016, partially offset by a decrease in domestic site leasing depreciation associated with assets that became fully depreciated since the prior year period.

~~Operating Income (Expense):~~

For the three months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Domestic site leasing

$
112,222

$
106,182

$
—

$
6,040

5.7%
International site leasing

11,637

8,362

153

3,122

37.3%
Total site leasing

$
123,859

$
114,544

$
153

$
9,162

8.0%
Site development

(106)

(88)

—

(18)

20.5%
Not identified by segment

(6,742)

(6,246)

—

(496)

7.9%
Total

$
117,011

$
108,210

$
153

$
8,648

8.0%

Domestic site leasing operating income increased $6.0 million for the three months ended September 30, 2017, as compared to the prior year, primarily due to higher segment operating profit and decreases in selling, general, and administrative expenses and depreciation, accretion, and amortization expenses, partially offset by increases in asset impairment and decommission costs and acquisition related adjustments and expenses.

International site leasing operating income increased $3.3 million for the three months ended September 30, 2017, as compared to the prior year. On a constant currency basis, international site leasing operating income increased $3.1 million. These changes were primarily due to higher segment operating profit and a decrease in acquisition related adjustments and expenses, partially offset by increases in depreciation, accretion, and amortization expenses, selling, general, and administrative expenses, and asset impairment and decommission costs.

~~Table of Contents~~

~~Other Income (Expense):~~

For the three months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Interest income

$
2,505

$
3,101

$
42

$
(638)

(20.6%)
Interest expense

(81,357)

(83,426)

(3)

2,072

(2.5%)
Non-cash interest expense

(725)

(585)

—

(140)

23.9%
Amortization of deferred financing fees

(4,957)

(5,445)

—

488

(9.0%)
Loss from extinguishment of debt, net

—

(34,512)

—

34,512

—%
Other (expense) income, net

20,062

(1,139)

21,521

(320)

28.1%
Total

$
(64,472)

$
(122,006)

$
21,560

$
35,974

(29.5%)

Interest expense decreased $2.1 million, on an actual and constant currency basis, for the three months ended September 30, 2017, as compared to the prior year, due to a lower weighted average interest rate on debt and lower average principal amount of cash-interest bearing debt outstanding as compared to the prior year. The decrease primarily resulted from the repayment of the 2010-2C Tower Securities in July 2016, the 5.75% Senior Notes in August 2016, the 5.625% Senior Notes in October 2016, and the 2012-1C Tower Securities in April 2017, partially offset by the issuance of the 2016 Senior Notes in August 2016 and the 2017-1C Tower Securities in April 2017, and a higher average balance outstanding on the Revolving Credit Facility in the current year period.

Loss from extinguishment of debt was $34.5 million for the three months ended September 30, 2016 due to the payment of a $25.8 million call premium on the redemption of the 5.75% Senior Notes, the write-off of $7.7 million in deferred financing fees related to the 5.75% Senior Notes, and the write-off of $1.0 million in deferred financing fees related to the redemption of the 2010-2C Tower Securities.

Other (expense) income, net includes an $18.4 million gain on the remeasurement of a U.S. dollar denominated intercompany loan with a Brazilian subsidiary for the three months ended September 30, 2017, while the prior year period included a $3.2 million loss.

~~Provision for Income Taxes:~~

For the three months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Provision for income taxes

$
(3,378)

$
(1,574)

$
8

$
(1,812)

115.1%

Provision for income taxes increased $1.8 million, on an actual and constant currency basis, for the three months ended September 30, 2017, as compared to the prior year. These changes were primarily due to an increase in state tax provisions from becoming a taxpayer in additional jurisdictions.

~~Net Income:~~

~~Table of Contents~~

Net income increased $64.5 million for the three months ended September 30, 2017, as compared to the prior year. On a constant currency basis, net income increased $42.8 million. These changes were primarily due to fluctuations in our foreign currency exchange rates including changes recorded on the remeasurement of the intercompany loan, an increase in operating income, and a decrease in the loss from extinguishment of debt.

~~Nine Months Ended September 30, 2017 Compared to Nine Months Ended September 30, 2016~~

~~Revenues and Segment Operating Profit:~~

For the nine months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

Revenues

(in thousands)

Domestic site leasing

$
974,850

$
951,181

$
—

$
23,669

2.5%
International site leasing

234,239

193,280

16,365

24,594

12.7%
Site development

75,513

72,159

—

3,354

4.6%
Total

$
1,284,602

$
1,216,620

$
16,365

$
51,617

4.2%
Cost of Revenues

Domestic site leasing

$
195,903

$
196,027

$
—

$
(124)

(0.1%)
International site leasing

73,167

59,582

5,738

7,847

13.2%
Site development

62,713

59,021

—

3,692

6.3%
Total

$
331,783

$
314,630

$
5,738

$
11,415

3.6%
Operating Profit

Domestic site leasing

$
778,947

$
755,154

$
—

$
23,793

3.2%
International site leasing

161,072

133,698

10,627

16,747

12.5%
Site development

12,800

13,138

—

(338)

(2.6%)

~~Revenues~~

Domestic site leasing revenues increased $23.7 million for the nine months ended September 30, 2017, as compared to the prior year, due to (i) revenues from 402 towers acquired and 85 towers built since January 1, 2016 and (ii) organic site leasing growth, primarily from monetary lease amendments for additional equipment added to our towers as well as new leases and contractual rent escalators, partially offset by lease non-renewals primarily by MetroPCS, Clearwire, and Cricket.

International site leasing revenues increased $41.0 million for the nine months ended September 30, 2017, as compared to the prior year. On a constant currency basis, international site leasing revenues increased $24.6 million. These changes were primarily due to (i) revenues from 565 towers acquired and 575 towers built since January 1, 2016, (ii) organic site leasing growth from new leases and contractual escalators, and (iii) an increase in reimbursable pass-through expenses. Site leasing revenue in Brazil represented 13.4% of total site leasing revenue for the period. No other individual international market represented more than 3% of our total site leasing revenue.

~~Site development revenues increased $3.4 million for the nine months ended September 30, 2017, as compared to the prior year, as a result of increased carrier activity.~~

~~Operating Profit~~

~~Domestic site leasing segment operating profit increased $23.8 million for the nine months ended September 30, 2017, as compared to the prior year,~~ primarily due to additional profit generated by (i) towers acquired and built since January 1, ~~2016~~2018 and organic site leasing growth as noted above, (ii) continued control of our site leasing cost of revenue, and (iii) the positive impact of our ground lease purchase program.

~~Table of Contents~~

~~International site leasing~~Site development segment operating profit increased ~~$27.4~~$10.2 million for the nine months ended September 30, 2017, as compared to the prior year. On a constant currency basis, international site leasing segment operating profit increased $16.7 million. These changes were primarily due to towers acquired and built since January 1, 2016 and organic site leasing growth as noted above, partially offset by increases in cost of revenues.

~~Site development segment operating profit decreased $0.3 million for the nine months ended September 30, 2017,~~2019, as compared to the prior year, primarily due to ~~lower margins resulting~~an increase in revenue from increased carrier activity primarily driven by network related projects by Sprint and T-Mobile partially offset by a change in the mix of work ~~performed, partially offset by an increase in revenue due to increased carrier activity.~~performed.

Selling, General, and Administrative Expenses:



	For the nine months ended								Constant		For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency		September 30,				Foreign		Constant		Currency
	2017		2016		Currency Impact		Currency Change		% Change		2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)										(in thousands)
Domestic site leasing	$	53,147	$	55,141	$	—	$	(1,994)		(3.6%)	$	77,926	$	55,047	$	—	$	22,879		41.6%
International site leasing		19,007		30,727		911		(12,631)		(41.1%)		22,624		20,242		(786)		3,168		15.7%
Total site leasing	$	72,154	$	85,868	$	911	$	(14,625)		(17.0%)	$	100,550	$	75,289	$	(786)	$	26,047		34.6%
Site development		11,495		9,960		—		1,535		15.4%		16,774		11,943		—		4,831		40.5%
Not identified by segment		16,528		14,498		—		2,030		14.0%
Other												31,431		19,669		—		11,762		59.8%
Total	$	100,177	$	110,326	$	911	$	(11,060)		(10.0%)	$	148,755	$	106,901	$	(786)	$	42,640		39.9%

Selling, general, and administrative expenses ~~decreased $10.1~~increased $41.9 million for the nine months ended September 30, ~~2017,~~2019, as compared to the prior year. On a constant currency basis, selling, general, and administrative expenses ~~decreased $11.1~~increased $42.6 million. These changes were primarily as a result of a ~~decrease~~$27.8 million increase in ~~the provision for doubtful accounts which included the $16.5 million Oi reserve recorded~~noncash compensation as well as increases in ~~the second quarter of 2016,~~personnel, compensation, benefits, and other support-related costs, partially offset by ~~increases~~a $2.3 million partial recovery of the Oi reserve in ~~non-cash compensation, personnel, salaries, benefits,~~the first quarter of 2019.

Acquisition and ~~other support costs.~~

~~Acquisition~~New Business Initiatives Related Adjustments and Expenses:



	For the nine months ended								Constant		For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency		September 30,				Foreign		Constant		Currency
	2017		2016		Currency Impact		Currency Change		% Change		2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)										(in thousands)
Domestic site leasing	$	4,300	$	3,533	$	—	$	767		21.7%	$	4,698	$	5,242	$	—	$	(544)		(10.4%)
International site leasing		2,557		5,441		194		(3,078)		(56.6%)		4,971		3,929		(250)		1,292		32.9%
Total	$	6,857	$	8,974	$	194	$	(2,311)		(25.8%)	$	9,669	$	9,171	$	(250)	$	748		8.2%

~~Acquisition related adjustments~~
‎

Table of Contents

Asset Impairment and ~~expenses decreased $2.1~~Decommission Costs:



	For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Domestic site leasing	$	18,476	$	15,971	$	—	$	2,505		15.7%
International site leasing		5,155		6,475		(169)		(1,151)		(17.8%)
Total site leasing	$	23,631	$	22,446	$	(169)	$	1,354		6.0%
Site development		—		332		—		(332)		(100.0%)
Total	$	23,631	$	22,778	$	(169)	$	1,022		4.5%

Depreciation, Accretion, and Amortization Expenses:



	For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Domestic site leasing	$	394,308	$	382,490	$	—	$	11,818		3.1%
International site leasing		117,197		113,550		(6,750)		10,397		9.2%
Total site leasing	$	511,505	$	496,040	$	(6,750)	$	22,215		4.5%
Site development		1,900		1,936		—		(36)		(1.9%)
Other		4,185		4,683		—		(498)		(10.6%)
Total	$	517,590	$	502,659	$	(6,750)	$	21,681		4.3%

Depreciation, accretion, and amortization expense increased $14.9 million for the nine months ended September 30, 2017, as compared to the prior year. On a constant currency basis, acquisition related adjustments and expenses decreased $2.3 million. These changes were primarily as a result of changes in our estimated pre-acquisition contingencies as compared to the prior year period and a reduction in third party acquisition costs expensed in the current year as compared to the prior year.

