SBA Communications (SBAC) 10-K risk factor changes: FY2016 vs FY2015

If our wireless service provider customers combine their operations to a significant degree, our future operating [removed: results and our] [added: results,] ability to service our [removed: indebtedness] [added: indebtedness, and stock price] could be adversely affected.

In connection with the combinations of Verizon Wireless and ALLTEL (to form Verizon Wireless), Cingular and AT&T Wireless (to form AT&T Mobility) and Sprint PCS and Nextel (to form Sprint), the combined companies have rationalized [removed: and may continue to rationalize] duplicative parts of their networks, and, in the case of Sprint, the Nextel [removed: iDen] [added: iDEN] network was discontinued, which has led and may continue to lead to the non-renewal of certain leases on our towers.

[removed: This consolidation] [added: These consolidations have led and] may also lead to additional non-renewal of certain of our tower leases.

If our wireless service provider customers continue to consolidate as a result of, among other factors, limited wireless spectrum for commercial use in the U.S., [removed: this consolidation] [added: these consolidations] could significantly impact the number of tower leases that are not renewed or the number of new leases that our wireless service provider customers require to expand their networks, which could materially and adversely affect our future operating [removed: results.][added: results and our ability to service our indebtedness.]

The following table sets forth our total principal amount of debt and shareholders’ deficit as of December 31, [removed: 2015] [added: 2016] and [removed: 2014.][added: 2015.]

| | | [added: 2016] | | | 2015 | | | 2014 | |

| Total principal amount of indebtedness | | | | | $ | [removed: 8,555,000] [added: 8,875,000] | | $ | [removed: 7,870,000] [added: 8,555,000] |

| Shareholders' deficit | | | | | $ | [removed: (1,706,144)] [added: (1,995,921)] | | $ | [removed: (660,800)] [added: (1,706,144)] |

For example, on [removed: June 10, 2015, SBA Senior Finance II secured a new $500.0 million senior secured Term Loan, and on October 14, 2015,] [added: July 7, 2016,] we, through a New York common law trust, issued [removed: $500.0] [added: $700.0] million aggregate principal amount of [removed: Secured] Tower [removed: Revenue Securities.][added: Securities, and on August 15, 2016, we issued $1.1 billion of unsecured senior notes.]

- we may be required to dedicate a substantial portion of our cash flow from operations to the payment of principal and interest on our debt, reducing the available cash flow to fund other investments, including [added: share repurchases,] tower acquisition and new build capital [removed: expenditures;][added: expenditures, or to satisfy our REIT distribution requirements;]

These restrictions could have a material adverse effect on our business by limiting our ability to take advantage of financing, new tower development, mergers and [removed: acquisitions] [added: acquisitions, share repurchases,] or other [removed: opportunities.][added: opportunities and to satisfy our REIT distribution requirements.]

In addition, fluctuations in market interest rates [added: or changes in central bank monetary policy] may increase interest expense relating to our floating rate indebtedness, which we expect to incur [removed: under] [added: pursuant to] our Revolving Credit Facility and Term Loans, and may make it difficult to refinance our existing indebtedness at a commercially reasonable rate or at all.

We depend on a relatively small number of customers for most of our revenue, and the loss, consolidation or financial instability of any of our significant customers may materially decrease our [removed: revenues.][added: revenue and adversely affect our financial condition.]

| Percentage of Total Revenues | | | | [removed: 2015] [added: 2016] | | [removed: 2014] [added: 2015] | | [removed: 2013] [added: 2014] |

| AT&T Wireless (1) | | | | [removed: 24.2%] [added: 25.7%] | | [removed: 23.0%] [added: 24.2%] | | [removed: 20.5%] [added: 23.0%] |

| Sprint | | | | [removed: 19.6%] [added: 16.1%] | | [removed: 23.4%] [added: 19.6%] | | [removed: 25.0%] [added: 23.4%] |

| T-Mobile | | | | [removed: 16.0%] [added: 17.0%] | | [removed: 15.5%] [added: 16.0%] | | [removed: 17.3%] [added: 15.5%] |

| Verizon Wireless | | | | [removed: 13.8%] [added: 15.2%] | | [removed: 12.0%] [added: 13.8%] | | [removed: 11.3%] [added: 12.0%] |

| Percentage of Domestic Site Leasing Revenue | | | | [removed: 2015] [added: 2016] | | [removed: 2014] [added: 2015] | | [removed: 2013] [added: 2014] |

| AT&T Wireless (1) | | | | [removed: 31.9%] [added: 32.7%] | | [removed: 30.1%] [added: 31.9%] | | [removed: 25.5%] [added: 30.1%] |

| Sprint | | | | [removed: 22.3%] [added: 19.8%] | | [removed: 25.6%] [added: 22.3%] | | [removed: 30.9%] [added: 25.6%] |

| T-Mobile | | | | [removed: 19.0%] [added: 19.6%] | | [removed: 19.2%] [added: 19.0%] | | [removed: 20.2%] [added: 19.2%] |

| Verizon Wireless | | | | [removed: 16.3%] [added: 18.2%] | | [removed: 14.4%] [added: 16.3%] | | [removed: 13.3%] [added: 14.4%] |

| Percentage of International Site Leasing Revenue | | | | [removed: 2015] [added: 2016] | | [removed: 2014] [added: 2015] | | [removed: 2013] [added: 2014] |

| Oi S.A. | | | | [removed: 48.8%] [added: 43.9%] | | [removed: 44.3%] [added: 48.8%] | | [removed: 6.3%] [added: 44.3%] |

| Telefonica | | | | [removed: 24.7%] [added: 26.4%] | | [removed: 28.8%] [added: 24.7%] | | [removed: 44.2%] [added: 28.8%] |

| Percentage of Site Development Revenue | | | | [removed: 2015] [added: 2016] | | [removed: 2014] [added: 2015] | | [removed: 2013] [added: 2014] |

| Sprint | | | | [removed: 28.5%] [added: 11.7%] | | [removed: 36.7%] [added: 28.5%] | | [removed: 1.5%] [added: 36.7%] |

| T-Mobile | | | | [removed: 17.6%] [added: 28.4%] | | [removed: 8.5%] [added: 17.6%] | | [removed: 8.4%] [added: 8.5%] |

| Ericsson, Inc. | | | | [removed: 15.3%] [added: 5.0%] | | [removed: 16.8%] [added: 15.3%] | | [removed: 34.5%] [added: 16.8%] |

| Verizon Wireless | | | | [removed: 14.8%] [added: 16.5%] | | [removed: 10.1%] [added: 14.8%] | | [removed: 4.8%] [added: 10.1%] |

Our operations in Central America and Ecuador are primarily denominated in United States [removed: Dollars,] [added: dollars,] while our operations in Canada and [removed: Brazil] [added: the remainder of South America] are denominated in local currencies.

For the year ended December 31, [removed: 2015,] [added: 2016,] approximately [removed: 15%] [added: 16.3%] of our total cash site leasing revenue was generated by our [removed: International] [added: international] operations, of which [removed: 11.2%] [added: 11.6%] was generated in [removed: non-US] [added: non-U.S.] dollar currencies, including [removed: 10.5%] [added: 10.8%] which was [removed: generated] [added: denominated] in Brazilian [removed: Reais.][added: Real.]

For example, the Brazilian Real has historically been subject to substantial volatility and [removed: devalued 49.2%] [added: weakened 5.5%] when comparing the [removed: spot] [added: average] rate [removed: on January 1, 2015 and] [added: for the years ended] December 31, [added: 2016 and] 2015.

This trend has [removed: adversely] affected, and may in the future continue to [removed: adversely] affect, our reported results of operations.

As of December 31, [removed: 2015,] [added: 2016,] the outstanding balance under this agreement was [removed: $455.8] [added: $433.3] million.

In accordance with ASC 830, we remeasure foreign denominated intercompany loans with the corresponding change in the balance being recorded in Other income (expense), net in our Consolidated Statements of [removed: Operations.][added: Operations as settlement is anticipated or planned in the foreseeable future.]

Consequently, if the U.S. Dollar [removed: continues to strengthen] [added: strengthens] against the Brazilian Real, our results of operations would be adversely affected.

For the years ended December 31, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] we recorded [removed: $178.9] [added: a $90.0] million [added: gain] and [removed: $23.0 million,] [added: a $178.9 million loss,] respectively, [removed: of foreign exchange losses] on [removed: the] remeasurement of [added: the] intercompany [removed: loans.][added: loan due to changes in foreign currency exchange rates.]

Our real property interests relating to [added: the land under] our tower structures consist primarily of leasehold and sub-leasehold interests, fee interests, easements, licenses, rights-of-way, and other similar interests.

These risks could be exacerbated due to changes in governmental policy that may favor industry consolidation.

In addition, the market price of our Class A common stock may be affected by the economic and market perception of the announcement or consummation of wireless service provider customer consolidations and their impact on our future operating results.

| | | | | | 2016 | | | 2015 | |

On June 20, 2016, Oi, S.A. (“Oi”), our largest customer in Brazil, filed a petition for judicial reorganization in Brazil.

For the year ended December 31, 2016, Oi comprised approximately 7.5% of our total site leasing revenue.

Due to the uncertainty surrounding the recoverability of amounts owed by Oi prior to the date of Oi’s petition, we recorded a $16.5 million bad debt provision during the second quarter of 2016 relating to amounts owed or potentially owed by Oi as of the petition date.

While we continue to do business with Oi under our contracts in the ordinary course and Oi has stated its intentions to continue normal operations during its judicial reorganization, we cannot assure you that Oi will continue to be willing or able to continue to make payments to us in accordance with the terms of our contracts.

Judicial reorganization in Brazil requires the agreement of certain creditors, for which there can be no assurance.

If Oi is unable to successfully reorganize, it may be forced to liquidate.

If Oi is unable or unwilling to reorganize in a manner that continues to provide us anticipated payments in accordance with our contracts, it could materially decrease our revenues and adversely affect our financial condition.

In addition, as customers deploy increased capital to the development and implementation of new technologies, they may allocate less of their budgets to lease space on our towers.

Further, a customer may decide to no longer outsource wireless infrastructure or otherwise change its business model.

able to meet our annual and long-term tower portfolio growth targets.

financial resources than we do.

borrowers.

In 2016, we were profitable; however, in 2015 and 2014, we were not profitable.

In addition, in 2015, our loss included remeasurement losses related to a foreign currency denominated intercompany loan.

In addition, new regulations

Risks Related to Our Status as a REIT

Complying with the REIT requirements may cause us to liquidate assets or hinder our ability to pursue otherwise attractive asset acquisition opportunities.

To qualify as a REIT for federal income tax purposes, we must continually satisfy tests concerning, among other things, the nature and diversification of our assets, the sources of our income and the amounts we distribute to our shareholders.

For example, to qualify as a REIT, we must ensure that, at the end of each calendar quarter, at least 75% of the value of our assets consists of cash, cash items, government securities and “real estate assets” (as defined in the Code), including towers and certain mortgage loans and securities.

