SBA COMMUNICATIONS CORP 10-Q

ITEM 1: FINANCIAL STATEMENTS SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except par values) March 31, December 31, 2021 2020 ASSETS (unaudited) Current assets: Cash and cash equivalents $ 176,622 $ 308,560 Restricted cash 62,926 31,671 Accounts receivable, net 86,165 74,088 Costs and estimated earnings in excess of billings on uncompleted contracts 38,574 34,796 Prepaid expenses and other current assets 25,640 23,875 Total current assets 389,927 472,990 Property and equipment, net 2,608,526 2,677,326 Intangible assets, net 2,984,098 3,156,150 Operating lease right-of-use assets, net 2,303,070 2,369,358 Acquired and other right-of-use assets, net 956,945 4,202 Other assets 520,894 477,992 Total assets $ 9,763,460 $ 9,158,018 LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS, AND SHAREHOLDERS' DEFICIT Current Liabilities: Accounts payable $ 33,610 $ 109,969 Accrued expenses 57,218 63,031 Current maturities of long-term debt 24,000 24,000 Deferred revenue 174,351 113,117 Accrued interest 27,003 54,350 Current lease liabilities 231,952 236,037 Other current liabilities 12,630 14,297 Total current liabilities 560,764 614,801 Long-term liabilities: Long-term debt, net 12,019,757 11,071,796 Long-term lease liabilities 2,035,371 2,094,363 Other long-term liabilities 179,068 186,246 Total long-term liabilities 14,234,196 13,352,405 Redeemable noncontrolling interests 13,677 15,194 Shareholders' deficit: Preferred stock - par value $ 0.01 , 30,000 shares authorized, no shares issued or outstanding — — Common stock - Class A, par value $ 0.01 , 400,000 shares authorized, 109,331 shares and 109,819 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively 1,093 1,098 Additional paid-in capital 2,610,472 2,586,130 Accumulated deficit ( 6,848,313 ) ( 6,604,028 ) Accumulated other comprehensive loss, net ( 808,429 ) ( 807,582 ) Total shareholders' deficit ( 5,045,177 ) ( 4,824,382 ) Total liabilities, redeemable noncontrolling interests, and shareholders' deficit $ 9,763,460 $ 9,158,018 The accompanying condensed notes are an integral part of these consolidated financial statements. 1 Table of Contents SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in thousands, except per share amounts) For the three months ended March 31, 2021 2020 Revenues: Site leasing $ 505,103 $ 492,356 Site development 43,636 24,711 Total revenues 548,739 517,067 Operating expenses: Cost of revenues (exclusive of depreciation, accretion, and amortization shown below): Cost of site leasing 95,368 95,799 Cost of site development 34,406 19,715 Selling, general, and administrative expenses (1) 51,601 49,617 Acquisition and new business initiatives related adjustments and expenses 5,001 3,799 Asset impairment and decommission costs 4,903 14,355 Depreciation, accretion, and amortization 183,881 182,579 Total operating expenses 375,160 365,864 Operating income 173,579 151,203 Other income (expense): Interest income 632 885 Interest expense ( 90,095 ) ( 95,851 ) Non-cash interest expense ( 11,804 ) ( 2,406 ) Amortization of deferred financing fees ( 4,891 ) ( 5,139 ) Loss from extinguishment of debt, net ( 11,652 ) ( 16,864 ) Other expense, net ( 88,436 ) ( 226,299 ) Total other expense, net ( 206,246 ) ( 345,674 ) Loss before income taxes ( 32,667 ) ( 194,471 ) Benefit for income taxes 20,922 66,538 Net loss ( 11,745 ) ( 127,933 ) Net loss attributable to noncontrolling interests — 875 Net loss attributable to SBA Communications Corporation $ ( 11,745 ) $ ( 127,058 ) Net loss per common share attributable to SBA Communications Corporation: Basic $ ( 0.11 ) $ ( 1.14 ) Diluted $ ( 0.11 ) $ ( 1.14 ) Weighted average number of common shares Basic 109,469 111,908 Diluted 109,469 111,908 (1) Includes non-cash compensation of $ 19,584 and $ 15,553 for the three months ended March 31, 2021 and 2020, respectively. The accompanying condensed notes are an integral part of these consolidated financial statements. 2 Table of Contents SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (unaudited) (in thousands) For the three months ended March 31, 2021 2020 Net loss $ ( 11,745 ) $ ( 127,933 ) Adjustments related to interest rate swaps 42,787 ( 103,240 ) Foreign currency translation adjustments ( 43,634 ) ( 174,841 ) Comprehensive loss ( 12,592 ) ( 406,014 ) Comprehensive loss attributable to noncontrolling interests — 2,058 Comprehensive loss attributable to SBA Communications Corporation $ ( 12,592 ) $ ( 403,956 ) The accompanying condensed notes are an integral part of these consolidated financial statements. ‎ 3 Table of Contents SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS ’ DEFICIT (unaudited) (in thousands) Accumulated Class A Additional Other Total Common Stock Paid-In Accumulated Comprehensive Shareholders' Shares Amount Capital Deficit Loss Deficit BALANCE, December 31, 2019 111,775 $ 1,118 $ 2,461,335 $ ( 5,560,695 ) $ ( 568,765 ) $ ( 3,667,007 ) Net loss attributable to SBA Communications Corporation — — — ( 127,058 ) — ( 127,058 ) Common stock issued in connection with equity awards and stock purchase plans, offset by the impact of net share settlements 621 6 ( 5,625 ) — — ( 5,619 ) Non-cash stock compensation — — 16,660 — — 16,660 Adjustments related to interest rate swaps — — — — ( 103,240 ) ( 103,240 ) Repurchase and retirement of common stock ( 837 ) ( 8 ) — ( 203,322 ) — ( 203,330 ) Foreign currency translation adjustments attributable to SBA Communications Corporation — — — — ( 174,841 ) ( 174,841 ) Dividends and dividend equivalents — — — ( 52,311 ) — ( 52,311 ) Adjustment to fair value related to noncontrolling interests — — ( 484 ) — — ( 484 ) BALANCE, March 31, 2020 111,559 $ 1,116 $ 2,471,886 $ ( 5,943,386 ) $ ( 846,846 ) $ ( 4,317,230 ) Accumulated Class A Additional Other Total Common Stock Paid-In Accumulated Comprehensive Shareholders' Shares Amount Capital Deficit Loss Deficit BALANCE, December 31, 2020 109,819 1,098 2,586,130 ( 6,604,028 ) ( 807,582 ) ( 4,824,382 ) Net loss attributable to SBA Communications Corporation — — — ( 11,745 ) — ( 11,745 ) Common stock issued in connection with equity awards and stock purchase plans, offset by the impact of net share settlements 166 2 2,013 — — 2,015 Non-cash stock compensation — — 20,812 — — 20,812 Adjustments related to interest rate swaps — — — — 42,787 42,787 Repurchase and retirement of common stock ( 654 ) ( 7 ) — ( 168,916 ) — ( 168,923 ) Foreign currency translation adjustments attributable to SBA Communications Corporation — — — — ( 43,634 ) ( 43,634 ) Dividends and dividend equivalents on common stock — — — ( 63,624 ) — ( 63,624 ) Adjustment to fair value related to noncontrolling interests — — 1,517 — — 1,517 BALANCE, March 31, 2021 109,331 $ 1,093 $ 2,610,472 $ ( 6,848,313 ) $ ( 808,429 ) $ ( 5,045,177 ) The accompanying condensed notes are an integral part of these consolidated financial statements. ‎ 4 Table of Contents SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (in thousands) For the three months ended March 31, 2021 2020 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ ( 11,745 ) $ ( 127,933 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation, accretion, and amortization 183,881 182,579 Loss on remeasurement of U.S. dollar denominated intercompany loans 86,251 230,132 Non-cash compensation expense 20,422 16,278 Non-cash asset impairment and decommission costs 4,791 13,997 Loss from extinguishment of debt 10,652 16,864 Deferred income tax benefit ( 26,837 ) ( 72,204 ) Other non-cash items reflected in the Statements of Operations 17,413 1,402 Changes in operating assets and liabilities, net of acquisitions: Accounts receivable and costs and estimated earnings in excess of billings on uncompleted contracts, net ( 4,523 ) 19,712 Prepaid expenses and other assets 3,517 ( 1,643 ) Operating lease right-of-use assets, net 29,865 30,181 Accounts payable and accrued expenses ( 4,667 ) ( 4,725 ) Accrued interest ( 27,347 ) ( 18,197 ) Long-term lease liabilities ( 26,393 ) ( 24,712 ) Other liabilities 30,218 16,011 Net cash provided by operating activities 285,498 277,742 CASH FLOWS FROM INVESTING ACTIVITIES: Acquisitions ( 1,052,676 ) ( 89,531 ) Capital expenditures ( 24,536 ) ( 39,291 ) Purchase of investments ( 755,013 ) ( 610,012 ) Proceeds from sale of investments 755,000 610,000 Other investing activities 641 ( 3,178 ) Net cash used in investing activities ( 1,076,584 ) ( 132,012 ) CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings under Revolving Credit Facility 710,000 500,000 Repayments under Revolving Credit Facility ( 500,000 ) ( 505,000 ) Proceeds from issuance of Senior Notes, net of fees 1,485,670 988,516 Repayment of Senior Notes ( 757,500 ) ( 759,143 ) Repurchase and retirement of common stock ( 168,923 ) ( 203,330 ) Payment of dividends on common stock ( 63,412 ) ( 52,201 ) Proceeds from employee stock purchase/stock option plans 10,838 38,869 Payments related to taxes on net settlement of stock options and restricted stock units ( 8,823 ) ( 44,488 ) Other financing activities ( 6,507 ) ( 6,558 ) Net cash provided by (used in) financing activities 701,343 ( 43,335 ) Effect of exchange rate changes on cash, cash equivalents, and restricted cash ( 10,880 ) ( 13,900 ) NET CHANGE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH ( 100,623 ) 88,495 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH: Beginning of period 342,808 141,120 End of period $ 242,185 $ 229,615 The accompanying condensed notes are an integral part of these consolidated financial statements. 5 Table of Contents SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (in thousands) For the three months ended March 31, 2021 2020 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for: Interest $ 118,430 $ 114,033 Income taxes $ 6,387 $ 5,981 SUPPLEMENTAL CASH FLOW INFORMATION OF NON-CASH ACTIVITIES: Right-of-use assets obtained in exchange for new operating lease liabilities $ 11,890 $ 11,250 Operating lease modifications and reassessments $ 6,181 $ 15,264 Right-of-use assets obtained in exchange for new finance lease liabilities $ 1,033 $ 893 The accompanying condensed notes are an integral part of these consolidated financial statements. ‎ 6 Table of Contents SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. BASIS OF PRESENTATION The accompanying consolidated financial statements should be read in conjunction with the Annual Report on Form 10-K for the fiscal year ended December 31, 2020 for SBA Communications Corporation and its subsidiaries (the “Company”). These financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X and, therefore, omit or condense certain footnotes and other information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States. In the opinion of the Company’s management, all adjustments (consisting of normal recurring accruals) considered necessary for fair financial statement presentation have been made. The results of operations for an interim period may not give a true indication of the results for the year. Certain reclassifications have been made to prior year amounts or balances to conform to the presentation adopted in the current year. The preparation of financial statements requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. While the Company believes that such estimates are fair when considered in conjunction with the consolidated financial statements and accompanying notes, the actual amounts, when known, may vary from these estimates. Foreign Currency Translation All assets and liabilities of foreign subsidiaries that do not utilize the U.S. dollar as its functional currency are translated at period-end exchange rates, while revenues and expenses are translated at monthly average exchange rates during the period. Unrealized remeasurement gains and losses are reported as foreign currency translation adjustments through Accumulated other comprehensive loss, net in the Consolidated Statement of Shareholders’ Deficit. For foreign subsidiaries where the U.S. dollar is the functional currency, monetary assets and liabilities of such subsidiaries, which are not denominated in U.S. dollars, are remeasured at exchange rates in effect at the balance sheet date, and revenues and expenses are remeasured at monthly average rates prevailing during the year. Remeasurement gains and losses are reported as other income (expense), net in the Consolidated Statements of Operations. Intercompany Loans Subject to Remeasurement In accordance with Accounting Standards Codification (ASC) 830, the Company remeasures foreign denominated intercompany loans with the corresponding change in the balance being recorded in Other income (expense), net in the Consolidated Statements of Operations as settlement is anticipated or planned in the foreseeable future. The Company recorded a $ 57.0 million loss and a $ 152.8 million loss, net of taxes, on the remeasurement of intercompany loans for the three months ended March 31, 2021 and 2020, respectively, due to changes in foreign exchange rates. During the three months ended March 31, 2021, the Company repaid $ 116.3 million of the intercompany loan. As of March 31, 2021 and December 31, 2020, the aggregate amount outstanding under the intercompany loan agreements subject to remeasurement with the Company’s foreign subsidiaries was $ 793.7 million and $ 909.8 million, respectively. Reference Rate Reform ASU 2020-04 and ASU 2021-01, Reference Rate Reform, provide optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. An entity may elect to apply the amendments prospectively through December 31, 2022. The ICE Benchmark Administration Limited (“IBA”) intends to cease the publication of USD LIBOR as follows: the 1 week and 2 month tenors on December 31, 2021 and all other tenors on June 30, 2023. As of March 31, 2021, the Company has not modified any contracts as a result of reference rate reform and is evaluating the impact this standard may have on its consolidated financial statements. 