~~Table of Contents~~

~~Asset Impairment and Decommission Costs:~~

For the nine months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Domestic site leasing

$
22,746

$
19,359

$
—

$
3,387

17.5%
International site leasing

2,956

1,476

201

1,279

86.7%
Total site leasing

$
25,702

$
20,835

$
201

$
4,666

22.4%
Site development

206

—

—

206

—%
Not identified by segment

—

2,345

—

(2,345)

(100.0%)
Total

$
25,908

$
23,180

$
201

$
2,527

10.9%

Asset impairment and decommission costs increased by $2.7 million for the nine months ended September 30, 2017, as compared to the prior year. On a constant currency basis, asset impairment and decommission costs increased $2.5 million. These changes were primarily as a result of a $9.0 million gain on the sale of fiber assets recorded in the prior year period, partially offset by a $2.3 million decrease in write-off and disposal costs related to our former corporate headquarters building during the second quarter of 2016 and a $4.0 million decrease in impairment charges resulting from our regular analysis of whether the future cash flows are adequate to recover the carrying value of the investment.

~~Depreciation, Accretion, and Amortization Expenses:~~

For the nine months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Domestic site leasing

$
373,262

$
384,208

$
—

$
(10,946)

(2.8%)
International site leasing

100,388

88,111

6,988

5,289

6.0%
Total site leasing

$
473,650

$
472,319

$
6,988

$
(5,657)

(1.2%)
Site development

1,968

2,661

—

(693)

(26.0%)
Not identified by segment

4,839

4,655

—

184

4.0%
Total

$
480,457

$
479,635

$
6,988

$
(6,166)

(1.3%)

~~Depreciation, accretion, and amortization expense increased $0.8 million for the nine months ended September 30, 2017,~~2019, as compared to the prior year. On a constant currency basis, depreciation, accretion, and amortization expense ~~decreased $6.2~~increased $21.7 million. These changes were primarily due to a decrease in domestic site leasing depreciation associated with assets that became fully depreciated since the prior year period, partially offset by additional international site leasing depreciation associated with an increase in the number of towers we acquired and built since January 1, ~~2016.~~2018, partially offset by the impact of assets that became fully depreciated since the prior year period.

~~Table of Contents~~

Operating Income (Expense):



	For the nine months ended								Constant		For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency		September 30,				Foreign		Constant		Currency
	2017		2016		Currency Impact		Currency Change		% Change		2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)										(in thousands)
Domestic site leasing	$	325,492	$	292,913	$	—	$	32,579		11.1%	$	416,789	$	383,509	$	—	$	33,280		8.7%
International site leasing		36,164		7,943		2,333		25,888		325.9%		38,447		30,431		(2,358)		10,374		34.1%
Total site leasing	$	361,656	$	300,856	$	2,333	$	58,467		19.4%	$	455,236	$	413,940	$	(2,358)	$	43,654		10.5%
Site development		(869)		517		—		(1,386)		(268.1%)		9,949		4,256		—		5,693		133.8%
Not identified by segment		(21,367)		(21,498)		—		131		(0.6%)
Other												(35,616)		(24,352)		—		(11,264)		46.3%
Total	$	339,420	$	279,875	$	2,333	$	57,212		20.4%	$	429,569	$	393,844	$	(2,358)	$	38,083		9.7%

Domestic site leasing operating income increased ~~$32.6~~$33.3 million for the nine months ended September 30, ~~2017,~~2019, as compared to the prior year, primarily due to higher segment operating profit, partially offset by increases in selling, general, and ~~decreases in~~administrative expenses, depreciation, accretion, and amortization expense, and ~~selling, general, and administrative expenses, partially offset by an increase in~~ asset impairment and decommission costs.

Table of Contents

International site leasing operating income increased ~~$28.2~~$8.0 million for the nine months ended September 30, ~~2017,~~2019, as compared to the prior year. On a constant currency basis, international site leasing operating income increased ~~$25.9~~$10.4 million. These changes were primarily due to higher segment operating profit and ~~decreases~~a decrease in ~~selling, general,~~asset impairment and ~~administrative expenses resulting from the $16.5 million Oi reserve recorded in the second quarter of 2016 and acquisition related adjustments and expenses,~~decommission costs, partially offset by increases in depreciation, accretion, and amortization expenses, selling, general, and ~~asset impairment~~administrative expenses, and ~~decommission costs.~~acquisition and new business initiatives related adjustments and expenses.

Site development operating income ~~decreased $1.4~~increased $5.7 million for the nine months ended September 30, ~~2017,~~2019, as compared to the prior year, primarily due to ~~lower~~higher segment operating profit, ~~and~~partially offset by increases in selling, general, and administrative ~~expenses and asset impairment and decommission costs, partially offset by a decrease in depreciation, accretion, and amortization expense.~~expenses.

Other Income (Expense):



	For the nine months ended								Constant		For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency		September 30,				Foreign		Constant		Currency
	2017		2016		Currency Impact		Currency Change		% Change		2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)										(in thousands)
Interest income	$	8,648	$	7,704	$	685	$	259		3.4%	$	4,692	$	4,972	$	(151)	$	(129)		(2.6%)
Interest expense		(237,415)		(250,913)		(3)		13,501		(5.4%)		(292,681)		(278,278)		(8)		(14,395)		5.2%
Non-cash interest expense		(2,146)		(1,500)		—		(646)		43.1%		(1,954)		(2,002)		—		48		(2.4%)
Amortization of deferred financing fees		(16,603)		(16,035)		—		(568)		3.5%		(15,333)		(15,265)		—		(68)		0.4%
Loss from extinguishment of debt, net		(1,961)		(34,512)		—		32,551		(94.3%)		(457)		(14,443)		—		13,986		(96.8%)
Other (expense) income, net		16,218		92,137		(78,029)		2,110		2.3%		(21,296)		(110,175)		88,143		736		24.8%
Total	$	(233,259)	$	(203,119)	$	(77,347)	$	47,207		(23.2%)	$	(327,029)	$	(415,191)	$	87,984	$	178		(0.1%)

Interest expense ~~decreased $13.5~~increased $14.4 million ~~on an actual and constant currency basis,~~ for the nine months ended September 30, ~~2017,~~2019, as compared to the prior ~~year,~~year. These changes were primarily due to a ~~lower weighted average interest rate on debt and a lower~~higher average principal amount of cash-interest bearing debt outstanding as compared to the prior year. The decrease primarily resulted from the repayment of the 2010-2C Tower Securities in July 2016, the 5.75% Senior Notes in August 2016, the 5.625% Senior Notes in October 2016, and the 2012-1C Tower Securities in April 2017,year, partially offset by a lower weighted average interest rate as compared to the issuance of the 2016-1C Tower Securities in July 2016, the 2016 Senior Notes in August 2016, and the 2017-1C Tower Securities in April 2017, and a higher average balance outstanding on the Revolving Credit Facility in the current year period.prior year.

~~Table of Contents~~

Loss from extinguishment of debt was ~~$2.0~~$14.4 million for the nine months ended September 30, ~~2017~~2018 due tothe write-off of the original issuance discount and unamortized financing ~~costs~~fees associated with the repayment of the ~~2012-1C~~2013-1C Tower Securities and 2013-1D Tower Securities in March 2018, as well as the 2014 Term Loan and 2015 Term Loan in April ~~2017. Loss from extinguishment~~2018.

Other (expense) income, net includes a $24.8 million loss on the remeasurement of ~~debt was$34.5~~U.S. dollar denominated intercompany loans with foreign subsidiaries for the nine months ended September 30, 2019, while the prior year period included an $113.1 million loss.

(Provision) Benefit for Income Taxes:



	For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
(Provision) benefit for income taxes	$	(22,813)	$	11,645	$	(28,512)	$	(5,946)		22.2%

Provision for income taxes increased $34.5 million for the nine months ended September 30, 2016 due to the payment of a $25.8 million call premium and the write off of $7.7 million in deferred financing fees on the redemption of the 5.75% Senior Notes, and the write off of $1.0 million in deferred financing fees related to the redemption of the 2010-2C Tower Securities.

Other (expense) income, net includes an $11.6 million gain on the remeasurement of a U.S. dollar denominated intercompany loan with a Brazilian subsidiary for the nine months ended September 30, 2017, while the prior year period included an $89.0 million gain.

~~Provision for Income Taxes:~~

For the nine months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Provision for income taxes

$
(10,167)

$
(5,780)

$
19

$
(4,406)

76.2%

Provision for income taxes increased $4.4 million, on an actual and constant currency basis, for the nine months ended September 30, 2017, as compared to the prior year. These changes were primarily due to an increase in state tax provisions from becoming a taxpayer in additional jurisdictions.

~~Net Income:~~

For the nine months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Net income

$
95,994

$
70,976

$
(75,033)

$
100,051

141.0%

~~Net income increased $25.0 million for the nine months ended September 30, 2017,~~2019, as compared to the prior year. On a constant currency basis, ~~net~~provision for income taxes increased ~~$100.1~~$5.9 million. ~~These changes were~~This change was primarily due to an increase in foreign income and withholding taxes.

‎

Table of Contents

Net Income (Loss):



	For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Net income (loss)	$	79,727	$	(9,702)	$	57,114	$	32,315		(5.0%)

Net income increased $89.4 million for the nine months ended September 30, 2019, as compared to the prior year. This change was primarily due to increases in operating income, ~~and a decrease in interest expense, partially offset by~~ fluctuations in ~~our~~ foreign currency exchange rates including changes recorded on the remeasurement of the U.S. dollar denominated intercompany ~~loan.~~loans with foreign subsidiaries (net of the tax impact), and a decrease in loss from extinguishment of debt, partially offset by increases in the provision for income taxes and interest expense.

NON-GAAP FINANCIAL MEASURES

This report contains information regarding a non-GAAP measure, Adjusted EBITDA. We have provided below a description of Adjusted EBITDA, a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure and an explanation as to why management utilizes this measure. This report also presents our financial results and other financial metrics after eliminating the impact of changes in foreign currency exchange ~~rates and the Oi reserve recorded in the second quarter of 2016.~~rates. We believe that providing these financial results and metrics on a constant currency basis, which are non-GAAP measures, gives management and investors the ability to evaluate the performance of our business without the impact of foreign currency exchange rate fluctuations. We eliminate the impact of changes in foreign currency exchange rates by dividing the current period’s financial results by the average monthly exchange rates of the prior year period, as well as by eliminating the impact of the remeasurement of our intercompany loans. In addition, we believe that excluding the Oi reserve, which represents a $16.5 million one-time provision for doubtful accounts recorded in the prior year, provides management and investors the ability to better analyze our core results without the impact of what we believe is a non-recurring event.

~~Table of Contents~~

Adjusted EBITDA

We define Adjusted EBITDA as net income excluding the impact of non-cash straight-line leasing revenue, non-cash straight-line ground lease expense, non-cash compensation, net loss from extinguishment of debt, other income and expenses, acquisition and new business initiatives related adjustments and expenses, asset impairment and decommission costs, interest income, interest expenses, depreciation, accretion, and amortization, and provision for or benefit from taxes.