The remainder of our investments (other than government securities, qualified real estate assets and securities issued by a taxable REIT subsidiary (“TRS”) generally cannot include more than 10% of the outstanding voting securities of any one issuer or more than 10% of the total value of the outstanding securities of any one issuer.

In addition, in general, no more than 5% of the value of our total assets (other than government securities, qualified real estate assets and securities issued by a TRS) can consist of the securities of any one issuer, and no more than 25% (for taxable years beginning on or before December 31, 2017) or 20% (for taxable years beginning after December 31, 2017) of the value of our total assets can be represented by securities of one or more TRSs.

If we fail to comply with these requirements at the end of any calendar quarter, we must correct the failure within 30 days after the end of the calendar quarter or qualify for certain statutory relief provisions to avoid losing our REIT qualification and suffering adverse tax consequences.

As a result, we may be required to liquidate assets.

In addition to the asset tests set forth above, to qualify and be subject to tax as a REIT, we will generally be required to distribute at least 90% of our REIT taxable income after the utilization of any available NOLs (determined without regard to the dividends paid deduction and excluding net capital gain) each year to our shareholders.

Our determination as to the timing or amount of future dividends will be based on a number of factors, including investment opportunities around our core business and the availability of our existing NOLs.

To the extent that we satisfy the 90% distribution requirement, but distribute less than 100% of our REIT taxable income (after the application of available NOLs, if any), we will be subject to U.S. federal corporate income tax on our undistributed taxable income.

In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we pay out to our shareholders for a calendar year is less than a minimum amount specified under the Code.

These distribution requirements could hinder our ability to pursue otherwise attractive asset acquisition opportunities.

Furthermore, our ability to compete for acquisition opportunities in domestic and international markets may be adversely affected if we need, or require, the target company to comply with certain REIT requirements.

These actions could have the effect of reducing our income, amounts available for distribution to our shareholders and amounts available for making payments on our indebtedness.

Qualifying as a REIT involves highly technical and complex provisions of the Code.

If we fail to qualify as a REIT or fail to remain qualified as a REIT, to the extent we have REIT taxable income and have utilized our NOLs, we will be subject to U.S. federal income tax as a regular corporation and could face a substantial tax liability, which would reduce the amount of cash available for distribution to our shareholders.

Qualification as a REIT involves the application of highly technical and complex Code provisions for which only limited judicial and administrative authorities exist.

Even a technical or inadvertent violation could jeopardize our REIT qualification.

Our qualification as a REIT will depend on our satisfaction of certain asset, income, organizational, distribution, shareholder ownership and other requirements on a continuing basis.

Our Board of Directors has authorized us to take all necessary steps for SBAC to be subject to tax as a REIT for U.S. federal income tax purposes, commencing with our taxable year ending December 31, 2016.

We received an opinion of our special REIT tax counsel with respect to our qualification as a REIT.

| Digicel | | | | 4.6% | | 4.9% | | 11.2% |

We currently intend to build 590 to 610 new towers, domestically and internationally, during 2016.

We may not successfully integrate acquired towers into our operations.

As part of our growth strategy, we have made and expect to continue to make acquisitions.

Historically, we have not been profitable.

| | | 2015 | | | 2014 | | | 2013 | |

management, use, storage, disposal, emission and remediation of, and exposure to, hazardous and non-hazardous substances, materials, and wastes.

We recognize tax benefits of uncertain tax positions when we believe the positions are more likely than not of being sustained upon a challenge by the relevant tax authority.

We believe our judgments in this area are reasonable and correct, but there is no guarantee that we will be successful if challenged by a tax authority.

In addition, we may be limited in our ability to utilize our NOLs to offset future taxable income and thereby reduce our otherwise payable income taxes.

We have substantial federal and state NOLs, including significant portions obtained through acquisitions and dispositions, as well as those generated through our historic business operations.

In addition, we have disposed of some entities and restructured other entities in conjunction with financing transactions and other business activities.

To the extent we believe that a position with respect to an NOL is not more likely than not to be sustained, we do not record the related deferred tax asset.

In addition, for NOLs that meet the recognition threshold, we assess the recoverability of the NOL and establish a valuation allowance against the deferred tax asset related to the NOL if recoverability is questionable.

Given the uncertainty surrounding the recoverability of certain of our NOLs, we have established a valuation allowance to offset the related deferred tax asset.

Our ability to utilize our NOLs is also dependent, in part, upon us having sufficient future earnings to utilize our NOLs before they expire.

If market conditions change materially and we determine that we will be unable to generate sufficient taxable income in the future to utilize our NOLs, we could be required to record an additional valuation allowance.

We review our uncertain tax position and the valuation allowance for our NOLs periodically and make adjustments from time to time, which can result in an increase or decrease to the net deferred tax asset related to our NOLs.

Currently, we have recorded a full valuation allowance against our NOLs because we have concluded that our loss history indicates that it is not “more likely than not” that such deferred tax assets will be realized.

We are a leading independent owner and operator of wireless communications [added: 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.

Our primary business line is our site leasing business, which contributed [removed: 96.8%] [added: 98.7%] of our total segment operating profit for the year ended December 31, [removed: 2015.][added: 2016.]

As of December 31, [removed: 2015,] [added: 2016,] we owned [removed: 25,465] [added: 26,197] 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 5,500 actual or potential towers, approximately 500 of which were revenue producing as of December 31, [removed: 2015.][added: 2016.]

Site leasing revenues are received primarily from wireless service provider tenants, including AT&T, Sprint, T-Mobile, Verizon Wireless, Oi S.A., Telefonica, Claro, and [removed: Digicel.][added: TIM.]

In our [removed: Canadian] [added: Brazilian, Canadian,] and [removed: Brazilian] [added: Chilean] operations, significantly all of our revenue, [removed: expenses] [added: expenses,] and capital expenditures, including tenant leases, ground [removed: leases] [added: leases,] and other tower-related [removed: expenses,] [added: expenses] are denominated in local currency.

Ground leases are generally for an initial term of five years or more with multiple renewal terms of five year periods at our option and provide for rent escalators which typically average [removed: 2\-3%] [added: 2-3%] annually, or in our South American markets, adjust in accordance with a standard cost of living index.

As of December 31, [removed: 2015,] [added: 2016,] approximately [removed: 73%] [added: 72%] of our tower structures were located on parcels of land that we own, land subject to perpetual easements, or parcels of land in which we have a leasehold interest that extends beyond 20 years.

| Segment operating profit as a percentage of total | | [removed: 2015] [added: 2016] | | | [removed: 2014] [added: 2015] | | | [removed: 2013] [added: 2014] | |

| Domestic site leasing | | | [removed: 82.4%] [added: 83.6%] | | | [removed: 82.8%] [added: 82.4%] | | | [removed: 89.9%] [added: 82.8%] |

| International site leasing | | | [removed: 14.4%] [added: 15.1%] | | | [removed: 13.5%] [added: 14.4%] | | | [removed: 6.3%] [added: 13.5%] |

| Total site leasing | | | [removed: 96.8%] [added: 98.7%] | | | [removed: 96.3%] [added: 96.8%] | | | [removed: 96.2%] [added: 96.3%] |

During [removed: 2016,] [added: 2017,] we expect organic site leasing revenue in both our domestic and international segments to be consistent with our growth in [removed: 2015.][added: 2016.]

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 [removed: service] [added: a specific technology] (e.g. [removed: iDen).][added: iDEN).]

Site development services revenues are earned primarily from providing a full range of end to end services to [removed: 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 [removed: antennas;] [added: antennas on existing infrastructure;] (4) support in [removed: buying or] leasing of the location; (5) assistance in obtaining zoning approvals and permits; (6) tower and related site construction; (7) antenna installation; and (8) radio equipment installation, commissioning, and maintenance.

We provide site development services [added: at our towers and at towers owned by others] on a local basis, through regional, [removed: territory,] [added: market,] and project offices.

For a detailed discussion on the application of these and other accounting policies, see Note 2 of our Consolidated Financial Statements for the year ended December 31, [removed: 2015,] [added: 2016,] included herein.

Amounts billed in advance (collected or uncollected) are recorded as deferred revenue on [removed: the Company’s] [added: our] Consolidated Balance Sheets.

[removed: This method is used because] management considers total cost to be the best available measure of progress on the contracts.

We monitor collections and payments from our customers and maintain a provision for estimated credit losses based upon historical experience, specific customer collection issues identified, and [added: past due balances as determined based on contractual terms.]

| | | For the year ended | | | | | | | | | | | [added: | Constant | |]

| | | 2015 | | | 2014 | | | [added: Currency Impact | | | Currency] Change | | | [added: %] Change | |

| Revenues | | (in thousands) | | | | | | | | | | | [added: | | |]

| Domestic site leasing | | $ | 1,236,758 | | $ | 1,157,293 | | $ | [added: — | | $ |] 79,465 | | | 6.9% |

| International site leasing | | | 243,876 | | | 202,909 | | | [removed: 40,967] [added: (69,856)] | | | [removed: 20.2%] [added: 110,823] | [added: | | 54.6% |]

| Site development | | | 157,840 | | | 166,794 | | | [added: — | | |] (8,954) | | | (5.4%) |

| Total | | $ | 1,638,474 | | $ | 1,526,996 | | $ | [removed: 111,478] [added: (69,856)] | | [added: $] | [removed: 7.3%] [added: 181,334] | [added: | | 11.9% |]

| Cost of Revenues | | | | | | | | | | | | | [added: | | |]

| Domestic site leasing | | $ | 252,493 | | $ | 247,237 | | $ | [added: — | | $ |] 5,256 | | | 2.1% |

| International site leasing | | | 72,162 | | | 54,076 | | | [removed: 18,086] [added: (22,832)] | | | [removed: 33.4%] [added: 40,918] | [added: | | 75.7% |]

| Site development | | | 119,744 | | | 127,172 | | | [added: — | | |] (7,428) | | | (5.8%) |

| Total | | $ | 444,399 | | $ | 428,485 | | $ | [removed: 15,914] [added: (22,832)] | | [added: $] | [removed: 3.7%] [added: 38,746] | [added: | | 9.0% |]

| Operating Profit | | | | | | | | | | | | | [added: | | |]

| Domestic site leasing | | $ | 984,265 | | $ | 910,056 | | $ | [added: — | | $ |] 74,209 | | | 8.2% |

| International site leasing | | | 171,714 | | | 148,833 | | | [removed: 22,881] [added: (47,024)] | | | [removed: 15.4%] [added: 69,905] | [added: | | 47.0% |]

| Site development | | | 38,096 | | | 39,622 | | | [added: — | | |] (1,526) | | | (3.9%) |

[removed: Total revenues increased $111.5 million for the year ended December 31, 2015, as compared to the prior year,] [added: These changes were] due largely to (i) revenues from [removed: 4,923] [added: 3,916] towers [removed: acquired] [added: acquired, primarily from the acquisition of 3,648 towers from Oi S.A. in March 2014] and [removed: 848] [added: December 2014, and 582] towers built since January 1, [removed: 2014] [added: 2014,] and (ii) organic site leasing growth from new leases, contractual rent escalators, and monetary lease amendments for additional equipment added to our towers.