7 Table of Contents 2. FAIR VALUE MEASUREMENTS Items Measured at Fair Value on a Recurring Basis — The Company’s asset retirement obligations are measured at fair value on a recurring basis using Level 3 inputs and are recorded in Other long-term liabilities in the Consolidated Balance Sheets. The fair value of the asset retirement obligations is calculated using a discounted cash flow model. Refer to Note 16 for discussion of the Company’s redeemable non-controlling interests. Items Measured at Fair Value on a Nonrecurring Basis — The Company’s long-lived and intangible assets are measured at fair value on a nonrecurring basis using Level 3 inputs. The Company considers many factors and makes certain assumptions when making this assessment, including, but not limited to: general market and economic conditions, historical operating results, geographic location, lease-up potential and expected timing of lease-up. The fair value of the long-lived and intangible assets is calculated using a discounted cash flow model. Asset impairment and decommission costs for all periods presented and the related impaired assets primarily relate to the Company’s site leasing operating segment. The following summarizes the activity of asset impairment and decommission costs (in thousands): For the three months ended March 31, 2021 2020 Asset impairment (1) $ 3,156 $ 11,009 Write-off of carrying value of decommissioned towers 1,327 2,699 Other (including third party decommission costs) 420 647 Total asset impairment and decommission costs $ 4,903 $ 14,355 (1) Represents impairment charges resulting from the Company’s regular analysis of whether the future cash flows from certain towers are adequate to recover the carrying value of the investment in those towers. The Company’s long term investments were $ 55.5 million and $ 57.6 million as of March 31, 2021 and December 31, 2020, respectively. Some of these investments provide for the Company to increase their investment in the future through call options exercisable by the Company and put options exercisable by the investee. These put and call options are recorded at fair market value. The estimation of the fair value of the investment involves the use of Level 3 inputs. The Company evaluates these investments for indicators of impairment. The Company considers impairment indicators such as negative changes in industry and market conditions, financial performance, business prospects, and other relevant events and factors. If indicators exist and the fair value of the investment is below the carrying amount, the investment could be impaired. Fair Value of Financial Instruments — The carrying values of cash and cash equivalents, accounts receivable, restricted cash, accounts payable, and short-term investments approximate their estimated fair values due to the shorter maturity of these instruments. The Company’s estimate of its short term investments are based primarily upon Level 1 reported market values. As of March 31, 2021 and December 31, 2020, the Company had $ 0.7 million of short-term investments, respectively. For the three months ended March 31, 2021, the Company purchased and sold $ 755.0 million of short-term investments. The Company determines fair value of its debt instruments utilizing various Level 2 sources including quoted prices and indicative quotes (non-binding quotes) from brokers that require judgment to interpret market information including implied credit spreads for similar borrowings on recent trades or bid/ask prices. The fair value of the Revolving Credit Facility is considered to approximate the carrying value because the Company does not believe its credit risk has changed materially from the date the applicable Eurodollar Rate was set for the Revolving Credit Facility ( 112.5 to 175.0 basis points). Refer to Note 10 for the fair values, principal balances, and carrying values of the Company’s debt instruments. For discussion of the Company’s derivatives and hedging activities, refer to Note 17. ‎ 8 Table of Contents 3. CASH, CASH EQUIVALENTS, AND RESTRICTED CASH The cash, cash equivalents, and restricted cash balances on the Consolidated Statements of Cash Flows consist of the following: As of As of March 31, 2021 December 31, 2020 Included on Balance Sheet (in thousands) Cash and cash equivalents $ 176,622 $ 308,560 Securitization escrow accounts 62,773 31,507 Restricted cash - current asset Payment and performance bonds 153 164 Restricted cash - current asset Surety bonds and workers compensation 2,637 2,577 Other assets - noncurrent Total cash, cash equivalents, and restricted cash $ 242,185 $ 342,808 Pursuant to the terms of the Tower Securities (see Note 10), the Company is required to establish a securitization escrow account, held by the indenture trustee, into which all rents and other sums due on the towers that secure the Tower Securities are directly deposited by the lessees. These restricted cash amounts are used to fund reserve accounts for the payment of (1) debt service costs, (2) ground rents, real estate and personal property taxes and insurance premiums related to towers, (3) trustee and servicing expenses, and (4) management fees. The restricted cash in the securitization escrow account in excess of required reserve balances is subsequently released to the Borrowers (as defined in Note 10) monthly, provided that the Borrowers are in compliance with their debt service coverage ratio and that no event of default has occurred. All monies held by the indenture trustee are classified as restricted cash on the Company’s Consolidated Balance Sheets. Payment and performance bonds relate primarily to collateral requirements for tower construction currently in process by the Company. Cash is pledged as collateral related to surety bonds issued for the benefit of the Company or its affiliates in the ordinary course of business and primarily related to the Company’s tower removal obligations. As of March 31, 2021 and December 31, 2020, the Company had $ 42.0 million and $ 41.8 million in surety and payment and performance bonds, respectively, for which no collateral was required to be posted. The Company periodically evaluates the collateral posted for its bonds to ensure that it meets the minimum requirements. As of March 31, 2021 and December 31, 2020, the Company had also pledged $ 2.3 million as collateral related to its workers’ compensation policy. 4. COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS The Company’s costs and estimated earnings on uncompleted contracts are comprised of the following: As of As of March 31, 2021 December 31, 2020 (in thousands) Costs incurred on uncompleted contracts $ 62,753 $ 54,949 Estimated earnings 25,149 21,778 Billings to date ( 51,333 ) ( 43,725 ) $ 36,569 $ 33,002 These amounts are included in the Consolidated Balance Sheets under the following captions: As of As of March 31, 2021 December 31, 2020 (in thousands) Costs and estimated earnings in excess of billings on uncompleted contracts $ 38,574 $ 34,796 Billings in excess of costs and estimated earnings on uncompleted contracts (included in Other current liabilities) ( 2,005 ) ( 1,794 ) $ 36,569 $ 33,002 As of March 31, 2021 and December 31, 2020, the eight largest customers comprised 99.5 % and 99.4 %, respectively, of the costs and estimated earnings in excess of billings on uncompleted contracts, net of billings in excess of costs and estimated earnings. ‎ 9 Table of Contents 5. PREPAID EXPENSES AND OTHER CURRENT ASSETS AND OTHER ASSETS The Company’s prepaid expenses and other current assets are comprised of the following: As of As of March 31, 2021 December 31, 2020 (in thousands) Prepaid ground rent $ 1,865 $ 1,412 Prepaid real estate taxes 3,292 3,153 Prepaid taxes 6,179 8,121 Other current assets 14,304 11,189 Total prepaid expenses and other current assets $ 25,640 $ 23,875 The Company’s other assets are comprised of the following: As of As of March 31, 2021 December 31, 2020 (in thousands) Straight-line rent receivable $ 318,107 $ 321,816 Interest rate swap asset (1) 43,689 12,123 Loan receivables 5,304 5,931 Deferred lease costs, net 5,029 4,788 Deferred tax asset - long term 71,494 53,722 Long-term investments 55,523 57,575 Other 21,748 22,037 Total other assets $ 520,894 $ 477,992 (1) Refer to Note 17 for more information on the Company’s interest rate swaps. 6. ACQUISITIONS The following table summarizes the Company’s acquisition activity: For the three months ended March 31, 2021 2020 (in thousands) Acquisitions of towers and related intangible assets $ 101,630 $ 82,274 Acquisition of right-of-use assets (1) 945,915 — Land buyouts and other assets (2) 5,131 7,257 Total cash acquisition capital expenditures $ 1,052,676 $ 89,531 (1) On February 16, 2021, the Company acquired the exclusive right to lease and operate 697 utility transmission structures, which included existing wireless tenant licenses from PG&E for $ 954.0 million. The difference between the agreed upon purchase price of $ 954.0 million and the cash acquisition amount is due to working capital adjustments. The Company accounted for the payment with respect to these sites as a right-of-use asset, which is recorded in Acquired and other right of use assets, net on its Consolidated Balance Sheets. The payments associated with the right of use of these structures has been fully funded and will be recognized over a weighted-average period of approximately 70 years. (2) In addition, the Company paid $ 2.8 million and $ 1.7 million for ground lease extensions and term easements on land underlying the Company’s towers during the three months ended March 31, 2021 and 2020, respectively. The Company recorded these amounts in prepaid rent on its Consolidated Balance Sheets. During the three months ended March 31, 2021, the Company allocated the purchase price of 34 acquired towers and related assets and liabilities consisting of $ 2.2 million of property and equipment, $ 21.1 million of intangible assets, and $ 78.4 million of other net assets and liabilities assumed. In the three months ended March 31, 2021, all acquisitions were accounted for as asset acquisitions. Subsequent to March 31, 2021, the Company acquired 17 tower and related assets for $ 6.0 million in cash. 10 Table of Contents The maximum potential obligation related to contingent consideration for acquisitions was $ 18.3 million and $ 35.0 million as of March 31, 2021 and December 31, 2020, respectively. No such amounts have been recorded on the Company’s Consolidated Balance Sheet. 7. PROPERTY AND EQUIPMENT, NET Property and equipment, net consists of the following: As of As of March 31, 2021 December 31, 2020 (in thousands) Towers and related components $ 5,204,880 $ 5,213,019 Construction-in-process (1) 34,040 38,065 Furniture, equipment, and vehicles 54,270 54,610 Land, buildings, and improvements 821,752 818,272 Total property and equipment 6,114,942 6,123,966 Less: accumulated depreciation ( 3,506,416 ) ( 3,446,640 ) Property and equipment, net $ 2,608,526 $ 2,677,326 (1) Construction-in-process represents costs incurred related to towers that are under development and will be used in the Company’s site leasing operations. Depreciation expense was $ 71.5 million and $ 71.8 million for the three months ended March 31, 2021 and 2020, respectively. At March 31, 2021 and December 31, 2020, unpaid capital expenditures that are included in accounts payable and accrued expenses were $ 5.3 million and $ 6.1 million, respectively. 8. INTANGIBLE ASSETS, NET The following table provides the gross and net carrying amounts for each major class of intangible assets: As of March 31, 2021 As of December 31, 2020 Gross carrying Accumulated Net book Gross carrying Accumulated Net book amount amortization value amount amortization value (in thousands) Current contract intangibles $ 4,794,137 $ ( 2,520,675 ) $ 2,273,462 $ 4,876,880 $ ( 2,471,438 ) $ 2,405,442 Network location intangibles 1,754,579 ( 1,043,943 ) 710,636 1,770,944 ( 1,020,236 ) 750,708 Intangible assets, net $ 6,548,716 $ ( 3,564,618 ) $ 2,984,098 $ 6,647,824 $ ( 3,491,674 ) $ 3,156,150 All intangible assets noted above are included in the Company’s site leasing segment. Amortization expense relating to the intangible assets above was $ 109.8 million and $ 110.7 million for the three months ended March 31, 2021 and 2020, respectively. 