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UNITEDSTATESSECURITIES AND EXCHANGE COMMISSION

Washington, D.C.20549

FORM10-Q

|                                                  |                                                                                       |
|--------------------------------------------------|---------------------------------------------------------------------------------------|
|          | QUARTERLYREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934 |

For the quarterly period ended March31,2006

OR

|                                |                                                                                        |
|--------------------------------|----------------------------------------------------------------------------------------|
|       | TRANSITIONREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934 |

For the transition period from______________to______________

Commission FileNumber 001-32168

GLOBAL SIGNALINC.

|                                                              |  |                                    |  |  |  |  |
|--------------------------------------------------------------|--|------------------------------------|--|--|--|--|
| DELAWARE                                                     |  | 65-0652634                         |
| (State orother jurisdiction of incorporation ororganization) |  | (I.R.S. EmployerIdentificationNo.) |
|                                                              |

301 North Cattlemen Road, Suite300, Sarasota, Florida 34232-6427(Address of principalexecutive offices)

Telephone: (941)364-8886(Registrant’s telephone number, including areacode)

Indicate by check markwhether the registrant (1) has filed all reports required to be filedby Section 13 or 15(d) of the Securities Exchange Act of 1934 duringthe preceding 12 months (or for such shorter period that the registrantwas required to file such reports), and (2) has been subject to suchfiling requirements for the past 90 days. Yes      No

Indicate by check mark whetherthe registrant is a large accelerated filer, an accelerated filer or anon-accelerated filer. See definition of ‘‘acceleratedfiler and large accelerated filer’’ in Rule 12b-2 of theExchange Act. (Check one): Large accelerated filer     Accelerated filer      Non-accelerated filer

Indicate by check mark whether theregistrant is a shell company (as defined in Rule 12b-2 of the Act).Yes      No 

AtMay  5,  2006, Registrant had outstanding 69,936,595 sharesof $0.01 par value commonstock.

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PART I.    FINANCIALINFORMATION

|                                                 |  |                                                                                                                                     |  |        |        |        |  |  |  |  |
|-------------------------------------------------|--|-------------------------------------------------------------------------------------------------------------------------------------|--|--------|--------|--------|--|--|--|--|
|                                            |  |                                                                                                                                |  | Page   |
| Item1.                                          |  | FinancialStatements                                                                                                                 |  |   |   |   |
|                                            |  | Condensed Consolidated BalanceSheets as of March 31, 2006 (unaudited) and    December 31,2005                   |  |   | 2      |   |
|                                            |  | Condensed ConsolidatedStatements of Operations (unaudited) for the Three Months    Ended March 31, 2006 and2005 |  |   | 3      |   |
|                                            |  | Condensed ConsolidatedStatements of Cash Flows (unaudited) for the Three Months    Ended March 31, 2006 and2005 |  |   | 4      |   |
|                                            |  | Notes to Unaudited CondensedConsolidated Financial Statements                                                                       |  |   | 5      |   |
| Item2.                                          |  | Management’s Discussion and Analysis of FinancialCondition and Results ofOperations                                           |  |   | 18     |   |
| Item3.                                          |  | Quantitative and Qualitative Disclosures About MarketRisk                                                                           |  |   | 31     |   |
| Item 4.                                         |  | ControlsandProcedures                                                                                                               |  |   | 31     |   |
|                                            |  |                                                                                                                                |  |   |   |   |
| PARTII.    OTHERINFORMATION |
|                                            |  |                                                                                                                                |  |   |   |   |
| Item1.                                          |  | Legal Proceedings                                                                                                                   |  |   | 32     |   |
| Item 1A.                                        |  | Risk Factors                                                                                                                        |  |   | 32     |   |
| Item 2.                                         |  | Unregistered Salesof Equity Securities and Use ofProceeds                                                                           |  |   | 32     |   |
| Item3.                                          |  | Defaults Upon SeniorSecurities                                                                                                      |  |   | 33     |   |
| Item4.                                          |  | Submission of Matters to a Vote of SecurityHolders                                                                                  |  |   | 33     |   |
| Item 5.                                         |  | OtherInformation                                                                                                                    |  |   | 33     |   |
| Item6.                                          |  | Exhibits                                                                                                                            |  |   | 34     |   |
|                                                 |

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PARTI.    FINANCIAL INFORMATION

Item 1.    FinancialStatements

GLOBAL SIGNAL INC.CONDENSEDCONSOLIDATED BALANCE SHEETS(in thousands, except sharedata)

|                                                                                                                                                                                            |  |               |           |                   |        |        |           |         |  |  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|---------------|-----------|-------------------|--------|--------|-----------|---------|--|--|
|                                                                                                                                                                                       |  | March31, 2006 |           | December 31, 2005 |
|                                                                                                                                                                                       |  | (unaudited)   |           |              |
| Assets                                                                                                                                                                                     |  |          |           |              |   |   |
| Currentassets:                                                                                                                                                                             |  |          |      |              |        |   |      |    |
| Cash and cashequivalents                                                                                                                                                                   |  | $             | 183,992   |              |        | $      | 47,793    |    |
| Accountsreceivable, less allowance for doubtful accounts of $1,648 and $1,559,respectively                                                                                                 |  |          | 2,689     |              |        |   | 2,360     |    |
| Prepaidexpenses and other currentassets                                                                                                                                                    |  |          | 37,932    |              |        |   | 36,930    |    |
| Interestrate swap asset, at fairvalue                                                                                                                                                      |  |          | —   |              |        |   | 22,609    |    |
| Totalcurrentassets                                                                                                                                                                         |  |          | 224,613   |              |        |   | 109,692   |    |
| Restrictedcash                                                                                                                                                                             |  |          | 38,607    |              |        |   | 20,232    |    |
| Fixed assets, netof accumulated depreciation of $209,312 and $174,917,respectively                                                                                                         |  |          | 1,672,483 |              |        |   | 1,681,755 |    |
| Intangibleassets:                                                                                                                                                                          |  |          |      |              |        |   |      |    |
| Goodwill                                                                                                                                                                                   |  |          | 10,610    |              |        |   | 10,610    |    |
| Leaseholdinterests, net of accumulated amortization of $13,784 and $12,811,respectively                                                                                                    |  |          | 7,026     |              |        |   | 8,084     |    |
| Leaseabsorption value, net of accumulated amortization of $60,792 and$53,229,respectively                                                                                                  |  |          | 387,363   |              |        |   | 395,391   |    |
| Leaseorigination value, net of accumulated amortization of $1,965 and$1,669,respectively                                                                                                   |  |          | 23,055    |              |        |   | 23,638    |    |
| Deferreddebt issuance costs, net of accumulated amortization of $2,395 and$10,943,respectively                                                                                             |  |          | 16,124    |              |        |   | 16,870    |    |
| Otherassets                                                                                                                                                                                |  |          | 26,760    |              |        |   | 22,540    |    |
|                                                                                                                                                                                       |  | $             | 2,406,641 |              |        | $      | 2,288,812 |    |
| Liabilitiesand Stockholders' Equity                                                                                                                                                        |  |          |      |              |        |   |      |    |
| Currentliabilities:                                                                                                                                                                        |  |          |      |              |        |   |      |    |
| Accountspayable                                                                                                                                                                            |  | $             | 20,227    |              |        | $      | 20,299    |    |
| Accruedexpenses                                                                                                                                                                            |  |          | 25,476    |              |        |   | 22,266    |    |
| Dividendpayable                                                                                                                                                                            |  |          | 36,653    |              |        |   | 34,304    |    |
| Deferredrevenue                                                                                                                                                                            |  |          | 32,785    |              |        |   | 21,307    |    |
| Notespayable and current portion of long-termdebt                                                                                                                                          |  |          | 576       |              |        |   | 538       |    |
| Totalcurrentliabilities                                                                                                                                                                    |  |          | 115,717   |              |        |   | 98,714    |    |
| Long-termdebt, net of currentportion                                                                                                                                                       |  |          | 1,844,067 |              |        |   | 1,693,058 |    |
| Otherliabilities                                                                                                                                                                           |  |          | 51,102    |              |        |   | 43,851    |    |
| Totalliabilities                                                                                                                                                                           |  |          | 2,010,886 |              |        |   | 1,835,623 |    |
| Stockholders'equity:                                                                                                                                                                       |  |          |      |              |        |   |      |    |
| Preferred stock,$0.01 par value, 20,000,000 shares authorized, no shares issued oroutstanding at March  31,  2006 and December31,2005                                                      |  |          | —   |              |        |   | —   |    |
| Commonstock, $0.01 par value, 150,000,000 shares authorized, 69,814,537shares issued and outstanding at March  31,  2006, and68,608,725 shares issued and outstanding at December  31,2005 |  |          | 698       |              |        |   | 686       |    |
| Additionalpaid-incapital                                                                                                                                                                   |  |          | 442,917   |              |        |   | 476,388   |    |
| Treasurystock, at cost, 29,327 shares at March 31, 2006 and 0 shares atDecember 31,2005                                                                                                    |  |          | (1,463    | )            |        |   | —   |    |
| Deferredstock-basedcompensation                                                                                                                                                            |  |          | —   |              |        |   | (1,055    | )  |
| Accumulatedother comprehensiveincome                                                                                                                                                       |  |          | 32,319    |              |        |   | 20,800    |    |
| Accumulateddeficit                                                                                                                                                                         |  |          | (78,716   | )            |        |   | (43,630   | )  |
| Totalstockholders'equity                                                                                                                                                                   |  |          | 395,755   |              |        |   | 453,189   |    |
|                                                                                                                                                                                       |  | $             | 2,406,641 |              |        | $      | 2,288,812 |    |
|                                                                                                                                                                                            |

Theaccompanying Notes to Unaudited Condensed Consolidated FinancialStatements arean integral part of these condensed financialstatements.

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GLOBAL SIGNAL INC.CONDENSEDCONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)(in thousands,except per sharedata)

|                                                                                                                                 |  |                            |         |         |  |        |         |         |  |  |
|---------------------------------------------------------------------------------------------------------------------------------|--|----------------------------|---------|---------|--|--------|---------|---------|--|--|
|                                                                                                                            |  | ThreeMonths Ended March31, |
|                                                                                                                            |  | 2006                       |         | 2005    |
| Revenues                                                                                                                        |  | $                          | 120,922 |    |  | $      | 53,798  |    |
| Directsite operating expenses (excluding depreciation, amortization andaccretion)                                               |  |                       | 53,202  |    |  |   | 15,823  |    |
| Grossmargin                                                                                                                     |  |                       | 67,720  |    |  |   | 37,975  |    |
| Otherexpenses:                                                                                                                  |  |                       |    |    |  |   |    |    |
| Selling, generaland administrative (including $(10) and $318 of non-cash stock-basedcompensation (income) expense,respectively) |  |                       | 11,100  |    |  |   | 6,756   |    |
| Sprintsites integrationcosts                                                                                                    |  |                       | 254     |    |  |   | — |    |
| Statefranchise, excise and minimumtaxes                                                                                         |  |                       | 525     |    |  |   | 174     |    |
| Depreciation,amortization andaccretion                                                                                          |  |                       | 44,270  |    |  |   | 17,389  |    |
|                                                                                                                            |  |                       | 56,149  |    |  |   | 24,319  |    |
| Operatingincome                                                                                                                 |  |                       | 11,571  |    |  |   | 13,656  |    |
| Interestexpense, net                                                                                                            |  |                       | 24,647  |    |  |   | 10,201  |    |
| Gain onderivativeinstruments                                                                                                    |  |                       | (176    | )  |  |   | — |    |
| Loss onearly extinguishment ofdebt                                                                                              |  |                       | 21,102  |    |  |   | — |    |
| Other expense(income)                                                                                                           |  |                       | 45      |    |  |   | (103    | )  |
| Income(loss) from continuing operations before income tax benefit(expense)                                                      |  |                       | (34,047 | )  |  |   | 3,558   |    |
| Income taxbenefit(expense)                                                                                                      |  |                       | (37     | )  |  |   | 525     |    |
| Income(loss) from continuingoperations                                                                                          |  |                       | (34,084 | )  |  |   | 4,083   |    |
| Loss fromdiscontinuedoperations                                                                                                 |  |                       | (503    | )  |  |   | (169    | )  |
| Income(loss) before loss on sale ofproperties                                                                                   |  |                       | (34,587 | )  |  |   | 3,914   |    |
| Loss onsale ofproperties                                                                                                        |  |                       | (499    | )  |  |   | (18     | )  |
| Netincome(loss)                                                                                                                 |  | $                          | (35,086 | )  |  | $      | 3,896   |    |
| Basicincome (loss) per commonshare:                                                                                             |  |                       |    |    |  |   |    |    |
| Income (loss) fromcontinuingoperations                                                                                          |  | $                          | (0.49   | )  |  | $      | 0.08    |    |
| Income(loss) from discontinuedoperations                                                                                        |  |                       | (0.01   | )  |  |   | (0.01   | )  |
| Gain(loss) on sale ofproperties                                                                                                 |  |                       | (0.01   | )  |  |   | — |    |
| Netincome(loss)                                                                                                                 |  | $                          | (0.51   | )  |  | $      | 0.07    |    |
| Dilutedincome (loss) per commonshare:                                                                                           |  |                       |    |    |  |   |    |    |
| Income (loss) fromcontinuingoperations                                                                                          |  | $                          | (0.49   | )  |  | $      | 0.08    |    |
| Income(loss) from discontinuedoperations                                                                                        |  |                       | (0.01   | )  |  |   | (0.01   | )  |
| Gain(loss) on sale ofproperties                                                                                                 |  |                       | (0.01   | )  |  |   | — |    |
| Netincome(loss)                                                                                                                 |  | $                          | (0.51   | )  |  | $      | 0.07    |    |
| Dividendsdeclared per commonshare                                                                                               |  | $                          | 0.525   |    |  | $      | 0.400   |    |
| Weightedaverage number of common sharesoutstanding:                                                                             |  |                       |    |    |  |   |    |    |
| Basic                                                                                                                           |  |                       | 69,378  |    |  |   | 52,023  |    |
| Diluted                                                                                                                         |  |                       | 69,378  |    |  |   | 53,935  |    |
|                                                                                                                                 |

Theaccompanying Notes to Unaudited Condensed Consolidated FinancialStatements are an integral part of these condensed financialstatements.