[removed: International] [added: Domestic] site leasing revenues increased [removed: $41.0] [added: $37.1] million for the year ended December 31, [removed: 2015,] [added: 2016,] as compared to the prior year, due largely to (i) revenues from [removed: 3,916 towers acquired, primarily from the acquisition of 3,648] [added: 951] towers [removed: from Oi S.A. in March 2014 and December 2014,] [added: acquired] and [removed: 582] [added: 183] towers built since January 1, [removed: 2014,] [added: 2015] and (ii) organic site leasing [removed: growth] [added: growth, primarily] from [removed: new leases, contractual rent escalators, and] monetary lease amendments for additional equipment added to our [removed: towers.][added: towers as well as new leases and contractual rent escalators, partially offset by lease non-renewals in 2015 primarily related to carrier consolidation, including Sprint’s iDEN network, which impacted our year-over-year growth rates during 2016.]

Domestic site leasing segment operating profit increased [removed: $74.2] [added: $28.7] million for the year ended December 31, [removed: 2015,] [added: 2016,] as compared to the prior year, primarily due to additional profit generated by (i) towers acquired and built since January 1, [removed: 2014] [added: 2015] and organic site leasing growth as noted above, (ii) [removed: improving] [added: continued] control of our site leasing cost of revenue, and (iii) the positive impact of our ground lease purchase program.

REIT Conversion

In October 2016, we announced our intention to take the necessary steps to qualify as a REIT for U.S. federal income tax purposes.

We refer to this as the 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 intend to make the election to be subject to tax as a REIT commencing with our taxable year ending December 31, 2016.

Because we believe our business is currently operated in a manner that complies with the REIT rules, no further reorganization of our operations is necessary to complete the REIT conversion.

As part of the REIT conversion, effective January 13, 2017, we completed the merger with our predecessor that was approved by our shareholders at a special meeting held on January 12, 2017, and as a result of the merger, we now hold, directly or indirectly through our subsidiaries, the assets held by our predecessor prior to the merger and conduct the existing businesses of our predecessor and its subsidiaries.

At the effective time of the merger, all outstanding shares of Class A common stock of our predecessor were converted into a right to receive an equal number of our shares of Class A common stock.

Although the REIT rules do not require the completion of this merger, we completed the merger to facilitate our compliance with the REIT rules by ensuring the effective adoption of certain REIT-related ownership limitations and transfer restrictions related to our capital stock.

A REIT is a corporation 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 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 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.

We do not expect that we will be required to make any distribution of accumulated earnings and profits (commonly referred to as a “purging” dividend) in connection with our REIT conversion.

Site leases in South America typically provide for a fixed rental amount and a pass through charge for the underlying ground lease rent.

wireless service providers or companies providing development or project management services to wireless service providers.

The market offices are responsible for all site development operations.

Capital Allocation Strategy

Our capital allocation strategy is to prioritize 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 of our capital allocation strategy is to increase our Adjusted Funds From Operations per share.

To achieve this, we expect we would continue to deploy capital between 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.

Stock repurchase program.

We currently utilize stock repurchases as part of our capital allocation policy when we believe our share price is below intrinsic value.

After portfolio growth, we believe that share repurchases, when purchased at the right price, will facilitate our goal of increasing our Adjusted Funds From Operations per share.

This method is used because

In September 2015, the FASB issued ASU 2015-16 Business Combinations.

The standard requires that the acquirer (1) recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined, (2) record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date, and (3) to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date.

We adopted ASU 2015-16 effective January 1, 2016.

The financial statement impact of adopting this standard was not material for all periods presented.

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.

The standard is effective for annual and interim periods beginning after December 15, 2018 and early adoption is permitted.

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The regional offices are responsible for all site development operations, including hiring employees and opening or closing project offices, and a substantial portion of the sales in such area.

past due balances as determined based on contractual terms.

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| | | December 31, | | | | | | Dollar | | | Percentage | |

The increase in total revenues includes the negative impact of $43.2 million from fluctuations in foreign currency exchange rates as compared to the prior year.

The increase in international site leasing revenues includes the negative impact of $43.2 million from fluctuations in foreign currency exchange rates as compared to the prior year.

resulting from the integration of towers acquired in 2014.

The increase in international site leasing segment operating profit includes the negative impact of $31.2 million from fluctuations in foreign currency exchange rates as compared to the prior year.

The increase in selling, general, and administrative expenses includes the positive impact of $1.8 million from fluctuations in foreign currency exchange rates as compared to the prior year.

| Total | | $ | 11,864 | | $ | 7,798 | | $ | 4,066 | | | 52.1% |

The decrease in International acquisition related adjustments and expenses includes the positive impact of $0.4 million from fluctuations in foreign currency exchange rates as compared to the prior year.

| Total | | $ | 94,783 | | $ | 23,801 | | $ | 70,982 | | | 298.2% |

The impact from fluctuations in foreign currency exchange rates as compared to the prior year was not material.

The increase in depreciation, accretion, and amortization expense includes the positive impact of $22.7 million from fluctuations in foreign currency exchange rates as compared to the prior year.

The increase in international site leasing operating income includes the negative impact of $5.4 million from fluctuations in foreign currency exchange rates as compared to the prior year.

Other (expense) income, net increased $149.8 million for the year ended December 31, 2015, as compared to the prior year, primarily due to a $178.9 million loss related to the remeasurement of an intercompany loan not denominated in the functional currency of the subsidiary in which it is recorded during the year ended December 31, 2015 as compared to a $23.0 million loss in the prior year, as well as a $17.9 million gain realized on the settlement of two foreign currency contracts entered into to hedge the purchase price of the Oi S.A. acquisition in Brazil in 2014.

This was partially offset by a $37.2 million gain realized on the sale of a cost-method investment in 2015 as compared to a $12.5 million gain on the sale of a cost\-method investment in the prior year.

The increase in net loss includes the negative impact of $170.0 million from fluctuations in foreign currency exchange rates as compared to the prior year.

| | | 2014 | | | 2013 | | | Change | | | Change | |

| Domestic site leasing | | $ | 1,157,293 | | $ | 1,048,756 | | $ | 108,537 | | | 10.3% |

| International site leasing | | | 202,909 | | | 84,257 | | | 118,652 | | | 140.8% |

| Site development | | | 166,794 | | | 171,853 | | | (5,059) | | | (2.9%) |

| Total | | $ | 1,526,996 | | $ | 1,304,866 | | $ | 222,130 | | | 17.0% |

| Domestic site leasing | | $ | 247,237 | | $ | 242,839 | | $ | 4,398 | | | 1.8% |

| International site leasing | | | 54,076 | | | 27,933 | | | 26,143 | | | 93.6% |

| Site development | | | 127,172 | | | 137,481 | | | (10,309) | | | (7.5%) |

| Total | | $ | 428,485 | | $ | 408,253 | | $ | 20,232 | | | 5.0% |

| Domestic site leasing | | $ | 910,056 | | $ | 805,917 | | $ | 104,139 | | | 12.9% |

| International site leasing | | | 148,833 | | | 56,324 | | | 92,509 | | | 164.2% |

| Site development | | | 39,622 | | | 34,372 | | | 5,250 | | | 15.3% |

Total revenues increased $222.1 million for the year ended December 31, 2014, as compared to the prior year, due largely to (i) revenues from 6,532 towers acquired and 731 towers built since January 1, 2013 and (ii) organic site leasing growth from new leases, contractual rent escalators, and lease amendments which increased the related rent to compensate for additional equipment added to our towers.

The increase in total revenues includes the negative impact of $3.1 million from fluctuations in foreign currency exchange rates as compared to the prior year.

Domestic site leasing revenues increased $108.5 million for the year ended December 31, 2014, as compared to the prior year, due largely to (i) revenues from 426 towers acquired and 228 towers built since January 1, 2013 and (ii) organic site leasing growth from new leases, contractual rent escalators, and lease amendments which increased the related rent to compensate for additional equipment added to our towers.

International site leasing revenues increased $118.7 million for the year ended December 31, 2014, as compared to the prior year, due largely to (i) revenues from 6,106 towers acquired and 503 towers built since January 1, 2013 and (ii) organic site leasing growth from new leases, contractual rent escalators, and lease amendments which increased the related rent to compensate for additional equipment added to our towers.

The increase in international site leasing revenues includes the negative impact of $3.1 million from fluctuations in foreign currency exchange rates as compared to the prior year.

Domestic site leasing segment operating profit increased $104.1 million for the year ended December 31, 2014, as compared to the prior year, primarily due to additional profit generated by (i) towers acquired and built since January 1, 2013 as noted above and (ii) organic site leasing growth from new leases, contractual rent escalators, and lease amendments with current tenants which increased the related rent as a result of additional equipment added to our towers in addition to improving control of our site leasing cost of revenue, and the positive impact of our ground lease purchase program.

International site leasing segment operating profit increased $92.5 million for the year ended December 31, 2014, as compared to the prior year, primarily due to additional profit generated by (i) towers acquired and built since January 1, 2013 as noted above and (ii) organic site leasing growth from new leases, contractual rent escalators, and lease amendments with current tenants which increased the related rent as a result of additional equipment added to our towers in addition to improving control of our site leasing cost of revenue, and the positive impact of our ground lease purchase program.

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 December 31, [removed: 2015:][added: 2016:]

| | | [removed: 2016 | | |] 2017 | | | 2018 | | | 2019 | | | 2020 | | | [added: 2021 | | |] Thereafter | | | Total | | | Fair Value | |

| [added: 2014-2C Tower] Securities (1) | | | — | | | — | | | — | | | — | | | — | | | 620,000 | | | 620,000 | | | [removed: 608,084] [added: 608,921] |

| 2014 Term Loan | | | 15,000 | | | 15,000 | | | 15,000 | | | 15,000 | | | [removed: 15,000] [added: 1,402,500] | | | [removed: 1,402,500] [added: —] | | | [removed: 1,477,500] [added: 1,462,500] | | | [removed: 1,447,950] [added: 1,467,984] |

(1)The anticipated repayment date and the final maturity date for the [removed: 2010-2] [added: 2012-1C] Tower Securities is [removed: April] [added: December] 11, 2017 and [removed: April] [added: December] 9, 2042, respectively.

The anticipated repayment date and the final maturity date for the [removed: 2012] [added: 2015-1C] Tower Securities is [removed: December 11, 2017] [added: October 8, 2020] and [removed: December 9, 2042,] [added: October 10, 2045,] respectively.

The anticipated repayment date and the final maturity date for the [removed: 2015-1C] [added: 2016\-1C] Tower Securities is [removed: October 8, 2020] [added: July 9, 2021] and [removed: October] [added: July] 10, [removed: 2049,] [added: 2046,] respectively.

Our current primary market risk exposure is [added: (1)] interest rate risk relating to [removed: (1)] our ability to refinance our debt at commercially reasonable rates, if at all, [added: and] (2) interest rate risk relating to the impact of interest rate movements on our 2014 Term Loan and 2015 Term Loan and any borrowings that we may incur under our Revolving Credit Facility, which are at floating rates.