We believe that Adjusted EBITDA is useful to investors or other interested parties in evaluating our financial performance. Adjusted EBITDA is the primary measure used by management (1) to evaluate the economic productivity of our operations and (2) for purposes of making decisions about allocating resources to, and assessing the performance of, our operations. Management believes that Adjusted EBITDA helps investors or other interested parties to meaningfully evaluate and compare the results of our operations (1) from period to period and (2) to our competitors, by excluding the impact of our capital structure (primarily interest charges from our outstanding debt) and asset base (primarily depreciation, amortization and accretion) from our financial results. Management also believes Adjusted EBITDA is frequently used by investors or other interested parties in the evaluation of REITs. In addition, Adjusted EBITDA is ~~a component~~similar to the measure of ~~the calculation that has been~~current financial performance generally used by our lenders to determine compliance with certain covenants under our Senior Credit Agreement and the indentures relating to the 2014 Senior Notes, 2016 Senior Notes, and 2017 Senior Notes. Adjusted EBITDA should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.

‎

For the three months ended

Constant

September 30,

Foreign

Constant

Currency

2017

2016

Currency Impact

Currency Change

% Change

(in thousands)

Net income (loss)

$
49,161

$
(15,370)

$
21,705

$
42,826

(278.6%)
Non-cash straight-line leasing revenue

(4,376)

(7,334)

(86)

3,044

(41.5%)
Non-cash straight-line ground lease expense

7,698

8,323

14

(639)

(7.7%)
Non-cash compensation

9,423

8,076

31

1,316

16.3%
Loss from extinguishment of debt, net

—

34,512

—

(34,512)

—%
Other expense (income), net

(20,062)

1,139

(21,521)

320

28.1%
Acquisition related adjustments and expenses

1,583

2,970

(12)

(1,375)

(46.3%)
Asset impairment and decommission costs

9,417

2,305

66

7,046

305.7%
Interest income

(2,505)

(3,101)

(42)

638

(20.6%)
Interest expense (1)

87,039

89,456

3

(2,420)

(2.7%)
Depreciation, accretion, and amortization

161,907

160,111

662

1,134

0.7%
Provision for taxes (2)

3,835

2,123

8

1,704

80.3%
Adjusted EBITDA

$
303,120

$
283,210

$
828

$
19,082

3640

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	For the three months ended								Constant
	September 30,				Foreign		Constant		Currency
	2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)
Net income	$	21,766	$	16,144	$	(3,541)	$	9,163		27.5%
Non-cash straight-line leasing revenue		(3,807)		(5,064)		6		1,251		(24.7%)
Non-cash straight-line ground lease expense		4,522		6,961		(1)		(2,438)		(35.0%)
Non-cash compensation		12,732		10,433		(24)		2,323		22.3%
Loss from extinguishment of debt, net		457		—		—		457		—%
Other (income) expense, net		33,551		24,518		5,994		3,039		NM
Acquisition and new business initiatives
related adjustments and expenses		4,692		2,995		(31)		1,728		57.7%
Asset impairment and decommission costs		8,240		6,868		(12)		1,384		20.2%
Interest income		(1,311)		(2,006)		4		691		(34.4%)
Total interest expense ⁽¹⁾		102,386		101,329		—		1,057		1.0%
Depreciation, accretion, and amortization		174,987		167,703		(313)		7,597		4.5%
Provision (benefit) for income taxes ⁽²⁾		(2,788)		(1,786)		(2,417)		1,415		20.2%
Adjusted EBITDA	$	355,427	$	328,095	$	(335)	$	27,667		8.4%



	For the nine months ended								Constant		For the nine months ended								Constant
	September 30,				Foreign		Constant		Currency		September 30,				Foreign		Constant		Currency
	2017		2016		Currency Impact		Currency Change		% Change		2019		2018		Currency Impact		Currency Change		% Change

	(in thousands)										(in thousands)
Net income	$	95,994	$	70,976	$	(75,033)	$	100,051		141.0%
Net income (loss)											$	79,727	$	(9,702)	$	57,114	$	32,315		(5.0%)
Non-cash straight-line leasing revenue		(12,440)		(24,955)		(1,061)		13,576		(54.4%)		(9,344)		(15,691)		213		6,134		(39.1%)
Non-cash straight-line ground lease expense		23,461		26,610		130		(3,279)		(12.3%)		15,880		20,328		(5)		(4,443)		(21.9%)
Non-cash compensation		28,894		24,752		110		4,032		16.3%		60,633		32,140		(228)		28,721		89.4%
Loss from extinguishment of debt, net		1,961		34,512		—		(32,551)		(94.3%)		457		14,443		—		(13,986)		(96.8%)
Other expense (income), net		(16,218)		(92,137)		78,029		(2,110)		2.3%
Acquisition related adjustments and expenses		6,857		8,974		194		(2,311)		(25.8%)
Other (income) expense, net												21,296		110,175		(88,143)		(736)		(24.8%)
Acquisition and new business initiatives
related adjustments and expenses												9,669		9,171		(250)		748		8.2%
Asset impairment and decommission costs		25,908		23,180		201		2,527		10.9%		23,631		22,778		(169)		1,022		4.5%
Interest income		(8,648)		(7,704)		(685)		(259)		3.4%		(4,692)		(4,972)		151		129		(2.6%)
Interest expense (1)		256,164		268,448		3		(12,287)		(4.6%)
Total interest expense ⁽¹⁾												309,968		295,545		8		14,415		4.9%
Depreciation, accretion, and amortization		480,457		479,635		6,988		(6,166)		(1.3%)		517,590		502,659		(6,750)		21,681		4.3%
Provision for taxes (2)		11,680		7,185		50		4,445		61.9%
Provision (benefit) for income taxes ⁽²⁾												23,423		(11,069)		28,510		5,983		21.8%
Adjusted EBITDA		894,070		819,476		8,926		65,668			$	1,048,238	$	965,805	$	(9,549)	$	91,983		9.5%
Oi reserve		—		16,498		—		(16,498)
Adjusted EBITDA excluding Oi reserve	$	894,070	$	835,974	$	8,926	$	49,170

(1)Total interest expense includes interest expense, non-cash interest expense, and amortization of deferred financing fees.

(2)Provision for taxes includes $214 and $193 of franchise taxes for the three months ended September 30, 2019 and 2018, respectively, and $610 and $576 of franchise taxes for the nine months ended September 30, 2019 and 2018, respectively, reflected in selling, general, and administrative expenses on the Consolidated Statements of Operations.

~~(1)~~

~~Interest expense includes interest expense, non-cash interest expense, and amortization of deferred financing fees.~~

~~(2)~~

Provision for taxes includes $457 and $549 of franchise and gross receipts taxes for the three months ended September 30, 2017 and 2016, respectively, and $1,513 and $1,405 of franchise and gross receipts taxes for the nine months ended September 30, 2017 and 2016, respectively, reflected in selling, general, and administrative expenses on the Consolidated Statement of Operations.

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Adjusted EBITDA increased ~~$19.9~~$27.3 million for the three months ended September 30, ~~2017,~~2019, as compared to the prior year period. On a constant currency basis, Adjusted EBITDA increased ~~$19.1~~$27.7 million. These changes were primarily due to ~~increases in domestic site leasing, international site leasing, and site development~~higher segment operating ~~profit.~~profit, partially offset by an increase in cash selling, general, and administrative expenses.

Adjusted EBITDA ~~excluding the Oi reserve~~ increased ~~$58.1~~$82.4 million for the nine months ended September 30, ~~2017,~~2019, as compared to the prior year period. On a constant currency basis, Adjusted EBITDA ~~excluding the Oi reserve~~ increased ~~$49.2~~$92.0 million. These changes were primarily due to ~~increases in domestic and international site leasing~~higher segment operating profit, partially offset by an increase in cash selling, general, and administrative ~~expenses after excluding the Oi reserve and a decrease in site development segment operating profit.~~expenses.

LIQUIDITY AND CAPITAL RESOURCES

SBAC is a holding company with no business operations of its own. SBAC’s only significant asset is 100% of the outstanding capital stock of SBA Telecommunications, LLC (“Telecommunications”), which is also a holding company that owns equity interests in entities that directly or indirectly own all of our domestic and international towers and assets. We conduct all of our business operations through Telecommunications’ subsidiaries. Accordingly, our only source of cash to pay our obligations, other than financings, is distributions with respect to our ownership interest in our subsidiaries from the net earnings and cash flow generated by these subsidiaries.

~~Table of Contents~~

A summary of our cash flows is as follows:



	For the nine months ended
	September 30, 2019		September 30, 2018

	(in thousands)
Cash provided by operating activities	$	704,984	$	624,143
Cash used in investing activities		(415,066)		(520,317)
Cash used in financing activities		(307,581)		(31,189)
Change in cash, cash equivalents, and restricted cash		(17,663)		72,637
Effect of exchange rate changes on cash, cash equiv., and restricted cash		(1,957)		(13,608)
Cash, cash equivalents, and restricted cash, beginning of period		178,300		104,295
Cash, cash equivalents, and restricted cash, end of period	$	158,680	$	163,324

For the nine months ended

September 30, 2017

September 30, 2016

(in thousands)
Cash provided by operating activities

$
591,472

$
527,231
Cash used in investing activities

(290,915)

(300,213)
Cash (used in) provided by financing activities

(317,602)

333,534
Change in cash, cash equivalents, and restricted cash

(17,045)

560,552
Effect of exchange rate changes on cash, cash equiv., and restricted cash

3,537

13,760
Cash, cash equivalents, and restricted cash, beginning of period

185,970

146,619
Cash, cash equivalents, and restricted cash, end of period

$
172,462

$
720,931

Operating Activities

Cash provided by operating activities was ~~$591.5~~$705.0 million for the nine months ended September 30, ~~2017~~2019 as compared to ~~$527.2~~$624.1 million for the nine months ended September 30, ~~2016.~~2018. The increase ~~of $64.2 million~~ was primarily due to ~~increases~~an increase in segment operating profit ~~from domestic site leasing and international site leasing operating segments~~ and a decrease in cash outflows associated with working capital changes, partially offset by increases in selling, general, and administrative expenses and cash interest payments.

