Note 15. Supplemental Guarantor Information

In connection with the issuance of the Senior Secured Notes, Senior Unsecured Notes and Term Loan Facility due 2022, the Guarantors provided guarantees of that indebtedness. These guarantees are full and unconditional as well as joint and several. All property assets and related operations of the Guarantors are pledged as collateral under these obligations and the Guarantors are subject to restrictions on certain investments and payments. Subject to the terms and provisions of the debt agreements, in certain circumstances, a Guarantor may be released from its guarantee obligation including, upon the sale or transfer of any portion of its equity interest or all or substantially all its property, and upon any Guarantor being designated an Unrestricted Subsidiary, as defined in the Credit Agreement, or otherwise no longer being required to remain a Guarantor given its size or regulatory restrictions.

We have determined that certain immaterial classifications existed in the Condensed Consolidating Statements of Comprehensive Income for the period from April 24, 2015 to June 30, 2015, which impacted only CS&L with applicable offsetting adjustments in the Eliminations column. For the period from April 24, 2015 to June 30, 2015, earnings from consolidated subsidiaries, net income and comprehensive income of CS&L should have been increased from $8.6 million, ($40.5) million, and ($11.9) million to $57.4 million, $8.3 million, and $36.9 million, respectively. The condensed consolidating statement of comprehensive income for the period from April 24, 2015 to June 30, 2015 presented below includes the impact of these revisions.

The following information summarizes our Condensed Consolidating Balance Sheets as of June 30, 2016 and December 31, 2015, Condensed Consolidating Statement of Comprehensive Income (Loss) for the three and six months ended June 30, 2016, and the Condensed Consolidating Statement of Cash Flows for the six months ended June 30, 2016:

	Condensed Consolidating Balance Sheet As of June 30, 2016
(Thousands)	CS&L			CSL Capital			Guarantors		Non-Guarantors			Eliminations			Consolidated
Assets:
Property, plant and equipment, net	$	—		$	—		$	2,051,691	$	517,711		$	—		$	2,569,402
Cash and cash equivalents		799			—			44,220		3,794			—			48,813
Accounts receivable, net		—			—			6,985		1,473			—			8,458
Affiliate receivable		—			—			—		1,899			(1,899	)		—
Goodwill		—			—			146,590		—			—			146,590
Intangible assets, net		—			—			37,582		10,338			—			47,920
Straight-line rent receivable		—			—			20,422		—			—			20,422
Investment in consolidated subsidiaries		2,628,156			2,628,156			336,279		326,894			(5,919,485	)		-
Other assets		136			—			9,271		663			—			10,070
Total Assets	$	2,629,091		$	2,628,156		$	2,653,040	$	862,772		$	(5,921,384	)	$	2,851,675
Liabilities and Shareholders' Deficit:
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	63		$	—		$	18,869	$	1,274		$	—		$	20,206
Accrued interest payable		26,384			26,384			—		—			(26,384	)		26,384
Deferred revenue		—			—			104,516		43,830			—			148,346
Derivative liability		66,888			66,888			—		—			(66,888	)		66,888
Affiliate payable		—			—			1,899		—			(1,899	)		—
Dividends payable		93,208			—			—		—			—			93,208
Deferred income taxes		—			—			1,715		3,400			—			5,115
Capital lease obligations		—			—			48,980		—			—			48,980
Notes and other debt, net		3,690,186			3,690,186			—		—			(3,690,186	)		3,690,186
Total liabilities		3,876,729			3,783,458			175,979		48,504			(3,785,357	)		4,099,313

Convertible preferred stock		79,063			—			—		—			—			79,063

Shareholders' Deficit:
Common stock		15			—			—		—			—			15
Additional paid-in capital		81,881			—			—		—			—			81,881
Accumulated other comprehensive income		(66,967	)		(66,888	)		—		(79	)		66,967			(66,967	)
Distributions in excess of earnings		(1,341,630	)		(1,088,414	)		2,477,061		814,347			(2,202,994	)		(1,341,630	)
Total shareholders' deficit		(1,326,701	)		(1,155,302	)		2,477,061		814,268			(2,136,027	)		(1,326,701	)
Total Liabilities, Convertible Preferred Stock, and Shareholders' Deficit	$	2,629,091		$	2,628,156		$	2,653,040	$	862,772		$	(5,921,384	)	$	2,851,675