[added: 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.

We are exposed to market risk from changes in foreign currency exchange rates in connection with our operations in Brazil, Canada, [removed: Costa Rica, Guatemala,] and [removed: Nicaragua.][added: Chile, and to a lesser extent, our markets in Central America.]

[removed: 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 [removed: Brazil and] [added: Brazil,] Canada, [added: and Chile,] we receive significantly all of our revenue and pay significantly all of our operating expenses in local currency.

All assets and liabilities are translated into U.S. Dollars at exchange rates in effect at the end of the applicable fiscal reporting [removed: period] [added: period,] and all revenues and expenses are translated at average rates for the period.

For the year ended December 31, [removed: 2015,] [added: 2016,] approximately [removed: 11.0%] [added: 11.6%] of our revenues and approximately [removed: 11.7%] [added: 14.9%] 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 December 31, [removed: 2015.][added: 2016.]

As of December 31, [removed: 2015,] [added: 2016,] the analysis indicated that such an adverse movement would have caused our revenues and operating [removed: results] [added: income] to fluctuate by [removed: less than 2.0%] [added: approximately 0.7% and 2.0%, respectively,] for the year ended December 31, [removed: 2015.][added: 2016.]

[removed: During 2014,] [added: As of December 31, 2016,] we [removed: incurred] [added: had] intercompany debt, which is denominated in a currency other than the functional currency of the subsidiary in which it is recorded.

As [added: settlement of] this debt [removed: had not been designated as being a long-term investment] [added: is anticipated or planned] in [removed: nature,] [added: 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 December 31, [removed: 2015] [added: 2016] would have resulted in approximately [removed: $46.6] [added: $42.0] million of unrealized gains or losses that would have been included in Other [removed: expense] [added: income (expense), net] in our [removed: condensed] consolidated statements of operations for the year ended December 31, [removed: 2015.][added: 2016.]

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

- our expectations regarding the opportunities in the international wireless markets in which we currently operate or have targeted for growth, our beliefs regarding how we can capitalize on such opportunities, and our intent to continue expanding internationally through new [removed: builds] [added: acquisitions] and [removed: acquisitions;][added: new builds;]

- our beliefs regarding our [added: business strategy, our] ability to capture and capitalize on industry [removed: growth and] [added: growth,] the impact of such growth on our financial and operational [removed: results;][added: results, and our intent to grow our tower portfolio domestically and internationally;]

- our [removed: expectation] [added: belief] that over the long-term, site leasing revenues will continue to grow as wireless service providers [removed: lease additional antenna space on] [added: increase their use of] our towers due to increasing minutes of network use and data transfer, network expansion and network coverage [removed: requirements and the rate of such growth,] [added: requirements,] 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 [removed: expenditures;][added: expenditures, and our expectations regarding levels of site leasing revenue;]

- our expectations regarding our annual debt service in [removed: 2016] [added: 2017] and thereafter, and our belief that our cash on hand, [added: capacity under our Revolving Credit Facility, and our] cash flows from operations for the next twelve months [removed: and availability under our Revolving Credit Facility] will be sufficient to service our outstanding debt during the next twelve months;

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

- our ability to build new towers, including our ability to identify and acquire land that would be attractive for our [removed: clients] [added: 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;

- 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 [removed: net operating losses] [added: NOLs] to offset future taxable income;

- a decrease in demand for our towers; [removed: and]

- the introduction of new technologies or changes in a tenant’s business model that may make our tower leasing business less desirable to potential [removed: tenants.][added: tenants;]

| 2014 Senior Notes | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 750,000 | | $ | 750,000 | | $ | 763,125 |

| 2016 Senior Notes | | | — | | | — | | | — | | | — | | | — | | | 1,100,000 | | | 1,100,000 | | | 1,083,500 |

| 2012-1C Tower Securities (1) | | | 610,000 | | | — | | | — | | | — | | | — | | | — | | | 610,000 | | | 610,165 |

| 2013-1C Tower Securities (1) | | | — | | | 425,000 | | | — | | | — | | | — | | | — | | | 425,000 | | | 423,381 |

| 2013-2C Tower Securities (1) | | | — | | | — | | | — | | | — | | | — | | | 575,000 | | | 575,000 | | | 563,322 |

| 2013-1D Tower Securities (1) | | | — | | | 330,000 | | | — | | | — | | | — | | | — | | | 330,000 | | | 334,521 |

| 2014-1C Tower Securities (1) | | | — | | | — | | | 920,000 | | | — | | | — | | | — | | | 920,000 | | | 922,199 |

| 2015-1C Tower Securities (1) | | | — | | | — | | | — | | | 500,000 | | | — | | | — | | | 500,000 | | | 495,145 |

| 2016-1C Tower Securities (1) | | | — | | | — | | | — | | | — | | | 700,000 | | | — | | | 700,000 | | | 688,072 |

| Revolving Credit Facility | | | — | | | — | | | — | | | 390,000 | | | — | | | — | | | 390,000 | | | 390,000 |

| 2015 Term Loan | | | 5,000 | | | 5,000 | | | 5,000 | | | 5,000 | | | 5,000 | | | 467,500 | | | 492,500 | | | 494,347 |

| Total debt obligation | | $ | 630,000 | | $ | 775,000 | | $ | 940,000 | | $ | 910,000 | | $ | 2,107,500 | | $ | 3,512,500 | | $ | 8,875,000 | | $ | 8,844,682 |

In each of these countries, we pay most of our selling,

- our ability to qualify and to remain qualified as a REIT and the timing of such qualification and our election to be subject to a 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 belief that we will not be required to make an earnings and profits distribution in order to qualify as a REIT;

- 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 and the impact of the REIT conversion on that strategy;

- our expectations regarding the impact of the Oi reorganization;

- the willingness and ability of Oi to continue to make payments to us in accordance with the terms of our contracts;

- 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.

| 5.625% Senior Notes due 2019 | | $ | — | | $ | — | | $ | — | | $ | 500,000 | | $ | — | | $ | — | | $ | 500,000 | | $ | 521,250 |

| 5.750% Senior Notes due 2020 | | | — | | | — | | | — | | | — | | | 800,000 | | | — | | | 800,000 | | | 832,000 |

| 4.875% Senior Notes due 2022 | | | — | | | — | | | — | | | — | | | — | | | 750,000 | | | 750,000 | | | 744,375 |

| 5.101% 2010-2 Tower | | | | | | | | | | | | | | | | | | | | | | | | |

| Securities (1) | | | — | | | 550,000 | | | — | | | — | | | — | | | — | | | 550,000 | | | 558,223 |

| 2.933% 2012 Tower | | | | | | | | | | | | | | | | | | | | | | | | |

| Securities (1) | | | — | | | 610,000 | | | — | | | — | | | — | | | — | | | 610,000 | | | 611,879 |

| 2.240% 2013-1C Tower | | | | | | | | | | | | | | | | | | | | | | | | |

| Securities (1) | | | — | | | — | | | 425,000 | | | — | | | — | | | — | | | 425,000 | | | 416,959 |

| 3.722% 2013-2C Tower | | | | | | | | | | | | | | | | | | | | | | | | |

| Securities (1) | | | — | | | — | | | — | | | — | | | — | | | 575,000 | | | 575,000 | | | 565,541 |

| 3.598% 2013-1D Tower | | | | | | | | | | | | | | | | | | | | | | | | |

| Securities (1) | | | — | | | — | | | 330,000 | | | — | | | — | | | — | | | 330,000 | | | 332,676 |

| 2.898% 2014-1C Tower | | | | | | | | | | | | | | | | | | | | | | | | |

| Securities (1) | | | — | | | — | | | — | | | 920,000 | | | — | | | — | | | 920,000 | | | 910,368 |

| 3.869% 2014-2C Tower | | | | | | | | | | | | | | | | | | | | | | | | |

| 3.156% 2015-1C Tower | | | | | | | | | | | | | | | | | | | | | | | | |

| Securities (1) | | | — | | | — | | | — | | | — | | | 500,000 | | | — | | | 500,000 | | | 489,680 |

| 2015 Term Loan | | | 5,000 | | | 5,000 | | | 5,000 | | | 5,000 | | | 5,000 | | | 472,500 | | | 497,500 | | | 486,306 |

| Total debt obligation | | $ | 20,000 | | $ | 1,180,000 | | $ | 775,000 | | $ | 1,440,000 | | $ | 1,320,000 | | $ | 3,820,000 | | $ | 8,555,000 | | $ | 8,525,291 |

While we cannot predict our ability to refinance

- our intent to grow our tower portfolio, domestically and internationally, and our expectations regarding the pace of such growth;

- our expectation that we will continue our ground lease purchase program and the estimates of the impact of such program on our financial results;

- our expectation that we will continue to incur losses;

We are a leading independent owner and operator of wireless communications [added: infrastructure, including] tower structures, [removed: rooftops] [added: rooftop,] and other structures that support antennas used for wireless communications, which we collectively refer to as “towers” or “sites.” Our [removed: principal operations are in] [added: primary business line is our site leasing business, which contributed 98.7% of our total segment operating profit for] the [removed: United States and its territories.][added: year ended December 31, 2016.]

In addition, we own and operate towers in [removed: South America,] [added: Canada,] Central America, and [removed: Canada.][added: South America.]

As of December 31, [removed: 2015,] [added: 2016,] we owned [removed: 25,465] [added: 26,197] 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 5,500 actual or potential [removed: towers,] [added: sites,] approximately 500 of which were revenue producing as of December 31, [removed: 2015.][added: 2016.]

We [removed: receive] [added: derive] site leasing revenues primarily from wireless service provider tenants, including AT&T, [removed: Sprint,] T-Mobile, [added: Sprint,] Verizon Wireless, Oi S.A., Telefonica, Claro, and [removed: Digicel.][added: TIM.]

Our site leasing business generates substantially all of our total segment operating profit, representing [removed: 96.2%] [added: 96.3%] or more of our total segment operating profit for the past three [added: fiscal] years.

For the year ended December 31, [removed: 2015,] [added: 2016,] we generated [removed: 83.5%] [added: 82.8%] of our total site leasing revenue from these sites.

We [removed: receive] [added: derive] domestic site leasing revenues primarily from AT&T, [added: T\-Mobile,] Sprint, [removed: Verizon Wireless,] and [removed: T-Mobile.][added: Verizon Wireless.]

[removed: In the United States, wireless] [added: Wireless] service providers [removed: typically] enter into tenant leases with us, each of which relates to the lease or use of space at [removed: an] [added: each] individual [removed: tower.][added: site.]

[removed: Our tenant leases in] [added: In] the United [removed: States] [added: States, our tenant leases] are generally for an initial term of five to ten years with five 5-year renewal periods at the option of the tenant.

These tenant leases typically contain specific rent escalators, which [removed: typically] average 3-4% per year, [removed: for both] [added: including] the [removed: initial and] renewal option periods.