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GLOBAL SIGNAL INC.CONDENSEDCONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)(in thousands,except per sharedata)

|                                                                                                          |  |                            |            |                                 |  |        |         |         |  |  |
|----------------------------------------------------------------------------------------------------------|--|----------------------------|------------|---------------------------------|--|--------|---------|---------|--|--|
|                                                                                                     |  | ThreeMonths Ended March31, |
|                                                                                                     |  | 2006                       |            | 2005                            |
|                                                                                                     |  |                       |            | (Revised)(See Note 2) |
| Cashflows from operatingactivities:                                                                      |  |                       |       |                            |  |   |    |    |
| Net income(loss)                                                                                         |  | $                          | (35,086    | )                          |  | $      | 3,896   |    |
| Adjustmentsto reconcile net income (loss) to net cash provided by operatingactivities:                   |  |                       |       |                            |  |   |    |    |
| Depreciation,amortization andaccretion                                                                   |  |                       | 44,270     |                            |  |   | 17,389  |    |
| Amortizationof deferred debt issuance costs andhedges                                                    |  |                       | 1,467      |                            |  |   | 1,564   |    |
| Loss onearly extinguishment ofdebt                                                                       |  |                       | 21,102     |                            |  |   | — |    |
| Netof effects from otheradjustments:                                                                     |  |                       |       |                            |  |   |    |    |
| Continuingoperations                                                                                     |  |                       | 600        |                            |  |   | (198    | )  |
| Discontinuedoperations                                                                                   |  |                       | 236        |                            |  |   | 165     |    |
| (Increase)decrease in assets, net of effects fromacquisitions                                            |  |                       | (8,175     | )                          |  |   | (1,208  | )  |
| Increasein liabilities, net of effects fromacquisitions                                                  |  |                       | 20,826     |                            |  |   | 2,383   |    |
| Netcash provided by operatingactivities                                                                  |  |                       | 45,240     |                            |  |   | 23,991  |    |
| Cashflows from investingactivities:                                                                      |  |                       |       |                            |  |   |    |    |
| Payments made inconnection with acquisitions of communcationsites                                        |  |                       | (19,769    | )                          |  |   | (43,999 | )  |
| Capitalexpenditures                                                                                      |  |                       | (5,624     | )                          |  |   | (2,934  | )  |
| Proceedsfrom the sale of fixed assets: Continuingoperations                                              |  |                       | 243        |                            |  |   | 18      |    |
| Funds provided by(invested in) restrictedcash                                                            |  |                       | (18,375    | )                          |  |   | (5,329  | )  |
| Netcash used in investingactivities                                                                      |  |                       | (43,525    | )                          |  |   | (52,244 | )  |
| Cashflows from financingactivities:                                                                      |  |                       |       |                            |  |   |    |    |
| Borrowingsunder notes payable and long-termdebt                                                          |  |                       | 1,557,050  |                            |  |   | 67,850  |    |
| Repaymentof notes payable and long-termdebt                                                              |  |                       | (1,413,008 | )                          |  |   | (17,955 | )  |
| Paymentof debt issuancecosts                                                                             |  |                       | (11,867    | )                          |  |   | (808    | )  |
| Paymentreceived to terminate interest rateswaps                                                          |  |                       | 33,759     |                            |  |   | — |    |
| Ordinarydividendspaid                                                                                    |  |                       | (34,713    | )                          |  |   | (20,857 | )  |
| Proceedsfrom the issuance of commonstock                                                                 |  |                       | 3,205      |                            |  |   | 901     |    |
| Netcash provided by financingactivities                                                                  |  |                       | 134,426    |                            |  |   | 29,131  |    |
| Effectof exchange rate changes oncash                                                                    |  |                       | 58         |                            |  |   | 211     |    |
| Netincrease in cash and cashequivalents                                                                  |  |                       | 136,199    |                            |  |   | 1,089   |    |
| Cash andcash equivalents, beginning ofperiod                                                             |  |                       | 47,793     |                            |  |   | 5,991   |    |
| Cashand cash equivalents, end ofperiod                                                                   |  | $                          | 183,992    |                            |  | $      | 7,080   |    |
| Non-cashinvesting and financingtransactions:                                                             |  |                       |       |                            |  |   |    |    |
| Assetsacquired under a capital leaseobligation                                                           |  | $                          | —    |                            |  | $      | 243     |    |
| Increasein the fair value of interest rate swaps recorded to accumulated othercomprehensive income(loss) |  | $                          | 8,450      |                            |  | $      | 11,703  |    |
| Equityderivative arising from InvestmentAgreement                                                        |  | $                          | —    |                            |  | $      | (62,157 | )  |
| Equityderivative arising from OptionAgreement                                                            |  | $                          | —    |                            |  | $      | 37,843  |    |
|                                                                                                          |

Theaccompanying Notes to Unaudited Condensed Consolidated FinancialStatements are an integral part of these condensed financialstatements.

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|          |                   |
|----------|-------------------|
| 1.  | Nature ofBusiness |

The accompanying unaudited condensed consolidatedfinancial statements reflect the financial position, results ofoperations and cash flows of Global Signal Inc. and its wholly ownedsubsidiaries. Global Signal Inc. owns, leases and managescommunications towers and other communications sites and leases spaceon them to providers of communications and broadcast services, such aswireless telephony, paging, mobile radio, wireless data transmission,radio and television broadcasting, and to operators of private networkssuch as federal, state and local government agencies. For the threemonths ended March  31,  2006, Sprint Corporation comprised37.3% of our revenues and Cingular Wireless comprised15.5% of our revenues.

As used herein, unless the contextotherwise requires, ‘‘we,’’‘‘us,’’‘‘our,’’‘‘Company,’’ or ‘‘GlobalSignal’’ refers to Global Signal Inc. and its whollyowned consolidated subsidiaries. All significant intercompany balancesand transactions have been eliminated.‘‘Fortress’’ refers to Fortress InvestmentHoldings LLC and certain of its affiliates,‘‘Greenhill’’ refers to Greenhill CapitalPartners, L.P. and affiliated investment funds, and‘‘Abrams’’ refers to Abrams Capital, LLCand certain of its affiliates. Since November  1,  2002,Fortress has been our largest stockholder, Greenhill has been oursecond largest stockholder and Abrams has been our third largeststockholder.

On May  11,  2004, we completed ourformation of an UPREIT structure whereby we own substantially all ofour assets and conduct our operations through an operating partnership,Global Signal Operating Partnership, L.P. (‘‘GlobalSignal OP’’). Global Signal Inc. is the special limitedpartner of Global Signal OP. Global Signal GP LLC, our wholly ownedsubsidiary, is the managing general partner and, as such, has the powerto manage and conduct the business of Global Signal OP. Global SignalInc. holds 99% of the partnership interests and Global Signal GPLLC holds 1% of the partnership interests in Global Signal OP.The partnership agreement of Global Signal OP provides that it shalldistribute cash flows from its operations to its limited partners andthe managing general partner in accordance with their relativepercentage interests. The distributions that we receive from GlobalSignal OP are, among other things, used to make dividend distributionsto our stockholders. We believe that the UPREIT structure may provideflexibility by enabling us to execute certain acquisitions moreeffectively by giving tax advantages to sellers who accept partnershipunits in the UPREIT as payment.

Results of operations for anyinterim period are not necessarily indicative of results of any otherperiods or for the year. The accompanying unaudited condensedconsolidated financial statements have been prepared in conformity withgenerally accepted accounting principles in the United States forinterim financial statements and with the instructions to Form 10-Q andRule 10-01 of Regulation S-X. They do not include all information andnotes required by generally accepted accounting principles for completefinancial statements. In the opinion of management, all adjustments(consisting of normal recurring adjustments) considered necessary forfair presentation have been included. Certain amounts from the prioryear period have been reclassified for consistency with currentpresentation. These reclassifications were not material to thecondensed consolidated financial statements. These unaudited condensedconsolidated financial statements should be read in conjunction withGlobal Signal’s audited consolidated financial statements andnotes thereto for the year ended December  31,  2005,included in Global Signal’s Annual Report on Form 10-K for theyear ended December  31,  2005, filed with the Securitiesand Exchange Commission on March  16,2006.

|          |                                           |
|----------|-------------------------------------------|
| 2.  | Summary of Significant AccountingPolicies |

The financial statements have been prepared inaccordance with U.S. generally accepted accounting principles. Theprincipal accounting policies are set forth below:

Use ofEstimates

The preparation of financial statements in conformitywith generally accepted accounting principles in the United Statesrequires management to make estimates and assumptions that affect theamounts reported in the unaudited condensed consolidated financialstatements and accompanying notes. Actual results may differ from thoseestimates and such differences could be material.

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Stock-Based Compensation

EffectiveJanuary  1,  2006, we adopted Statement of FinancialAccounting Standard (‘‘SFAS’’) No.123(R) Share-Based-Payments, using the modified prospectivetransition method to account for our employee stock-options. Under thattransition method, compensation costs for the portion of awards forwhich the requisite service had not yet been rendered, and that wereoutstanding as of the adoption date, will be recognized as the serviceis rendered based on the grant date fair value of those awardscalculated under SFAS No. 123. Prior period results are not restated.Since all options were fully vested on January 1, 2006, the adoption ofSFAS No. 123(R) had no impact on net income or earnings per share. Inconnection with the adoption of SFAS No. 123(R), we reclassified $1.1million of deferred stock-based compensation expense, which relatesentirely to unvested restricted stock, to additional paid-in capital asof January 1, 2006. See Note 7 for disclosures related to stock-basedcompensation.

New Accounting Pronouncements

EffectiveJanuary  1,  2006, we adopted Financial AccountingStandards Board (‘‘FASB’’) InterpretationNo. 47 (‘‘FIN 47’’) Accounting forConditional Asset Retirement Obligations. This interpretationclarifies that the term ‘‘conditional asset retirementobligation’’ as used in SFAS No. 143, Accounting forAsset Retirement Obligations, refers to a legal obligation toperform an asset retirement activity in which the timing and (or)method of settlement are conditional on a future event that may or maynot be within the control of the entity. The obligation isunconditional even though uncertainty exists about the timing and (or)method of settlement. Our asset retirement obligations are within ourcontrol as to timing and method as they relate to the removal of ourcommunications towers from leased land; therefore the adoption of thisinterpretation did not impact our financial statements.

EffectiveJanuary  1,  2006, we adopted FASB Staff Position 13-1Accounting for Rental Costs Incurred during a Construction Period.This staff position concludes that rental costs associated withground or building operating leases that are incurred during aconstruction period should be recognized as rental expense. We hadalready accounted for such rental costs in the manner prescribed by thestaff position, so this staff position did not impact our financialstatements.

Reclassifications and Revisions

In the firstquarter of 2006, we have separately disclosed the operating, investingand financing portion of the cash flows attributed to discontinuedoperations, which in the prior period was not separately reported.Certain amounts from prior year have been reclassified for consistencywith the current year presentation. All other reclassifications relateto discontinued operations. The reclassifications and revisions werenot material to the consolidated financialstatements.

|          |                         |
|----------|-------------------------|
| 3.  | Discontinued Operations |

As a partof our ongoing operational reviews, we make decisions to divestourselves of under-performing towers or other communications sites,including 19 tower sites in the three months ended March31,  2006, and one tower site in the three months endedMarch  31,  2005. Of the 19 tower sites we decided todivest in the three months ended March  31,  2006, 14 areincluded in discontinued operations while the other five remain incontinuing operations as we are not assured that they will be soldwithin one year. At March  31,  2006, we had 232 towersites that were classified as held for disposal by sale.

Inaccordance with SFAS No. 144, Accounting for the Impairment orDisposal of Long-Lived Assets, we classified the operating resultsof 227 of these sites as discontinued operations in the accompanyingcondensed consolidated financial statements and all prior periods havebeen reclassified to conform to the current quarter’spresentation with respect to these sites.

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Results of operations for thesediscontinued sites for the three months ended March  31,2006 and 2005 are as follows (inthousands):

|                                               |  |                            |      |             |  |        |         |         |  |  |
|-----------------------------------------------|--|----------------------------|------|-------------|--|--------|---------|---------|--|--|
|                                          |  | ThreeMonths Ended March31, |
|                                          |  | 2006                       |      | 2005        |
|                                          |  | (unaudited)                |      | (unaudited) |
| Revenues                                      |  | $                          | 550  |        |  | $      | 918     |    |
| Directoperatingexpenses                       |  |                       | 786  |        |  |   | 1,081   |    |
| Resultsof operations                          |  |                       | (236 | )      |  |   | (163    | )  |
| Loss onimpairment ofassets                    |  |                       | (33  | )      |  |   | — |    |
| Loss recognizedon assets of discontinuedsites |  |                       | (234 | )      |  |   | (6      | )  |
| Income(loss) from discontinuedoperations      |  | $                          | (503 | )      |  | $      | (169    | )  |
|                                               |

Assetsheld for sale of $0.8  million and $0.8  million areincluded in fixed assets, net in the condensed consolidated balancesheets as of March  31,  2006 and December31,  2005, respectively.

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|          |      |
|----------|------|
| 4.  | Debt |

Our outstanding debtas of March  31,  2006 and December  31,  2005consists of the following (in thousands):

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |  |               |           |                 |  |        |           |         |  |  |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|---------------|-----------|-----------------|--|--------|-----------|---------|--|--|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | March31, 2006 |           | December31,2005 |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | (unaudited)   |           |            |
| February2004 mortgage loan, weighted average interest rate of approximately5.0%, secured by first priority mortgage liens on substantiallyall tangible assets of Pinnacle Towers LLC and its subsidiaries,monthly principal and interest installments of approximately$2.4  million beginning March  2004. Contractual maturitydate of January  2029, anticipated maturity date ofJanuary  2009 (repaid in full with a portion of the net proceedsfrom the February  2006 mortgageloan)                       |  | $             | —   |            |  | $      | 404,087   |    |
| December2004 mortgage loan, weighted average interest rate of approximately4.7%, secured by first priority mortgage liens on substantiallyall tangible assets of Pinnacle Towers Acquisition LLC and itssubsidiaries, monthly interest-only installments beginningJanuary  2005, contractual maturity date of December2009                                                                                                                                                                                    |  |          | 293,825   |            |  |   | 293,825   |    |
| February2006 mortgage loan, weighted average interest rate of approximately5.7%, secured by first priority mortgage liens on substantiallyall tangible assets of Pinnacle Towers LLC, GSA and GSA II, monthlyinterest-only installments beginning March  2006, contractualmaturity date of February2011                                                                                                                                                                                                       |  |          | 1,550,000 |            |  |   | —   |    |
| Bridgeloan, interest at LIBOR plus 1.50% (5.8% atDecember  31,  2005), secured by our ownership interests inGlobal Signal Acquisitions II LLC (‘‘GSAII’’), and in GSA II’s leasehold and subleaseholdinterests in the Sprint Towers, and an assignment of leases and rent.Interest installments due monthly and a contractual maturity date ofMay  25,  2006, before extension options (repaid in fullwith a portion of the net proceeds from the February  2006mortgage loan.) |  |          | —   |            |  |   | 850,000   |    |
| $200.0million acquisition credit facility, interest at LIBOR plus 2.0%(6.4% at December  31,  2005), secured by theacquired tower assets through a pledge of Global Signal OP’sequity interest in Global Signal Acquisitions LLC(‘‘GSA’’). Interest installments duemonthly and a contractual maturity date of April  24,  2006(repaid in full with a portion of the net proceeds from theFebruary  2006 mortgageloan.)                                                         |  |          | —   |            |  |   | 144,725   |    |
| Capitallease obligations, interest rate fixed at a weighted average rate of9.5%, secured by the underlying capital assets, with monthlyprincipal installments beginning April  2004 and continuingthrough July2010                                                                                                                                                                                                                                                                                            |  |          | 818       |            |  |   | 959       |    |
| RevolvingCredit Facility interest at a variable rate of LIBOR plus 3.0%or the lender’s base rate plus 2.0%, secured by a pledgeof Global Signal OP’s assets, maturity date of December2006                                                                                                                                                                                                                                                                                                        |  |          | —   |            |  |   | —   |    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |          | 1,844,643 |            |  |   | 1,693,596 |    |
| Less:Notes payable and current portion of long-termdebt                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |          | (576      | )          |  |   | (538      | )  |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | $             | 1,844,067 |            |  | $      | 1,693,058 |    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |

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As noted in the table above, theFebruary  2004 mortgage loan, the bridge loan and the$200.0  million acquisition credit facility were repaid in fullwith a portion of the proceeds of the February  2006 mortgageloan described below. In accordance with SFAS No. 6 Classificationof Short-Term Obligations Expected to be Refinanced, wereclassified the current portion of debt at December  31,2005 under these three loans to long-term.

The following tableshows the maturities of long-term debt for the five twelve monthperiods after March  31,  2006 (in thousands):

|                                       |  |        |           |        |  |  |
|---------------------------------------|--|--------|-----------|--------|--|--|
| For the twelve months ending March31, |  |   |      |   |
| 2007                                  |  | $      | 576       |   |
| 2008                                  |  |   | 201       |   |
| 2009                                  |  |   | 18        |   |
| 2010                                  |  |   | 293,844   |   |
| 2011                                  |  |   | 1,550,004 |   |
|                                  |  | $      | 1,844,643 |   |
|                                       |

TheFebruary  2006 Mortgage Loan

On February28,  2006, three of our wholly owned special purpose entities,Global Signal Acquisitions II LLC, Global Signal Acquisitions LLC andPinnacle Towers LLC (and its 13 subsidiaries), borrowed a total of$1.55  billion under a mortgage loan made payable to a newlyformed trust, Global Signal Trust III (‘‘February 2006mortgage loan’’), that issued $1.55  billion infixed-rate commercial mortgage pass-through certificates to providefixed-rate financing for the assets leased in May  2005 fromSprint Corporation (the ‘‘Sprint Towers’’),the communications sites originally financed with the February2004 mortgage loan, and for other communications sites we acquired fromApril  2005 to January  2006. We have continued toconsolidate our subsidiaries, but have not consolidated Global SignalTrust III in our financial statements. The proceeds of theFebruary  2006 mortgage loan were used to repay the $850.0million bridge loan, to repay $402.7  million (the totalthen-outstanding borrowings under the February  2004 mortgageloan), to repay $151.8  million (the total then-outstandingborrowings under the acquisition credit facility) and to provide$145.5  million of funds for working capital and generalcorporate purposes, including payment of fees and expenses of theoffering and potential future acquisitions. The borrowers and theirdirect parent, Global Signal Holdings V LLC, are separate legalentities from Global Signal Inc., with their own assets, which are notavailable to satisfy the debts and other obligations of Global SignalInc. or any of its other affiliates.