	Condensed Consolidating Balance Sheet As of December 31, 2015
(Thousands)	CS&L			CSL Capital			Guarantors		Non-Guarantors		Eliminations			Consolidated
Assets:
Property, plant and equipment, net	$	—		$	—		$	1,839,603	$	533,048	$	—		$	2,372,651
Cash and cash equivalents		17			—			140,197		2,284		—			142,498
Accounts receivable, net		—			—			474		1,609		—			2,083
Affiliate receivable		—			—			151		—		(151	)		—
Intangible assets, net		—			—			—		10,530		—			10,530
Straight-line rent receivable		—			—			11,795		—		—			11,795
Investment in consolidated subsidiaries		2,458,679			2,458,679			11,235		—		(4,928,593	)		—
Other assets		—			—			2,781		298		—			3,079
Total Assets	$	2,458,696		$	2,458,679		$	2,006,236	$	547,769	$	(4,928,744	)	$	2,542,636

Liabilities and Shareholders' Deficit:
Accounts payable, accrued expenses and other liabilities	$	—		$	—		$	9,204	$	1,205	$	—		$	10,409
Accrued interest payable		24,440			24,440			—		—		(24,440	)		24,440
Deferred revenue		—			—			44,862		22,955		—			67,817
Derivative liability		5,427			5,427			—		—		(5,427	)		5,427
Affiliate payable		—			—			—		151		(151	)		—
Dividends payable		90,507			—			—		—		—			90,507
Deferred income taxes		—			—			1,677		4,037		—			5,714
Notes and other debt, net		3,505,228			3,505,228			—		—		(3,505,228	)		3,505,228
Total liabilities		3,625,602			3,535,095			55,743		28,348		(3,535,246	)		3,709,542

Common stock		15			—			—		—		—			15
Additional paid-in capital		1,392			—			—		—		—			1,392
Accumulated other comprehensive income		(5,427	)		(5,427	)		—		—		5,427			(5,427	)
Distributions in excess of earnings		(1,162,886	)		(1,070,989	)		1,950,493		519,421		(1,398,925	)		(1,162,886	)
Total shareholders' deficit		(1,166,906	)		(1,076,416	)		1,950,493		519,421		(1,393,498	)		(1,166,906	)
Total Liabilities and Shareholders' Deficit	$	2,458,696		$	2,458,679		$	2,006,236	$	547,769	$	(4,928,744	)	$	2,542,636

	Condensed Consolidating Statement of Comprehensive Income (Loss) For the Three Months Ended June 30, 2016
(Thousands)	CS&L			CSL Capital			Guarantors		Non-Guarantors			Eliminations			Consolidated
Revenues:
Leasing	$	—		$	—		$	168,522	$	528		$	—		$	169,050
Fiber Infrastructure		—			—			13,776		—			—			13,776
Consumer CLEC		—			—			—		5,747			—			5,747
Total revenues		—			—			182,298		6,275			—			188,573
Costs and Expenses:
Interest expense		66,381			66,381			1,667		(12	)		(66,381	)		68,036
Depreciation and amortization		—			—			70,059		22,326			—			92,385
General and administrative expense		1,200			—			6,935		104			—			8,239
Operating expense		—			—			5,482		4,429			—			9,911
Transaction related costs		—			—			11,210		—			—			11,210
Total costs and expenses		67,581			66,381			95,353		26,847			(66,381	)		189,781
Earnings from consolidated subsidiaries		66,046			66,046			—		—			(132,092	)		—
(Loss) income before income taxes		(1,535	)		(335	)		86,945		(20,572	)		(65,711	)		(1,208	)
Income tax expense		—			—			136		191			—			327
Net (loss) income	$	(1,535	)	$	(335	)	$	86,809	$	(20,763	)	$	(65,711	)	$	(1,535	)