Our ground leases in the United States are generally for an initial term of five years or more with multiple renewal terms of [removed: 5-year periods,] [added: five\-year periods] at our [removed: option,] [added: option] and provide for rent escalators which typically average [removed: 2\-3%] [added: 2-3%] annually.

[removed: In 2015, we continued] [added: We continue] to focus on growing our international site leasing business through the acquisition and development of towers.

We [removed: receive] [added: derive] international site leasing revenues primarily from Oi S.A., Telefonica, Claro, [removed: Digicel,] and TIM.

Our operations in these countries are solely in the site leasing business, and we expect to continue to expand operations through [removed: new builds] [added: acquisitions] and [removed: acquisitions.][added: new builds.]

[removed: Our] [added: In Canada, our] tenant leases [removed: in Canada typically have similar terms and conditions as those in the United States with] [added: are generally for] an initial term of five to ten years with five 5-year renewal periods at the option of the tenant.

These tenant leases typically contain specific rent escalators, which average 3-4% per [removed: year.][added: year, including the renewal option periods.]

In Central America, we have similar [added: fixed] rent escalators to that of leases in the United States and Canada while our leases in South America [removed: typically] escalate in accordance with a standard cost of living index.

In Brazil, [removed: site] [added: tenant] leases are typically governed by master lease agreements, which provide for the material terms and conditions that will govern the terms of the use of the site.

[removed: Site] [added: Tenant] leases in South America typically provide for a fixed rental amount and a pass-through charge for the underlying ground lease rent.

Since we first entered the Central and South American markets, we have built or acquired [removed: 9,430] [added: 10,003] towers [added: as of December 31, 2016] and continue to expand in these markets to respond to growing demand.

| | · | | Country analysis – We consider the country’s [added: economic and] political stability, and whether the country’s general business, legal and regulatory environment is conducive to the sustainability and growth of our business. |

| | · | | Risk adjusted return criteria – We consider whether buying or building towers in a country, and providing our management and leasing services, will meet our return criteria. As part of this analysis, we consider the risk of entering into an international market (for example, the impact of foreign currency exchange [removed: rates),] [added: rates, real estate, permitting,] and [added: taxation risks), and] how our expansion meets our long-term strategic objectives for the region and our business generally. |

When we construct tower structures in locations chosen by us, we utilize our knowledge of our customers’ network requirements to identify locations where we believe multiple wireless service providers need, or will [removed: need,] [added: need] to locate antennas to meet capacity or service demands.

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 [removed: towers.][added: tower locations.]

[removed: We earn site] [added: Site] development services revenues [added: are earned] primarily from [removed: the] [added: providing a] full range of end to end services [removed: we provide] 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 [removed: antennas;] [added: antennas on existing infrastructure;] (4) support in [removed: buying or] leasing of the location; (5) assistance in obtaining zoning approvals and permits; (6) tower and related site construction; (7) antenna installation; and (8) radio equipment installation, commissioning, and maintenance.

We provide site development services [added: at our towers and at towers owned by others] on a local basis, through regional, [removed: territory,] [added: market,] and project offices.

We believe that growing wireless traffic (particularly data and video), the deployment of additional spectrum, and technology advancements will require wireless service providers to improve their network infrastructure and increase their network capacity resulting in an increase in the number of towers that they utilize and additions [removed: and] [added: or] changes to the equipment they deploy at existing towers.

| | · | | As wireless [added: data] traffic continues to grow, carriers are investing to increase the capacity of their networks; and we believe that the continued capacity increases will require our customers to add [removed: large numbers of] additional cell sites and additional new equipment at current cell sites. |

| | · | | Spectrum licensed by the Federal Communications Commission (the “FCC”) has enabled continued network development. We expect the deployment of currently fallow spectrum and the [removed: potential] availability of additional spectrum through a [removed: planned] government auction [added: anticipated] to [added: be completed in 2017 to] drive continued network development in the U.S. |

| | · | | Consumers are increasing their [removed: use of] [added: demand for] wireless [removed: data services] [added: connectivity] due to expansion of wireless data applications, such as video, mobile apps and games, web browsing, email and social networking, and continued wireline to wireless migration. Wireless devices such as smartphones, tablets, laptops, and other emerging and embedded devices continue to trend toward being more bandwidth-intensive. As a result, according to industry estimates, global mobile data traffic will grow at an approximately [removed: 53%] [added: 47%] compound annual growth rate from [removed: 2015] [added: 2016] to [removed: 2020] [added: 2021] and will grow at a rate three times faster than non-mobile data traffic over the same period. |

| | · | | Consumers list network quality as [removed: one of the greatest contributors to their dissatisfaction] [added: a key contributor] when terminating or changing service. To decrease subscriber churn [removed: rate and drive revenue growth,] [added: rate,] wireless carriers have made substantial capital expenditures on wireless networks to improve service quality and expand coverage. [removed: For example,] [added: We expect] U.S. wireless [removed: carriers’ capital expenditures have increased from an estimated $22.9 billion in 2010] [added: carriers] to [removed: an estimated $31.7 billion in 2015, and we expect] [added: continue to expend] capital [removed: expenditures in] [added: for] the foreseeable future [added: in order] to [removed: remain elevated as wireless carriers] continue to improve their networks. |

Therefore, we expect that we will see a multi-year trend of [removed: strong] additional demand for tower space from our customers, which we believe will translate into [removed: strong] [added: steady] leasing growth for us.

Our primary strategy is to continue to focus on expanding our site leasing business due to its attractive characteristics such as long-term contracts, built-in rent escalators, high operating margins, and low customer [removed: churn.][added: churn (which refers to when a customer does not renew its lease, or, in very limited circumstances, such as in a customer bankruptcy, cancels its lease prior to the end of its term) other than in connection with customer consolidation or cessation of a particular technology (e.g. iDEN).]

As of December 31, [removed: 2015,] [added: 2016,] we had an average of 1.8 tenants per tower structure.

[removed: During 2016, we] [added: We] intend to continue to grow our tower portfolio, domestically and internationally, through tower acquisitions and the construction of new tower structures.

[added: We believe that our] industry expertise and strong relationships with wireless service providers will allow us to expand our position as a leading provider of site leasing and site development services.

As of December 31, [removed: 2015,] [added: 2016,] approximately [removed: 73%] [added: 72%] of our tower structures were located on land that we own or control for more than 20 years and the average remaining life under our ground leases, including renewal options under our control, was 33 years.

As of December 31, [removed: 2015,] [added: 2016,] approximately [removed: 5.8%] [added: 6.2%] of our tower structures [removed: have] [added: had] ground leases maturing in the next 10 years.

Our principal operations are in the United States and its territories.

In October 2016, we announced our intention to take the necessary steps to qualify as a Real Estate Investment Trust (“REIT”) for U.S. federal income tax purposes.

We refer to this as the 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 intend to make the election to be subject to tax as a REIT commencing with our taxable year ending December 31, 2016.

Because we believe our business is currently operated in a manner that complies with the REIT rules, no further reorganization of our operations is necessary to complete the REIT conversion.

As part of the REIT conversion, effective January 13, 2017, we completed the merger with our predecessor that was approved by our shareholders at a special meeting held on January 12, 2017.

As a result of the merger, we now hold, directly or indirectly through our subsidiaries, the assets held by our predecessor prior to the merger and conduct the existing businesses of our predecessor and its subsidiaries.

Although the REIT rules do not require the completion of this merger, we completed the merger to facilitate our compliance with the REIT rules by ensuring the effective adoption of certain REIT-related ownership limitations and transfer restrictions related to our capital stock.

See “Management’s Discussion and Analysis of Financial Condition and Results of Operation—REIT Conversion” for more information.

As of December 31, 2016, we owned 15,922 sites in the United States and its territories.

As of December 31, 2016, (1) no U.S. state or territory included 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 year ended December 31, 2016.

As of December 31, 2016, we owned

10,275 towers in our international markets, including Canada, Central America, and South America.

Approximately 28% of our total towers are located in Brazil and less than 3% of our total towers are located in each of our other international markets (each country is considered a market).

Our operations in Central America and Ecuador are primarily denominated in United States Dollars, while our operations in Canada and the remainder of South America are denominated in local currencies.

The market offices are responsible for all site development operations.

We measure the available

capacity of our existing facilities to support additional tenants and generate additional lease revenue by assessing several factors, including tower height, tower type, wind loading, environmental conditions, existing equipment on the tower and zoning and permitting regulations in effect in the jurisdiction where the tower is located.

Internationally, we service all the major service providers in Canada, Central America, and South America.

In addition to the Big 4 wireless carriers (AT&T, T\-Mobile, Sprint, and Verizon Wireless), we have also provided services or leased space to a number of customers including:

| Cable & Wireless | Ericsson, Inc. | SouthernLinc |

| Cellular South | ICE | TIM |

| Claro | NII Holdings | Telefonica |

| CNT | Mastec | U.S. Cellular |

Our corporate offices are located in our headquarters in Boca Raton, Florida.

operating requirements.

Our primary business line is our site leasing business, which contributed 96.8% of our total segment operating profit for the year ended December 31, 2015.

As of December 31, 2015, we had 15,778 sites in the United States.

As of December 31, 2015, we owned 9,687 towers in our international markets, including Brazil, Canada, Costa Rica, Ecuador, El Salvador, Guatemala, Nicaragua, and Panama.

During 2016, we intend to build between 590 and 610 new tower structures, domestically and internationally.

The regional offices are responsible for all site development operations, including hiring employees and opening or closing project offices, and a substantial portion of the sales in such area.

We believe that our

During the past two years, we provided services or leased space to a number of customers, including:

| AT&T Wireless | NII Holdings | Sprint |

| Cellular South | Ntelos | T-Mobile |

| Claro | Mastec | TIM |

| Ericsson, Inc. | Overland Contracting | U.S. Cellular |

| Goodman Networks | SouthernLinc | Verizon Wireless |

Our executive, corporate development, accounting, finance, human resources, legal and regulatory, information technology and site administration personnel, and our network operations center, are located in our headquarters in Boca Raton, Florida.

Certain sales, new tower build support and tower maintenance personnel are also located in our Boca Raton office.

New tower construction also requires approval from the state or local governing

For the fiscal year ended December 31, [removed: 2015][added: 2016]

Commission file number: [removed: 000-30110][added: 001\-16853]

The aggregate market value of the voting stock held by non-affiliates of the Registrant was approximately [removed: $14.5] [added: $13.3] billion as of June 30, [removed: 2015.][added: 2016.]