The principal amount of theFebruary  2006 mortgage loan is divided into seven tranches, eachhaving a different level of seniority. Interest accrues on theFebruary  2006 mortgage loan at a weighted average interest rateof approximately 5.7%. The effective interest rate on theFebruary  2006 mortgage loan, including the benefit fromterminating the 2005 interest rate swaps which qualified for hedgeaccounting and the amortization of deferred debt issuance costs, isapproximately 5.5%. The February  2006 mortgage loanrequires monthly payments of interest until its repayment date inFebruary  2011. The February  2006 mortgage loan is securedby, among other things, (1) mortgage liens on the borrowers’interests (fee, leasehold and/or easement) in over 80% of theircommunications sites, (2) a security interest in substantially all ofthe borrowers’ personal property and fixtures and (3) a pledgeof the capital stock (or equivalent equity interests) of each of theborrowers (including a pledge of the capital stock of Pinnacle TowersLLC, Global Signal Acquisitions LLC and Global Signal Acquisitions IILLC from its direct parent, Global Signal Holdings V LLC).

On amonthly basis, the excess cash flows from the securitized entities,after the payment of principal, interest, reserves and expenses, aredistributed to us. If the debt service coverage ratio(‘‘DSCR’’), defined in the February2006 mortgage loan as the net cash flow for the sites for theimmediately preceding twelve calendar month period divided by theamount of interest that we will be required to pay over the succeedingtwelve months on the February  2006 mortgage loan, as of the endof any calendar quarter falls to 1.35 times or lower, then all excesscash flow will be deposited into a reserve account instead of beingreleased to us. The funds in the reserve account will not be releasedto us until the DSCR exceeds 1.35 

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times for two consecutive calendar quarters.If the DSCR falls below 1.20 times as of the end of any calendarquarter, then all funds on deposit in the reserve account along withfuture excess cash flows will be applied to prepay the February2006 mortgage loan with applicable prepayment penalties.

We maynot prepay the February  2006 mortgage loan in whole or in partat any time prior to February  28,  2008, the secondanniversary of the closing date, except in limited circumstances (suchas the occurrence of certain casualty and condemnation events relatingto the communications sites securing the February  2006 mortgageloan). Thereafter, prepayment is permitted provided it is accompaniedby any applicable prepayment consideration. If the prepayment occurswithin three months of the February  2011 monthly payment date,no prepayment consideration is due.

The February  2006mortgage loan documents include covenants customary for mortgage loanssubject to rated securitizations. Among other things, the borrowers areprohibited from incurring additional indebtedness or furtherencumbering their assets.

The December  2004 MortgageLoan

On December  7,  2004, our subsidiary PinnacleTowers Acquisition Holdings LLC and five of its direct and indirectsubsidiaries, issued a $293.8  million mortgage loan to a newlyformed trust, Global Signal Trust II (the ‘‘December 2004mortgage loan’’). Global Signal Trust II(‘‘Trust II’’) then issued an identicalamount of commercial mortgage pass-through certificates in a privatetransaction. We have continued to consolidate our subsidiaries, buthave not consolidated Trust II in our financial statements. The netproceeds of the December  2004 mortgage loan were used primarilyto repay the $181.7  million of then-outstanding borrowings underour credit facility and to partially fund a $120.7  million siteacquisition reserve account which was used to acquire additionalqualifying wireless communications sites over the six-month periodfollowing the December  2004 closing. The borrowers and theirdirect parent, Global Signal Holdings III LLC, are separate legalentities from Global Signal Inc., with their own assets, which are notavailable to satisfy the debts and other obligations of Global SignalInc. or any of its other affiliates.

The principal amount of theDecember  2004 mortgage loan is divided into seven tranches, eachhaving a different level of seniority. Interest accrues on each trancheat a fixed rate per annum. The weighted average interest rate on thevarious tranches is approximately 4.7%. The December  2004mortgage loan requires monthly payments of interest until its maturityin December  2009 when the unpaid principal balance will be due.The December  2004 mortgage loan is secured by, among otherthings, (1) mortgage liens on the borrowers’ interests (fee,leasehold or easement) in substantially all of their wirelesscommunications sites, (2) a security interest in substantially all ofthe borrowers’ personal property and fixtures and (3) a pledgeof the capital stock (or equivalent equity interests) of each of theborrowers (including a pledge of the capital stock of Pinnacle TowersAcquisition Holdings LLC from its direct parent, Global Signal HoldingsIII LLC).

On a monthly basis, the excess cash flows from thesecuritized entities, after the payment of principal, interest,reserves and expenses, are distributed to us. If the debt servicecoverage ratio (‘‘DSCR’’), defined in theDecember  2004 mortgage loan as the net cash flow for the sitesfor the immediately preceding twelve calendar month period divided bythe amount of principal and interest that we will be required to payover the succeeding twelve months on the December  2004 mortgageloan, as of the end of any calendar quarter falls to 1.30 times orlower, then all excess cash flow will be deposited into a reserveaccount instead of being released to us. The funds in the reserveaccount will not be released to us until the DSCR exceeds 1.30 timesfor two consecutive calendar quarters. If the DSCR falls below 1.15times as of the end of any calendar quarter, then all funds on depositin the reserve account along with future excess cash flows will beapplied to prepay the December  2004 mortgage loan.

We maynot prepay the December  2004 mortgage loan in whole or in partat any time prior to December  7,  2006, the secondanniversary of the closing date, except in limited circumstances (suchas the occurrence of certain casualty and condemnation events relatingto the communications sites securing the December  2004 mortgageloan). Thereafter, prepayment is permitted provided it is accompaniedby any applicable prepayment consideration. If the prepayment occurswithin three months of the December  2009 monthly payment date,no prepayment consideration is due.

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The December  2004 mortgage loandocuments include covenants customary for mortgage loans subject torated securitizations. Among other things, the borrowers are prohibitedfrom incurring additional indebtedness or further encumbering theirassets.

The February  2004 Mortgage Loan

OnFebruary  5,  2004, one of our subsidiaries, PinnacleTowers LLC (formerly known as Pinnacle Towers Inc.) and thirteen of itsdirect and indirect subsidiaries, issued a $418.0  millionmortgage loan to a newly formed trust, Global Signal Trust I(‘‘February 2004 mortgage loan’’). OnFebruary  28,  2006, a portion of the net proceeds from theFebruary  2006 mortgage loan was used to repay theFebruary  2004 mortgage loan in full. A prepayment penalty of$7.0  million was paid and recognized in the first quarter of2006 as loss on early extinguishment of debt. In addition, unamortizeddeferred debt issuance costs of $9.5  million and accumulatedother comprehensive loss of $3.4  million related to theelimination of the portion of accumulated other comprehensive loss forinterest rate swaps related to the February 2004 mortgage loan (seeNote 5), respectively, were expensed in the first quarter of 2006 asloss on early extinguishment of debt.

Sprint BridgeFinancing

At the closing of the Sprint Transaction, we executedthe $850.0  million bridge loan financing with Morgan StanleyAsset Funding Inc. and Bank of America, N.A. The borrower was a newlycreated entity, Global Signal Acquisitions II LLC, under our indirectcontrol, which owned 100% of our interest in the Sprint Towers.On February  28,  2006, a portion of the net proceeds fromthe February  2006 mortgage loan was used to repay the Sprintbridge loan in full. Unamortized deferred debt issuance costs of$1.0  million related to the Sprint bridge loan were expensed inthe first quarter of 2006 as loss on early extinguishment ofdebt.

Revolving Credit Agreement

On December1,  2005, Global Signal OP entered into a 364-day $15.0million revolving credit facility pursuant to a revolving creditagreement, which we refer to as the Revolving Credit Agreement, withMorgan Stanley Asset Funding Inc. and Bank of America, N.A. to providefunding for working capital and other corporate purposes.

AtMarch  31,  2006 and December  31,  2005, therewere no balances outstanding under the revolving credit facility.Interest on the $15.0  million revolving credit facility ispayable, at Global Signal OP’s option, at either LIBOR plus3.0% or the bank’s base rate plus 2.0%. Interestis payable at the end of the interest period or at the time ofprincipal repayments. Principal on the revolving credit facility may bepaid, in whole or in part, at any time and must be repaid by the loanmaturity date, December  1,  2006. 

The RevolvingCredit Agreement, and the related ancillary documentation containcovenants and restrictions customary for a facility of this typeincluding a limitation on our consolidated indebtedness atapproximately $1.875  billion and a requirement to limit ourratio of consolidated indebtedness to consolidated EBITDA, as definedin the loan document, to a ratio of 7.65 to 1.0. The Revolving CreditAgreement continues to be guaranteed by us, Global Signal GP, LLC andcertain subsidiaries of Global Signal OP. It is secured by a pledge ofGlobal Signal OP’s assets, including a pledge of 65% ofits interest in our United Kingdom subsidiary, 100% of itsinterest in certain other domestic subsidiaries, a pledge by us andGlobal Signal GP, LLC of our interests in Global Signal OP, and apledge by us of 65% of our interest in our Canadiansubsidiary.

Acquisition Credit Facility

On April25,  2005, our wholly owned subsidiary, GSA, entered into a364-day $200.0  million credit facility, which we refer to as theacquisition credit facility, with Morgan Stanley Asset Funding Inc. andBank of America, N.A. to provide funding for the acquisition ofadditional communications sites. On February  28,  2006, aportion of the net proceeds from the February  2006 mortgage loanwas used to repay in full and terminate the acquisition creditfacility. Unamortized deferred debt issuance costs of $0.2million related to the acquisition credit facility were expensed in thefirst quarter of 2006 as loss on early extinguishment ofdebt.

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|          |                              |
|----------|------------------------------|
| 5.  | Interest Rate SwapAgreements |

2005 Interest Rate Swaps

On January11,  2005, in anticipation of the issuance of interim bridgefinancing and later a third mortgage loan to finance the acquisition ofadditional communications sites we expected to acquire during 2005, weentered into six forward-starting interest rate swap agreements withMorgan Stanley as counterparty to hedge the variability of futureinterest rates on our anticipated mortgage financing. Concurrent withthe pricing of our February  2006 mortgage loan, we terminatedour six interest rate swaps and received a payment, excluding accruedinterest, of $8.1  million, of which $4.3  million wasrecorded as accumulated other comprehensive income and is beingamortized as a reduction of interest expense on the February2006 mortgage loan using the effective interest method over five years,the life of the February  2006 mortgage loan.

OnFebruary  2,  2005 and March  21,  2005, inconnection with the Sprint Transaction, we entered into tenforward-starting interest rate swap agreements with Bank of America,N.A. as counterparty, in anticipation of securing $850.0  millionof bridge financing, which was expected to be replaced by a mortgageloan, for a total notional value of $850.0  million. Concurrentwith the pricing of our February  2006 mortgage loan, weterminated our ten interest rate swaps and received a payment,excluding accrued interest, of $25.8  million, which was recordedas accumulated other comprehensive income (loss) and which is beingamortized as a reduction of interest expense on the February2006 mortgage loan using the effective interest method over five years,the life of the February  2006 mortgage loan.

Theeffective interest rate on the February  2006 mortgage loanincluding the cost of terminating the swaps and the amortization ofdeferred debt issuance costs is approximately 5.5%. For thethree months ended March  31,  2006, amortization ofaccumulated other comprehensive income of $0.6  million wasrecorded as an offset to interest expense.

2004 Interest RateSwaps

On March  26,  2004, in anticipation of afuture financing, we entered into four forward-starting interest rateswaps with Morgan Stanley as counterparty to hedge the variability offuture interest rates on the financing. On August  27,2004, in anticipation of a future financing, we entered into twoadditional forward-starting interest rate swaps with Morgan Stanley ascounterparty to hedge the variability of future interest rates on thefinancing.

Concurrent with the pricing of the December2004 mortgage loan, we terminated our six interest rate swaps andreceived a net payment of $2.0  million which was recorded aspart of accumulated other comprehensive income and is being amortizedas a reduction of interest expense using the effective interest methodover five years, the life of the December  2004 mortgage loan.The effective interest rate on the December  2004 mortgage loan,including the proceeds from terminating the interest rate swaps and theamortization of deferred debt issuance costs, is approximately5.0%. For the three months ended March  31,  2006and 2005, amortization of accumulated other comprehensive income of$0.1  million and $0.1  million, respectively, was recordedas an offset to interest expense.

2003 Interest RateSwap

On December  11,  2003, in anticipation of theissuance of the February  2004 mortgage loan, we entered into aforward-starting interest rate swap agreement (the‘‘December 2003 swap’’) with Morgan Stanleyas the counterparty to hedge the variability of future interestpayments under the anticipated February  2004 mortgage loan. TheDecember  2003 swap was terminated in connection with theissuance of the February  2004 mortgage loan on February5,  2004 at a cost of $6.2  million which was recorded aspart of accumulated other comprehensive loss and was being amortized asinterest expense using the effective interest method over five years,the expected life of the February  2004 mortgage loan. Theeffective interest rate on the February  2004 mortgage loan,including the cost of terminating the interest rate swap and theamortization of deferred debt issuance costs, was approximately6.0%. For the three 

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months ended March  31,  2006 and2005, amortization of accumulated other comprehensive loss of$0.2  million and $0.3  million, respectively, was recordedas interest expense. On February  28,  2006, theFebruary  2004 mortgage loan was repaid in full from a portion ofthe net proceeds from the February  2006 mortgage loan (see Note4), and the remaining $3.4  million of unamortized accumulatedother comprehensive loss related to the 2003 interest rate swap wasrecorded in the first quarter of 2006 as loss on early extinguishmentof debt.

|          |                              |
|----------|------------------------------|
| 6.  | Commitments andContingencies |

Purchase Commitments

As ofMarch  31,  2006, we had signed master services agreementswith Stratos VSAT, Inc. and Hark Tower Systems, Inc. which require usto purchase approximately $6.5  million in satellite datamonitoring equipment. As of March  31,  2006, we hadpurchased $4.1  million of equipment under these commitments. Asof March  31,  2006, we also had outstanding purchaseagreements to acquire 3 communications sites from various sellers for atotal estimated purchase price of $4.2  million, includingestimated fees and expenses, and 146 land parcels for $21.1million, including estimated fees and expenses. As of March31,  2006, we also had binding letters of intent to purchase 5additional communications sites for approximately $4.3  million,including estimated fees and expenses.

Earn Outs

A numberof our asset purchase agreements provide for additional monies to bepaid to the sellers based on future lease commencements during alimited period after the acquisition is completed, generally one yearor less. The aggregate amount of these contingent purchase prices isnot expected to be material for the acquisitions we have closed throughMarch  31,  2006. As of March  31,  2006, wehad no accruals for any such additional acquisition payments. Themaximum additional contingent payments on closed acquisitions wereapproximately $1.1  million at March  31,2006.

Legal Matters

We are involved inlitigation incidental to the conduct of our business. We believe thatnone of such pending litigation, or unasserted claims of which we haveknowledge, will have a material adverse effect on our business,financial condition, results of operations orliquidity.

|          |                           |
|----------|---------------------------|
| 7.  | Stockholders’Equity |

Dividends

On March  15,2006, our board of directors declared a dividend of $0.525 per share ofour common stock for the three months ended March  31,2006, which was paid on April  20,  2006 to thestockholders of record as of April  6,  2006. The entiredividend of $36.7  million was a reduction of additional paid-incapital.