Comprehensive (loss) income	$	(22,713	)	$	(21,354	)	$	86,809	$	(20,922	)	$	(44,533	)	$	(22,713	)

	Condensed Consolidating Statement of Comprehensive Income For the Period from April 24 - June 30, 2015
(Thousands)	CS&L		CSL Capital		Guarantors		Non-Guarantors			Eliminations			Consolidated
Revenues:
Leasing	$	—	$	—	$	124,172	$	—		$	—		$	124,172
Consumer CLEC		—		—		—		4,576			—			4,576
Total revenues		—		—		124,172		4,576			—			128,748
Costs and Expenses:
Interest expense		48,797		48,797		—		—			(48,797	)		48,797
Depreciation and amortization		—		—		46,744		17,700			—			64,444
General and administrative expense		338		—		2,823		—			—			3,161
Operating expense		—		—		—		3,741			—			3,741
Transaction related costs		—		—		73		—			—			73
Total costs and expenses		49,135		48,797		49,640		21,441			(48,797	)		120,216
Earnings from consolidated subsidiaries		57,436		57,436		—		—			(114,872	)		—
Income (loss) before income taxes		8,301		8,639		74,532		(16,865	)		(66,075	)		8,532
Income tax expense		—		—		94		137			—			231
Net income (loss)	$	8,301	$	8,639	$	74,438	$	(17,002	)	$	(66,075	)	$	8,301

Comprehensive income (loss)	$	36,852	$	37,190	$	74,438	$	(17,002	)	$	(94,626	)	$	36,852

	Condensed Consolidating Statement of Comprehensive Income (Loss) For the Six Months Ended June 30, 2016
(Thousands)	CS&L			CSL Capital			Guarantors		Non-Guarantors			Eliminations			Consolidated
Revenues:
Leasing	$	—		$	—		$	336,797	$	894		$	—		$	337,691
Fiber Infrastructure		—			—			13,776		—						13,776
Consumer CLEC		—			—			—		11,781			—			11,781
Total revenues		—			—			350,573		12,675			—			363,248
Costs and Expenses:
Interest expense		132,526			132,526			1,571		(12	)		(132,526	)		134,085
Depreciation and amortization		—			—			134,143		44,582			—			178,725
General and administrative expense		2,130			—			11,098		200			—			13,428
Operating expense		—			—			5,483		9,135			—			14,618
Transaction related costs		—			—			15,120		—			—			15,120
Total costs and expenses		134,656			132,526			167,415		53,905			(132,526	)		355,976
Earnings from consolidated subsidiaries		141,157			141,157			—		—			(282,314	)		—
(Loss) income before income taxes		6,501			8,631			183,158		(41,230	)		(149,788	)		7,272
Income tax expense		—			—			384		387			—			771
Net (loss) income	$	6,501		$	8,631		$	182,774	$	(41,617	)	$	(149,788	)	$	6,501

Comprehensive (loss) income	$	(55,039	)	$	(52,830	)	$	182,774	$	(41,696	)	$	(88,248	)	$	(55,039	)

	Condensed Consolidating Statement of Comprehensive Income For the Period from April 24 - June 30, 2015
(Thousands)	CS&L		CSL Capital		Guarantors		Non-Guarantors			Eliminations			Consolidated
Revenues:
Leasing	$	—	$	—	$	124,172	$	—		$	—		$	124,172
Consumer CLEC		—		—		—		4,576			—			4,576
Total revenues		—		—		124,172		4,576			—			128,748
Costs and Expenses:
Interest expense		48,797		48,797		—		—			(48,797	)		48,797
Depreciation and amortization		—		—		46,744		17,700			—			64,444
General and administrative expense		338		—		2,823		—			—			3,161
Operating expense		—		—		—		3,741			—			3,741
Transaction related costs		—		—		73		—			—			73
Total costs and expenses		49,135		48,797		49,640		21,441			(48,797	)		120,216
Earnings from consolidated subsidiaries		57,436		57,436		—		—			(114,872	)		—
Income (loss) before income taxes		8,301		8,639		74,532		(16,865	)		(66,075	)		8,532
Income tax expense		—		—		94		137			—			231
Net income (loss)	$	8,301	$	8,639	$	74,438	$	(17,002	)	$	(66,075	)	$	8,301