The number of shares outstanding of the Registrant’s common stock (as of February [removed: 19, 2016):] [added: 21, 2017):] Class A common stock — [removed: 125,257,417][added: 120,977,227]

Portions of the Registrant’s definitive proxy statement for its [removed: 2016] [added: 2017] annual meeting of shareholders, which proxy statement will be filed no later than 120 days after the close of the Registrant’s fiscal year ended December 31, [removed: 2015,] [added: 2016,] are hereby incorporated by reference in Part III of this Annual Report on Form 10-K.

| ITEM 1A. | [RISK FACTORS](#Item1A) | [removed: 7] [added: 8] |

| ITEM 2. | [PROPERTIES](#Item2) | [removed: 18] [added: 22] |

| ITEM 3. | [LEGAL PROCEEDINGS](#Item3) | [removed: 18] [added: 23] |

| ITEM 4. | [MINE SAFETY DISCLOSURE](#Item4) | [removed: 18] [added: 23] |

| ITEM 5. | [MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES](#Item5) | [removed: 19] [added: 23] |

| ITEM 6. | [SELECTED FINANCIAL DATA](#Item6) | [removed: 21] [added: 25] |

| ITEM 7. | [MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#Item7) | [removed: 22] [added: 26] |

| ITEM 7A. | [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](#Item7A) | [removed: 44] [added: 50] |

| ITEM 8. | [FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA](#Item8) | [removed: 47] [added: 53] |

| ITEM 9. | [CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE](#Item9) | [removed: 47] [added: 53] |

| ITEM 9A. | [CONTROLS AND PROCEDURES](#Item9A) | [removed: 47] [added: 53] |

| ITEM 9B. | [OTHER INFORMATION](#Item9B) | [removed: 50] [added: 56] |

| ITEM 10. | [DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE](#Item10) | [removed: 50] [added: 56] |

| ITEM 11. | [EXECUTIVE COMPENSATION](#Item11) | [removed: 50] [added: 56] |

| ITEM 12. | [SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS](#Item12) | [removed: 50] [added: 57] |

| ITEM 13. | [CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE](#Item13) | [removed: 50] [added: 57] |

| ITEM 14. | [PRINCIPAL ACCOUNTING FEES AND SERVICES](#Item14) | [removed: 50] [added: 57] |

| ITEM 15. | [EXHIBITS, FINANCIAL STATEMENT SCHEDULES](#Item15) | [removed: 50] [added: 57] |

| [SIGNATURES](#Signatures) | | [removed: 55] [added: 62] |

10-K 1 sbac-20161231x10k.htm 10-K

| ITEM 16. | [FORM 10-K SUMMARY](#Item16) | 61 |

10-K 1 sbac-20151231x10k.htm 10-K

[removed: On November 1, 2013, we purchased a new] [added: We own our] headquarters in Boca Raton, Florida where we currently [removed: own] [added: have] approximately 160,000 square feet of office space.

We have entered into long-term leases for [removed: international, regional,] [added: international] and [added: regional locations convenient for the management and operation of our site leasing activities, and in] certain site development office locations where we expect our activities to be longer-term.

As of December 31, [removed: 2015,] [added: 2016,] approximately [removed: 73%] [added: 72%] of our tower structures were located on parcels of land that we own, land subject to perpetual easements, or parcels of land that have an interest that extends beyond 20 years.

The average remaining life under our ground leases, including renewal options under our control, [removed: has been extended to] [added: is] 33 years.

Most of our towers have significant capacity available for additional antennas.

We measure the available capacity of our existing facilities to support additional tenants and generate additional lease revenue by assessing several factors, including tower height, tower type, wind loading, environmental conditions, existing equipment on the tower and zoning and permitting regulations in effect in the jurisdiction where the tower is located.

As of December 31, 2016, we had an average of 1.8 tenants per tower structure.

As of February [removed: 19, 2016,] [added: 21, 2017,] there were [removed: 92] [added: 89] record holders of our Class A common stock.

The following table presents information related to our repurchases of Class A common stock during the fourth quarter of [removed: 2015:][added: 2016:]

| | (1) | | On June 4, 2015, [removed: we announced] [added: our Board of Directors authorized] a new [removed: $1.0 billion] stock repurchase plan. This plan [removed: authorizes] [added: authorized] us to [removed: purchase] [added: purchase,] from time to [removed: time] [added: time, up to $1.0 billion of] our outstanding [added: 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 [removed: discretion.] [added: discretion based on market and business conditions, applicable legal requirements and other factors.] Shares purchased [removed: will be] [added: were] retired. [removed: This plan has no time deadline and will continue until otherwise modified or terminated by our Board at any time in our sole discretion.] |

| | | (in [removed: thousands] [added: thousands,] except exercise price) | | | | | | | | |

| 2001 Plan (1) | | [removed: 346] [added: 79] | | | $ | [removed: 29.97] [added: 34.56] | | | — | |

(2)Included in the number of securities in column (a) is [removed: 277,153] [added: 291,215] restricted stock units, which have no exercise price.

The weighted average exercise price of outstanding options, warrants, and rights (excluding restricted stock units) is [removed: $90.15.][added: $94.15.]

| Quarter ended December 31, 2016 | | $ | 116.27 | | $ | 95.66 |

| Quarter ended September 30, 2016 | | $ | 118.57 | | $ | 107.36 |

| Quarter ended June 30, 2016 | | $ | 108.30 | | $ | 96.68 |

| Quarter ended March 31, 2016 | | $ | 107.44 | | $ | 82.80 |

We have never paid a dividend on any class of common stock.

As a REIT, we are required to distribute annually at least 90% of our REIT taxable income after the utilization of any available NOLs (determined before the deduction for dividends paid and excluding any net capital gain).

As of December 31, 2016, $1.1 billion of the federal NOLs are attributes of the REIT.

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 our NOLs have been fully utilized.

The amount of future distributions will be determined, from time to time, by the board of directors to balance our goal of increasing long-term shareholder value and retaining sufficient cash to implement our current capital allocation policy, which prioritizes investment in quality assets that meet our return criteria, and then stock repurchases when we believe our stock price is below its intrinsic value.

The actual amount, timing and frequency of future dividends, will be at the sole discretion of the board of directors and will be declared based upon various factors, many of which are beyond our control.

| 10/1/2016 - 10/31/2016 | | 230,900 | | $ | 108.76 | | 230,900 | | $ | 472,577,444 |

| 11/1/2016 - 11/30/2016 | | 2,095,174 | | $ | 103.64 | | 2,095,174 | | $ | 255,425,700 |

| 12/1/2016 - 12/31/2016 | | 1,004,723 | | $ | 100.53 | | 1,004,723 | | $ | 154,421,950 |

| Total | | 3,330,797 | | $ | 103.06 | | 3,330,797 | | $ | 154,421,950 |

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 purchased 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.

| | | As of December 31, 2016 | | | | | | | | |

| 2010 Plan | | 4,659 | (2) | | $ | 88.26 | | | 8,804 | |

| Total | | 4,738 | | | $ | 87.37 | | | 8,804 | |

| Quarter ended December 31, 2014 | | $ | 122.79 | | $ | 103.83 |

| Quarter ended September 30, 2014 | | $ | 114.37 | | $ | 99.70 |

| Quarter ended June 30, 2014 | | $ | 102.57 | | $ | 87.03 |

| Quarter ended March 31, 2014 | | $ | 99.64 | | $ | 87.29 |

We have never paid a dividend on any class of common stock and anticipate that we will retain future earnings, if any, to fund the development and growth of our business.

Consequently, we do not anticipate paying cash dividends on our Class A common stock in the foreseeable future.

In addition, our ability to pay dividends is limited by the terms of our debt instruments.

| 10/1/2015 - 10/31/2015 | | — | | $ | — | | — | | $ | 750,002,750 |

| 11/1/2015 - 11/30/2015 | | 184,215 | | $ | 103.86 | | 184,215 | | $ | 730,869,600 |

| 12/1/2015 - 12/31/2015 | | 297,781 | | $ | 103.66 | | 297,781 | | $ | 700,002,810 |

| Total | | 481,996 | | $ | 103.74 | | 481,996 | | $ | 700,002,810 |

| 2010 Plan | | 3,724 | (2) | | $ | 83.45 | | | 10,188 | |

| Total | | 4,070 | | | $ | 78.90 | | | 10,188 | |

The following table sets forth selected historical financial data as of and for each of the five years in the period ended December 31, [removed: 2015.][added: 2016.]

The financial data for the fiscal years ended [added: 2016,] 2015, 2014, 2013, [removed: 2012,] and [removed: 2011] [added: 2012] have been derived from our audited consolidated financial statements.

| | | [added: 2016 | | |] 2015 | | | 2014 | | | 2013 | | | 2012 | | [removed: | 2011 | |]

| Site leasing | | $ | [removed: 1,480,634] [added: 1,538,070] | | $ | [removed: 1,360,202] [added: 1,480,634] | | $ | [removed: 1,133,013] [added: 1,360,202] | | $ | [removed: 846,094] [added: 1,133,013] | | $ | [removed: 616,294] [added: 846,094] |

| Site development | | | [added: 95,055 | | |] 157,840 | | | 166,794 | | | 171,853 | | | 107,990 | [removed: | | 81,876 |]

| Total revenues | | | [added: 1,633,125 | | |] 1,638,474 | | | 1,526,996 | | | 1,304,866 | | | 954,084 | [removed: | | 698,170 |]

| Cost of site leasing | | | [added: 342,215 | | |] 324,655 | | | 301,313 | | | 270,772 | | | 188,951 | [removed: | | 131,916 |]

| Cost of site development | | | [added: 78,682 | | |] 119,744 | | | 127,172 | | | 137,481 | | | 90,556 | [removed: | | 71,005 |]

| Selling, general, and administrative | | | [added: 143,349 | | |] 114,951 | | | 103,317 | | | 85,476 | | | 72,148 | [removed: | | 62,828 |]

| Acquisition related adjustments and expenses | | | [added: 13,140 | | |] 11,864 | | | 7,798 | | | 19,198 | | | 40,433 | [removed: | | 7,144 |]

| Asset impairment and decommission costs | | | [added: 30,242 | | |] 94,783 | | | 23,801 | | | 28,960 | | | 6,383 | [removed: | | 5,472 |]

| Depreciation, accretion, and amortization | | | [added: 638,189 | | |] 660,021 | | | 627,072 | | | 533,334 | | | 408,467 | [removed: | | 309,146 |]

| Total operating expenses | | | [added: 1,245,817 | | |] 1,326,018 | | | 1,190,473 | | | 1,075,221 | | | 806,938 | [removed: | | 587,511 |]

| Operating income | | | [added: 387,308 | | |] 312,456 | | | 336,523 | | | 229,645 | | | 147,146 | [removed: | | 110,659 |]

| Interest income | | | [added: 10,928 | | |] 3,894 | | | 677 | | | 1,794 | | | 1,128 | [removed: | | 136 |]

| Interest expense | | | [added: (329,171) | | |] (322,366) | | | (292,600) | | | (249,051) | | | (196,241) | [removed: | | (160,896) |]

| Non-cash interest expense | | | [added: (2,203) | | |] (1,505) | | | (27,112) | | | (49,085) | | | (70,110) | [removed: | | (63,629) |]

| Amortization of deferred financing fees | | | [added: (21,136) | | |] (19,154) | | | (17,572) | | | (15,560) | | | (12,870) | [removed: | | (9,188) |]

| Loss from extinguishment of debt, net | | | [added: (52,701) | | |] (783) | | | (26,204) | | | (6,099) | | | (51,799) | [removed: | | (1,696) |]