‎

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Investing Activities

A detail of our ~~cash capital expenditures~~investing activities is as follows:

For the nine months

ended September 30,

2017

2016

(in thousands)
Acquisitions of towers and related intangible assets (1)(2)

$
124,476

$
144,535
Construction and related costs on new tower builds

49,650

51,487
Augmentation and tower upgrades

31,704

28,201
Land buyouts and other assets (3)

36,531

46,867
Tower maintenance

21,752

21,125
General corporate

3,204

3,507
Total cash capital expenditures

$
267,317

$
295,722



	For the nine months ended September 30,
	2019		2018

	(in thousands)
Acquisitions of towers and related intangible assets	$	(224,585)	$	(372,054)
Land buyouts and other assets ⁽¹⁾		(59,116)		(31,781)
Construction and related costs on new builds		(40,191)		(45,029)
Augmentation and tower upgrades		(46,571)		(34,978)
Tower maintenance		(21,480)		(21,616)
General corporate		(3,139)		(3,343)
Purchase of investments		(528,915)		(99,823)
Proceeds from sale of investments		515,557		95,890
Other investing activities		(6,626)		(7,583)
Net cash used in investing activities	$	(415,066)	$	(520,317)

~~(1)~~

~~The nine months ended September 30, 2017 excludes $63.3 million of acquisition costs funded through the issuance of 487,963 shares of Class A common stock.~~

~~(2)~~

~~The nine months ended September 30, 2017 excludes $21.0 million of acquisitions completed during the second quarter of 2017 which were not funded as of September 30, 2017.~~

~~(3)~~

In addition, we paid $10.6 million and $8.7 million for ground lease extensions and term easements on land underlying our towers during the nine months ended September 30, 2017 and 2016, respectively.

~~During all~~(1)Excludes $13.1 million and $16.4 million spent to extend ground lease terms for the nine months ended September 30, 2019 and 2018, respectively.

Subsequent to September 30, 2019, we acquired 6 towers and related assets for $6.7 million in cash. In addition, we have agreed to purchase and anticipate to close on 107 additional communication sites for an aggregate of ~~2017, inclusive of the~~$32.7 million.

For 2019, including capital expenditures made during the nine months ended September 30, ~~2017,~~2019, we expect to incur non-discretionary cash capital expenditures associated with tower maintenance and general corporate expenditures of ~~$32.5~~$31.0 million to ~~$37.5~~$37.0 million and discretionary cash capital expenditures, based on current or potential acquisition obligations, planned new tower construction, forecasted tower augmentations, and forecasted ground lease purchases, of ~~$395.0~~$468.0 million to ~~$415.0 million as well as potential, additional tower acquisitions not yet under contract.~~$478.0 million. We expect to fund these cash capital expenditures from cash on hand, cash flow from operations, and borrowings under the Revolving Credit Facility or new financings. The exact amount of our future

~~Table of Contents~~

cash capital expenditures will depend on a number of factors, including amounts necessary to support our tower portfolio, our new tower build and acquisition programs, and our ground lease purchase program.

Financing Activities

A detail of our financing activities is as follows:



	For the nine months ended
	September 30, 2019		September 30, 2018

	(in thousands)
Net (repayments) borrowings under Revolving Credit Facility⁽¹⁾	$	(325,000)	$	80,000
Repayment of Tower Securities⁽¹⁾		(920,000)		(755,000)
Proceeds from issuance of Tower Securities, net of fees⁽¹⁾		1,153,036		631,479
Repurchase and retirement of common stock⁽²⁾		(267,534)		(453,539)
Proceeds from employee stock purchase/stock option plans		112,909		33,678
Repayment of Term Loans⁽¹⁾		(18,000)		(1,941,000)
Proceeds from Term Loans, net of fees⁽¹⁾		—		2,377,264
Payment of dividends on common stock		(41,873)		—
Other financing activities		(1,119)		(4,071)
Net cash used in financing activities	$	(307,581)	$	(31,189)

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(1)For additional information regarding our debt offerings, refer to the Debt Instruments and Debt Service Requirements below.

(2)On July 29, 2019, our Board of Directors authorized a new $1.0 billion stock repurchase plan, replacing the prior plan authorized on February 16, 2018 which had a remaining authorization of $110.0 million. This new plan authorizes us to purchase, from time to time, up to $1.0 billion of our outstanding Class A common stock through open market repurchases in compliance with Rule 10b-18 under the Exchange Act and/or in privately negotiated transactions at management’s discretion based on market and business conditions, applicable legal requirements and other factors. The new plan has no time deadline and will continue until otherwise modified or terminated by our Board of Directors at any time in its sole discretion. During the nine months ended September 30, 2017, we borrowed $415.0 million and repaid $375.0 million of the outstanding balance under the Revolving Credit Facility. As of September 30, 2017, we had $430.0 million outstanding under the $1.0 billion Revolving Credit Facility. Subsequent to September 30, 2017, we borrowed an additional $30.0 million and repaid $460.0 million of the outstanding balance under the Revolving Credit Facility with proceeds from the 2017 Senior Notes (defined below). As of the date of this filing, no amount was outstanding under the Revolving Credit Facility.

~~During the nine months ended September 30, 2017,~~2019, we repurchased ~~3.9~~1.2 million shares of our Class A common stock ~~under our current stock repurchase plan~~ for ~~$538.9~~$270.3 million, at ~~a weighted~~an average price per share of $139.16. Subsequent to September 30, 2017, we repurchased 0.8 million shares of our Class A common stock under our current stock repurchase plan for $111.1 million at a weighted average price per share of $147.19.$231.20. Shares repurchased were retired. As of the date of this filing, wethe Company had ~~$350.0~~$824.3 million of authorization remaining under the current stock repurchase plan.

Dividend

On ~~January 20, 2017, SBA Senior Finance II repriced its senior secured term loans from~~September 25, 2019, we paid a ~~Eurodollar Rate plus 250 basis points (with a Eurodollar Rate floor~~cash dividend of ~~0.75%)~~$0.37 per share, or an aggregate amount of $41.9 million, to ~~a Eurodollar Rate plus 225 basis points (with a zero Eurodollar floor).~~

~~On April 17, 2017, we, through a New York common law trust (the “Trust”), issued $760.0 million~~shareholders of ~~2017-1C Tower Securities (as defined below). The fixed interest rate~~record at the close of business on the 2017-1C Tower Securities is 3.168% per annum, payable monthly. Net proceeds from this offering were used to prepay the entire $610.0 million aggregate principal amount, as well as accrued and unpaid interest, of the 2012-1C Tower Securities and for general corporate purposes.

August 28, 2019. On October ~~13, 2017, we issued $750.0 million~~25, 2019, our Board of ~~2017 Senior Notes (as defined below).~~Directors declared a quarterly cash dividend of $0.37 per share on shares of our Class A common stock. The ~~2017 Senior Notes accrue interest~~dividend will be payable on December 19, 2019 to shareholders of record at ~~a rate~~the close of ~~4.0% per annum. Interest~~business on November 21, 2019. Future dividends are subject to the ~~2017 Senior Notes is due semi-annually on April 1~~approval of our Board of Directors. We expect to continue to invest our cash flow after dividends, if declared, consistent with our past practice of investing in acquisitions, the construction of new sites, land purchases and ~~October 1~~the repurchase of ~~each year, beginning on April 1, 2018. Net proceeds from this offering were used to repay $460.0 million outstanding under the Revolving Credit Facility and for general corporate purposes.~~our own shares.

Registration Statements

We have on file with the Commission a shelf registration statement on Form S-4 registering shares of Class A common stock that we may issue in connection with the acquisition of wireless communication towers or antenna sites and related assets or companies who own wireless communication towers, antenna sites, or related assets. During the nine months ended September 30, ~~2017,~~2019, we issued ~~487,963~~10,000 shares of Class A common stock under this registration statement. As of September 30, ~~2017,~~2019, we had approximately 1.2 million shares of Class A common stock remaining under this shelf registration statement.

On March ~~3, 2015,~~5, 2018, we filed with the Commission an automatic shelf registration statement for well-known seasoned issuers on Form S-3ASR. This registration statement enables us to issue shares of our Class A common stock, preferred stock or debt securities either separately or represented by warrants, or depositary shares as well as units that include any of these securities. Under the rules governing automatic shelf registration statements, we will file a prospectus supplement and advise the Commission of the amount and type of securities each time we issue securities under this registration statement. No securities were issued under this registration statement ~~from March 3, 2015~~ through the date of this filing.

Debt Instruments and Debt Service Requirements

Revolving Credit Facility under the Senior Credit Agreement

~~The Revolving Credit Facility is governed by the Senior Credit Agreement.~~ The Revolving Credit Facility consists of a revolving loan under which up to ~~$1.0~~$1.25 billion aggregate principal amount may be borrowed, repaid and redrawn, based upon specific financial ratios and subject to the satisfaction of other customary conditions to borrowing. Amounts borrowed under the Revolving Credit Facility accrue interest, at SBA Senior Finance II’s election, at either ~~(i)~~(1) the Eurodollar Rate plus a margin that ranges from ~~137.5~~112.5 basis points to ~~200.0~~175.0 basis points or ~~(ii)~~(2) the Base Rate plus a margin that ranges from ~~37.5~~12.5 basis points to ~~100.0~~75.0 basis points, in each case based on the ratio of Consolidated ~~Total~~Net Debt to Annualized Borrower EBITDA, calculated in accordance with the Senior Credit Agreement. ~~As of September 30, 2017, the balance outstanding under the Revolving Credit Facility was accruing interest at 3.20% per annum.~~ In addition, SBA Senior Finance II is required to pay a commitment fee of between 0.20% and 0.25% per annum on the amount of unused commitment. If not earlier terminated by SBA Senior Finance II, the Revolving Credit Facility will terminate on, and SBA

~~Table of Contents~~

Senior Finance II will repay all amounts outstanding on or before, ~~February 5, 2020.~~April 11, 2023. The proceeds available under the Revolving Credit Facility may be used for general corporate purposes. SBA Senior Finance II may, from time to time, borrow from and repay the Revolving Credit Facility. Consequently, the amount outstanding under the Revolving Credit Facility at the end of athe period may not be reflective of the total amounts outstanding during such period.

During the three months ended September 30, 2019, we borrowed $175.0 million and repaid $255.0 million of the outstanding balance under the Revolving Credit Facility. During the nine months ended September 30, 2019, we borrowed $265.0 million and repaid $590.0 million of the outstanding balance under the Revolving Credit Facility. As of September 30, ~~2017,~~2019, there was no balance outstanding under the Revolving Credit Facility. In addition, SBA Senior Finance II was required to pay a commitment fee of 0.20% per annum on the amount of the unused commitment. As of September 30, 2019, SBA Senior Finance II was in compliance with the financial covenants contained in the Senior Credit Agreement.

Table of Contents

Term Loans under the Senior Credit Agreement

~~Repricing Amendment to the Senior Credit Agreement~~2018 Term Loan

On ~~January 20, 2017,~~April 11, 2018, we, through our wholly owned subsidiary, SBA Senior Finance II LLC, obtained a new term loan (the “2018 Term Loan”) under the amended ~~its~~and restated Senior Credit Agreement, primarily to reduce the stated rate of interest applicable to its senior secured term loans. As amended, the senior secured term loans accrue interest, at SBA Senior Finance II’s election, at either the Base Rate plus 125 basis points (with a zero Base Rate floor) or the Eurodollar Rate plus 225 basis points (with a zero Eurodollar Rate floor).