9. ACCRUED EXPENSES The Company’s accrued expenses are comprised of the following: As of As of March 31, 2021 December 31, 2020 (in thousands) Salaries and benefits $ 15,046 $ 20,958 Real estate and property taxes 9,178 9,583 Unpaid capital expenditures 5,330 6,073 Other 27,664 26,417 Total accrued expenses $ 57,218 $ 63,031 11 Table of Contents 10. DEBT The principal values, fair values, and carrying values of debt consist of the following (in thousands): As of As of March 31, 2021 December 31, 2020 Maturity Date Principal ‎ Balance Fair Value Carrying ‎ Value Principal ‎ Balance Fair Value Carrying ‎ Value Revolving Credit Facility Apr. 11, 2023 $ 590,000 $ 590,000 $ 590,000 $ 380,000 $ 380,000 $ 380,000 2018 Term Loan Apr. 11, 2025 2,334,000 2,301,908 2,320,200 2,340,000 2,310,750 2,325,391 2013-2C Tower Securities (1) Apr. 11, 2023 575,000 590,841 572,370 575,000 599,662 572,063 2014-2C Tower Securities (1) Oct. 8, 2024 620,000 655,185 616,368 620,000 670,003 616,131 2017-1C Tower Securities (1) Apr. 11, 2022 760,000 767,532 757,703 760,000 774,410 757,165 2018-1C Tower Securities (1) Mar. 9, 2023 640,000 660,928 636,481 640,000 671,341 636,045 2019-1C Tower Securities (1) Jan. 12, 2025 1,165,000 1,192,249 1,155,684 1,165,000 1,218,613 1,155,106 2020-1C Tower Securities (1) Jan. 9, 2026 750,000 734,505 743,050 750,000 752,910 742,782 2020-2C Tower Securities (1) Jan. 11, 2028 600,000 571,254 594,215 600,000 597,840 594,081 2016 Senior Notes Sep. 1, 2024 1,100,000 1,124,871 1,089,616 1,100,000 1,127,500 1,088,924 2017 Senior Notes Oct. 1, 2022 — — — 750,000 757,500 746,642 2020 Senior Notes Feb. 15, 2027 1,500,000 1,533,975 1,482,131 1,500,000 1,567,500 1,481,466 2021 Senior Notes Feb. 1, 2029 1,500,000 1,445,625 1,485,939 — — — Total debt $ 12,134,000 $ 12,168,873 $ 12,043,757 $ 11,180,000 $ 11,428,029 $ 11,095,796 Less: current maturities of long-term debt ( 24,000 ) ( 24,000 ) Total long-term debt, net of current maturities $ 12,019,757 $ 11,071,796 (1) The maturity date represents the anticipated repayment date for each issuance. The table below reflects cash and non-cash interest expense amounts recognized by debt instrument for the periods presented: Interest For the three months ended March 31, Rates as of 2021 2020 March 31, Cash Non-cash Cash Non-cash 2021 Interest Interest Interest Interest Revolving Credit Facility 1.590 % $ 2,148 $ — $ 2,714 $ — 2018 Term Loan (1) 1.872 % 10,997 11,434 22,203 2,022 2013-2C Tower Securities 3.722 % 5,396 — 5,396 — 2014-2C Tower Securities 3.869 % 6,046 — 6,046 — 2015-1C Tower Securities 3.156 % — — 3,985 — 2016-1C Tower Securities 2.877 % — — 5,090 — 2017-1C Tower Securities 3.168 % 6,085 — 6,085 — 2018-1C Tower Securities 3.448 % 5,570 — 5,570 — 2019-1C Tower Securities 2.836 % 8,357 — 8,357 — 2020-1C Tower Securities 1.884 % 3,598 — — — 2020-2C Tower Securities 2.328 % 3,540 — — — 2014 Senior Notes 4.875 % — — 3,352 112 2016 Senior Notes 4.875 % 13,406 286 13,406 272 2017 Senior Notes 4.000 % 2,333 — 7,500 — 2020 Senior Notes 3.875 % 14,531 84 6,135 — 2021 Senior Notes 3.125 % 8,073 — — — Other 15 — 12 — Total $ 90,095 $ 11,804 $ 95,851 $ 2,406 (1) The 2018 Term Loan has a blended rate of 1.872 %, which includes the impact of the interest rate swap entered into on August 4, 2020, which swapped $ 1.95 billion of notional value accruing interest at one month LIBOR plus 175 basis points for a fixed rate of 1.874 % per annum through the maturity date of the 2018 Term Loan. Excluding the impact of the interest rate swap, the 2018 Term Loan was accruing interest at 1.860 % as of March 31, 2021. Refer to Note 17 for more information on the Company’s interest rate swap. 12 Table of Contents Revolving Credit Facility under the Senior Credit Agreement During the three months ended March 31, 2021, the Company borrowed $ 710.0 million and repaid $ 500.0 million of the outstanding balance under the Revolving Credit Facility. As of March 31, 2021, the balance outstanding under the Revolving Credit Facility was $ 590.0 million accruing interest at 1.590 % per annum. In addition, SBA Senior Finance II LLC, the Company’s wholly owned subsidiary (“SBA Senior Finance II”) was required to pay a commitment fee of 0.20 % per annum on the amount of the unused commitment. As of March 31, 2021, SBA Senior Finance II was in compliance with the financial covenants contained in the Senior Credit Agreement. Subsequent to March 31, 2021, the Company repaid $ 95.0 million of the outstanding balance under the Revolving Credit Facility. As of the date of this filing, $ 495.0 million was outstanding under the Revolving Credit Facility. Term Loan under the Senior Credit Agreement During the three months ended March 31, 2021, the Company repaid an aggregate of $ 6.0 million of principal on the 2018 Term Loan. As of March 31, 2021, the 2018 Term Loan had a principal balance of $ 2.3 billion. Secured Tower Revenue Securities As of March 31, 2021, the entities that are borrowers on the mortgage loan (the “Borrowers”) met the debt service coverage ratio required by the mortgage loan agreement and were in compliance with all other covenants as set forth in the agreement. The sole asset of the Trust (defined below) consists of a non-recourse mortgage loan made in favor of the Borrowers. 2021-1C Tower Securities On April 29, 2021, the Company, through the Trust, priced $ 1.165 billion of Secured Tower Revenue Securities Series 2021-1C which have an anticipated repayment date of November 9, 2026 and a final maturity date of May 9, 2051 (the “2021-1C Tower Securities”). This transaction is expected to close May 14, 2021. The 2021-1C Tower Securities have a fixed interest rate of 1.631 % per annum, payable monthly. In addition, to satisfy certain risk retention requirements of Regulation RR promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), SBA Guarantor, LLC, a wholly owned subsidiary, will purchase $ 61.4 million of Secured Tower Revenue Securities Series 2021-1R issued by the Trust. These securities have an anticipated repayment date of November 9, 2026 and a final maturity date of May 9, 2051 (the “2021-1R Tower Securities”). The fixed interest rate on the 2021-1R Tower Securities is 3.625 % per annum, payable monthly. Principal and interest payments made on the 2021-1R Tower Securities will eliminate in consolidation. Net proceeds from this offering will be used to repay the entire aggregate principal amount of the 2017-1C Tower Securities ($ 760.0 million) and the Secured Tower Revenue Securities, Series 2017-1R ($ 40.0 million) and for general corporate purposes. Senior Notes 2021 Senior Notes On January 29, 2021, the Company issued $ 1.5 billion