| Other income (expense) | | | [added: 94,278 | | |] (139,137) | | | 10,628 | | | 31,138 | | | 5,654 | [removed: | | (165) |]

| Total other expense | | | [added: (300,005) | | |] (479,051) | | | (352,183) | | | (286,863) | | | (324,238) | [removed: | | (235,438) |]

| [removed: Loss] [added: Income (loss)] before provision for income taxes | | | [added: 87,303 | | |] (166,595) | | | (15,660) | | | (57,218) | | | (177,092) | [removed: | | (124,779) |]

| (Provision) benefit for income taxes | | | [added: (11,065) | | |] (9,061) | | | (8,635) | | | 1,309 | | | (6,594) | [removed: | | (2,113) |]

| Net [removed: loss] [added: income (loss)] from continuing operations | | | [added: 76,238 | | |] (175,656) | | | (24,295) | | | (55,909) | | | (183,686) | [removed: | | (126,892) |]

| Income from discontinued operations, net of income taxes | | | — | | | — | | | — | | | [removed: 2,296] [added: —] | | | [removed: —] [added: 2,296] |

| Net [removed: loss] [added: income (loss)] | | | [added: 76,238 | | |] (175,656) | | | (24,295) | | | (55,909) | | | (181,390) | [removed: | | (126,892) |]

| Net income attributable to the [added: noncontrolling interest] | | | [added: —] | | | [added: —] | | | [added: —] | | | [added: —] | | | [added: 353] |

| Net [removed: loss] [added: income (loss)] attributable to SBA [removed: Communications Corporation] [added: Commun. Corp.] | | $ | [removed: (175,656)] [added: 76,238] | | $ | [removed: (24,295)] [added: (175,656)] | | $ | [removed: (55,909)] [added: (24,295)] | | $ | [removed: (181,037)] [added: (55,909)] | | $ | [removed: (126,456)] [added: (181,037)] |

| Basic [removed: and diluted] [added: net income (loss)] per common [removed: share amounts:] [added: share:] | | | | | | | | | | | | | | | |

| [removed: Loss from continuing] [added: Continuing] operations | | $ | [removed: (1.37)] [added: 0.61] | | $ | [removed: (0.19)] [added: (1.37)] | | $ | [removed: (0.44)] [added: (0.19)] | | $ | [removed: (1.53)] [added: (0.44)] | | $ | [removed: (1.14)] [added: (1.53)] |

| [removed: Income from discontinued] [added: Discontinued] operations | | | — | | | — | | | — | | | [removed: 0.02] [added: —] | | | [removed: —] [added: 0.02] |

| [removed: Net loss] [added: Basic net income (loss)] per common share | | $ | [removed: (1.37)] [added: 0.61] | | $ | [removed: (0.19)] [added: (1.37)] | | $ | [removed: (0.44)] [added: (0.19)] | | $ | [removed: (1.51)] [added: (0.44)] | | $ | [removed: (1.14)] [added: (1.51)] |

| Basic [removed: and diluted weighted avg. number of common shares] | | | [added: 124,448 | | |] 127,794 | | | 128,919 | | | 127,769 | | | 120,280 | [removed: | | 111,595 |]

| Cash and cash equivalents | | $ | [removed: 118,039] [added: 146,109] | | $ | [removed: 39,443] [added: 118,039] | | $ | [removed: 122,112] [added: 39,443] | | $ | [removed: 233,099] [added: 122,112] | | $ | [removed: 47,316] [added: 233,099] |

| Restricted cash - current | | | [added: 36,786 | | |] 25,353 | | | 52,519 | | | 47,305 | | | 27,708 | [removed: | | 22,266 |]

| Short-term investments | | | [added: 223 | | |] 706 | | | 5,549 | | | 5,446 | | | 5,471 | [removed: | | 5,773 |]

| Property and equipment, net | | | [added: 2,792,076 | | |] 2,782,353 | | | 2,762,417 | | | 2,578,444 | | | 2,671,317 | [removed: | | 1,583,393 |]

| Intangibles, net | | | [added: 3,656,924 | | |] 3,735,413 | | | 4,189,540 | | | 3,387,198 | | | 3,134,133 | [removed: | | 1,639,784 |]

| Total shareholders' (deficit) equity | | | [removed: (1,706,144)] [added: (1,995,921)] | | | [removed: (660,800)] [added: (1,706,144)] | | | [removed: 356,966] [added: (660,801)] | | | [removed: 652,991] [added: 356,966] | | | [removed: (11,313)] [added: 652,991] |

| Diluted net income (loss) per common share: | | | | | | | | | | | | | | | |

| Continuing operations | | $ | 0.61 | | $ | (1.37) | | $ | (0.19) | | $ | (0.44) | | $ | (1.53) |

| Discontinued operations | | | — | | | — | | | — | | | — | | | 0.02 |

| Diluted net income (loss) per common share | | $ | 0.61 | | $ | (1.37) | | $ | (0.19) | | $ | (0.44) | | $ | (1.51) |

| Weighted average common shares outstanding: | | | | | | | | | | | | | | | |

| Diluted | | | 125,144 | | | 127,794 | | | 128,919 | | | 127,769 | | | 120,280 |

| | | 2016 | | | 2015 | | | 2014 | | | 2013 | | | 2012 | |

| Total assets (1) | | | 7,360,945 | | | 7,312,980 | | | 7,748,635 | | | 6,714,025 | | | 6,554,506 |

| Total debt (1) | | | 8,775,583 | | | 8,452,070 | | | 7,768,309 | | | 5,807,444 | | | 5,294,698 |

| | | 2016 | | | 2015 | | | 2014 | | | 2013 | | | 2012 | |

| Operating activities (2) | | $ | 742,525 | | $ | 723,030 | | $ | 674,340 | | $ | 509,852 | | $ | 343,190 |

| Investing activities (2) | | | (428,235) | | | (737,065) | | | (1,764,127) | | | (820,197) | | | (2,268,628) |

| Financing activities (2) | | | (288,557) | | | 75,751 | | | 995,298 | | | 218,170 | | | 2,113,650 |

(1) During the first quarter of 2016, we adopted an accounting standard update on the presentation of debt issuance costs.

The new standard requires debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability on the consolidated balance sheets.

The December 31, 2015, 2014, 2013, and 2012 consolidated balance sheet were retrospectively adjusted to reflect this change.

(2) During the fourth quarter of 2016, we adopted an accounting standard update on the presentation of cash and cash equivalents in the Statement of Cash Flows.

The new standard requires cash and cash equivalent balances to include restricted cash equivalents.

The December 31, 2015, 2014, 2013, and 2012 consolidated statements of cash flows were retrospectively adjusted to reflect this change.

| noncontrolling interest | | | — | | | — | | | — | | | 353 | | | 436 |

| Total assets | | | 7,403,215 | | | 7,841,125 | | | 6,783,188 | | | 6,615,911 | | | 3,606,399 |

| Total debt | | | 8,542,305 | | | 7,860,799 | | | 5,876,607 | | | 5,356,103 | | | 3,354,485 |

| Operating activities | | $ | 737,173 | | $ | 671,643 | | $ | 497,587 | | $ | 340,914 | | $ | 249,058 |

| Investing activities | | | (734,521) | | | (1,760,127) | | | (817,198) | | | (2,269,120) | | | (503,273) |

| Financing activities | | | 88,937 | | | 991,838 | | | 210,837 | | | 2,110,481 | | | 237,432 |

Financial statements and supplementary data are on pages F-1 through [removed: F-38.][added: F-40.]

In connection with the preparation of this Annual Report on Form 10-K, as of December 31, [removed: 2015,] [added: 2016,] an evaluation was performed under the supervision and with the participation of our management, including the CEO and CFO, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act).

Based on such evaluation, our CEO and CFO concluded that, as of December 31, [removed: 2015,] [added: 2016,] our disclosure controls and procedures were effective.

There has been no change in our internal control over financial reporting during the quarter ended December 31, [removed: 2015] [added: 2016] that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Management’s Annual Report on Internal Control over Financial Reporting – Management is responsible for establishing and maintaining adequate internal control over financial reporting, and for performing an assessment of the effectiveness of internal control over financial reporting as of December 31, [removed: 2015.][added: 2016.]

[added: Our system of internal control over financial reporting includes those] policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of SBAC; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of SBAC are being made only in accordance with authorizations of management and directors of SBAC; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of SBAC’s assets that could have a material effect on the financial statements.

Management performed an assessment of the effectiveness of SBAC’s internal control over financial reporting as of December 31, [removed: 2015] [added: 2016] based upon criteria in Internal Control – Integrated Framework (2013 Framework) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on our assessment, management determined that SBAC’s internal control over financial reporting was effective as of December 31, [removed: 2015] [added: 2016] based on the criteria in Internal Control – Integrated Framework (2013 Framework) issued by COSO.

We have audited SBA Communications Corporation and Subsidiaries’ internal control over financial reporting as of December 31, [removed: 2015,] [added: 2016,] based on criteria established in Internal Control [removed: –] Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, SBA Communications Corporation and Subsidiaries maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2015,] [added: 2016,] based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of SBA Communications Corporation and Subsidiaries as of December 31, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015] and the related consolidated statements of operations, comprehensive [removed: loss,] [added: income (loss),] shareholders’ equity (deficit) and cash flows for each of the three years in the period ended December 31, [removed: 2015] [added: 2016] of SBA Communications Corporation and Subsidiaries and our report dated [removed: February 26, 2016] [added: March 1, 2017] expressed an unqualified opinion thereon.

March 1, 2017

Our system of internal control over financial reporting includes those

February 26, 2016

[removed: On December 7, 2015, we entered into amended] [added: Stoops, our President] and [removed: restated employment agreements with each of] [added: Chief Executive Officer,] Brendan Cavanagh, Executive Vice President and Chief Financial Officer, Thomas P.

The [removed: prior] employment agreements [removed: with each of] [added: for] Messrs.

Cavanagh, [removed: Hunt] [added: Hunt,] and [removed: Bagwell] [added: Bagwell, dated December 7, 2015 and expiring on December 31, 2018, provide for each] to continue to serve in their present [removed: positions, became effective on December 31, 2015 and expire on December 31, 2018.][added: positions.]

Item 1.01 Entry into a Material Definitive Agreement.

Repricing Amendment

On January 20, 2017, SBA Senior Finance II, our wholly-owned subsidiary, entered into the Seventh Amendment (the “Amendment”), among SBA Senior Finance II, as borrower, the lenders parties thereto, and Toronto Dominion (Texas) LLC, as administrative agent, to the Senior Credit Agreement.

The Amendment reduced the interest rate margins applicable to senior secured term loans.

As amended, the senior secured term loans under the Senior Credit Agreement 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).

All other material terms of the Senior Credit Agreement, as amended, remained unchanged.

Relationships

SBAC and certain of its affiliates have previously entered into commercial financial arrangements with each of the lenders under the Senior Credit Agreement and/or their respective affiliates, and each of these entities and/or its affiliates has in the past provided financial, advisory, investment banking and other services to SBAC and its affiliates, including (1) serving as a lender and/or in other related capacities in connection with the Senior Credit Agreement and the various term loans and the revolving credit facility under the Senior Credit Agreement and (2) as a book runner and/or an initial purchaser for our various series of Secured Tower Revenue Securities.