Comprehensive income (loss)	$	36,852	$	37,190	$	74,438	$	(17,002	)	$	(94,626	)	$	36,852

	Condensed Consolidating Statement of Cash Flows For the Six Months Ended June 30, 2016
(Thousands)	CS&L			CSL Capital		Guarantors			Non-Guarantors			Eliminations			Consolidated
Cash flow from operating activities
Net cash provided by (used in) operating activities	$	(46,656	)	$	—	$	308,096		$	6,060		$	(83,689	)	$	183,811

Cash flow from investing activities
Acquisition of businesses, net of cash acquired		—			—		(316,244	)		111			—			(316,133	)
Capital expenditures		—			—		(3,397	)		(6,055	)		—			(9,452	)
Net cash (used in) provided by investing activities		—			—		(319,641	)		(5,944	)		—			(325,585	)

Cash flow from financing activities
Principal payment on debt		(11,394	)		—		—			—			—			(11,394	)
Dividends paid		(180,694	)		—		—			—			—			(180,694	)
Proceeds from issuance of Notes		148,875			—		—			—			—			148,875
Borrowings under revolving credit facility		321,000			—		—			—			—			321,000
Payments under revolving credit facility		(278,936	)													(278,936	)
Capital lease payments		—			—		(469	)		—			—			(469	)
Deferred financing costs		(2,998	)		—		—			—			—			(2,998	)
Common stock issuance, net of costs		54,836			—		—			—			—			54,836
Net share settlement		(2,055	)		—		—			—			—			(2,055	)
Intercompany transactions, net		(1,196	)		—		(83,963	)		1,470			83,689			—
Net cash (used in) provided by investing activities		47,438			—		(84,432	)		1,470			83,689			48,165

Effect of exchange rates on cash and cash equivalents		—			—		—			(76	)		—			(76	)

Net increase in cash and cash equivalents		782			—		(95,977	)		1,510			—			(93,685	)
Cash and cash equivalents, December 31, 2015		17			—		140,197			2,284						142,498
Cash and cash equivalents, June 30, 2016	$	799		$	—	$	44,220		$	3,794		$	—		$	48,813

	Condensed Consolidating Statement of Cash Flows For the period from April 24 - June 30, 2015
(Thousands)	CS&L			CSL Capital		Guarantors			Non-Guarantors		Eliminations		Consolidated
Cash flow from operating activities
Net cash (used in) provided by operating activities	$	(61,540	)	$	—	$	154,971		$	—	$	—	$	93,431

Cash flow from investing activities
Consideration paid to Windstream Services		(1,035,029	)		—		—			—		—		(1,035,029	)
Capital expenditures		—			—		(397	)		—		—		(397	)
Net cash used in investing activities		(1,035,029	)		—		(397	)		—		—		(1,035,426	)

Cash flow from financing activities
Proceeds from issuance of Term Loans		1,127,000			—		—			—		—		1,127,000
Deferred financing costs		(29,933	)		—		—			—		—		(29,933	)
Common stock issuance		(456	)		—		—			—		—		(456	)
Cash in-lieu of fractional shares		(19	)		—		—			—		—		(19	)
Net cash provided by investing activities		1,096,592			—		—			—		—		1,096,592

Net increase in cash and cash equivalents		23			—		154,574			—		—		154,597
Cash and cash equivalents, December 31, 2015		—			—		18			—		—		18
Cash and cash equivalents, June 30, 2015	$	23		$	—	$	154,592		$	—	$	—	$	154,615