of unsecured senior notes due February 1, 2029 at par value (the “2021 Senior Notes”). The 2021 Senior Notes accrue interest at a rate of 3.125 % per annum. Interest on the 2021 Senior Notes is due semi-annually on February 1 and August 1 of each year, beginning on August 1, 2021. The Company incurred financing fees of $ 14.3 million to date in relation to this transaction, which are being amortized through the maturity date. Net proceeds from this offering were used to redeem all of the outstanding principal amount of the 2017 Senior Notes, repay the amounts outstanding under the Revolving Credit Facility, and for general corporate purposes. The 2021 Senior Notes are subject to redemption in whole or in part on or after February 1, 2024 at the redemption prices set forth in the indenture agreement plus accrued and unpaid interest. Prior to February 1, 2024, the Company may, at its option, redeem up to 35 % of the aggregate principal amount of the 2021 Senior Notes originally issued at a redemption price of 103.125 % of the principal amount of the 2021 Senior Notes to be redeemed on the redemption date plus accrued and unpaid interest with the net proceeds of certain equity offerings. The Company may redeem the 2021 Senior Notes during the twelve-month period beginning on the following dates at the following redemption prices: February 1, 2024 at 101.563 %, February 1, 2025 at 100.781 %, or February 1, 13 Table of Contents 2026 until maturity at 100.000 %, of the principal amount of the 2021 Senior Notes to be redeemed on the redemption date plus accrued and unpaid interest. 2017 Senior Notes On February 11, 2021, the Company redeemed the entire $ 750.0 million balance of the 2017 Senior Notes with proceeds from the 2021 Senior Notes. In addition, the Company paid a $ 7.5 million call premium and expensed $ 4.2 million for the write-off of financing fees related to the redemption of the 2017 Senior Notes, which are reflected in loss from extinguishment of debt on the Consolidated Statement of Operations. 11. SHAREHOLDERS’ EQUITY Common Stock Equivalents The Company has outstanding stock options, time-based restricted stock units (“RSUs”), and performance-based restricted stock units (“PSUs”) which were considered in the Company’s diluted earnings per share calculation (see Note 15). Registration of Additional Shares On February 26, 2021, the Company filed with the Securities and Exchange Commission an automatic shelf registration statement for well-known seasoned issuers on Form S-3, which enables the Company to issue shares of its Class A common stock, preferred stock, debt securities, warrants, or depositary shares as well as units that include any of these securities. The Company will file a prospectus supplement containing the amount and type of securities each time it issues securities under its automatic shelf registration statement on Form S-3. No securities were issued under this automatic shelf registration statement through the date of this filing. Stock Repurchases The Company’s Board of Directors authorizes the Company to purchase, from time to time, outstanding Class A common stock through open market repurchases in compliance with Rule 10b-18 under the Exchange Act and/or in privately negotiated transactions at management’s discretion based on market and business conditions, applicable legal requirements and other factors. Once authorized, the repurchase plan has no time deadline and will continue until otherwise modified or terminated by the Company’s Board of Directors at any time in its sole discretion. Shares repurchased are retired. On November 2, 2020, the Company’s Board of Directors authorized a new $ 1.0 billion stock repurchase plan, replacing the prior plan authorized on July 29, 2019, which had a remaining authorization of $ 124.3 million. As of the date of this filing, the Company had $ 475.1 million authorization remaining under the new plan. The following is a summary of the Company’s share repurchases: For the three months ended March 31, 2021 2020 Total number of shares purchased (in millions) (1) 0.7 0.8 Average price paid per share (1) $ 258.33 $ 242.86 Total price paid (in millions) (1) $ 168.9 $ 200.0 (1) Amounts are calculated based on the trade date and differ from the Consolidated Statements of Cash Flows, which calculate share repurchases based on the settlement date . Dividends As of March 31, 2021, the Company paid the following cash dividends: Payable to Shareholders of Record At the Close Cash Paid Aggregate Amount Date Declared of Business on Per Share Paid Date Paid February 19, 2021 March 10, 2021 $ 0.58 $ 63.4 million March 26, 2021 14 Table of Contents Dividends paid in 2021 and 2020 were ordinary income. Subsequent to March 31, 2021, the Company declared the following cash dividends: Payable to Shareholders Cash to of Record At the Close be Paid Date Declared of Business on Per Share Date to be Paid April 26, 2021 May 20, 2021 $ 0.58 June 15, 2021 12. STOCK-BASED COMPENSATION Stock Options The following table summarizes the Company’s activities with respect to its stock option plans for the three months ended March 31, 2021 as follows (dollars and shares in thousands, except for per share data): Weighted- Weighted-Average Average Remaining Number Exercise Price Contractual Aggregate of Shares Per Share Life (in years) Intrinsic Value Outstanding at December 31, 2020 3,202 $ 143.01 Exercised ( 70 ) $ 122.72 Forfeited/canceled ( 7 ) $ 173.81 Outstanding at March 31, 2021 3,125 $ 143.39 3.5 $ 419,128 Exercisable at March 31, 2021 2,371 $ 132.98 3.2 $ 342,849 Unvested at March 31, 2021 754 $ 176.21 4.7 $ 76,279 The total intrinsic value for options exercised during the three months ended March 31, 2021 was $ 9.5 million. Restricted Stock Units and Performance-Based Restricted Stock Units The following table summarizes the Company’s RSU and PSU activity for the three months ended March 31, 2021: RSUs PSUs Weighted-Average Weighted-Average Number of Grant Date Fair Number of Grant Date Fair Shares Value per Share Shares Value per Share (in thousands) (in thousands) Outstanding at December 31, 2020 (1) 274 $ 206.48 148 $ 376.48 Granted (1) 101 $ 235.92 153 $ 236.48 Vested ( 122 ) $ 185.34 — $ — Forfeited/canceled ( 3 ) $ 224.37 ( 1 ) $ 376.50 Outstanding at March 31, 2021 250 $ 228.47 300 $ 304.80 (1) PSUs represent the target number of shares granted that are issuable at the end of the three year performance period. Fair value for a portion of the PSUs was calculated using a Monte Carlo simulation model. 