Stock-Based Compensation

Prior to ourJanuary  1,  2006 adoption of SFAS No. 123(R), we accountedfor our stock option and restricted stock grants to employees and stockgrants to directors using the intrinsic value method under AccountingPrinciples Board (APB) Opinion No. 25, Accounting for Stock Issuedto Employees. Under APB No. 25, no compensation costs wererecognized relating to the stock option grants to employees if theexercise price of the options awarded was equal to or greater than thefair value of the common stock on the dates of grant. We used and willcontinue to use under SFAS No. 123(R) the accelerated method torecognize compensation expense of our equity-based awards with gradedvesting. For restricted stock grants under APB No. 25, the unamortizedportion of the related compensation expense was recorded as deferredstock compensation expense, a contra account within stockholders'equity. In connection with the adoption of SFAS No. 123(R), wereclassified $1.1  million of deferred stock-based compensationexpense, which relates entirely to unvested restricted stock, toadditional paid-in capital as of January 1, 2006. Prior toadopting SFAS No. 123(R), we amended an officer's optionagreement to cancel options 

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relating to 35,875 shares with an exerciseprice of $8.53 per share and options relating to 107,625 shares with anexercise price of $18.00 per share, and accelerated vesting of optionsrelating to 46,125 shares with an exercise price of $8.53 per share andoptions relating to 138,375 shares with an exercise price of $18.00 pershare.

Had compensation costs for employee stock option activitybeen determined based on the fair value at the dates of grant for theperiods prior to calendar year 2006, our net income for the threemonths ended March  31,  2005, would have decreased to thepro forma amount indicated below (in thousands, except per sharedata):

|                                                                                                                                                            |  |                                 |        |         |  |  |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|--|---------------------------------|--------|---------|--|--|
|                                                                                                                                                       |  | ThreeMonths Ended March 31,2005 |
|                                                                                                                                                       |  | (unaudited)                     |
| Netincome attributable to commonstockholders:                                                                                                              |  |                            |   |    |
| Net income asreported                                                                                                                                      |  | $                               | 3,896  |    |
| Add: Stock-basedcompensation costs included in reported net income, net of $0related tax effect for allperiods                                             |  |                            | 318    |    |
| Deduct: Total stock-basedemployee compensation expense determined under fair value basedmethod for all awards, net of $0 related tax effect for allperiods |  |                            | (658   | )  |
| Proforma netincome                                                                                                                                         |  | $                               | 3,556  |    |
| Basicincome per share attributable to commonstockholders:                                                                                                  |  |                            |   |    |
| Net income per shareasreported                                                                                                                             |  | $                               | 0.07   |    |
| Proforma net income pershare                                                                                                                               |  | $                               | 0.07   |    |
| Dilutedincome per share attributable to commonstockholders:                                                                                                |  |                            |   |    |
| Net income per shareasreported                                                                                                                             |  | $                               | 0.07   |    |
| Proforma net income pershare                                                                                                                               |  | $                               | 0.07   |    |
|                                                                                                                                                            |

StockIncentive Plan

The Stock Incentive Plan (the"Plan") became effective November1,  2002. The Plan provides for awards consisting of stockoptions and restricted stock grants(‘‘Awards’’) to employees, non-employeedirectors, and other persons who perform services for us. The Plan isadministered by the board of directors or, at the board ofdirectors’ sole discretion, by a committee consisting solely ofpersons who are non-employee directors and outside directors (the‘‘Committee’’).

On February11,  2004, the stockholders approved an increase of 2,000,000shares in the shares available under the Plan and as of January1,  2005, subsequent annual increases of the lesser of 1,000,000shares or 2% of the then-outstanding number of shares of commonstock on the last day of the immediately preceding fiscal year. Themaximum number of shares of common stock that may be made subject toawards granted under the Plan was 7,715,000 at December31,  2005. On January  1,  2006, the number of sharesavailable increased by 1,000,000 pursuant to the annual increasesprovision discussed above. In the event of any change in ourcapitalization, an equitable substitution or proportionate adjustmentshall be made in the aggregate number and/or kind of shares of commonstock reserved for issuance under the Plan and the kind, number and/oroption price at the sole discretion of the Committee. In addition, ifany award expires or terminates without having been exercised, theshares of common stock subject to the Award again become available forgrant under the Plan.

The Committee is authorized to grant toeligible persons incentive stock options(‘‘ISO’’) or nonqualified stock options(‘‘NSO’’). The term of an ISO cannot exceed10 years, and the exercise price of any ISO must be equal to or greaterthan the fair market value of the shares of common stock on the date ofthe grant. Any ISO granted to a holder of 10% or more of thecombined voting power of our capital stock must have an exercise priceequal to or greater than 110% of the fair market value of thecommon stock on the date of grant and may not have a term exceedingfive years from the grant date. The Committee shall determine theexercise price and the term of an NSO on the date that the NSO isgranted.

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Options shall become exercisable in wholeor in part on the date or dates specified by the Committee. TheCommittee, in its sole discretion, may accelerate the date or dates onwhich an option becomes exercisable. Each option shall expire on suchdate or dates as the Committee shall determine at the time the optionis granted. Upon termination of an optionee’s employment forretirement, death or disability, options granted to the employee willexpire one year from the date of termination. Upon termination of anoptionee’s employment for involuntary termination other than forcause, options granted to the employee will expire ninety days plus thenumber of days the employee is prohibited from trading in GlobalSignal’s shares because of insider trading rules or otherarrangements, after the date of termination. Upon termination of anoptionee’s employment for any other reasons, options granted tothe employee will expire on the expiration date specified in theagreement. If an optionee’s employment is terminated for cause(as defined in the Plan), all of such person’s options shallimmediately terminate.

The Committee may also grant to aneligible person an award of common stock subject to future service andsuch other restrictions and conditions as the Committee may determine,which may be either restricted stock, wherein the recipient receivesthe benefits of ownership (such as voting and the receipt of dividends)prior to the vesting of the stock (other than the right to sell ortransfer the stock), or deferred stock, wherein the recipient does nothave any benefits of ownership prior to the vesting of the stock (asapplicable, the ‘‘Restricted Stock’’ or the‘‘Deferred Stock’’). The Committee willdetermine the terms of such Restricted Stock and/or Deferred Stock,including the price, if any, to be paid by the recipient for the stock,the restrictions placed on the shares and the time or times when therestrictions will lapse, at the time of the granting thereof.

Asummary of our stock option activity under the Plan for the threemonths ended March  31,  2006, is presented in the tablebelow. Net proceeds from the exercise of stock options for the threemonths ended March  31,  2006, were $4.7  millionwhich was recorded in common stock and additional paid-in capital. Thefair value at the time of issuance of the options that vested duringthe three months ended March  31,  2006, was $2.1million. The intrinsic value at the time of exercise of the stockoptions exercised during the three months ended March  31,2006, was $47.9million.

|                                 |  |                                  |            |                    |  |                               |  |        |      |        |  |  |  |  |
|---------------------------------|--|----------------------------------|------------|--------------------|--|-------------------------------|--|--------|------|--------|--|--|--|--|
|                            |  | Numberof SharesSubject to Option |            | ExercisePriceRange |  | Weighted AverageExercisePrice |
| Under option, December  31,2005 |  |                             | 1,317,134  |               |  | $4.26–$18.00            |  | $      | 9.41 |   |
| Granted                         |  |                             | —    |               |  | N/A                           |  |   | N/A  |   |
| Forfeited                       |  |                             | —    |               |  | N/A                           |  |   | N/A  |   |
| Exercised                       |  |                             | (1,317,134 | )             |  | $4.26– $18.00           |  | $      | 9.41 |   |
| Under option,March  31,2006     |  |                             | —    |               |  | N/A                           |  |   | N/A  |   |
|                                 |

Allshares that were issued upon option exercise were newly issuedshares.

The following table discloses the number of sharessubject to option that are unvested and the weighted average fair valueof these shares at the date of grant as of March 31, 2006 and December31,2005:

|                                     |  |                                  |          |                                           |  |        |                           |        |  |  |
|-------------------------------------|--|----------------------------------|----------|-------------------------------------------|--|--------|---------------------------|--------|--|--|
|                                |  | Numberof SharesSubject to Option |          | Weighted AverageFairValueat Date of Grant |
| Unvested balance atDecember 31,2005 |  |                             | 459,208  |                                      |  | $      | 4.57                      |   |
| Vested                              |  |                             | (459,208 | )                                    |  |   | 4.57                      |   |
| Unvestedbalance at March 31,2006    |  |                             | —  |                                      |  | $      |    — |   |
|                                     |

OtherStock Options

In connection with the initial public offering,discussed above, and to compensate Fortress and Greenhill for theirsuccessful efforts in raising capital in the offering, in March2004 we granted options to Fortress and Greenhill, or their respectiveaffiliates, to purchase the number of shares of our common stock equalto an aggregate of 10% of the number of shares issued in theinitial public offering in the following amounts (1) for Fortress (orits affiliates), the right to acquire the number of shares equal to8% 

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of the number of shares issued in theinitial public offering, including the over-allotment and (2) forGreenhill (or its affiliate), the right to acquire the number of sharesequal to 2% of the number of shares issued in the initial publicoffering, including the over-allotment, all at an exercise price pershare equal to the initial offering price per share. Upon consummationof the offering, the number of shares and exercise price were therebyfixed at 805,000 shares at $18.00 per share, respectively. All of theoptions were immediately vested upon the initial public offering andare exercisable for ten years from June  8,  2004. Werecognized the fair value of these options using the Black-Scholesmethod on the offering date as a cost of the offering of $1.9million by netting it against the net proceeds of the offering. Theseoptions were granted outside of the Plan, and therefore are excludedfrom the Plan activity shown above. Greenhill exercised 128,800 of itsoptions in March  2006. At March  31,  2006, 644,000of these options remain outstanding.

Common StockGrants

In the first quarter of 2006, we issued 28,488 shares ofrestricted stock to certain employees. The grants vest 33.3%,33.3% and 33.4% on December  31,  2008, 2009and 2010, respectively. We valued the restricted stock awards at$1.3  million on the date of grants using the current marketprice. This amount was recorded as unearned compensation, a contraaccount included in stockholders’ equity, and will be amortizedas non-cash stock-based compensation expense over the vesting periodusing the accelerated method over a weighted average period ofapproximately three years. An additional 26,495 restricted sharesissued in 2004 and 2006 were forfeited in the first quarter of 2006.Prior to the adoption of SFAS No. 123(R), we accounted for forfeituresat the time they occurred. Under SFAS No. 123(R), we estimateforfeitures each quarter.

In April 2006, our new Chief FinancialOfficer was granted 120,000 shares of restricted stock, of which20% vested immediately and 20% vests on December 31,2007, 2008, 2009 and 2010, respectively. In May 2006, our new ChiefExecutive Officer will be granted 200,000 shares of restricted stock,of which 20% vests immediately and 20% vests on December31, 2007, 2008, 2009 and 2010, respectively.

The following tablediscloses the number of unvested shares of restricted stock and theweighted average fair value of these shares at date ofgrant:

|                                       |  |                 |         |                                           |  |        |       |        |  |  |
|---------------------------------------|--|-----------------|---------|-------------------------------------------|--|--------|-------|--------|--|--|
|                                  |  | RestrictedStock |         | Weighted AverageFair Valueat Date ofGrant |
| Unvested balance at December  31,2005 |  |            | 54,917  |                                      |  | $      | 26.02 |   |
| Granted                               |  |            | 28,488  |                                      |  |   | 44.14 |   |
| Vested                                |  |            | — |                                      |  |   | N/A   |   |
| Forfeited                             |  |            | (26,495 | )                                    |  | $      | 31.12 |   |
| Unvestedbalance at March  31,2006     |  |            | 56,910  |                                      |  | $      | 32.72 |   |
|                                       |

DeferredShares

In 2005, we began offering some of our employees theopportunity to earn deferred shares. The number of deferred shares thatwill be granted in December  2006 will be determined by theamount of our fourth quarter 2006 dividend. The base grant issued is124,698 shares and the actual shares to be issued will vary between0% and 150% of the base grant based on the fourth quarter2006 dividend amount.

On January  3,  2006, weentered into Deferred Shares Award Agreements with certain employees.These employees were awarded an aggregate base grant of 5,233 shares.These shares, if granted, will vest 33.3%, 33.3% and33.4% on December  31,  2008, 2009 and 2010,respectively.

Warrants

In connection with our 2002bankruptcy plan, 1,229,850 common stock warrants were issued to ourconvertible note holders and our common stockholders. The warrants havea current exercise price of $8.53 and expire on October31,  2007. In the first quarter of 2006, warrants were exercisedresulting in the issuance of 2,402 shares. As of March31,  2006, there were 443,104 warrants outstanding to acquirecommon stock.

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Treasury Stock

In the firstquarter of 2006, 29,327 shares of outstanding common stock werereturned to us to pay for the exercise price of certain stock options.The value of this returned stock was $1.5  million and wasrecorded as treasury stock.

|          |                 |
|----------|-----------------|
| 8.  | Income PerShare |

The following table sets forth the reconciliation of basicand diluted average shares outstanding used in the computation ofincome (loss) per share of commonstock:

|                                                                          |  |                            |         |             |  |        |        |        |  |  |
|--------------------------------------------------------------------------|--|----------------------------|---------|-------------|--|--------|--------|--------|--|--|
|                                                                     |  | ThreeMonths Ended March31, |
|                                                                     |  | 2006                       |         | 2005        |
|                                                                     |  | (unaudited)                |         | (unaudited) |
| Denominatorfor basic income per share – adjusted weightedaverage   |  |                       | 69,378  |        |  |   | 52,023 |   |
| Effect ofdilutivesecurities                                              |  |                       | — |        |  |   | 1,912  |   |
| Denominatorfor diluted income per share – adjusted weightedaverage |  |                       | 69,378  |        |  |   | 53,935 |   |
|                                                                          |

Approximately1.1  million shares of common stock issuable pursuant tooutstanding stock options and warrants have been excluded from thecalculation of diluted earnings per share for the three months endedMarch  31,  2006 as their effect would have beenantidilutive.

|          |                            |
|----------|----------------------------|
| 9.  | Comprehensive Income(Loss) |

Comprehensive income (loss) for the three months endedMarch  31,  2006 and 2005 is comprised of the following (inthousands):

|                                                                                                                    |  |                            |         |             |  |        |        |         |  |  |
|--------------------------------------------------------------------------------------------------------------------|--|----------------------------|---------|-------------|--|--------|--------|---------|--|--|
|                                                                                                               |  | ThreeMonths Ended March31, |
|                                                                                                               |  | 2006                       |         | 2005        |
|                                                                                                               |  | (unaudited)                |         | (unaudited) |
| Netincome(loss)                                                                                                    |  | $                          | (35,086 | )      |  | $      | 3,896  |    |
| Increasein fair value ofderivatives                                                                                |  |                       | 8,450   |        |  |   | 11,703 |    |
| Derivativeamounts reclassified to income statement through interest expense andloss on early extinguishment ofdebt |  |                       | 2,951   |        |  |   | 232    |    |
| Currency translationadjustment                                                                                     |  |                       | 118     |        |  |   | (222   | )  |
| Othercomprehensiveincome                                                                                           |  |                       | 11,519  |        |  |   | 11,713 |    |
| Comprehensiveincome(loss)                                                                                          |  | $                          | (23,567 | )      |  | $      | 15,609 |    |
|                                                                                                                    |

Thecomponents of accumulated other comprehensive income (loss) atMarch  31,  2006 and December  31,  2005 are asfollows (inthousands):

|                                             |  |               |        |                  |  |        |        |        |  |  |
|---------------------------------------------|--|---------------|--------|------------------|--|--------|--------|--------|--|--|
|                                        |  | March31, 2006 |        | December 31,2005 |
|                                        |  | (unaudited)   |        |             |
| Foreigncurrency translationadjustments      |  | $             | 1,251  |             |  | $      | 1,133  |   |
| Changes infair value ofderivatives          |  |          | 31,068 |             |  |   | 19,667 |   |
| Accumulatedother comprehensive income(loss) |  | $             | 32,319 |             |  | $      | 20,800 |   |
|                                             |

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Item2.    Management’s Discussion and Analysis of FinancialCondition and Results of Operations