In addition, each of J.P. Morgan Securities LLC, Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., TD Securities (USA) LLC, and Wells Fargo Securities, LLC served as a book runner and/or an initial purchaser for our 4.875% Senior Notes due 2024, 4.875% Senior Notes due 2022, 5.75% Senior Notes due 2020, and 5.625% Senior Notes due 2019, and Mizuho Bank, Ltd. was an initial purchaser of our 4.875% Senior Notes due 2024.

On January 13, 2017, we entered into an Assignment and Assumption of Employment Agreement with each of Jeffrey A.

The employment agreement for Jeffrey A.

Stoops, dated October 30, 2014 and expiring on December 31, 2017, provides for him to continue to serve in his present position.

Cavanagh, Hunt and Bagwell were set to expire by their terms on December 31, 2015.

The amended and restated employment agreements, which provide for each of Messrs.

The remaining items required by Part III, Item 10 are incorporated herein by reference from the Registrant’s Proxy Statement for its [removed: 2016] [added: 2017] Annual Meeting of Shareholders to be filed on or before April 29, [removed: 2016.][added: 2017.]

The items required by Part III, Item 11 are incorporated herein by reference from the Registrant’s Proxy Statement for its [removed: 2016] [added: 2017] Annual Meeting of Shareholders to be filed on or before April 29, [removed: 2016.][added: 2017.]

The items required by Part III, Item 12 are incorporated herein by reference from the Registrant’s Proxy Statement for its [removed: 2016] [added: 2017] Annual Meeting of Shareholders to be filed on or before April 29, [removed: 2016.][added: 2017.]

The items required by Part III, Item 13 are incorporated herein by reference from the Registrant’s Proxy Statement for its [removed: 2016] [added: 2017] Annual Meeting of Shareholders to be filed on or before April 29, [removed: 2016.][added: 2017.]

The items required by Part III, Item 14 are incorporated herein by reference from the Registrant’s Proxy Statement for its [removed: 2016] [added: 2017] Annual Meeting of Shareholders to be filed on or before April 29, [removed: 2016.][added: 2017.]

[added: | |] (3) [added: | |] Exhibits [added: |]

| [removed: 3.4] [added: 3.1] | | [removed: Fourth] Amended and Restated Articles of [removed: Incorporation, as Amended,] [added: Incorporation] of SBA Communications [removed: Corporation.] [added: Corporation, effective as of January 13, 2017.] | | [removed: S-4 (333-166966)] [added: 8-K] | | [removed: 05/19/10] [added: 01/17/17] |

| [removed: 3.6] [added: 3.3] | | [added: Second] Amended and Restated Bylaws of SBA Communications Corporation, effective as of [removed: July 28, 2015.] [added: January 14, 2017.] | | 8-K | | [removed: 07/31/15] [added: 01/18/17] |

| 10.57D | | Amended and Restated Employment Agreement, dated as of December 7, 2015, between SBA Communications Corporation and Kurt L. [removed: Bagwell.†*] [added: Bagwell.†] | | [added: 10-K] | | [added: Year ended December 31, 2015] |

| 10.58D | | Amended and Restated Employment Agreement, dated as of December 7, 2015, between SBA Communications Corporation and Thomas P. [removed: Hunt.†*] [added: Hunt.†] | | [added: 10-K] | | [added: Year ended December 31, 2015] |

| 10.85C | | Amended and Restated Employment Agreement, dated as of December 7, 2015, between SBA Communications Corporation and Brendan T. [removed: Cavanagh.†*] [added: Cavanagh.†] | | [added: 10-K] | | [added: Year ended December 31, 2015] |

| [removed: 10.96] [added: 10.14] | | Purchase Agreement, dated [removed: July 10, 2012, among] [added: August 1, 2016, between] SBA Communications [removed: Corporation, SBA Telecommunications,] [added: Corporation and Deutsche Bank Securities] Inc. and J.P. Morgan Securities LLC, as [removed: representative] [added: representatives] of the several initial purchasers listed on Schedule 1 thereto. | | 8-K | | [removed: 07/16/12] [added: 08/02/2016] |

| [removed: 10.97] [added: 10.15] | | Registration Rights Agreement, dated [removed: July 13, 2012,] [added: August 15, 2016,] among SBA Communications [removed: Corporation, SBA Telecommunications, Inc.] [added: Corporation] and [removed: J.P. Morgan Securities LLC, as representative of] the several initial purchasers listed on Schedule [removed: 2] [added: I] thereto. | | 8-K | | [removed: 07/16/12] [added: 08/16/16] |

| 32.1 | | Certification by Jeffrey A. Stoops, Chief Executive Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002.*] [added: 2002.] | | | | |

| 32.2 | | Certification by Brendan T. Cavanagh, Chief Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002.*] [added: 2002.] | | | | |

| 101.INS | | XBRL Instance [removed: Document.] [added: Document.*] | | | | |

| 101.SCH | | XBRL Taxonomy Extension Schema [removed: Document.] [added: Document.*] | | | | |

| 101.DEF | | XBRL Taxonomy Extension Definition Linkbase [removed: Document.] [added: Document.*] | | | | |

| 101.CAL | | XBRL Taxonomy Extension Calculation Linkbase [removed: Document.] [added: Document.*] | | | | |

| 101.LAB | | XBRL Taxonomy Extension Label Linkbase [removed: Document.] [added: Document.*] | | | | |

| 101.PRE | | XBRL Taxonomy Extension Presentation Linkbase [removed: Document.] [added: Document.*] | | | | |

| 2.1 | | Agreement and Plan of Merger, by and between SBA Communications Corporation and SBA Communications REIT Corporation, dated November 10, 2016. | | 8-K | | 01/17/17 |

| 3.2 | | Articles of Merger, effective as of January 13, 2017. | | 8-K | | 01/17/17 |

| 4.24A | | Supplemental Indenture, dated as of January 13, 2017, between SBA Communications Corporation and U.S. Bank National Association, to the Indenture dated as of July 1, 2014, between SBA Communications Corporation and U.S. Bank National Association. | | 8-K | | 01/17/17 |

| 4.26 | | Indenture, dated August 15, 2016, between SBA Communications Corporation and U.S. Bank National Association. | | 8-K | | 08/16/16 |

| 4.26A | | Supplemental Indenture, dated as of January 13, 2017, between SBA Communications Corporation and U.S. Bank National Association, to the Indenture dated as of August 15, 2016, between SBA Communications Corporation and U.S. Bank National Association. | | 8-K | | 01/17/17 |

| 4.27 | | Form of 4.875% Senior Notes due 2024 (included in Exhibit 4.26). | | 8-K | | 08/16/16 |

| 10.7A | | Seventh Amendment, dated as of January 20, 2017, among SBA Senior Finance II LLC, as borrower, the lenders parties thereto, and Toronto Dominion (Texas) LLC, as administrative agent.* | | | | |

| 10.12B | | Second Loan and Security Agreement Supplement, dated as of July 7, 2016, by and among the Borrowers named therein and Midland Loan Services, a division of PNC Bank, National Association, as Servicer on behalf of Deutsche Bank Trust Company Americas, as Trustee. | | 8-K | | 07/08/2016 |

| 10.13 | | Purchase Agreement, dated June 21, 2016, among SBA Senior Finance, LLC, Deutsche Bank Trust Company Americas, as trustee, and the several initial purchasers listed on Schedule I thereto. | | 8-K | | 06/24/2016 |

| | | | | | | |

| --- | --- | --- | --- | --- | --- | --- |

| 10.98 | | Purchase Agreement, dated September 20, 2012, between SBA Communications Corporation and J.P. Morgan Securities LLC, as representative of the several initial purchasers listed on Schedule 1 thereto. | | 8-K | | 09/26/12 |

| 10.99 | | Registration Rights Agreement, dated September 28, 2012, between SBA Communications Corporation and J.P. Morgan Securities LLC, as representative of the several initial purchasers listed on Schedule 2 thereto. | | 8-K | | 09/28/12 |

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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 | |

| By: | /s/ Jeffrey A. Stoops |

| | Jeffrey A. Stoops Chief Executive Officer and President |

| Date: | February 26, 2016 |

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

| | | |

| --- | --- | --- |

| Signature | Title | Date |

| /s/ Steven E. Bernstein | Chairman of the Board of Directors | February 26, 2016 |

| Steven E. Bernstein | | |

| /s/ Jeffrey A. Stoops | Chief Executive Officer and President | February 26, 2016 |

| Jeffrey A. Stoops | (Principal Executive Officer) | |

| /s/ Brendan T. Cavanagh | Chief Financial Officer and Executive Vice President | February 26, 2016 |

| Brendan T. Cavanagh | (Principal Financial Officer) | |

| /s/ Brian D. Lazarus | Chief Accounting Officer and Senior Vice President | February 26, 2016 |

| Brian D. Lazarus | (Principal Accounting Officer) | |

| /s/ Brian C. Carr | Director | February 26, 2016 |

| Brian C. Carr | | |

| /s/ Mary S. Chan | Director | February 26, 2016 |

| Mary S. Chan | | |

| /s/ Duncan H. Cocroft | Director | February 26, 2016 |

| Duncan H. Cocroft | | |

| /s/ George R. Krouse Jr. | Director | February 26, 2016 |

| George R. Krouse Jr. | | |

| /s/ Jack Langer | Director | February 26, 2016 |

| Jack Langer | | |

| /s/ Kevin L. Beebe | Director | February 26, 2016 |

| Kevin L. Beebe | | |

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

Table of Contents

| | Page |

None.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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 | |

| | |

| By: | /s/ Jeffrey A. Stoops |

| | |

| | Jeffrey A. Stoops Chief Executive Officer and President |

| | |

| Date: | March 1, 2017 |

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

| | | |

| --- | --- | --- |

| Signature | Title | Date |

| | | |

| /s/ Steven E. Bernstein | Chairman of the Board of Directors | March 1, 2017 |

| Steven E. Bernstein | | |

| | | |

| /s/ Jeffrey A. Stoops | Chief Executive Officer and President | March 1, 2017 |

| Jeffrey A. Stoops | (Principal Executive Officer) | |

| | | |

| /s/ Brendan T. Cavanagh | Chief Financial Officer and Executive Vice President | March 1, 2017 |

| Brendan T. Cavanagh | (Principal Financial Officer) | |

| | | |

| /s/ Brian D. Lazarus | Chief Accounting Officer and Senior Vice President | March 1, 2017 |

| Brian D. Lazarus | (Principal Accounting Officer) | |

| | | |

| /s/ Brian C. Carr | Director | March 1, 2017 |

| Brian C. Carr | | |

| | | |

| /s/ Mary S. Chan | Director | March 1, 2017 |

| Mary S. Chan | | |

| | | |

| /s/ Duncan H. Cocroft | Director | March 1, 2017 |

| Duncan H. Cocroft | | |

| | | |

| | | |