~~2014 Term Loan~~

Agreement. The ~~2014~~2018 Term Loan consists of a senior secured term loan with an initial aggregate principal amount of ~~$1.5~~$2.4 billion that matures on ~~March 24, 2021. Prior to the reduction in the term loan interest rates as discussed above, the 2014~~April 11, 2025. The 2018 Term Loan ~~accrued~~accrues interest, at SBA Senior Finance II’s election at either the Base Rate plus ~~150~~100 basis points (with a zero Base Rate ~~floor of 1.75%)~~floor) or the Eurodollar Rate plus ~~250~~200 basis points (with a zero Eurodollar Rate ~~floor of 0.75%)~~floor). The ~~2014~~2018 Term Loan was issued at 99.75% of par value. As of September 30, ~~2017,~~2019, the ~~2014~~2018 Term Loan was accruing interest at ~~3.49%~~4.05% per annum. Principal payments on the ~~2014~~2018 Term Loan commenced on September 30, ~~2014~~2018 and are being made in quarterly installments on the last day of each March, June, September, and December in an amount equal to ~~$3.8~~$6.0 million. ~~SBA Senior Finance II has the ability to prepay any or all amounts under the 2014 Term Loan.~~ We incurred deferred financing fees of approximately ~~$14.1~~$16.8 million in relation to this transaction, which are being amortized through the maturity date. The proceeds from the 2018 Term Loan were used (1) to retire the outstanding $1.93 billion in aggregate principal amount of the 2014 Term Loan and 2015 Term Loan, (2) to pay down the existing outstanding balance under the Revolving Credit Facility, and (3) for general corporate purposes.

During the three and nine months ended September 30, ~~2017,~~2019, we repaid ~~$3.8~~$6.0 million and ~~$11.3~~$18.0 million, respectively, of principal on the ~~2014~~2018 Term Loan. As of September 30, ~~2017,~~2019, the ~~2014~~2018 Term Loan had a principal balance of ~~$1,451.3 million.~~$2.4 billion.

~~2015 Term Loan~~

The 2015 Term Loan consists of a senior secured term loan with an initial aggregate principal amount of $500.0 million that matures on June 10, 2022. Prior to the reduction in the term loan interest rates as discussed above, the 2015 Term Loan accrued interest, at SBA Senior Finance II’s election, at either the Base Rate plus 150 basis points (with a Base Rate floor of 1.75%) or the Eurodollar Rate plus 250 basis points (with a Eurodollar Rate floor of 0.75%). The 2015 Term Loan was issued at 99.0% of par value. As of September 30, 2017, the 2015 Term Loan was accruing interest at 3.49% per annum. Principal payments on the 2015 Term Loan commenced on September 30, 2015 and are being made in quarterly installments on the last day of each March, June, September, and December in an amount equal to $1.3 million.On February 1, 2019, we, through our wholly owned subsidiary, SBA Senior Finance II, ~~has the ability to prepay any or all amounts under the 2015 Term Loan. We incurred deferred financing fees~~LLC, entered into a four year interest rate swap on a portion of ~~approximately $5.5 million in relation to this transaction, which are being amortized through the maturity date.~~

~~During the three and nine months ended September 30, 2017, we repaid $1.3 million and $3.8 million of principal on the 2015 Term Loan. As of September 30, 2017, the 2015~~our 2018 Term Loan ~~had~~in order to reduce our exposure to fluctuations in interest rates. The interest rate swap has a ~~principal balance~~$1.2 billion notional value receiving interest at one month LIBOR plus 200 basis points and paying a fixed rate of ~~$488.8 million.~~4.495% per annum settled monthly.

On May 23, 2019, we, through our wholly owned subsidiary, SBA Senior Finance II, LLC, entered into a four year interest rate swap on a portion of our 2018 Term Loan in order to reduce our exposure to fluctuations in interest rates. The interest rate swap has a $750.0 million notional value receiving interest at one month LIBOR plus 200 basis points and paying a fixed rate of 4.08% per annum settled monthly.

Secured Tower Revenue Securities

~~2012-1C~~2013-2C Tower Securities

On August 9, 2012, we, through the Trust, issued $610.0 million of Secured Tower Revenue Securities Series 2012-1C (the “2012-1C Tower Securities”), which had an anticipated repayment date of December 11, 2017 and a final maturity date of December 9, 2042. The fixed interest rate of the 2012-1C Tower Securities was 2.933% per annum, payable monthly. We incurred deferred financing fees of $14.9 million in relation to this transaction, which were being amortized through the anticipated repayment date of the 2012-1C Tower Securities.

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On April 17, 2017, we repaid in full the 2012-1C Tower Securities with proceeds from the 2017-1C Tower Securities. In connection with the prepayment, we expensed $2.0 million of net deferred financing fees.

~~The sole asset of the Trust consists of a non-recourse mortgage loan made in favor of those entities that are borrowers on the mortgage loan (the “Borrowers”).~~

~~2013 Tower Securities~~

On April 18, 2013, we, through ~~the Trust,~~a New York common law trust (the “Trust”), issued $425.0 million of 2.240% Secured Tower Revenue Securities Series 2013-1C, which have an anticipated repayment date of April 10, 2018 and a final maturity date of April 9, 2043 (the “2013-1C Tower Securities”), $575.0 million of 3.722% Secured Tower Revenue Securities Series 2013-2C, which have an anticipated repayment date of April 11, 2023 and a final maturity date of April 9, 2048 (the “2013-2C Tower Securities”), and $330.0 million of 3.598% Secured Tower Revenue Securities Series 2013-1D, which have an anticipated repayment date of April 10, 2018 and a final maturity date of April 9, 2043 (the “2013-1D Tower Securities”) (collectively the “2013 Tower Securities”). ~~The aggregate $1.33 billion of 2013 Tower Securities have a blended interest rate of 3.218% per annum, payable monthly.~~ We incurred ~~deferred~~ financing fees of ~~$25.5~~$11.0 million in relation to this transaction, which ~~are~~were being amortized through the anticipated repayment date of each of the 2013 Tower Securities.

2014 Tower Securities

On October 15, 2014, we, through the Trust, issued $920.0 million of 2.898% Secured Tower Revenue Securities Series 2014-1C, which ~~have~~had an anticipated repayment date of October 8, 2019 and a final maturity date of October 11, 2044 (the “2014-1C Tower Securities”) and $620.0 million of 3.869% Secured Tower Revenue Securities Series 2014-2C, which have an anticipated repayment date of October 8, 2024 and a final maturity date of October 8, 2049 (the “2014-2C Tower Securities”) (collectively the “2014 Tower Securities”). The aggregate $1.54 billion of 2014 Tower Securities have a blended interest rate of 3.289% per annum, payable monthly. We incurred ~~deferred~~ financing fees of $22.5 million in relation to this transaction, which ~~are~~were being amortized through the anticipated repayment date of each of the 2014 Tower Securities.

On September 13, 2019, we repaid the entire aggregate principal amount of the 2014-1C Tower Securities in connection with the issuance of the 2019-1C Tower Securities (as defined below).

2015-1C Tower Securities

On October 14, 2015, we, through the Trust, issued $500.0 million of Secured Tower Revenue Securities Series 2015-1C, which have an anticipated repayment date of October 8, 2020 and a final maturity date of October 10, 2045 (the “2015-1C Tower Securities”). The fixed interest rate of the 2015-1C Tower Securities is 3.156% per annum, payable monthly. We incurred ~~deferred~~ financing

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fees of $11.2 million in relation to this transaction, which are being amortized through the anticipated repayment date of the 2015-1C Tower Securities.

2016-1C Tower Securities

On July 7, 2016, we, through the Trust, issued $700.0 million of Secured Tower Revenue Securities Series 2016-1C, which have an anticipated repayment date of July 9, 2021 and a final maturity date of July 10, 2046 (the “2016-1C Tower Securities”). The fixed interest rate of the 2016-1C Tower Securities is 2.877% per annum, payable monthly. ~~Net proceeds from this offering were used to prepay the full $550.0 million outstanding on the 2010-2C Tower Securities and for general corporate purposes.~~ We incurred ~~deferred~~ financing fees of $9.5 million in relation to this transaction, which are being amortized through the anticipated repayment date of the 2016-1C Tower Securities.

2017-1C Tower Securities

On April 17, 2017, we, through the Trust, issued $760.0 million of Secured Tower Revenue Securities Series 2017-1C, which have an anticipated repayment date of April 11, 2022 and a final maturity date of April 9, 2047 (the “2017-1C Tower Securities”). The fixed interest rate on the 2017-1C Tower Securities is 3.168% per annum, payable monthly. Net proceeds from this offering were used to prepay the entire $610.0 million aggregate principal amount, as well as accrued and unpaid interest, of the 2012-1C Tower Securities and for general corporate purposes. We incurred ~~deferred~~ financing fees of $10.2 million in relation to this transaction, which are being amortized through the anticipated repayment date of the 2017-1C Tower Securities.

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1R“2017-1R Tower Securities”). The fixed interest rate on the 2017-1R Tower Securities is 4.459% per annum, payable monthly. Principal and interest payments made on the 2017-1R Tower Securities eliminate in consolidation.

2018-1C Tower Securities

On March 9, 2018, we, through the Trust, issued $640.0 million of Secured Tower Revenue Securities Series 2018-1C, which have an anticipated repayment date of March 9, 2023 and a final maturity date of March 9, 2048 (the “2018-1C Tower Securities”). The fixed interest rate on the 2018-1C Tower Securities is 3.448% per annum, payable monthly. We incurred financing fees of $8.6 million in relation to this transaction, which are being amortized through the anticipated repayment date of the 2018-1C Tower Securities.

2019-1C Tower Securities

On September 13, 2019, we, through the Trust, issued $1.165 billion of Secured Tower Revenue Securities Series 2019-1C, which have an anticipated repayment date of January 12, 2025 and a final maturity date of January 12, 2050 (the “2019-1C Tower Securities”). The fixed interest rate on the 2019-1C Tower Securities is 2.836% per annum, payable monthly. Net proceeds from this offering were used to repay the entire aggregate principal amount of the 2014-1C Tower Securities ($920.0 million), as well as accrued and unpaid interest, amounts outstanding on the Revolving Credit Facility, and any remaining amount was used for general corporate purposes. We have incurred deferred financing fees of $12.0 million to date in relation to this transaction, which are being amortized through the anticipated repayment date of the 2019-1C Tower Securities.

In addition, to satisfy certain risk retention requirements of Regulation RR promulgated under the Exchange Act, SBA Guarantor, LLC, a wholly owned subsidiary, purchased $61.4 million of Secured Tower Revenue Securities Series 2019-1R issued by the Trust. These securities have an anticipated repayment date of January 12, 2025 and a final maturity date of January 12, 2050 (the “2019-1R Tower Securities”). The fixed interest rate on the 2019-1R Tower Securities is 4.213% per annum, payable monthly. Principal and interest payments made on the 2019-1R Tower Securities eliminate in consolidation.

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Securities and is subject to all other material terms of the existing mortgage loan, including collateral and interest rate after the anticipated repayment date.