SAFE HARBORSTATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF1995

Certain items in this Quarterly Report on Form10-Q, and other information we provide from time to time, mayconstitute forward-looking statements within the meaning of the PrivateSecurities Litigation Reform Act of 1995 and are subject to variousrisks and uncertainties, including, but not necessarily limited to,statements relating to our ability to deploy capital, close accretiveacquisitions, close dispositions of under-performing sites, closeacquisitions under letters of intent and purchase agreements,anticipate, manage and address industry trends and their effect on ourbusiness, the rate and timing of the deployment of new wirelesscommunications systems and equipment by our customers, whether wesuccessfully address future technological changes in the wirelessindustry, pay or grow dividends, generate growth organically or throughacquisitions, secure financing, and increase revenues, Adjusted EBITDAand/or Adjusted Funds From Operations, and add telephony tenants andstatements relating to the integration of and final costs of the SprintTransaction, the incremental costs of operating the Sprint sites, andhow the proceeds of future financings will be used. Forward-lookingstatements are generally identifiable by use of forward-lookingterminology such as ‘‘may,’’‘‘will,’’ ‘should,’’‘‘potential,’’‘‘intend,’’‘‘expect,’’‘‘endeavor,’’ ‘seek,’’‘‘anticipate,’’‘‘estimate,’’‘‘overestimate,’’‘‘underestimate,’’‘‘believe,’’‘‘could,’’‘‘would,’’‘‘project,’’‘‘predict,’’‘‘continue’’ or other similar words orexpressions. Forward-looking statements are based on certainassumptions or estimates, discuss future expectations, describe futureplans and strategies, contain projections of results of operations orof financial condition or state other forward-looking information. Ourability to predict results or the actual effect of future plans orstrategies is inherently uncertain. Although we believe that theexpectations reflected in such forward-looking statements are based onreasonable assumptions, actual results and performance could differmaterially from those set forth in the forward-looking statements.Factors which could have a material adverse effect on our operationsand future prospects or which could cause events or circumstances todiffer from the forward-looking statements include, but are not limitedto, failure to successfully and efficiently integrate the SprintTransaction into our operations, difficulties in acquiring towers atattractive prices or integrating acquisitions with our operations, thereduced likelihood of closing a transaction which is at a letter ofintent stage as opposed to one which is subject to a purchaseagreement, a decrease in the demand for our communications sites andour ability to attract additional tenants, the economies, real estatemarkets and communications industries in the regions where our sitesare located, consolidation in the wireless industry, termination ornon-renewal of leases, changes to the regulations governing wirelessservices, the creditworthiness of our tenants, customer concentrationand the loss of one or more of our major customers, the terms of ourleases, integration of new software systems, our ability to compete,competing technologies, equipment and software developments relating towireless telephony, our ability to modify our towers, our ability toobtain credit facilities or mortgage loans on favorable terms, ourfailure to comply with federal, state and local laws and regulationsand changes in the law, our failure to comply with environmental laws,our ability to conduct our business effectively, secure financing andgenerate revenues, the termination of site management agreements,disasters and other unforeseen events, the demonstrated or perceivednegative health effects from our towers or other tenants equipment onour towers, our ability to qualify as a REIT, REIT distributionrequirements and the stock ownership limit imposed by the InternalRevenue Code for REITs. When considering forward-looking statements,you should keep in mind the risk factors and other cautionarystatements detailed from time to time in this Quarterly Report on Form10-Q and in Global Signal’s other filings with the Securitiesand Exchange Commission, including our most recent Annual Report onForm 10-K for the year ending December  31,  2005, filed onMarch  16,  2006, and our most recent RegistrationStatement on Form S-3, filed on April  7,  2006. Readersare cautioned not to place undue reliance on any of theseforward-looking statements, which reflect our management’s viewsas of the date of this report. Although we believe that theexpectations reflected in the forward-looking statements arereasonable, we cannot guarantee future results, levels of activity,performance or achievements, and our actual results may differsignificantly from those contained in any forward-looking statement.Such forward-looking statements speak only as of the date of thisQuarterly Report on Form 10-Q and Global Signal expressly disclaims anyobligation to release publicly any updates or revisions to anyforward-looking statements contained herein to reflect any change inour expectations with regard thereto or any change in events,conditions or circumstances on which any statement isbased.

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Executive Overview

Global SignalInc. is one of the largest wireless communications tower operators inthe United States. As of March 31, 2006, we owned, leased or managed atotal of 10,952 wireless communications sites. Our growth strategy isto grow (1) organically by adding additional tenants to our towers, (2)by acquiring towers with existing telephony tenants in locations wherewe believe there are opportunities for organic growth and (3) byfinancing these newly acquired towers, on a long-term basis, usingequity issuances combined with low-cost fixed-rate debt obtainedthrough the issuance of mortgage-backed securities. Through thisstrategy, we will seek to increase our dividend per share over time.Our dividend for the three months ended March  31,  2006,of $0.525 per share of common stock represented a 31% increaseover the dividend we paid for the three months ended March31,  2005, of $0.400 per share of common stock.

We areorganized and conduct our operations to qualify as a REIT for federalincome tax purposes. As such, we will generally not be subject tofederal income tax on that portion of our income that is distributed toour stockholders if we distribute at least 90% of our REITtaxable income to our stockholders and comply with various otherrequirements. We also have certain subsidiaries that are not qualifiedREIT subsidiaries and therefore their operations will be subject tofederal income tax. Since May  12,  2004, we ownsubstantially all of our assets and conduct substantially all of ouroperations through an operating partnership, Global Signal OperatingPartnership, L.P., or ‘‘Global Signal OP.’’Global Signal Inc. is the special limited partner and our wholly ownedsubsidiary, Global Signal GP LLC, is the managing general partner ofGlobal Signal OP. Global Signal Inc. holds 99% of thepartnership interests and Global Signal GP LLC holds 1% of thepartnership interests in Global Signal OP.

Our customers includea wide variety of wireless service providers, government agencies,operators of private networks and broadcasters. These customers operatenetworks from our communications sites and provide wireless telephony,mobile radio, paging, broadcast and data services. As of March31,  2006, we had an aggregate of more than 26,000 tenant leaseson our communications sites with over 2,000 customers. Our revenuesfrom wireless telephony tenants have increased to 79.7% ofrevenues for the three months ended March  31,  2006 from52.7% of revenues for the three months ended March31,  2005. 

New wireless technologies, devices andapplications have become more advanced and broadly utilized by wirelesssubscribers. As new technologies, devices and applications havedeveloped, new networks have been deployed to support the more advancedapplications and the growth in the number of wireless subscribers whilemore mature technologies, such as paging and mobile radio, haveexperienced shrinking subscriber bases and network contraction. Some ofthe key indicators that we regularly monitor to evaluate growth trendsaffecting wireless technology usage are the growth or contraction of aparticular technology’s wireless subscribers and the usage asmeasured in minutes of use or network capacity utilization.

Thematerial opportunities, challenges and risks of our business havechanged significantly over the past several years. More recently,concurrent with an increased focus on improving network quality, manyof our wireless telephony customers have experienced a generalimprovement in their overall financial condition. This has resulted inan increase in these customers’ abilities to invest in theirnetworks and a related increase in our telephony tenant base. Ourgrowth will be primarily affected by the future demand forcommunications sites by wireless telephony service providers, pagingservice providers, users of mobile radio services and governmentagencies. In recent years, we have experienced significant demand fromour wireless telephony customers as they expand their networks, whileour paging and mobile radio customers have contracted their networks.The demand for communications site space by wireless telephony serviceproviders is expected to be driven by growth in the number of theirsubscribers and their utilization of wireless telephony services,including utilization of their networks for data services. In addition,demand could also be affected by carrier consolidation, becauseconsolidation has resulted in duplicative coverage and excess networkcapacity. For example, on October  26,  2004, Cingularmerged with AT&T Wireless and subsequently announced plans toeliminate approximately 7,000 of its cell sites as part of theirintegration of the two networks. As of March  31,  2006,302 of our sites are occupied by both Cingular and AT&T Wirelessand the combined revenues from AT&T Wireless and Cingular on thesesites were approximately $3.3  million for the three months endedMarch  31,  2006. In addition, Sprint merged with NextelCommunications on August  3,  2005. As of March31,  2006, 1,235 of our sites are 

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occupied by both Sprint and Nextel and thecombined revenues from Sprint and Nextel on these sites wereapproximately $13.1  million for the three months endedMarch  31,  2006. On August  1,  2005, ALLTELcompleted its purchase of Western Wireless. As of March31,  2006, none of our sites are occupied by both Alltel andWestern Wireless. On November  16,  2004, Arch Wirelessmerged with Metrocall Holdings, Inc. to form USA Mobility, our largestpaging customer. Both customers offer paging services throughout theUnited States and consequently have duplicate coverage in most markets.Our revenues from the merged paging company have declinedsubstantially. As a result of these mergers, network consolidations bythese tenants could adversely impact tenant lease revenues at some ofour sites. Lastly, the demand for communications site space bygovernment entities will be driven by the agencies’ demand fornew digital networks and the ability to communicate with othergovernment agencies as well as their ability to gain funding for suchnetworks.

Our growth opportunities are primarily linked toorganic growth on our existing towers and acquiring additional towerson which our wireless customers will seek to locate their equipment,thereby growing our overall tenant base. Since emerging from bankruptcyin November  2002, our number of wireless communication sites hasgrown from approximately 3,300 to approximately 11,000 at March31,  2006, primarily as a result of our acquisition strategy. See‘‘Acquisitions and Dispositions of CommunicationsSites’’ below. A key component of our growth strategy isour capital management strategy, which supports the financing of ourtower acquisition strategy. Our capital management strategy is tofinance newly acquired assets, on a long-term basis, using additionalequity issuances combined with low-cost fixed-rate debt obtainedthrough the periodic issuance of mortgage-backed securities. Forexample, in February  2006, we issued $1.55  billion inmortgage loans to provide fixed rate financing for the SprintTransaction (as defined below) and other tower acquisitions completedsince April  2005, and to refinance our February  2004mortgage loan. Prior to financing newly acquired towers usingmortgage-backed securities, our current strategy is to financecommunications sites we acquire on a short-term basis through cash onhand, cash remaining from the February  2006 mortgage loan, orcredit facilities we expect to obtain similar to our April  2005acquisition credit facility and our bridge loan, both of which werepaid with a portion of the net proceeds from our February  2006mortgage loan.

Our current growth strategy, which is in partbased on a new site acquisition and development strategy, reflects (1)our strategy to finance our new tower acquisitions using a capitalstructure which uses low-cost fixed-rate debt obtained through theissuance of mortgage-backed securities combined with proceeds fromequity offerings, (2) our strategy to buy core tower assets within-place telephony, government or investment grade tenants where webelieve there is a high likelihood of multiple lease renewals, (3) ourunderwriting process which is generally designed to allow us toevaluate and price acquisitions based on their current yield and on theasset and tenant attributes and location of the asset and (4) our focuson integrating, maintaining and operating the assets we acquireefficiently and effectively.

The primary factors affecting ourdetermination of the value of a communications site are the cash flowsof the site, its location, competitive structures in the immediatearea, tenant base, tenant credit quality and zoning restrictions. Whilewe also have communications sites located in Canada and the UnitedKingdom, our communications sites are primarily located in the UnitedStates. The locations of our sites are diverse and include sites alongactive transportation corridors, in dense urban centers and in growingsuburban communities. We also have a diverse tenant base, whichincludes large and small wireless service providers, governmentagencies, and operators of private communication networks. The creditquality of our tenants varies greatly from investment grade credits tosignificantly lesser credits, including small independentoperations.

Acquisitions and Dispositions of CommunicationsSites

Our financial results are impacted by the timing, size andnumber of acquisitions and dispositions we complete in a period. FromJanuary  1,  2006 to March  31,  2006, weacquired 10 communication sites for $4.0  million, including feesand expenses. In addition, we routinely review and dispose ofunder-performing sites which generate negative cash flows and which arenot compatible with our strategy. As of March  31,  2006,we had 232 sites held for sale.

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On May  26,  2005, we, SprintCorporation (‘‘Sprint’’) and certain Sprintsubsidiaries (the ‘‘Sprint Contributors’’),closed on an agreement to contribute, lease and sublease (the‘‘Agreement to Lease’’). Under theAgreement to Lease, we will lease or operate, for a period of 32 yearsapproximately 6,553 communications tower sites and the related towersand assets (collectively, the ‘‘SprintTowers’’) from newly formed special purpose entities ofSprint (collectively, ‘‘Sprint TowerCo’’),under six master leases for which we paid an upfront rental payment ofapproximately $1.2  billion as prepaid rent (the‘‘Upfront Rental Payment’’) (the‘‘Sprint Transaction’’). In connection withthe Sprint Transaction, certain Sprint entities agreed to lease spaceon approximately 6,342 of the Sprint Towers. The Sprint Towers had over5,600 collocation leases with other wireless tenants as of May26,  2005, and substantially all of the revenues from the SprintTowers are derived from wireless telephony tenants. We accounted forthis transaction as a capital lease reflecting the substance similar toan acquisition. In the fourth quarter, we adjusted our purchase priceallocation based on an appraisal of the Sprint sites assets, which wereceived from our third party valuation firm. We financed the SprintTransaction with (i) an $850.0  million bridge loan which werepaid with a portion of the net proceeds from our February  2006mortgage loan, (ii) $250.0  million from the proceeds of aprivate placement of our common stock and (iii) a portion of theproceeds from our May  2005 public offering of our commonstock.

From January  1,  2006 through March31,  2006, we also invested an additional $14.9  million,including fees and expenses, to acquire a fee interest or permanent orlong-term easement under 109 communications towers where we previouslyhad a leasehold interest in the land. We have financed these activitieswith cash generated from the February  2006 mortgageloan.

As of March  31,  2006, we have executeddefinitive agreements and non-binding letters of intent with otherparties to acquire an additional 8 communications sites and 146 feeinterest or long-term easements, for an aggregate purchase price ofapproximately $29.6  million, including estimated fees andexpenses. We are in the process of performing due diligence on thecommunications sites under non-binding letters of intent and seek tonegotiate definitive agreements.

Revenues

We generatesubstantially all of our revenues from leasing space on communicationssites to various tenants including wireless service providers,government agencies, operators of private networks, and broadcasters.Factors affecting our revenues include the rate at which our customersdeploy capital to enhance and expand their networks, the rate at whichcustomers rationalize their networks, the renewal rates of our tenantsand fixed-price annual escalation clauses in our contracts that allowus to increase our tenants’ rental rates overtime.

Typically, our tenant lease agreements are specific to asite, are for terms of one to ten years and are renewable for multiplepre-determined periods at the option of the tenant. Most of our leasesmay not be cancelled prior to their scheduled expiration dates, butsome may be cancelled upon prior notice and payment of a terminationfee. Rents under the tenant leases are generally due to us on a monthlybasis, and revenues from each agreement are recognized monthly. Theseagreements typically contain fixed-price annual escalation clauses.Rental revenues are recognized in our financial statements on astraight-line basis over the contractual term of the agreements withoutconsideration of customer renewal options.

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Our tenants are responsible for theinstallation and maintenance of their equipment at our sites. Thesetenants transmit from our sites utilizing a wide variety oftechnologies including personal communication services (PCS), cellular,enhanced specialized mobile radio (ESMR), mobile radio, paging, andradio and television broadcast. For the three months ended March31,  2006 and 2005, our revenue mix for the primary technologycategories was asfollows:

|                               |  |                                                        |       |         |  |        |       |         |  |  |
|-------------------------------|--|--------------------------------------------------------|-------|---------|--|--------|-------|---------|--|--|
|                          |  | Percentof Revenues for the ThreeMonths Ended March 31, |
| TenantTechnologyType          |  | 2006                                                   |       | 2005    |
| Telephony(PCS, Cellular,ESMR) |  |                                                   | 79.7  | %  |  |   | 52.7  | %  |
| Mobileradio                   |  |                                                   | 9.1   | %  |  |   | 20.5  | %  |
| Paging                        |  |                                                   | 6.0   | %  |  |   | 17.0  | %  |
| Broadcast                     |  |                                                   | 3.4   | %  |  |   | 6.3   | %  |
| Wirelessdata andother         |  |                                                   | 1.8   | %  |  |   | 3.5   | %  |
| Total                         |  |                                                   | 100.0 | %  |  |   | 100.0 | %  |
|                               |

DirectSite Operating Expenses and Other Expenses

Direct site operatingexpenses consist of ground rents (if we do not have a fully prepaidinterest in the land at the site), utilities, property and ad valoremtaxes, insurance and site maintenance costs. Many of our ground leaseagreements contain escalation clauses which are typically based oneither a fixed percentage rate or the change in the Consumer PriceIndex. For ground leases with escalation clauses based on a fixedpercentage rate, ground rental expenses are recognized in our financialstatements on a straight-line basis over the shorter of (i) thecontracted term of the lease agreement assuming we exercise all of therenewal options or (ii) the first renewal option period ending afterthe later of (a) our tenant leases which were in place or which weanticipated being in place at the date we entered into the ground leaseor acquired the communications site or (b) the depreciable life of theassets located on the leased property.