13. INCOME TAXES The primary reasons for the difference between the Company’s effective tax rate and the U.S. statutory rate are the Company’s REIT election and the Company’s full valuation allowance on the net deferred tax assets of the U.S. taxable REIT subsidiary (“TRS”). The TRS has concluded that it is not more likely than not that its deferred tax assets will be realized and has recorded a full valuation allowance. A foreign tax provision is recognized because certain foreign subsidiaries of the Company have profitable operations or are in a net deferred tax liability position. The Company elected to be taxed as a REIT commencing with its taxable year ended December 31, 2016. As a REIT, the Company generally will be entitled to a deduction for dividends that it pays, and therefore, not subject to U.S. federal corporate 15 Table of Contents income tax on that portion of its net income that it distributes to its shareholders. As a REIT, the Company will continue to pay U.S. federal income tax on earnings, if any, from assets and operations held through its TRSs. These assets and operations currently consist primarily of the Company’s site development services and its international operations. The Company’s international operations would continue to be subject, as applicable, to foreign taxes in the jurisdictions in which those operations are located. The Company may also be subject to a variety of taxes, including payroll taxes and state, local, and foreign income, property, and other taxes on its assets and operations. The Company’s determination as to the timing and amount of future dividend distributions will be based on a number of factors, including REIT distribution requirements, its existing federal net operating losses (“NOLs”) of approximately $ 651.1 million as of December 31, 2020, the Company’s financial condition, earnings, debt covenants, and other possible uses of such funds. The Company may use these NOLs to offset its REIT taxable income, and thus any required distributions to shareholders may be reduced or eliminated until such time as the NOLs have been fully utilized . 14. SEGMENT DATA The Company operates principally in two business segments: site leasing and site development. The Company’s site leasing business includes two reportable segments, domestic site leasing and international site leasing. The Company’s business segments are strategic business units that offer different services. They are managed separately based on the fundamental differences in their operations. The site leasing segment includes results of the managed and sublease businesses. The site development segment includes the results of both consulting and construction related activities. The Company’s Chief Operating Decision Maker utilizes segment operating profit and operating income as his two measures of segment profit in assessing performance and allocating resources at the reportable segment level. The Company has applied the aggregation criteria to operations within the international site leasing segment on a basis that is consistent with management’s review of information and performance evaluations of the individual markets in this region. Revenues, cost of revenues (exclusive of depreciation, accretion and amortization), capital expenditures (including assets acquired through the issuance of shares of the Company’s Class A common stock) and identifiable assets pertaining to the segments in which the Company continues to operate are presented below. Domestic Site Int'l Site Site Leasing Leasing Development Other Total For the three months ended March 31, 2021 (in thousands) Revenues $ 403,579 $ 101,524 $ 43,636 $ — $ 548,739 Cost of revenues (1) 65,120 30,248 34,406 — 129,774 Operating profit 338,459 71,276 9,230 — 418,965 Selling, general, and administrative expenses 28,056 7,760 5,789 9,996 51,601 Acquisition and new business initiatives related adjustments and expenses 3,332 1,669 — — 5,001 Asset impairment and decommission costs 3,871 1,032 — — 4,903 Depreciation, amortization and accretion 137,054 43,121 2,082 1,624 183,881 Operating income (loss) 166,146 17,694 1,359 ( 11,620 ) 173,579 Other expense (principally interest expense and other expense) ( 206,246 ) ( 206,246 ) Loss before income taxes ( 32,667 ) Cash capital expenditures (2) 1,059,678 16,947 870 750 1,078,245 For the three months ended March 31, 2020 Revenues $ 386,345 $ 106,011 $ 24,711 $ — $ 517,067 Cost of revenues (1) 63,905 31,894 19,715 — 115,514 Operating profit 322,440 74,117 4,996 — 401,553 Selling, general, and administrative expenses 27,323 7,931 4,456 9,907 49,617 Acquisition and new business initiatives related adjustments and expenses 2,597 1,202 — — 3,799 Asset impairment and decommission costs 10,826 3,529 — — 14,355 Depreciation, amortization and accretion 133,806 46,612 616 1,545 182,579 Operating income (loss) 147,888 14,843 ( 76 ) ( 11,452 ) 151,203 Other expense (principally interest expense and other expense) ( 345,674 ) ( 345,674 ) Loss before income taxes ( 194,471 ) Cash capital expenditures (2) 101,306 26,433 782 1,194 129,715 16 Table of Contents Domestic Site Int'l Site Site Leasing Leasing Development Other (3) Total Assets (in thousands) As of March 31, 2021 $ 6,776,019 $ 2,696,652 $ 81,127 $ 209,662 $ 9,763,460 As of December 31, 2020 $ 5,893,636 $ 2,955,563 $ 61,729 $ 247,090 $ 9,158,018 (1) Excludes depreciation, amortization, and accretion. (2) Includes cash paid for capital expenditures, acquisitions, and right-of-use assets. (3) Assets in Other consist primarily of general corporate assets and short-term investments. For the three months ended March 31, 2021 and 2020, site leasing revenue in Brazil was $ 55.4 million and $ 63.1 million, respectively. Other than Brazil, no foreign country represented a material amount of the Company’s total revenues in any of the periods presented. Total long-lived assets in Brazil were $ 0.9 billion and $ 1.0 billion as of March 31, 2021 and December 31, 2020, respectively. 