Debt Covenants and Terms of the Tower Revenue Securities

The sole asset of the Trust consists of a non-recourse mortgage loan made in favor of the Borrowers.

Senior Notes

2014 Senior Notes

On July 1, 2014, we issued $750.0 million of unsecured senior notes due July 15, 2022 (the “2014 Senior Notes”). The 2014 Senior Notes accrue interest at a rate of 4.875% per annum and were issued at 99.178% of par value. Interest on the 2014 Senior Notes is due semi-annually on January 15 and July 15 of each year. We incurred ~~deferred~~ financing fees of $11.6 million in relation to this transaction, which are being amortized through the maturity date.

The 2014 Senior Notes are subject to redemption in whole or in part at the redemption prices set forth in the indenture agreement plus accrued and unpaid interest. We may redeem the 2014 Senior Notes during the twelve-month period beginning on the following dates at the following redemption prices: July 15, 2019 at 101.219% or July 15, 2020 until maturity at 100.000% of the principal amount of the 2014 Senior Notes to be redeemed on the redemption date plus accrued and unpaid interest.

2016 Senior Notes

On August 15, 2016, we issued $1.1 billion of unsecured senior notes due September 1, 2024 (the “2016 Senior Notes”). The 2016 Senior Notes accrue interest at a rate of 4.875% per annum and were issued at 99.178% of par value. Interest on the 2016 Senior Notes is due semi-annually on March 1 and September 1 of each year, beginning on March 1, 2017. We incurred ~~deferred~~ financing fees of $12.8 million in relation to this transaction, which are being amortized through the maturity date. ~~Net proceeds from this offering~~The 2016 Senior Notes are subject to redemption in whole or in part on or after September 1, 2019 at the redemption prices set forth in the indenture agreement plus accrued and ~~cash~~unpaid interest. We may redeem the 2016 Senior Notes during the twelve-month period beginning on ~~hand were used to redeem $800.0 million,~~ the ~~aggregate~~following dates at the following redemption prices: September 1, 2019 at 103.656%, September 1, 2020 at 102.438%, September 1, 2021 at 101.219%, or September 1, 2022 until maturity at 100.000%, of the principal amount ~~outstanding,~~ of ~~Telecommunications’ 5.75%~~the 2016 Senior Notes to be redeemed on the redemption date plus accrued and ~~$250.0 million of our 5.625% Senior Notes and pay the associated call premiums.~~unpaid interest.

2017 Senior Notes

On October 13, 2017, we issued $750.0 million of unsecured senior notes due October 1, 2022 (the “2017 Senior Notes”). The 2017 Senior Notes accrue interest at a rate of 4.0% per annum. Interest on the 2017 Senior Notes is due semi-annually on April 1 and October 1 of each year, beginning on April 1, 2018. We incurred ~~deferred~~ financing fees of ~~$8.2~~$8.9 million in relation to this transaction, which are being amortized through the maturity date. ~~Net~~

The 2017 Senior Notes are subject to redemption in whole or in part on or after October 1, 2019 at the redemption prices set forth in the indenture agreement plus accrued and unpaid interest. Prior to October 1, 2020, we may, at our option, redeem up to 35% of the aggregate principal amount of the 2017 Senior Notes originally issued at a redemption price of 104.000% of the principal amount of the 2017 Senior Notes to be redeemed on the redemption date plus accrued and unpaid interest with the net proceeds ~~from this offering were used~~of certain equity offerings. We may redeem the 2017 Senior Notes during the twelve-month period beginning on the following dates at the following redemption prices: October 1, 2019 at 102.000%, October 1, 2020 at 101.000%, or October 1, 2021 until maturity at 100.000%, of the principal amount of the 2017 Senior Notes to ~~repay $460.0 million outstanding under~~be redeemed on the ~~Revolving Credit Facility~~redemption date plus accrued and ~~for general corporate purposes.~~unpaid interest.

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Debt Service

As of September 30, ~~2017,~~2019, we believe that our cash on hand, capacity available under our Revolving Credit Facility and cash flows from operations for the next twelve months will be sufficient to service our outstanding debt during the next twelve months.

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The following table illustrates our estimate of our debt service requirement over the twelve months ended September 30, ~~2018~~2020 based on the amounts outstanding as of September 30, ~~2017~~2019 and the interest rates accruing on those amounts on such date (in thousands):



2014 Senior Notes	$	36,563
2016 Senior Notes		53,625
2017 Senior Notes		30,000
2013-2C Tower Securities		21,585
2014-2C Tower Securities		24,185
2015-1C Tower Securities		15,939
2016-1C Tower Securities		20,361
2017-1C Tower Securities		24,318
2018-1C Tower Securities		22,270
2019-1C Tower Securities		33,409
Revolving Credit Facility ⁽¹⁾		2,500
2018 Term Loan		125,550
Total debt service for the next 12 months	$	410,305



~~2014 Senior Notes~~	$	~~36,563~~
~~2016 Senior Notes~~		~~53,625~~
~~2013-1C Tower Securities~~ ~~(1)~~		~~430,281~~
~~2013-2C Tower Securities~~		~~21,585~~
~~2013-1D Tower Securities~~ ~~(1)~~		~~336,552~~
~~2014-1C Tower Securities~~		~~26,954~~
~~2014-2C Tower Securities~~		~~24,185~~
~~2015-1C Tower Securities~~		~~15,939~~
~~2016-1C Tower Securities~~		~~20,361~~
~~2017-1C Tower Securities~~		~~24,318~~
~~Revolving Credit Facility~~		~~15,185~~
~~2014 Term Loan~~		~~65,452~~
~~2015 Term Loan~~		~~21,992~~
~~Total debt service for the next 12 months~~ ~~(2)~~	$	~~1,092,992~~

~~(1)~~

~~The anticipated repayment date and the final maturity date for the 2013-1C Tower Securities is April 10, 2018 and April 9, 2043, respectively.~~

~~The anticipated repayment date and~~(1)Amount represents the ~~final maturity date for~~unused commitment fee. No amounts were outstanding under the ~~2013-1D Tower Securities are April 10, 2018 and April 9, 2043, respectively.~~

~~(2)~~

Amounts exclude interest payments on the 2017 Senior Notes which are due semi-annually on April 1 and October 1 of each year, beginning on April 1, 2018. On October 13, 2017, proceeds from the issuance of the 2017 Senior Notes were used to repay the full $460.0 million outstanding under the Revolving Credit Facility at such time.

~~Table~~Revolving Credit Facility as of ~~Contents~~September 30, 2019.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to certain market risks that are inherent in our financial instruments. These instruments arise from transactions entered into in the normal course of business.

The following table presents the future principal payment obligations and fair values associated with our long-term debt instruments assuming our actual level of long-term indebtedness as of September 30, ~~2017:~~ 2019:



	2017		2018		2019		2020		2021		Thereafter		Total		Fair Value		2019		2020		2021		2022		2023		Thereafter		Total		Fair Value

	(in thousands)																(in thousands)
2014 Senior Notes	$	—	$	—	$	—	$	—	$	—	$	750,000	$	750,000	$	772,500	$	—	$	—	$	—	$	750,000	$	—	$	—	$	750,000	$	757,500
2016 Senior Notes		—		—		—		—		—		1,100,000		1,100,000		1,134,375		—		—		—		—		—		1,100,000		1,100,000		1,141,250
2013-1C Tower Securities (1)		—		425,000		—		—		—		—		425,000		423,959
2017 Senior Notes																		—		—		—		750,000		—		—		750,000		763,125
2013-2C Tower Securities (1)		—		—		—		—		—		575,000		575,000		586,103		—		—		—		—		575,000		—		575,000		589,410
2013-1D Tower Securities (1)		—		330,000		—		—		—		—		330,000		330,234
2014-1C Tower Securities (1)		—		—		920,000		—		—		—		920,000		921,168
2014-2C Tower Securities (1)		—		—		—		—		—		620,000		620,000		623,181		—		—		—		—		—		620,000		620,000		650,175
2015-1C Tower Securities (1)		—		—		—		500,000		—		—		500,000		501,790		—		500,000		—		—		—		—		500,000		502,500
2016-1C Tower Securities (1)		—		—		—		—		700,000		—		700,000		697,081		—		—		700,000		—		—		—		700,000		705,236
2017-1C Tower Securities (1)		—		—		—		—		—		760,000		760,000		759,248		—		—		—		760,000		—		—		760,000		766,300
Revolving Credit Facility		—		—		—		430,000		—		—		430,000		430,000
2014 Term Loan		3,750		15,000		15,000		15,000		1,402,500		—		1,451,250		1,454,878
2015 Term Loan		1,250		5,000		5,000		5,000		5,000		467,500		488,750		489,361
Total debt obligation (2)	$	5,000	$	775,000	$	940,000	$	950,000	$	2,107,500	$	4,272,500	$	9,050,000	$	9,123,878
2018-1C Tower Securities ⁽¹⁾																		—		—		—		—		640,000		—		640,000		662,586
2019-1C Tower Securities ⁽¹⁾																		—		—		—		—		—		1,165,000		1,165,000		1,165,501
2018 Term Loan																		6,000		24,000		24,000		24,000		24,000		2,268,000		2,370,000		2,372,963
Total debt obligation																	$	6,000	$	524,000	$	724,000	$	2,284,000	$	1,239,000	$	5,153,000	$	9,930,000	$	10,076,546

~~(1)~~

~~The anticipated repayment date and the final maturity date for the 2013-1C Tower Securities is April 10, 2018 and April 9, 2043, respectively.~~

(1)The anticipated repayment date and the final maturity date for the 2013-2C Tower Securities is April 11, 2023 and April 9, 2048, respectively.

~~The anticipated repayment date and the final maturity date for the 2013-1D Tower Securities are April 10, 2018 and April 9, 2043, respectively.~~

~~The anticipated repayment date and the final maturity date for the 2014-1C Tower Securities is October 8, 2019 and October 11, 2044, respectively.~~

The anticipated repayment date and the final maturity date for the 2014-2C Tower Securities is October 8, 2024 and October 8, 2049, respectively.

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The anticipated repayment date and the final maturity date for the 2015-1C Tower Securities is October 8, 2020 and October 10, 2045, respectively.

The anticipated repayment date and the final maturity date for the 2016-1C Tower Securities is July 9, 2021 and July 10, 2046, respectively.

The anticipated repayment date and the final maturity date for the 2017-1C Tower Securities is April 11, 2022 and April 9, 2047, respectively.

~~(2)~~

On October 13, 2017, proceeds from the issuance of the 2017 Senior Notes, which are due October 1, 2022, were used to repay the full $460.0 million outstanding under the Revolving Credit Facility at such time.

The anticipated repayment date and the final maturity date for the 2018-1C Tower Securities is March 9, 2023 and March 9, 2048, respectively.

The anticipated repayment date and the final maturity date for the 2019-1C Tower Securities is January 12, 2025 and January 12, 2050, respectively.

