UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 11-K
[x] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2002
or
[_] TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________ to ______________.
Commission file number 000-24737
CROWN CASTLE INTERNATIONAL CORP. 401(K) PLAN
(Full title of the Plan and address of the Plan,
if different from that of the issuer named below)
CROWN CASTLE INTERNATIONAL CORP.
----------------------
510 Bering Drive, Suite 500
Houston, Texas 77057-1457
-----------------------
(Name of issuer of the securities held pursuant to the
plan and the address of principal executive office)
CROWN CASTLE INTERNATIONAL CORP.
401(k) Plan
Table of Contents
Page
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Independent Auditors' Report 1
Statements of Net Assets Available for Plan Benefits as of December 31, 2002 and 2001 2
Statements of Changes in Net Assets Available for Plan Benefits for the Years Ended December 31, 2002 and 2001 3
Notes to Financial Statements 4
Schedule 1
Schedule H, Line 4i - Schedule of Assets (Held at End of Year) 9
Note: All other schedules required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974 (ERISA), have been omitted because there is no information to report.
Signature 10
Exhibits
23.1 Consent of KPMG LLP, Independent Auditors
99.1 Certification pursuant to Section 906 of Sarbanes-Oxley Act of 2002
Independent Auditors' Report
To the Plan Administrator for the
Crown Castle International Corp.
401(k) Plan:
We have audited the accompanying statements of net assets available for Plan
benefits of the Crown Castle International Corp. 401(k) Plan as of December 31,
2002 and 2001, and the related statements of changes in net assets available for
plan benefits for the years then ended. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the Plan at
December 31, 2002 and 2001, and the changes in its net assets available for plan
benefits for the years then ended, in conformity with accounting principles
generally accepted in the United States of America.
Our audits were made for the purpose of formulating an opinion on the financial
statements taken as a whole. The supplemental schedule included as Schedule 1 is
presented for purposes of additional analysis and is not a required part of the
basic financial statements but is supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplemental schedule
is the responsibility of the Plan's management. The supplemental schedule has
been subjected to the auditing procedures applied in our audits of the financial
statements and, in our opinion, is fairly stated in all material respects in
relation to the financial statements taken as a whole.
/s/ KPMG LLP
Pittsburgh, Pennsylvania
June 20, 2003
CROWN CASTLE INTERNATIONAL CORP.
401(k) PLAN
Statements of Net Assets Available for Plan Benefits
December 31, 2002 and 2001
Assets 2002 2001
----------- ----------
Interest bearing cash $ 19,048 $ 41,175
Investments (note 3):
Registered investment companies 12,575,433 10,109,622
Common stock 505,957 594,720
Participant loans 218,484 234,449
----------- -----------
Total investments 13,299,874 10,938,791
Receivables:
Participant contributions -- 120,023
Sponsor contributions 1,068,216 1,120,881
----------- -----------
Total receivables 1,068,216 1,240,904
----------- -----------
Net assets available for plan benefits $14,387,138 $12,220,870
=========== ===========
See accompanying notes to financial statements.
2
CROWN CASTLE INTERNATIONAL CORP.
401(k) PLAN
Statements of Changes in Net Assets Available for Plan Benefits
Years ended December 31, 2002 and 2001
2002 2001
------------ ----------
Additions:
Additions to net assets attributed to:
Investment income:
Net realized gain (loss) and unrealized appreciation
(depreciation) on investments (note 3) $(2,690,988) $(2,732,265)
Dividends and interest 93,017 108,881
Other income -- 1,297
Contributions:
Participant 3,872,979 3,922,106
Sponsor 2,516,889 2,453,190
Rollovers 441,650 493,713
----------- -----------
Total additions 4,233,547 4,246,922
Deductions:
Deductions from net assets attributed to:
Benefits paid to participants 2,005,162 1,690,482
Other expenses 62,117 31,464
------------ -----------
Total deductions 2,067,279 1,721,946
----------- -----------
Net increase 2,166,268 2,524,976
Net assets available for benefits:
Beginning of year 12,220,870 9,695,894
----------- -----------
End of year $14,387,138 $12,220,870
=========== ===========
See accompanying notes to financial statements.
3
CROWN CASTLE INTERNATIONAL CORP.
401(k) PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(1) Plan Description
The following description of the Crown Castle International Corp. 401(k)
Plan (the Plan) provides only general information. Participants should
refer to the Plan Agreement for more complete information.
(a) General
The Plan is a defined contribution plan available to eligible
employees of Crown Castle International Corp. (the Company). As of
December 31, 2002, PNC Bank, N.A. was the trustee of the Plan, and
served as both the custodian and the recordkeeper (see Note 7). The
Plan was established on May 1, 1999. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974
(ERISA) and is administered by a plan administrator appointed by the
Company.