Other shared costs suchas property management, site operations and contract administration areincluded in selling, general and administrative expenses as describedbelow. Because the costs of operating an owned site generally do notincrease significantly as we add additional tenants, new lease revenuesfrom additional tenants to a particular site provide high incrementalgross margin for that site. Similarly, the loss of any tenant on anowned site does not significantly reduce the costs associated withoperating that site; and as a result, the lost lease revenues willreduce cash flows and gross margin from that site. Fluctuations in ourgross margins on owned sites are directly related to changes in ourtenant lease revenues. For managed sites, we typically pay the siteowner either a fixed fee, a percentage of revenues or a combination ofa fixed fee plus a percentage of revenues. In instances where we paythe landlord a percentage of revenues, changes in revenues result in anincrease or decrease, as applicable, in our communications siteoperating expenses.

Selling, general and administrative expensesconsist of five major components: (1) sales, marketing and towerleasing; (2) property management and site operations; (3) contractsadministration; (4) business development including acquisitions and newbuilds and (5) administrative support, including legal, humanresources, finance, accounting, and informationtechnology.

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Results of Operations

Comparison of the three months ended March  31,2006 to the three months ended March  31,2005

The following table sets forth, for the periodsindicated, each statement of operations item and such item as apercentage of revenues. The results of operations for any particularperiod are not necessarily indicative of results for any future period.The following data should be read in conjunction with our unauditedconsolidated financial statements included elsewhere herein and ourconsolidated financial statements and notes thereto included in ourAnnual Report on Form 10-K for the year ended December31,  2005, filed with the Securities and Exchange Commission onMarch  16,  2006.

|                                                                                                                                |  |                           |         |            |  |        |       |            |  |        |         |         |  |        |       |          |  |        |         |         |  |        |         |          |  |  |
|--------------------------------------------------------------------------------------------------------------------------------|--|---------------------------|---------|------------|--|--------|-------|------------|--|--------|---------|---------|--|--------|-------|----------|--|--------|---------|---------|--|--------|---------|----------|--|--|
|                                                                                                                           |  | ThreeMonths Ended March31 |
|                                                                                                                           |  | 2006                      |         | 2005       |  | Change |
|                                                                                                                           |  | (dollarsinthousands)      |
|                                                                                                                           |  | $                         |         | %ofRevenue |  | $      |       | %ofRevenue |  | $      |         | %       |
| Revenues                                                                                                                       |  | $                         | 120,922 |       |  |   | 100.0 | %     |  | $      | 53,798  |    |  |   | 100.0 | %   |  | $      | 67,124  |    |  |   | 124.8   | %   |
| Directsite operating expenses (excluding depreciation, amortization andaccretion)                                              |  |                      | 53,202  |       |  |   | 44.0  | %     |  |   | 15,823  |    |  |   | 29.4  | %   |  |   | 37,379  |    |  |   | 236.2   | %   |
| Selling,general and administrative (including $(10) and $318 of non-cashstock-based compensation (income) expense,respectively |  |                      | 11,100  |       |  |   | 9.2   | %     |  |   | 6,756   |    |  |   | 12.6  | %   |  |   | 4,344   |    |  |   | 64.3    | %   |
| Sprintsites integrationcosts                                                                                                   |  |                      | 254     |       |  |   | 0.2   | %     |  |   | — |    |  |   | 0.0   | %   |  |   | 254     |    |  |   | N/A     |     |
| Statefranchise, excise and minimumtaxes                                                                                        |  |                      | 525     |       |  |   | 0.4   | %     |  |   | 174     |    |  |   | 0.3   | %   |  |   | 351     |    |  |   | 201.7   | %   |
| Depreciation,amortization andaccretion                                                                                         |  |                      | 44,270  |       |  |   | 36.6  | %     |  |   | 17,389  |    |  |   | 32.3  | %   |  |   | 26,881  |    |  |   | 154.6   | %   |
|                                                                                                                           |  |                      | 109,351 |       |  |   | 90.4  | %     |  |   | 40,142  |    |  |   | 74.6  | %   |  |   | 69,209  |    |  |   | 172.4   | %   |
| Operatingincome                                                                                                                |  |                      | 11,571  |       |  |   | 9.6   | %     |  |   | 13,656  |    |  |   | 25.4  | %   |  |   | (2,085  | )  |  |   | (15.3   | %)  |
| Interestexpense,net                                                                                                            |  |                      | 24,647  |       |  |   | 20.4  | %     |  |   | 10,201  |    |  |   | 19.0  | %   |  |   | 14,446  |    |  |   | 141.6   | %   |
| Gainon derivativeinstruments                                                                                                   |  |                      | (176    | )     |  |   | (0.1  | %)    |  |   | — |    |  |   | 0.0   | %   |  |   | (176    | )  |  |   | N/A     |     |
| Losson early extinguishment ofdebt                                                                                             |  |                      | 21,102  |       |  |   | 17.5  | %     |  |   | — |    |  |   | 0.0   | %   |  |   | 21,102  |    |  |   | N/A     |     |
| Otherexpense(income)                                                                                                           |  |                      | 45      |       |  |   | 0.0   | %     |  |   | (103    | )  |  |   | (0.2  | %)  |  |   | 148     |    |  |   | N/A     |     |
| Income(loss) from continuing operations before income tax benefit(expense)                                                     |  |                      | (34,047 | )     |  |   | (28.2 | %)    |  |   | 3,558   |    |  |   | 6.6   | %   |  |   | (37,605 | )  |  |   | N/A     |     |
| Incometax benefit(expense)                                                                                                     |  |                      | (37     | )     |  |   | (0.0  | %)    |  |   | 525     |    |  |   | 1.0   | %   |  |   | (562    | )  |  |   | N/A     |     |
| Income(loss) from continuingoperations                                                                                         |  |                      | (34,084 | )     |  |   | (28.2 | %)    |  |   | 4,083   |    |  |   | 7.6   | %   |  |   | (38,167 | )  |  |   | N/A     |     |
| Lossfrom discontinuedoperations                                                                                                |  |                      | (503    | )     |  |   | (0.4  | %)    |  |   | (169    | )  |  |   | (0.3  | %)  |  |   | (334    | )  |  |   | 197.6   | %   |
| Income(loss) before loss on sale ofproperties                                                                                  |  |                      | (34,587 | )     |  |   | (28.6 | %)    |  |   | 3,914   |    |  |   | 7.3   | %   |  |   | (38,501 | )  |  |   | N/A     |     |
| Losson sale ofproperties                                                                                                       |  |                      | (499    | )     |  |   | (0.4  | %)    |  |   | (18     | )  |  |   | (0.0  | %)  |  |   | (481    | )  |  |   | 2,672.2 | %   |
| Netincome(loss)                                                                                                                |  | $                         | (35,086 | )     |  |   | (29.0 | %)    |  | $      | 3,896   |    |  |   | 7.2   | %   |  | $      | (38,982 | )  |  |   | N/A     |     |
|                                                                                                                                |

Revenues

Ourrevenues increased $67.1  million, or 124.8%, for thequarter ended March  31,  2006 as compared to the prioryear quarter, primarily as a result of the Sprint Transaction and theacquisition of other communications sites since May  2005. Duringthe three months ended March  31,  2006, $62.2million of our revenue was generated from the Sprint Towers. We alsoexperienced growth in our revenues generated 

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from telephony customers which was in partoffset by a decline in our revenues generated by our non-telephonytenants. Our mix of revenues from wireless telephony customers as apercentage of total site revenues increased from 52.7% for thethree months ended March  31,  2005, to 79.7% forthe three months ended March  31,  2006, primarily as aresult of acquisitions and organic growth in our telephony revenues.Revenues from Sprint-Nextel and Cingular Wireless comprised37.3% and 15.5%, respectively, of our revenues for thequarter ended March  31,2006.

Expenses

Direct site operating expenses (excludingdepreciation, amortization and accretion expense)

Our directsite operating expenses increased $37.4  million primarily due todirect site operating expenses associated with the Sprint Towers alongwith other communication sites we have acquired since April 1,2005. These increases were partially offset by decreased rent expenseassociated with our purchase of various interests in parcels of land infee simple or other long-term easements, which we had previouslyleased. As a percentage of revenues, our direct site operating expensesincreased to 44.0% of revenues for the three months endedMarch  31,  2006, from 29.4% of revenues for thethree months ended March  31,  2005, primarily due to theSprint Towers, which have lower tenant revenues per tower and higherground rent expense as a percentage of revenue.

Selling, generaland administrative

Our selling, general and administrativeexpenses increase of $4.3  million was primarily attributable to(i) increases in personnel related expenses along with occupancy andother costs associated with the increase in our corporate staffnecessary to manage our growth, primarily related to the addition ofthe Sprint Towers and (ii) increased professional fees primarily due toour efforts to comply with Section 404 of the Sarbanes-Oxley Act of2002 and to a significant number of IT system enhancement projects. Asa percentage of revenues, our selling, general and administrativeexpenses declined to 9.2% of revenues for the three months endedMarch  31,  2006, from 12.6% of revenues for thethree months ended March  31,  2005.

Sprintintegration costs

For the three months ended March31,  2006, $0.3  million of costs were incurred in relationto the Sprint integration. There were no integration costs related toSprint during the three months ended March  31,  2005.

Depreciation, amortization and accretion

The increase indepreciation, amortization and accretion expenses of $26.9million for the three months ended March  31,  2006compared to the three months ended March  31,  2005, wasprimarily due to the addition of 7,008 communications sites sinceApril  1,  2005, including the SprintTowers.

Interest expense, net

Our net interest expenseincrease of $14.4  million is related to debt to finance theSprint Transaction and other newly acquired communication sites andland easements in 2005. Interest expense in the first quarter of 2006is net of interest income earned and one month of amortization ofderivative settlement gains recorded in accumulated other comprehensiveincome and deferred debt costs related to the February 2006 mortgageloan.

Loss on early extinguishment of debt

Our loss onearly extinguishment of debt of $21.1  million is from the payoffof the February  2004 mortgage loan, bridge loan and$200.0  million acquisition credit facility with a portion of theproceeds from our February  2006 mortgage loan. The loss wascomprised of a $7.0  million penalty relating to the

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February  2004 mortgage loan,$10.7  million of deferred debt costs relating to all three loansand a $3.4  million write-off of accumulated other comprehensiveloss relating to the 2003 interest rate swaps that were used to hedgethe February  2004 mortgage loan.

Liquidity and CapitalResources

Our liquidity needs arise from working capitalrequirements, debt service, tower acquisitions, construction costs foroccasional new tower builds and tower augmentations, other capitalexpenditures and dividend payments. We expect to meet our cashrequirements for the next twelve months by using cash on hand, cashgenerated from operating activities, borrowings under the $15.0million Revolving Credit Agreement and $114.5 million of the netproceeds remaining from our February  2006 mortgage loan.

February 2006 Mortgage Loan

On February  28,2006, three of our wholly owned special purpose entities, Global SignalAcquisitions II LLC, Global Signal Acquisitions LLC and Pinnacle TowersLLC (and its 13 subsidiaries), borrowed $1.55  billion underthree mortgage loans made payable to Global Signal Trust III thatissued $1.55  billion in commercial mortgage pass-throughcertificates, which we refer to as the February  2006 mortgageloan, to provide fixed-rate financing for the Sprint Towers andcommunications sites we acquired since April  2005, and torefinance the February  2004 mortgage loan. The borrowers andtheir direct parent, Global Signal Holdings V LLC, are separate legalentities from Global Signal Inc. with their own assets, which are notavailable to satisfy the debts and other obligations of Global SignalInc. or any of its affiliates. We have continued to consolidate oursubsidiaries, but have not consolidated Global Signal Trust III intoour financial statements. Interest accrues on the mortgage loan at aweighted average fixed rate per annum of approximately 5.7%. TheFebruary  2006 mortgage loan requires monthly payments ofinterest until its contractual repayment date in February  2011.The February  2006 mortgage loan is secured by, among otherthings, (1) mortgage liens on the borrowers’ interests (fee,leasehold or easement) in over 80% of their communicationssites, (2) a security interest in substantially all of theborrowers’ personal property and fixtures and (3) a pledge ofthe capital stock (or equivalent equity interests) of each of theborrowers (including a pledge of the capital stock of Pinnacle TowersLLC, Global Signal Acquisitions LLC and Global Signal Acquisitions IILLC from its direct parent, Global Signal Holdings V LLC).

On amonthly basis, the excess cash flows from the securitized entities,after the payment of principal, interest, reserves and expenses, aredistributed to us. If the DSCR, defined in the February  2006mortgage loan as the net cash flow for the sites for the immediatelypreceding twelve calendar month period divided by the amount ofinterest that we will be required to pay over the succeeding twelvemonths on the February  2006 mortgage loan, as of the end of anycalendar quarter falls to 1.35 times or lower, then all excess cashflow will be deposited into a reserve account instead of being releasedto us. The funds in the reserve account will not be released to usuntil the DSCR exceeds 1.35 times for two consecutive calendarquarters. If the DSCR falls below 1.20 times as of the end of anycalendar quarter, then all funds on deposit in the reserve accountalong with future excess cash flows will be applied to prepay theFebruary  2006 mortgage loan with applicable prepaymentconsideration.

The borrowers may not prepay the February2006 mortgage loan in whole or in part at any time prior toFebruary  28,  2008, the second anniversary of the closingdate, except in limited circumstances (such as the occurrence ofcertain casualty and condemnation events relating to the communicationssites securing the February  2006 mortgage loan). Thereafter,prepayment is permitted provided it is accompanied by any applicableprepayment consideration. If the prepayment occurs within three monthsof the February  2011 monthly payment date, no prepaymentconsideration is due.

The February  2006 mortgage loandocuments include covenants customary for mortgage loans subject torated securitizations. Among other things, the borrowers are prohibitedfrom incurring additional indebtedness or further encumbering theirassets. The effective interest rate on the February  2006mortgage loan including the benefit from terminating the 2005 interestrate swaps which qualified for hedge accounting and the amortization ofdeferred debt issuance costs is approximately5.5%.

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We used the proceeds asfollows:

|        |        |                                                                                                                                                                                                                                                                                                        |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | • | $850.0million to repay the debt outstanding under our $850.0  millionbridge loan that was incurred in connection with the SprintTransaction. As a result of this repayment, we wrote off as a loss onearly extinguishment of debt the unamortized deferred financing cost ofapproximately $1.0million; |

|        |        |                                                                                                                                                                                                                                                                                                                                                                                                                    |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | • | $402.7million to repay debt on the then-outstanding borrowings under theFebruary  2004 mortgage loan. In the first quarter of 2006 wewrote off as a loss on early extinguishment of debt the unamortizeddeferred financing cost of approximately $9.5  million,approximately $3.4  million of accumulated other comprehensiveloss related to the 2003 interest rate swaps and a pre-payment penaltyof $7.0million; |

|        |        |                                                                                                                                                                                                                                                                                                                                     |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | • | $151.8million to repay the debt outstanding under the acquisition creditfacility. Upon repayment, we also terminated our ability to make futuredraws under the acquisition credit facility. As a result, we wrote offas a loss on early extinguishment of debt the unamortized deferredfinancing cost of approximately $0.2million; |

|        |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | • | $145.5million to pay estimated expenses of approximately $14.0million, to fund increased impositions and reserves related to theFebruary  2006 mortgage loan of approximately $10.0million, to pay the $7.0  million prepayment penalty related tothe February  2004 mortgage loan refinancing, and to providefunds of approximately $114.5 to acquire additional communicationssites and additional fee interests or long-term easements for theground under our communications sites, and to provide workingcapital. |

The December  2004 Mortgage Loan

OnDecember  7,  2004, our special purpose entities, PinnacleTowers Acquisitions Holdings LLC, and five of its direct and indirectsubsidiaries, issued a $293.8  million mortgage loan to GlobalSignal Trust II. Global Signal Trust II then issued an identical amountof commercial mortgage pass-through certificates in a privatetransaction. We have continued to consolidate our subsidiaries, buthave not consolidated Global Signal Trust II in our financialstatements. The net proceeds of the December  2004 mortgage loanwere used primarily to repay the $181.7  million ofthen-outstanding borrowings under our credit facility and to partiallyfund a $120.7  million site acquisition reserve account which wasused to acquire additional qualifying communications sites over thesix-month period following the December  2004 closing.