Our current primary market risk exposure is (1) interest rate risk relating to our ability to refinance our debt at commercially reasonable rates, if at all, and (2) interest rate risk relating to the impact of interest rate movements on the variable portion of our ~~2014 Term Loan and 2015~~2018 Term Loan and any borrowings that we may incur under our Revolving Credit Facility, which are at floating rates. We manage the interest rate risk on our outstanding debt through our large percentage of fixed rate ~~debt.~~debt, including two four year interest rate swaps on a majority of our 2018 Term Loan entered into on February 1, 2019 and May 23, 2019. The first interest rate swap has a $1.2 billion notional value receiving interest at one month LIBOR plus 200 basis points and paying a fixed rate of 4.495% per annum settled monthly. The second interest rate swap has a $750.0 million notional value receiving interest at one month LIBOR plus 200 basis points and paying a fixed rate of 4.08% per annum settled monthly. While we cannot predict our ability to refinance existing debt or the impact interest rate movements will have on our existing debt, we continue to evaluate our financial position on an ongoing basis.

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We are exposed to market risk from changes in foreign currency exchange rates in connection with our operations in Brazil, Canada, Chile, Peru, Argentina, Colombia, South Africa, and to a lesser extent, our markets in Central America. In each of these countries, we pay most of our selling, general, and administrative expenses and a portion of our operating expenses, such as taxes and utilities incurred in the country in local currency. In addition, in Brazil, Canada, Chile, and ~~Colombia~~South Africa, we receive significantly all of our revenue and pay significantly all of our operating expenses in local currency. In ~~Peru~~Colombia, Argentina, and ~~Argentina,~~Peru, we receive our revenue and pay our operating expenses in a mix of local currency and U.S. dollars. All transactions denominated in currencies other than the U.S. Dollar are reported in U.S. Dollars at the applicable exchange rate. All assets and liabilities are translated into U.S. Dollars at exchange rates in effect at the end of the applicable fiscal reporting period, and all revenues and expenses are translated at average rates for the period. The cumulative translation effect is included in equity as a component of Accumulated other comprehensive income (loss). For the nine months ended September 30, ~~2017,~~2019, approximately ~~13.5%~~13.0% of our revenues and approximately ~~16.0%~~15.8% of our total operating expenses were denominated in foreign currencies.

We have performed a sensitivity analysis assuming a hypothetical 10% adverse movement in the Brazilian Real from the quoted foreign currency exchange rates at September 30, ~~2017.~~2019. As of September 30, ~~2017,~~2019, the analysis indicated that such an adverse movement would have caused our revenues and operating income to decline by approximately ~~1.1%~~1.0% and ~~2.8%~~0.6%, respectively, for the nine months ended September 30, ~~2017.~~2019.

As of September 30, ~~2017,~~2019, we had intercompany debt, which is denominated in a currency other than the functional currency of the subsidiary in which it is recorded. As settlement of this debt is anticipated or planned in the foreseeable future, any changes in the foreign currency exchange rates will result in unrealized gains or losses, which will be included in our determination of net income. A change of 10% in the underlying exchange rates of our unsettled intercompany debt at September 30, ~~2017~~2019 would have resulted in approximately ~~$43.8~~$37.8 million of unrealized gains or losses that would have been included in Other income (expense), net in our Consolidated ~~Statement~~Statements of Operations for the nine months ended September 30, ~~2017.~~2019.

Special Note Regarding Forward-Looking Statements

This quarterly report contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements concern expectations, beliefs, projections, plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. Specifically, this quarterly report contains forward-looking statements regarding:

our expectations on the future growth and financial health of the wireless industry and the industry participants, the drivers of such growth, the demand for our towers, the future capital investments of our customers, the trends developing in our industry, and competitive factors;

our ability to capture and capitalize on industry growth and the impact of such growth on our financial and operational results;

our intent to grow our tower portfolio domestically and internationally and expand through acquisitions, new builds, and organic lease up on existing towers;

our expectations on the future growth and financial health of the wireless industry and the industry participants, the drivers of such growth, the demand for our towers, and the trends developing in our industry;

~~our ability to capture and capitalize on industry growth and the impact of such growth on our financial and operational results;~~

~~our intent to grow our tower portfolio domestically and internationally;~~

our belief that over the long-term, site leasing revenues will continue to grow as wireless service providers increase their use of our towers due to increasing minutes of network use and data transfer, network expansion and network coverage requirements;

~~our expectation regarding site leasing revenue growth, on an organic basis, in our domestic and international segments;~~

~~our belief that our site leasing business is characterized by stable and long-term recurring revenues, predictable operating costs, and minimal non-discretionary capital expenditures;~~

~~our expectation that, due to the relatively young age and mix of our tower portfolio, future expenditures required to maintain these towers will be minimal;~~

~~our expectation that we will grow our cash flows by adding tenants to our towers at minimal incremental costs and executing monetary amendments;~~

~~our ability to qualify and to remain qualified as a REIT and the timing of such qualification and our election to be subject to tax as a REIT;~~

~~our belief that our business is currently operated in a manner that complies with the REIT rules and our intent to continue to do so;~~

~~our plans regarding our distribution policy, and the amount and timing of, and source of funds for, any such distributions;~~

~~our expectations regarding the use of NOLs to reduce REIT taxable income;~~

~~our expectations regarding our capital allocation strategy, the impact of our election to be taxed as a REIT on that strategy, and our goal of increasing our Adjusted Funds From Operations per share;~~

our expectations regarding our future cash capital expenditures, both discretionary and non-discretionary, including expenditures required to maintain, improve, and modify our towers, ground lease purchases, and general corporate expenditures, and the source of funds for these expenditures;

~~our intended use of our liquidity;~~

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our expectations regarding our debt service and our belief that our cash on hand, capacity under our Revolving Credit Facility, and our cash flows from operations for the next twelve months will be sufficient to service our outstanding debt during the next twelve months;

~~our belief regarding our credit risk; and~~

~~our estimates regarding certain accounting and tax matters.~~

our belief that over the long-term, site leasing revenues will continue to grow as wireless service providers increase their use of our towers due to increasing minutes of network use and data transfer, network expansion and network coverage requirements;

our expectation regarding site leasing revenue growth, on an organic basis, in our domestic and international segments, and the drivers of such growth;

our focus on our site leasing business and belief that our site leasing business is characterized by stable and long-term recurring revenues, reduced exposure to changes in customer spending, predictable operating costs, and minimal non-discretionary capital expenditures;

our expectation that, due to the relatively young age and mix of our tower portfolio, future expenditures required to maintain these towers will be minimal;

our expectation that we will grow our cash flows by adding tenants to our towers at minimal incremental costs and executing monetary amendments;

our expectations regarding churn rates;

our election to be subject to tax as a REIT and our intent to continue to operate as a REIT;

our belief that our business is currently operated in a manner that complies with the REIT rules and our intent to continue to do so;

our plans regarding our distribution policy, and the amount and timing of, and source of funds for, any such distributions;

our expectations regarding the use of NOLs to reduce REIT taxable income;

our expectations regarding our capital allocation strategy, including future allocation decisions among portfolio growth, stock repurchases and dividends, the impact of our election to be taxed as a REIT on that strategy, and our goal of increasing our Adjusted Funds From Operations per share;

our expectations regarding dividends and our ability to grow our dividend in the future and the drivers of such growth;

our expectations regarding our future cash capital expenditures, both discretionary and non-discretionary, including expenditures required for new builds and to maintain, improve, and modify our towers, ground lease purchases, and general corporate expenditures, and the source of funds for these expenditures;

our expectations regarding our business strategies, including our strategy for securing rights to the land underlying our towers, and the impact of such strategies on our financial and operational results;

our intended use of our liquidity;

our intent to maintain our target leverage levels, including in light of our dividend;

our expectations regarding our debt service in 2019 and our belief that our cash on hand, capacity under our Revolving Credit Facility, and our cash flows from operations for the next twelve months will be sufficient to service our outstanding debt during the next twelve months; and

our expectations and estimates regarding certain tax and accounting matters, including the impact on our financial statements.

These forward-looking statements reflect our current views about future events and are subject to risks, uncertainties and assumptions. We wish to caution readers that certain important factors may have affected and could in the future affect our actual results and could cause actual results to differ significantly from those expressed in any forward-looking statement. The most important factors that could prevent us from achieving our goals, and cause the assumptions underlying forward-looking statements and the actual results to differ materially from those expressed in or implied by those forward-looking statements include, but are not limited to, the following:

the impact of consolidation among wireless service providers, including the potential impact of the proposed merger between Sprint and T-Mobile if consummated, on our leasing revenue;

our ability to continue to comply with covenants and the terms of our credit instruments and our ability to obtain additional financing to fund our capital expenditures;

our ability to successfully manage the risks associated with international operations, including risks relating to political or economic conditions, inflation, tax laws, currency restrictions and exchange rate fluctuations, legal or judicial systems, and land ownership;

our ability to successfully manage the risks associated with our acquisition initiatives, including our ability to satisfactorily complete due diligence on acquired towers, the amount and quality of due diligence that we are able to complete prior to closing of any acquisition, our ability to accurately anticipate the future performance of the acquired towers, our ability to receive required regulatory approval, the ability and willingness of each party to fulfill their respective closing conditions and their contractual obligations, and, once acquired, our ability to effectively integrate acquired towers into our business and to achieve the financial results projected in our valuation models for the acquired towers;

the health of the South Africa economy and wireless communications market, and the willingness of carriers to invest in their networks in that market;

~~the impact of consolidation among wireless service providers on our leasing revenue;~~

~~our ability to continue to comply with covenants and the terms of our credit instruments and our ability to obtain additional financing to fund our capital expenditures;~~

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our ability to successfully manage the risks associated with international operations, including risks relating to political or economic conditions, tax laws, currency restrictions and exchange rate fluctuations, legal or judicial systems, and land ownership;

our ability to successfully manage the risks associated with our acquisition initiatives, including our ability to effectively integrate acquired towers into our business and to achieve the financial results projected in our valuation models for the acquired towers;

developments in the wireless communications industry in general, and for wireless communications infrastructure providers in particular, that may slow growth or affect the willingness or ability of the wireless service providers to expend capital to fund network expansion or enhancements;

~~our ability to secure as many site leasing tenants as anticipated, recognize our expected economies of scale with respect to new tenants on our towers, and retain current leases on towers;~~

~~our ability to secure and deliver anticipated services business at contemplated margins;~~

our ability to build new towers, including our ability to identify and acquire land that would be attractive for our customers and to successfully and timely address zoning, permitting, weather, availability of labor and supplies and other issues that arise in connection with the building of new towers;

competition for the acquisition of towers and other factors that may adversely affect our ability to purchase towers that meet our investment criteria and are available at prices which we believe will be accretive to our shareholders and allow us to maintain our long-term target leverage ratios while achieving our expected portfolio growth levels;

~~our capital allocation decisions and the impact on our ability to achieve our expected tower portfolio growth levels;~~

~~our ability to protect our rights to the land under our towers, and our ability to acquire land underneath our towers on terms that are accretive;~~

our ability to sufficiently increase our revenues and maintain expenses and cash capital expenditures at appropriate levels to permit us to meet our anticipated uses of liquidity for operations, debt service and estimated portfolio growth;