(b) Contributions
For the plan year ended December 31, 2001, eligible employees
(participants) could elect to contribute from 1% to 15% of their
biweekly compensation as a salary reduction contribution on a
before-tax basis. For the plan year ended December 31, 2002,
participants may contribute any percentage that allows the participant
to reach the section 401(k) pre-tax contribution limit of $11,000 for
participants under age 50. Participants who are age 50 and older can
contribute an additional $1,000 for a total of $12,000. These salary
reduction contributions are fully vested at all times. Participants
may also contribute amounts representing distributions from other
qualified plans. Participants direct the investment of their
contributions into various investment options offered by the Plan. The
Plan offers fifteen mutual funds and Crown Castle International Corp.
Common Stock as of December 31, 2002. The Company matches and
contributes 100% of the first 3% of compensation that a participant
contributes to the Plan. Additional discretionary amounts may be
contributed at the option of the Company's board of directors.
Contributions are subject to certain limitations.
(c) Participant Accounts
Participant accounts are maintained at fair market value. Each
participant's account is credited with the participant's contribution
and allocations of (a) the Company's matching contribution and (b)
Plan earnings and losses. The benefit to which a participant is
entitled is the benefit that can be provided from the participant's
vested account.
(d) Vesting
Participants are vested immediately in their contributions plus actual
earnings thereon. Vesting in the Company's contribution portion of
their accounts is based on years of continuous service. A participant
is 100% vested after three years of credited service.
(e) Participant Loans
Participants are permitted to borrow from their fund accounts a
minimum of $1,000 up to a maximum of 50% of vested balance or $50,000,
whichever is less. The loans are secured by the balance in the
participant's account and bear interest at a fixed rate of prime + 1%.
All loans are
(Continued)
4
CROWN CASTLE INTERNATIONAL CORP.
401(k) PLAN
Notes to Financial Statements
December 31, 2002 and 2001
subject to specific repayment terms and must be repaid within a
five-year period. Each participant is granted one loan at a time.
(f) Payment of Benefits
Participants are permitted to withdraw any portion of their vested
account balance due to death, permanent disability, retirement,
attainment of age 59-1/2, in the event of financial hardship or
termination of service. The participant may elect to receive a
lump-sum payment, subject to federal income tax withholdings, or
rollover the vested account balance to another qualified plan. These
withdrawals, prior to retirement, may result in certain suspensions of
future participation in the plan.
(g) Forfeitures
Company contributions and earnings thereon that have not become
vested, and have been forfeited by the withdrawal of participants'
savings in accordance with the applicable provisions of the Plan, are
applied against administrative expenses of the Plan. Excess
forfeitures are applied to reduce the Company's contributions required
under the Plan. Amounts forfeited were $228,123 in 2002.
(h) Termination of Plan
In the event of termination of the Plan, the plan administrator will
continue to function during such period as is necessary to make
remaining normal distributions and to administer and distribute the
residual interests of the participants.
(2) Summary of Significant Accounting Policies
(a) Basis of Financial Statements
The accompanying financial statements have been prepared on the
accrual basis. The preparation of the financial statements in
conformity with accounting principles generally accepted in the United
States of America requires the plan administrator to make estimates
and assumptions that affect the amounts reported in the financial
statements and notes thereto. Actual results could differ from those
estimates.
(b) Investment Income
Interest income from investments is recorded on an accrual basis.
Dividend income is recorded on the ex-dividend date.
(c) Investments
Investments in common stock traded on securities exchanges and
investment companies are valued at their last reported sales price on
the last business day of the Plan year. Investments in collective
trust funds are valued at the net asset value of the respective funds
on the last day of the Plan year.
Investment transactions are accounted for on a trade-date basis.
In accordance with the policy of stating investments at fair value,
changes in unrealized appreciation or depreciation are reflected in
the statements of changes in net assets available for plan benefits.
(Continued)
5
CROWN CASTLE INTERNATIONAL CORP.
401(k) PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(d) Contributions
Participant contributions are recorded on a biweekly basis as they are
withheld from the participant's wages.
(e) Distributions to Participants
Distributions to participants are recorded when applications for
withdrawals are processed by the recordkeeper.
(f) Expenses
The Company pays for all Plan administrative expenses.
(3) Investment Programs
PNC Bank, N.A. acted as custodian of the Plan assets as of December 31,
2002. The funds listed below were the investment options for salary
reduction contributions as of December 31, 2002. Any of these funds may be
invested in short-term debt obligations of any nature or held in cash
pending investment or distribution. The assets that comprise these funds
may be invested in registered investment companies or collective trust
funds.
o BlackRock Money Market Portfolio o American Century International Growth Fund
o Fidelity Advisor Government Investment Fund o American Century Equity Growth Fund
o Janus Advisor Flexible Income Fund o INVESCO Blue Chip Growth Fund
o Fidelity Advisor Growth & Income Fund o Janus Advisor Growth & Income Fund
o American Century Income & Growth Fund o Fidelity Advisory Mid-Cap Fund
o Fidelity Advisor Growth Opportunities Fund o Crown Castle International Corp. Common Stock
o Janus Advisor Worldwide Fund o American Balanced Fund
o Federated Max Capital Index Fund o Janus Advisor Capital Appreciation Fund
The following presents investments that represent 5% or more of the Plan's
assets:
December 31
--------------------------------
2002 2001
--------------------------------
BlackRock Money Market Portfolio $1,258,063 $ 948,513
INVESCO Blue Chip Growth Fund -- 766,014
Janus Advisor Capital Appreciation Fund 2,626,109 2,219,867
Janus Advisor Growth & Income Fund 1,334,494 1,176,623
Janus Advisor Worldwide Fund 880,443 835,429
Fidelity Advisor Mid-Cap Fund 1,313,548 1,038,783
American Balanced Fund 843,650 --
(Continued)
6
CROWN CASTLE INTERNATIONAL CORP.