15. EARNINGS PER SHARE Basic earnings per share was computed by dividing net loss attributable to SBA Communications Corporation by the weighted-average number of shares of Common Stock outstanding for each respective period. Diluted earnings per share was calculated by dividing net loss attributable to SBA Communications Corporation by the weighted-average number of shares of Common Stock outstanding adjusted for any dilutive Common Stock equivalents, including unvested RSUs, PSUs, and shares issuable upon exercise of stock options as determined under the “Treasury Stock” method. The following table sets forth basic and diluted net income (loss) per common share attributable to common shareholders for the three months ended March 31, 2021 and 2020 (in thousands, except per share data): For the three months ended March 31, 2021 2020 Numerator: Net loss attributable to SBA Communications Corporation $ ( 11,745 ) $ ( 127,058 ) Denominator: Basic and diluted weighted-average shares outstanding 109,469 111,908 Net loss per common share attributable to SBA Communications Corporation: Basic $ ( 0.11 ) $ ( 1.14 ) Diluted $ ( 0.11 ) $ ( 1.14 ) For the three months ended March 31, 2021, all potential common stock equivalents, including 3.1 million shares underlying stock options outstanding, 0.3 million shares underlying RSUs outstanding, and 0.3 million shares underlying PSUs outstanding, were excluded as the effect would be anti-dilutive. For the three months ended March 31, 2020, all potential common stock equivalents, including 3.7 million shares underlying stock options outstanding, 0.3 million shares underlying RSUs outstanding, and 0.1 million shares underlying PSUs outstanding, were excluded as the effect would be anti-dilutive. 16. REDEEMABLE NONCONTROLLING INTERESTS As a result of its acquisition of additional interests of a previously unconsolidated joint venture in South Africa which operated under the name Atlas Tower South Africa (“Atlas SA”), the Company has consolidated the results of the entity into its financial statements since August 2019. In connection with the acquisition of the additional interest in Atlas SA, the parties agreed to both a put option exercisable by the noncontrolling interest holder and a call option exercisable by the Company for the remaining 6 % minority interest based on a formulaic approach. During the third quarter of 2020, the Company noticed its intent to exercise its call option to acquire its remaining 6 % interest in the joint venture. On March 25, 2021, the Company remitted $ 13.7 million to the seller as closing consideration for the remaining 6 % interest in the joint venture, subject to an earnout in September 2021 based on the attainment of certain future performance metrics. The parties are currently in litigation regarding various issues arising in connection 17 Table of Contents with the closing of the transaction. Consequently, the Company is retaining the fair value of the acquired 6% noncontrolling interest in Redeemable Noncontrolling Interests until such time as the litigation is resolved. The fair value assigned to the redeemable noncontrolling interest as of March 31, 2021 is based on the contractually-defined redemption value, which was delivered as closing consideration for the remaining 6 % interest. In accordance with the terms of the call option, the amount of closing consideration was fixed upon exercise of the call option. The redeemable noncontrolling interest is recognized at the higher of (1) the initial carrying amount of the noncontrolling interest as adjusted for accumulated income or loss attributable to the noncontrolling interest holder, or (2) the contractually-defined redemption value as of the balance sheet date. Adjustments to the carrying amount of redeemable noncontrolling interest are charged against retained earnings (or additional paid-in capital if there are no retained earnings). As of March 31, 2021, the loss attributable to the 6% interest was immaterial. 17. DERIVATIVES AND HEDGING ACTIVITIES The Company enters into interest rate swaps to hedge the future interest expense from variable rate debt and reduce the Company’s exposure to fluctuations in interest rates. On August 4, 2020, the Company, through its wholly owned subsidiary, SBA Senior Finance II, terminated its existing $ 1.95 billion cash flow hedge on a portion of its 2018 Term Loan in exchange for a payment of $ 176.2 million. On the same date, the Company entered into an interest rate swap for $ 1.95 billion of notional value accruing interest at one month LIBOR plus 175 basis points for a fixed rate of 1.874 % per annum through the maturity date of the 2018 Term Loan. The Company designated this interest rate swap as a cash flow hedge as it is expected to be highly effective at offsetting changes in cash flows of the LIBOR based component interest payments of its 2018 Term Loan. As of March 31, 2021, the hedge remains highly effective; therefore, subsequent changes in the fair value are recorded in Accumulated other comprehensive loss, net. As of March 31, 2021 and December 31, 2020, the interest rate swap has a fair value of $ 43.7 million and $ 12.1 million respectively, and is recorded in Other assets on the Consolidated Balance Sheets. On August 4, 2020, the Company also terminated its existing interest rate swaps, which were previously de-designated as cash flow hedges. There was no cash transferred in connection with the termination of these swaps. The Company reclassifies the fair value of its interest rate swaps recorded in Accumulated other comprehensive loss, net on their de-designation date to non-cash interest expense on the Consolidated Statements of Operations over their respective remaining term end dates, which range from 2023 to 2025 . Accumulated other comprehensive loss, net includes an aggregate of $ 98.1 million and $ 140.9 million of accumulated derivative net losses as of March 31, 2021 and December 31, 2020, respectively. The Company is exposed to counterparty credit risk to the extent that a counterparty fails to meet the terms of a contract. The Company’s exposure is limited to the current value of the contract at the time the counterparty fails to perform. The cash flows associated with these activities are reported in Net cash provided by operating activities on the Consolidated Statements of Cash Flows with the exception of the termination of interest rate swaps, which are recorded in Net cash used in financing activities. The table below outlines the effects of the Company’s derivatives on the Consolidated Statements of Operations and Consolidated Statements of Shareholders’ Deficit for the three month periods ended March 31, 2021 and 2020. For the three months ended March 31, 2021 2020 Cash Flow Hedge - Interest Rate Swap Agreement (in thousands) Change in fair value recorded in Accumulated other comprehensive loss, net $ 31,566 $ ( 107,882 ) Amount recognized in Non-cash interest expense $ — $ ( 2,822 ) Derivatives Not Designated as Hedges - Interest Rate Swap Agreements Amount reclassified from Accumulated other comprehensive loss, net into Non-cash interest expense $ 11,221 $ 4,642 Change in fair value recorded in Other income (expense), net $ — $ 3,966 18 Table of Contents