~~our ability to successfully estimate the impact of regulatory and litigation matters;~~

~~natural disasters and other unforeseen damage for which our insurance may not provide adequate coverage;~~

~~a decrease in demand for our towers;~~

~~the introduction of new technologies or changes in a tenant’s business model that may make our tower leasing business less desirable to potential tenants;~~

~~our ability to qualify for treatment as a REIT for U.S. federal income tax purposes and to comply with and conduct our business in accordance with such rules;~~

~~our ability to utilize available NOLs to reduce REIT taxable income; and~~

our ability to successfully estimate the impact of certain accounting and tax matters, including the effect on our company of adopting certain accounting pronouncements and the availability of sufficient NOLs to offset future REIT taxable income.

developments in the wireless communications industry in general, and for wireless communications infrastructure providers in particular, that may slow growth or affect the willingness or ability of the wireless service providers to expend capital to fund network expansion or enhancements;

our ability to secure as many site leasing tenants as anticipated, recognize our expected economies of scale with respect to new tenants on our towers, and retain current leases on towers;

our ability to secure and deliver anticipated services business at contemplated margins;

our ability to build new towers, including our ability to identify and acquire land that would be attractive for our customers and to successfully and timely address zoning, permitting, weather, availability of labor and supplies and other issues that arise in connection with the building of new towers;

competition for the acquisition of towers and other factors that may adversely affect our ability to purchase towers that meet our investment criteria and are available at prices which we believe will be accretive to our shareholders and allow us to maintain our long-term target leverage ratios while achieving our expected portfolio growth levels;

our capital allocation decisions and the impact on our ability to achieve our expected tower portfolio growth levels;

our ability to protect our rights to the land under our towers, and our ability to acquire land underneath our towers on terms that are accretive;

our ability to sufficiently increase our revenues and maintain expenses and cash capital expenditures at appropriate levels to permit us to meet our anticipated uses of liquidity for operations, debt service and estimated portfolio growth;

the impact of rising interest rates on our results of operations and our ability to refinance our existing indebtedness at commercially reasonable rates or at all;

our ability to successfully estimate the impact of regulatory and litigation matters;

natural disasters and other unforeseen damage for which our insurance may not provide adequate coverage;

a decrease in demand for our towers;

the introduction of new technologies or changes in a tenant’s business model that may make our tower leasing business less desirable to existing or potential tenants;

our ability to qualify for treatment as a REIT for U.S. federal income tax purposes and to comply with and conduct our business in accordance with such rules;

our ability to utilize available NOLs to reduce REIT taxable income; and

our ability to successfully estimate the impact of certain accounting and tax matters, including the effect on our company of adopting certain accounting pronouncements and the availability of sufficient NOLs to offset future REIT taxable income.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

In order to ensure that the information we must disclose in our filings with the Commission is recorded, processed, summarized and reported on a timely basis, we have formalized our disclosure controls and procedures. Our principal executive officer and principal financial officer have reviewed and evaluated the effectiveness of our disclosure controls and procedures, as defined in Securities and Exchange Act Rule 13a-15(e) as of September 30, ~~2017.~~2019. Based on such evaluation, such officers have concluded that, as of September 30, ~~2017,~~2019, our disclosure controls and procedures were effective.

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There have been no changes in our internal control over financial reporting during the quarter ended September 30, 2017 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

The following table presents information related to our repurchases of Class A common stock during the third quarter of ~~2017:~~2019:

Total

Total Number of Shares

Approximate Dollar Value

Number

Average

Purchased as Part of

of Shares that May Yet Be

of Shares

Price Paid

Publicly Announced

Purchased Under the
Period

Purchased

Per Share

Plans or Programs (1)

Plans or Programs

7/1/2017 - 7/31/2017

698,923

$
135.92

698,923

$
750,002,586
8/1/2017 - 8/31/2017

1,202,321

$
141.39

1,202,321

$
580,003,146
9/1/2017 - 9/30/2017

817,962

$
145.33

817,962

$
461,125,150
Total

2,719,206

$
141.17

2,719,206

$
461,125,150



	Total			Total Number of Shares	Approximate Dollar Value
	Number	Average		Purchased as Part of	of Shares that May Yet Be
	of Shares	Price Paid		Publicly Announced	Purchased Under the
Period	Purchased	Per Share		Plans or Programs ⁽¹⁾	Plans or Programs

7/1/2019 - 7/31/2019	—	$	—	—	$	1,000,000,000
8/1/2019 - 8/31/2019	112,482	$	262.38	112,482	$	970,486,675
9/1/2019 - 9/30/2019	593,012	$	246.50	593,012	$	824,306,904
Total	705,494	$	249.04	705,494	$	824,306,904

1)On July 29, 2019, our Board of Directors authorized a new $1.0 billion stock repurchase plan, replacing the prior plan authorized on February 16, 2018 which had a remaining authorization of $110.0 million. This new plan authorizes us to purchase, from time to time, up to $1.0 billion of our outstanding Class A common stock through open market repurchases in compliance with Rule 10b-18 under the Exchange Act and/or in privately negotiated transactions at management’s discretion based on market and business conditions, applicable legal requirements and other factors. Shares repurchased will be retired. The new plan has no time deadline and will continue until otherwise modified or terminated by our Board of Directors at any time in its sole discretion.

ITEM 6. EXHIBITS

~~(1)~~

On January 12, 2017, our Board of Directors authorized a new stock repurchase plan, replacing the plan authorized on June 4, 2015 which had a remaining authorization of $150.0 million. This plan authorizes us to purchase, from time to time, up to $1.0 billion of our outstanding Class A common stock through open market repurchases in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, and/or in privately negotiated transactions at management’s discretion based on market and business conditions, applicable legal requirements and other factors. Shares repurchased will be retired. The new plan has no time deadline and will continue until otherwise modified or terminated by our Board of Directors at any time in its sole discretion.

~~ITEM 5. OTHER INFORMATION~~

~~Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.~~

~~(e)~~

On August 15, 2017, we entered into an employment agreement with Jeffrey A. Stoops, our President and Chief Executive Officer. The agreement replaces his existing employment agreement entered into with him on October 30, 2014, which would have expired on December 31, 2017. The new employment agreement provides for Mr. Stoops to serve in his present position and expires on December 31, 2020.

Pursuant to the employment agreement, Mr. Stoops will receive an annual base salary of $800,000, which may be increased by the Board of Directors. In addition, Mr. Stoops will receive an annual bonus based on achievement of performance criteria established by the Compensation Committee of the Board of Directors. Mr. Stoops is eligible to receive a target bonus of 150% of base salary for 2017, and in subsequent years, the Compensation Committee will set Mr. Stoops’ target bonus, which may be greater or less than 150% of Mr. Stoops’ base salary for that year.

The employment agreement provides that upon termination of Mr. Stoops’ employment without cause, or Mr. Stoops’ resignation for good reason, Mr. Stoops is entitled to receive (i) an amount equal to the Applicable Multiple (as defined below) times the sum of his: (a) base salary for the year in which the termination or resignation occurs, (b) Reference Bonus (as defined below) and (c) Reference Benefits Value (as defined below), and (ii) a pro rata portion of the bonus for the year in which the termination or

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resignation occurs. The severance payments will be paid in a lump sum on the first business day of the third calendar month following the calendar month in which the termination or resignation is effective.

The Applicable Multiple means two, in the event the termination occurs prior to a change in control, and three, in the event the termination occurs on or after a change in control. Reference Benefits Value means the greater of (1) $33,560 and (2) the value of all medical, dental, health, life, and other fringe benefit plans and arrangements for the year in which the termination or resignation occurs. Reference Bonus means the greater of (i) 75% of Mr. Stoops’ target bonus for the year in which the termination or resignation occurs and (ii) 100% of the bonus for the year immediately preceding the year in which the termination or resignation occurred.

Upon a change in control, the agreement is automatically extended for three years. The employment agreement provides for noncompetition, noninterference, non-disparagement and nondisclosure covenants. Mr. Stoops’ severance payment is subject to his execution of a full release and waiver of claims against us.

~~ITEM 6.~~ ~~EXHIBITS~~



Exhibit No.	Description of Exhibits
~~10.18~~31.1	Purchase Agreement, dated September 28, 2017, between SBA Communications Corporation and Citigroup Global Markets, Inc. and J.P. Morgan Securities LLC, as representatives of the several initial purchasers listed on Schedule 1 thereto.
~~10.35G~~	~~Employment Agreement, dated August 15, 2017, between SBA Communications Corporation and Jeffrey A. Stoops.~~ †
~~31.1~~	Certification by Jeffrey A. Stoops, Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification by Brendan T. Cavanagh, Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification by Jeffrey A. Stoops, Chief Executive Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification by Brendan T. Cavanagh, Chief Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance ~~Document.~~Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	XBRL Taxonomy Extension Schema Document.
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive File (formatted in Inline XBRL and contained in Exhibit 101).

‎

~~† Management contract or compensatory plan or arrangement.~~

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SIGNATURES

~~SIGNATURES~~

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	SBA COMMUNICATIONS CORPORATION

November 7, ~~2017~~2019	/s/ Jeffrey A. Stoops
	Jeffrey A. Stoops
	Chief Executive Officer
	(Duly Authorized Officer)

November 7, ~~2017~~2019	/s/ Brendan T. Cavanagh
	Brendan T. Cavanagh
	Chief Financial Officer
	(Principal Financial Officer)

4953



	As of September 30, 2017						As of December 31, 2016
	Gross carrying		Accumulated		Net book		Gross carrying		Accumulated		Net book
	amount		amortization		value		amount		amortization		value

	(in thousands)
Current contract intangibles	$	4,284,068	$	(1,612,010)	$	2,672,058	$	4,141,968	$	(1,401,025)	$	2,740,943
Network location intangibles		1,555,579		(676,927)		878,652		1,515,348		(599,367)		915,981
Intangible assets, net	$	5,839,647	$	(2,288,937)	$	3,550,710	$	5,657,316	$	(2,000,392)	$	3,656,924



		Weighted-
		Average
		Grant Date
	Number of	Fair Value per
	Shares	Share
	(in thousands)
Outstanding at December 31, 2016	291	$	101.74
Granted	171	$	116.52
Vested	(122)	$	98.75
Forfeited/canceled	(10)	$	109.83
Outstanding at September 30, 2017	330	$	110.27



	For the nine months ended
	September 30, 2017		September 30, 2016

	(in thousands)
Cash provided by operating activities	$	591,472	$	527,231
Cash used in investing activities		(290,915)		(300,213)
Cash (used in) provided by financing activities		(317,602)		333,534
Change in cash, cash equivalents, and restricted cash		(17,045)		560,552
Effect of exchange rate changes on cash, cash equiv., and restricted cash		3,537		13,760
Cash, cash equivalents, and restricted cash, beginning of period		185,970		146,619
Cash, cash equivalents, and restricted cash, end of period	$	172,462	$	720,931