401(k) PLAN
Notes to Financial Statements
December 31, 2002 and 2001
During 2002 and 2001, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) depreciated
in value by $(2,690,988) and $(2,732,265), respectively, as follows:
2002 2001
----------- ----------
Mutual funds $(2,276,688) $(2,107,440)
Common stock (414,300) (624,825)
----------- -----------
$(2,690,988) $(2,732,265)
=========== ===========
(4) Nonparticipant-Directed Investments
Information about the net assets and the significant components of the
changes in net assets relating to the nonparticipant-directed investments
is as follows:
December 31
----------------------------------
2002 2001
--------- ----------
Net assets:
Common stock $505,957 $ 594,720
======== =========
Year ended
December 31,
2002
-----------
Changes in net assets:
Contributions $ 390,688
Net depreciation (414,300)
Participant withdrawals (61,126)
Administrative expenses (4,025)
---------
$ (88,763)
=========
(5) Federal Income Taxes
The Company adopted a Prototype Standardized Profit Sharing Plan with a
cash or deferred arrangement and has requested a favorable determination
letter from the Internal Revenue Service. The determination letter has not
yet been received. However, the Company believes that the Plan currently is
designed and being operated in compliance with the applicable requirements
of the Plan and the Internal Revenue Code. Accordingly, the accompanying
financial statements do not include a provision for federal income taxes.
(Continued)
7
CROWN CASTLE INTERNATIONAL CORP.
401(k) PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(6) Loans to Participants
Loans are made available to all participants on a nondiscriminatory basis
in accordance with the specific provisions set forth in the Plan. The
amount of a loan cannot generally exceed the lesser of $50,000 or one-half
of a participant's total vested account balance. The loans bear interest at
rates determined by the plan administrator, generally 1% above the prime
rate at the time the loan is made. All loans are subject to specific
repayment plans and are secured by the participant's nonforfeitable
interest in his/her account equivalent to the principal amount of the loan.
(7) Subsequent Events
Effective February 1, 2003, the Plan changed its trustee from PNC Bank,
N.A. to The Charles Schwab Trust Company (CSTC). In addition, the
recordkeeper and custodian were changed from PNC Bank, N.A. to Schwab
Retirement Plan Services, Inc. (SRPS).
8
Schedule 1
CROWN CASTLE INTERNATIONAL CORP.
401(k) PLAN
EIN: 76-0470458
Plan Number: 001
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2002
Identity of issue, borrower, Current
lessor, or similar party Description of investment value
----------------------------------------- ------------------------------------------------------ -----------
* BlackRock Funds BlackRock Money Market Portfolio $ 1,258,063
Fidelity Investments Fidelity Advisors Government Investment Fund 479,320
Janus Capital Corporation Janus Advisor Flexible Income Fund 678,351
Fidelity Investments Fidelity Advisor Growth & Income Fund 579,539
Fidelity Investments Fidelity Advisor Growth Opportunities Fund 589,729
Janus Capital Corporation Janus Advisor Worldwide Fund 880,443
American Century Investments American Century International Growth Fund 352,972
American Century Investments American Century Equity Growth Fund 378,741
American Century Investments American Century Income & Growth Fund 488,827
American Century Investments American Balanced Fund 843,650
INVESCO Funds INVESCO Blue Chip Growth Fund 715,173
Janus Capital Corporation Janus Advisor Growth & Income Fund 1,334,494
Janus Capital Corporation Janus Advisor Capital Appreciation Fund 2,626,109
Fidelity Investments Fidelity Advisor Mid-Cap Fund 1,313,548
Federated Investments Federated Max Capital Index Fund 56,474
* Crown Castle International Corp. Common Stock 505,957
* Participants Participant loans with various rates of interest
from 8.75% to 9.50% and various
maturity dates through 2005 218,484
-----------
$13,299,874
===========
* Party-in-interest.
See accompanying independent auditors' report.
9
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Plan Administrator for the Plan has duly caused this annual report to be signed
on its behalf by the undersigned hereunto duly authorized.
CROWN CASTLE INTERNATIONAL CORP.
401(K) PLAN
(Name of Plan)
By /s/ WESLEY D. CUNNINGHAM
-----------------------------
Wesley D. Cunningham
Senior Vice President,
Chief Accounting Officer
and Corporate Controller
Date: June 27, 2003
10