Theprincipal amount of the December  2004 mortgage loan is dividedinto seven tranches, each having a different level of seniority.Interest accrues on each tranche at a fixed rate per annum. Theweighted average interest rate on the various tranches is approximately4.7%. The December  2004 mortgage loan requires monthlypayments of interest until its maturity in December  2009 whenthe unpaid principal balance will be due. The December  2004mortgage loan is secured by, among other things, (1) mortgage liens onthe borrowers’ interests (fee, leasehold or easement) insubstantially all of their communications sites, (2) a securityinterest in substantially all of the borrowers’ personalproperty and fixtures and (3) a pledge of the capital stock (orequivalent equity interests) of each of the borrowers (including apledge of the capital stock of Pinnacle Towers Acquisition Holdings LLCfrom its direct parent, Global Signal Holdings III LLC). The borrowersand its direct parent, Global Signal Holdings III LLC, are separatelegal entities from Global Signal Inc., with their own assets, whichare not available to satisfy the debts and obligations of Global SignalInc. or any of its affiliates.

On a monthly basis, the excesscash flows from the securitized entities, after the payment ofprincipal, interest, reserves and expenses, are distributed to us. Ifthe DSCR, defined in the December  2004 mortgage loan as the netcash flow for the sites for the immediately preceding twelve calendarmonth period divided by the amount of interest that we will be requiredto pay over the succeeding twelve months on the December  2004mortgage loan, as of the end of any calendar quarter falls to 1.30times or lower, then all excess cash flow will be deposited into areserve account instead of being released to us. The funds in thereserve account will not be released to us until the DSCR exceeds 1.30times for two consecutive calendar quarters. If the DSCR falls below1.15 times as of the end of any calendar quarter, then all funds ondeposit in the reserve account along with future excess cash flows willbe applied to prepay the December  2004 mortgageloan.

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We may not prepay the December2004 mortgage loan in whole or in part at any time prior toDecember  7,  2006, the second anniversary of the closingdate, except in limited circumstances (such as the occurrence ofcertain casualty and condemnation events relating to the communicationssites securing the December  2004 mortgage loan). Thereafter,prepayment is permitted provided it is accompanied by any applicableprepayment consideration. If the prepayment occurs within three monthsof the December  2009 monthly payment date, no prepaymentconsideration is due.

The December  2004 mortgage loandocuments include covenants customary for mortgage loans subject torated securitizations. Among other things, the borrowers are prohibitedfrom incurring additional indebtedness or further encumbering theirassets.

Revolving Credit Agreement

On December1,  2005, Global Signal OP entered into a 364-day $15.0million revolving credit facility pursuant to a revolving creditagreement with Morgan Stanley Asset Funding Inc. and Bank of America,N.A. to provide funding for working capital and other corporatepurposes.

At March  31,  2006 and December31,  2005, there were no balances outstanding under the revolvingcredit facility. Interest on the $15.0  million revolving creditfacility is payable, at Global Signal OP’s option, at eitherLIBOR plus 3.0% or the bank’s base rate plus 2.0%.Interest is payable at the end of the interest period or at the time ofprincipal repayments. Principal on the revolving credit facility may bepaid, in whole or in part, at any time and must be repaid by the loanmaturity date, December  1,  2006. 

The RevolvingCredit Agreement, and the related ancillary documentation containcovenants and restrictions customary for a facility of this typeincluding a limitation on our consolidated indebtedness atapproximately $1.875  billion and a requirement to limit ourratio of consolidated indebtedness to consolidated EBITDA, as definedin the loan document, to a ratio of 7.65 to 1.0. The Revolving CreditAgreement is guaranteed by us, Global Signal GP, LLC and certainsubsidiaries of Global Signal OP. It is secured by a pledge of GlobalSignal OP’s assets, including a pledge of 65% of itsinterest in our United Kingdom subsidiary, 100% of its interestin certain other domestic subsidiaries, a pledge by us and GlobalSignal GP, LLC of our interests in Global Signal OP, and a pledge by usof 65% of our interest in our Canadian subsidiary.

TheFebruary  2004 Mortgage Loan

On February  5,2004, Pinnacle Towers LLC (formerly Pinnacle Towers Inc.) and thirteenof its direct and indirect subsidiaries issued a $418.0  millionmortgage loan to Global Signal Trust I (‘‘February 2004mortgage loan’’). Global Signal Trust I then issued anidentical amount of commercial mortgage pass-through certificates in aprivate transaction. We continued to consolidate our subsidiaries, butdid not consolidate Global Signal Trust I in our financial statements.The net proceeds from the February  2004 mortgage loan were usedto repay the then-outstanding borrowings under our old credit facilityof $234.4  million, to fund a $142.2  million specialdistribution to our stockholders, to fund $4.6  million ofrestricted cash into an imposition reserve which was required to beescrowed in connection with our securitization transaction andFebruary  2004 mortgage loan and relates to taxes, insurance andrents, and the remaining $15.9  million was available to fundoperations.

The principal amount of the February  2004mortgage loan was divided into seven tranches, each having a differentlevel of seniority. Interest accrued on each tranche at a fixed rateper annum. The weighted average interest rate on the various trancheswas approximately 5.0%. The February  2004 mortgage loanwas secured by mortgages, deeds of trust, deeds to secure debt andfirst priority mortgage liens on more than 1,100 of the communicationssites owned or leased of Pinnacle Towers LLC and its thirteen directand indirect subsidiaries. The February  2004 mortgage loanrequired monthly payments of principal and interest calculated based ona 25-year amortization schedule through January  2009 (the‘‘Anticipated Repayment Date’’). OnFebruary  28,  2006, we repaid in full and terminated theFebruary  2004 mortgage loan with a portion of the net proceedsfrom the February  2006 mortgage loan. 

The February2004 mortgage loan documents included covenants customary for mortgageloans subject to rated securitizations. Among other things, theborrowers were prohibited from incurring additional indebtedness orfurther encumbering their assets.

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Acquisition Credit Facility

OnApril  25,  2005, our wholly owned subsidiary, GlobalSignal Acquisitions entered into a 364-day $200.0  million creditfacility with Morgan Stanley Asset Funding Inc. and Bank of America,N.A. to provide funding for the acquisition of additionalcommunications sites. The acquisition credit facility was guaranteed byGlobal Signal OP and future subsidiaries of Global Signal Acquisitions.It was secured by substantially all of Global SignalAcquisitions’ tangible and intangible assets and by a pledge ofGlobal Signal OP’s equity interest in Global SignalAcquisitions. In addition, on May  16,  2005, we enteredinto a guarantee agreement with respect to the acquisition creditfacility secured by a pledge of our equity interest in Global SignalOP. On February  28,  2006, we repaid in full andterminated this acquisition credit facility with a portion of the netproceeds from the February  2006 mortgage loan.

2005Interest Rate Swaps

On January  11,  2005, inanticipation of the issuance of interim bridge financing and later athird mortgage loan to finance the acquisition of additionalcommunications sites we expected to acquire during 2005, we enteredinto six forward-starting interest rate swaps agreements with MorganStanley as counterparty to hedge the variability of future interestrates on our anticipated mortgage financing. Under the interest rateswaps, we agreed to pay the counterparty a weighted average fixedinterest rate of 4.403% on a total notional amount of$300.0  million beginning on various dates between July29,  2005 and November  30,  2005, and continuingthrough September  2010 in exchange for receiving floatingpayments based on three-month LIBOR on the same notional amounts forthe same period. Concurrent with the pricing of our February2006 mortgage loan, we terminated our six interest rate swaps andreceived a payment, excluding accrued interest, of $8.1  million,of which $4.3  million was recorded as part of accumulated othercomprehensive income and is being amortized as a reduction of interestexpense using the effective interest method over five years, the lifeof the February  2006 mortgage loan.

On February2,  2005, and March  21,  2005, in connection withthe Sprint Transaction, we entered into ten forward-starting interestrate swap agreements with Bank of America, N.A. as counterparty, inanticipation of securing $850.0  million of bridge financing,which was replaced by a mortgage loan, for a total notional value of$850.0  million. Concurrent with the pricing of ourFebruary  2006 mortgage loan, we terminated our ten interest rateswaps and received a payment, excluding accrued interest, of$25.8  million, all of which was recorded as part of accumulatedother comprehensive income and which is being amortized as a reductionof interest expense using the effective interest method over fiveyears, the life of the February  2006 mortgage loan.

2004Interest Rate Swaps

On March  26,  2004, inanticipation of a future financing, we entered into fourforward-starting interest rate swaps with Morgan Stanley ascounterparty to hedge the variability of future interest rates on thefinancing. Under the interest rate swaps, we agreed to pay thecounterparty a fixed interest rate of 3.416% on a total notionalamount of $200.0  million beginning in October  2004through April  2009 in exchange for receiving three-month LIBORon the same notional amount for the same period.

OnAugust  27,  2004, in anticipation of a future financing,we entered into two additional forward-starting interest rate swapswith Morgan Stanley as counterparty to hedge the variability of futureinterest rates on the financing. Under the interest rate swaps, weagreed to pay the counterparty a fixed interest rate of 3.84% ona total notional amount of $100.0  million beginning inOctober  2004 through April  2009 in exchange for receivingthree-month LIBOR on the same notional amount for the same period.

Concurrent with the pricing of the December  2004 mortgageloan, we terminated our six interest rate swaps and received a netpayment of $2.0  million which was recorded as part ofaccumulated other comprehensive income and which is being amortized asa reduction of interest expense using the effective interest methodover five years, the life of the December  2004 mortgage loan.Because the $300.0  million total notional value of the sixinterest rate swaps exceeded the $293.8  million principal amountof the December  2004 mortgage loan, one of the swaps was nolonger effective and we expensed approximately 

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$40,000 related to the fair market value ofone of our August  2004 swaps, during the fourth quarter of 2004.The effective interest rate on the mortgage loan, including theproceeds from terminating the interest rate swaps and the amortizationof deferred debt issuance costs, is approximately 5.0%.

2003 Interest Rate Swap

On December  11,  2003,in anticipation of the issuance of the February  2004 mortgageloan, we entered into a forward-starting interest rate swap agreement(the ‘‘December 2003 swap’’) with MorganStanley as the counterparty to hedge the variability of future interestpayments under the anticipated February  2004 mortgage loan.Under the December  2003 swap, we agreed to pay Morgan Stanley afixed rate of 3.816% on a notional amount of $400.0million for five years beginning in March  2004 in exchange forreceiving floating payments based on three-month LIBOR on the notionalamount for the same five-year period. The December  2003 swaprequired us to begin making monthly payments to the counterparty equalto the difference between 3.816% and the then currentthree-month LIBOR rate, which was 1.15% on December31,  2003, on the notional amount of $400.0  million. TheDecember  2003 swap was terminated in connection with theissuance of the February  2004 mortgage loan on February5,  2004, at a cost of $6.2  million that was recorded aspart of accumulated other comprehensive income (loss) and was beingamortized as interest expense using the effective interest method overfive years, the expected life of the February  2004 mortgageloan. The effective interest rate on the mortgage loan, including thecost of terminating the interest rate swap and the amortization ofdeferred debt issuance costs, was approximately 6.0%. OnFebruary  28,  2006, a portion of the net proceeds from theFebruary  2006 mortgage loan was used to pay off theFebruary  2004 mortgage loan. In connection with this, theremaining $3.4  million of accumulated other comprehensive lossrelated to the December  2003 swap was recorded as a loss onearly extinguishment of debt in the first quarter of 2006.

CashFlows

Net cash flows provided by operating activities were$45.2  million for the three months ended March  31,2006, compared to $24.0  million for the three months endedMarch  31,  2005. The increase of $21.2  million ofnet cash provided by operating activities is primarily the result ofcash flow from the communication sites acquired since April1,  2005.

Net cash flows used in investing activities were$43.5  million for the three months ended March  31,2006 compared to $52.2  million for the three months endedMarch  31,  2005. Investing activities for the three monthsended March  31,  2006 consists of the acquisition of 10communications sites for $4.0 million, including fees andexpenses. Also, during the three months ended March  31,2006, we acquired 109 parcels of land, in fee simple title and underlong-term easements, which we had previously leased from the sellers,for a total purchase price of $14.9 million, including fees andexpenses. Restricted cash increased $18.4  million as a result ofthe February  2006 mortgage loan requirements.

Investingactivities for the three months ended March  31,  2005consisted primarily of the acquisition of 95 communications sites in 16unrelated transactions for $41.1 million, including fees andexpenses, which were funded from cash in our site acquisition reserveaccount established with a portion of the net proceeds from ourDecember  2004 mortgage loan. During the three months endedMarch  31,  2005, we also acquired 18 parcels of land,eight in fee simple title, and ten under long-term easements, which wehad previously leased from the sellers, for a total purchase price of$2.0 million, including fees and expenses. Additionally,$50.0  million was invested in restricted cash to fund the SprintTransaction deposit which was partially offset by funds provided fromrestricted cash related to the acquisition reserve fund from theDecember  2004 mortgage loan, used to fund communications siteacquisitions during the three months ended March  31,2005.

Capital expenditures were $5.6  million for the threemonths ended March  31,  2006, compared to $2.9million for the three months ended March  31,  2005. Thecapital expenditures for these two periods primarily consisted of thepurchase of tower-related equipment and tower augmentations andimprovements.

Net cash flows provided by financing activitieswere $134.4  million for the three months ended March31,  2006 and consisted of (1) the $1.55  billion borrowingunder the February  2006 mortgage loan, 

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(2) the $33.8  million paymentreceived from the termination of the 2005 interest rate swaps and (3)$3.2  million from the issuance of common stock. This was in partoffset by (1) $850.0  million to repay the debt outstanding underour bridge loan that was incurred in connection with the SprintTransaction, (2) $404.1  million to repay debt under theFebruary  2004 mortgage loan, (3) $151.8  million to repaythe debt outstanding under the acquisition credit facility, and (4)payment of a $34.7  million ordinary dividend.

Net cashflows provided by financing activities were $29.1  million forthe three months ended March  31,  2005 and were primarilyrelated to borrowings under our Revolving Credit Agreement to fund the$50.0  million Sprint Transaction deposit, partially offset by$20.9  million in ordinary dividends paid in January  2005,for the fourth quarter of 2004.

ContractualCommitments

A number of our asset purchase agreements providefor additional monies to be paid to the sellers based on future leasecommencements during a limited period after the acquisition iscompleted, generally one year or less. The amount of this contingentpurchase price is not expected to be material for the acquisitions wehave closed during through March  31,  2006. As ofMarch  31,  2006, we had no accruals for future acquisitionpayments. The maximum additional contingent payments on closedacquisitions were $1.1 million at March  31,2006.

We have signed master services agreements with StratosVSAT, Inc. and Hark Tower Systems, Inc. which require us to purchaseapproximately $6.5  million in satellite data communicationsequipment. We have fulfilled $4.1  million of these purchasecommitments as of March  31,  2006. Our tower relatedcapital expenditures over the next twelve months will include theinstallation of satellite light monitoring equipment at substantiallyall of our lit sites.

As part of the Sprint Transaction, we andSprint agreed to a refund to us of a portion of the upfront rentalpayment if an agreed-upon portion of the Sprint Towers do not qualifyas financeable sites, as defined in the Sprint Agreement, within oneyear of the closing of the Sprint Transaction. As part of the SprintAgreement, we agreed to use commercially reasonable efforts to convertSprint Towers which do not qualify as financeable sites intofinanceable sites by May 26, 2006. As such, we have employees andcontractors dedicated to these efforts. As of March 31, 2006, less thanthe agreed-upon allocated purchase price value for the Sprint Towersqualified as financeable sites and if no further sites were convertedto financeable sites by May 26, 2006, we would be due an upfront rentalpayment refund of approximately $3.5 million. We anticipate thatadditional Sprint Towers will qualify as financeable sites by May 26,2006 and as such, we expect the upfront rental payment refund to beless than $3.5 million.

Critical Accounting Policies andEstimates

New Accounting Pronouncements

EffectiveJanuary  1,  2006, we adopted SFAS No. 123(R)Share-Based-Payments, on a modified prospective transitionmethod to account for our employee stock options. Under that transitionmethod, compensation costs for the portion of awards for which therequisite service had not yet been rendered, and that were outstandingas of the adoption date, will be recognized as the service is renderedbased on the grant date fair value of those awards calculated underSFAS No. 123(R). Prior period results are not restated. In connectionwith the adoption of SFAS No. 123(R), we reclassified $1.1million of deferred compensation expense, which relates entirely tounvested restricted stock, to additional paid-in capital as ofJanuary  1,  2006. There was no impact to earnings fromadopting SFAS No. 123(R).

Effective January  1,2006, the Company adopted FIN 47 Accounting for Conditional AssetRetirement Obligations. This interpretation clarifies that the term‘‘conditional asset retirement obligation’’as used in SFAS No. 143, Accounting for Asset RetirementObligations, refers to a legal obligation to perform an assetretirement activity in which the timing and (or) method of settlementare conditional on a future event that may or may not be within thecontrol of the entity. The obligation is unconditional even thoughuncertainty exists about the timing and (or) method of settlement. Ourasset retirement obligations are within our control as to timing andmethod as they relate to the removal of our communications towers fromleased land; therefore the adoption of this interpretation did notimpact our financial statements.

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Effective January  1,  2006,the Company adopted FASB Staff Position 13-1 Accounting for RentalCosts Incurred during a Construction Period. This staff positionconcludes that rental costs associated with ground or buildingoperating leases that are incurred during a construction period shouldbe recognized as rental expense. We had already accounted for suchrental costs in the manner prescribed by the staff position, so thisstaff position did not impact our financial statements.

Item3.    Quantitative and Qualitative Disclosures About MarketRisk 

Interest Rate Risk

We are not exposed tomarket risks from changes in interest rates charged on our debt as theinterest rates are fixed. We had no outstanding variable rate debtunder our Revolving Credit Agreement at March  31,2006.

The following table presents the future principal paymentobligations and weighted-average interest rates at March31,  2006 associated with our existing debt instruments using ouractual level of indebtedness of $0.8 million under capitalleases to finance new computer software and $1,843.8  millionunder our mortgage loans issued on February  28,  2006 andDecember  7,  2004.

|                             |  |                             |        |        |           |                                                                          |        |        |         |        |        |        |         |        |        |        |         |        |        |        |         |        |        |        |           |        |        |        |  |  |
|-----------------------------|--|-----------------------------|--------|--------|-----------|--------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|-----------|--------|--------|--------|--|--|
|                        |  | WeightedAverageInterestRate |        | Total  |           | FuturePrincipal Payment Obligations – Twelve Months Ended March31, |
|                        |  | 2007                        |        | 2008   |           | 2009                                                                     |        | 2010   |         | 2011   |
| Fixedrate:                  |  |                        |   |   |           |                                                                     |   |   |         |   |   |   |         |   |   |   |         |   |   |   |         |   |   |   |           |   |   |   |
| February  2006 mortgageloan |  | 5.7%                        |        | $      | 1,550,000 |                                                                     |        | $      | — |   |        | $      | — |   |        | $      | — |   |        | $      | — |   |        | $      | 1,550,000 |   |
| December2004 mortgageloan   |  | 4.7%                        |        |   | 293,825   |                                                                     |        |   | — |   |        |   | — |   |        |   | — |   |        |   | 293,825 |   |        |   | —   |   |
| Capitalleaseobligations     |  | 9.5%                        |        |   | 818       |                                                                     |        |   | 576     |   |        |   | 201     |   |        |   | 18      |   |        |   | 19      |   |        |   | 4         |   |
| Totalfixed ratedebt         |  |                        |        | $      | 1,844,643 |                                                                     |        | $      | 576     |   |        | $      | 201     |   |        | $      | 18      |   |        | $      | 293,844 |   |        | $      | 1,550,004 |   |
|                             |

ForeignCurrency Exchange Risk

Our exposure to adverse movements inforeign currency exchange rates is primarily related to our foreignsubsidiaries’ (United Kingdom and Canada) operating expenses,denominated in the respective local currency. A hypothetical change of10% in foreign currency exchange rates would not have a materialimpact on our consolidated financial statements or results ofoperations.

Item 4.    Controls andProcedures

|          |                         |
|----------|-------------------------|
| a)  | Controls andProcedures. |

Our disclosure controls and procedures aredesigned to provide reasonable assurance that information is recorded,processed, summarized and reported accurately and on a timely basis.Our management, with the participation of our Chief Executive Officerand Chief Financial Officer, has evaluated the effectiveness of ourdisclosure controls and procedures (as such term is defined in Rules13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, asamended, (the ‘‘Exchange Act’’)) as of theend of the period covered by this report. Our Chief Executive Officerand our Chief Financial Officer, based on their evaluation of theeffectiveness of the design and operation of our disclosure controlsand procedures as of the end of the period covered by this report, haveconcluded that our disclosure controls and procedures were noteffective to provide reasonable assurance that the foregoing objectiveswere achieved, in light of the material weaknesses described in ourAnnual Report on Form 10-K for the year ended December31,  2005.

|          |                                           |
|----------|-------------------------------------------|
| b)  | InternalControl Over Financial Reporting. |

Other than as set forthbelow, there have not been any changes in our internal control overfinancial reporting (as such term is defined in Rules 13a-15(f) and15d-15(f) under the Exchange Act) during the fiscal quarter to whichthis report relates that have materially affected, or are reasonablylikely to materially affect, our internal control over financialreporting.

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Management believes the materialweaknesses identified and reported for the year ended December31,  2005, described in our Annual Report on Form 10-K, wereprimarily a result of the implementation of a new lease administrationsystem, the effort required to effectively integrate and account forthe Sprint Transaction and other acquisitions, and the tenure of ourfinancial accounting and reporting staff. We have begun planning andimplementing changes to our processes to improve our internal controlover financial reporting. The following are among the steps we havetaken, or intend to take, to remediate the material weaknessesidentified as of December  31,2005:

|        |        |                                                                                                                          |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------|
|   | • | Improvingprocesses and controls to re-evaluate key data in the leaseadministration system, and subsequent changesthereto |

|        |        |                                                                                                                                                                                                             |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | • | Establishingprocesses and controls to revise and test detail calculations in thelease administration system and subsequent changes thereto, withrespect to straight-line and other amortization oraccretion |

|        |        |                                                                                                                                             |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------|
|   | • | Developingautomated exception reports to allow accounting personnel to moreeffectively monitor and detect errors in certain accountbalances |

|        |        |                                                                                                                   |
|--------|--------|-------------------------------------------------------------------------------------------------------------------|
|   | • | Reorganizingcertain accounting functions and increasing the number of financialaccounting personnel andmanagement |

|        |        |                                                                                                                                     |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------|
|   | • | Undertakinga project to evaluate alternatives and plan for the replacement of theCompany’s current lease administrationsystem |

|        |        |                                                                                                                                    |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------|
|   | • | Hiringan experienced Chief Information Officer to help oversee the systemenhancements required to remediate the controlweaknesses. |

Although we have already taken some of the stepsabove to remediate these material weaknesses, further action isrequired to remediate including the addition of accounting staff,enhancements to our existing lease administration system, and thedevelopment and implementation of enhanced processes. We have hired anew Chief Information Officer who began work in April  2006. Ourmanagement and Audit Committee will monitor closely the continuingprogress under our remediation plan. The effectiveness of the steps wehave taken to date and the steps we are still in the process ofcompleting are subject to continued management review, as well as AuditCommittee oversight, and we may make additional changes to our internalcontrol over financial reporting. To address the control weaknesses,the Company performed other procedures to prepare the unauditedquarterly consolidated financial statements in accordance withgenerally accepted accounting principles.

PART II.    OTHERINFORMATION

Item 1.    Legal Proceedings 

Weare involved in litigation incidental to the conduct of our business.We believe that none of such pending litigation or unasserted claims ofwhich we have knowledge, will have a material adverse effect on ourbusiness, financial condition, results of operations orliquidity.

Item 1A.    RiskFactors 

None

Item 2.    Unregistered Sales ofEquity Securities and Use ofProceeds 

|           |      |
|-----------|------|
| (a)  | None |

|           |      |
|-----------|------|
| (b)  | None |

|           |                                                                      |
|-----------|----------------------------------------------------------------------|
| (c)  | Purchasesof Equity Securities by the Issuer and AffiliatedPurchasers |

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The following table shows thenumber of shares of Global Signal common stock deemed to have beenrepurchased during the quarter.

|                                              |  |                                                |         |                                        |  |                                                                                          |         |                                                                                                                   |  |        |         |        |  |        |         |        |  |  |
|----------------------------------------------|--|------------------------------------------------|---------|----------------------------------------|--|------------------------------------------------------------------------------------------|---------|-------------------------------------------------------------------------------------------------------------------|--|--------|---------|--------|--|--------|---------|--------|--|--|
|                                         |  | (a)Total Numberof Shares (orUnits)Purchased(1) |         | (b) AveragePricePaidper Share(or Unit) |  | (c) Total NumberofShares (or Units)Purchased as PartofPubliclyAnnounced Plansor Programs |         | (d) MaximumNumber(or ApproximateDollar Value) ofShares (orUnits)that May Yet BePurchased Underthe PlansorPrograms |
| January  1,  2006– January  31,2006    |  |                                           | 99,660  |                                   |  | $                                                                                        | 43.91   |                                                                                                              |  |   | — |   |  |   | — |   |
| February1,  2006 – February  28,  2006 |  |                                           | — |                                   |  |                                                                                     | — |                                                                                                              |  |   | — |   |  |   | — |   |
| March1,  2006 – March  31,2006         |  |                                           | 144,857 |                                   |  | $                                                                                        | 49.45   |                                                                                                              |  |   | — |   |  |   | — |   |
| Total1st Quarter 2006                        |  |                                           | 244,517 |                                   |  | $                                                                                        | 47.19   |                                                                                                              |  |   | — |   |  |   | — |   |
|                                              |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | These shares were notrepurchased through a publicly announced plan or program, but ratherrelate to compensation plans of the Company. Specifically, these sharesrepresent shares delivered to satisfy stock option exercise prices andshares retained by the Company upon option exercise by option holdersto offset the employee's tax withholding obligations associatedwith the exercise of stock options by holders who exercised options. Inaddition to the repurchased shares noted in the above table, 26,495shares of restricted stock were forfeited to us by employees during thethree months ended March  31,  2006. |

|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (i)  | The Revolving Credit Agreementrestricts the ability of Global Signal OP to make distributions except:(i) distributions in cash or other property to the extent required tosatisfy the REIT Distribution Requirement (as defined in the RevolvingCredit Agreement), and, (ii) so long as no event of default then existsor would result, (1) equity distributions as consideration for amerger, so long as no event of default then exists or will result, ofGlobal Signal OP, or one of its subsidiaries, into Global Signal Inc.or a subsidiary of Global Signal Inc., (2) in addition to and withoutduplication of dividends paid under clause (i) above, ordinaryquarterly dividends to the holders of capital stock of the GlobalSignal OP in an amount reasonably comparable to ordinary quarterlydividends customarily declared (including increases in such dividendsconsistent, in terms of the percentage of such increase, with pastpractices) by the board of directors of Global Signal Inc., and (3)distributions of cash to the extent necessary to pay the ordinaryoperating expenses of Global Signal Inc., provided that the aggregateamount of such distributions from December  3,  2004 shallnot exceed $2.0million. |

|            |                                                                                                                                                                                                                                                                                  |
|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (ii)  | Our mortgage loans mayindirectly restrict the payment of dividends, as decreases belowcertain levels in our Debt Service Coverage Ratio would require excesscash flows, that could be used to pay dividends, be used to repayoutstanding principal due under the mortgage loans. |

Item3.    Defaults Upon Senior Securities

None

Item4.    Submission of Matters to a Vote of SecurityHolders 

None

Item 5.    OtherInformation 

None

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ITEM6.    Exhibits.

|               |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |  |  |  |
|---------------|--|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|--|--|
| ExhibitNumber |  | Description                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 3.1           |  | Amendedand Restated Certificate of Incorporation of the Registrant(incorporated by reference to Exhibit 3.1 to the Company’sRegistration Statement on Form S-11 (Amendment No. 1) (No. 333-112839)filed on April  2,2004).                                                                                                                                                                                                                                                                      |
| 3.2           |  | Certificate of Amendmentof Amended and Restated Certificate of Incorporation (incorporated byreference to Exhibit 3.2 to the Company’s Registration Statementon Form S-11 (Amendment No. 3) (No. 333-112839) filed on May19,  2004).                                                                                                                                                                                                                                                            |
| 3.3           |  | Amended andRestated Bylaws of the Registrant (incorporated by reference to Exhibit3.1 to the Company’s Current Report on Form 8-K, filed onDecember  23,2005).                                                                                                                                                                                                                                                                                                                                  |
| 4.1           |  | Form of Certificate forCommon Stock (incorporated by reference to Exhibit 4.1 to theCompany’s Registration Statement on Form S-11 (Amendment No. 3)(No. 333-112839) filed on May  19,2004).                                                                                                                                                                                                                                                                                                     |
| 4.2           |  | Amended and RestatedInvestor Agreement dated as of March  31,  2004 amongGlobal Signal Inc., Fortress Pinnacle Acquisition LLC, GreenhillCapital Partners, L.P., and its related partnerships named therein, andAbrams Capital Partners II, L.P. and certain of its relatedpartnerships named therein, and other parties named therein(incorporated by reference to Exhibit 4.2 to the Company’sRegistration Statement on Form S-11 (Amendment No. 1) (No. 333-112839)filed on April  2,2004).* |
| 4.3           |  | Warrant Agreement betweenPinnacle Holdings Inc. and Wachovia Bank, N.A., dated November1,  2002 (incorporated by reference to Exhibit 4.3 to theCompany's Registration Statement on Form S-11 (No. 333-112839)filed on February  13,2004).                                                                                                                                                                                                                                                            |
| 4.4           |  | Warrant Agreement betweenGlobal Signal Inc. and American Stock Transfer Company, dated as ofFebruary  13,  2006 (incorporated by reference to Exhibit4.4 to the Company’s Annual Report on Form 10-K, filed onMarch  16,2006).                                                                                                                                                                                                                                                                  |
| 10.1          |  | Form of Index DeferredShares Award Agreement (incorporated by reference to Exhibit 10.1 tothe Company’s Current Report on Form 8-K, filed onJanuary  9,2006).                                                                                                                                                                                                                                                                                                                                   |
| 10.2          |  | Amended and Restated Loanand Security Agreement, dated as of February  28,  2006, byand among the Borrowers (as defined therein) signatory thereto andTowers Finco III LLC (incorporated by reference to Exhibit 10.1 to theCompany’s Current Report on Form 8-K, filed on March1,  2006).                                                                                                                                                                                                      |
| 10.3          |  | ManagementAgreement, dated as of February  28,  2006, by and amongGlobal Signal Acquisitions LLC, Global Signal Acquisitions II LLC,Pinnacle Towers LLC and the other entities listed on the signaturepages thereto and Global Signal Services LLC (incorporated by referenceto Exhibit 10.2 to the Company’s Current Report on Form 8-K,filed on March  1,2006).                                                                                                                               |
| 31.1          |  | Certification of ChiefExecutive Officer as adopted pursuant to Section 302 of theSarbanes-Oxley Act of2002.                                                                                                                                                                                                                                                                                                                                                                                           |
| 31.2          |  | Certification of ChiefFinancial Officer as adopted pursuant to Section 302 of theSarbanes-Oxley Act of2002.                                                                                                                                                                                                                                                                                                                                                                                           |
| 32.1          |  | Certification of ChiefExecutive Officer pursuant to 18 U.S.C. Section 1350, as adoptedpursuant to Section 906 of the Sarbanes-Oxley Act of2002.                                                                                                                                                                                                                                                                                                                                                       |
| 32.2          |  | Certification of ChiefFinancial Officer pursuant to 18 U.S.C. Section 1350, as adoptedpursuant to Section 906 of the Sarbanes-Oxley Act of2002.                                                                                                                                                                                                                                                                                                                                                       |
|               |

|  |
|--|
|  |  |
|  |

|  |                                                                                           |
|--|-------------------------------------------------------------------------------------------|
|  | *    Indicatesmanagement contract or compensatory plan orarrangement. |

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SIGNATURES

Pursuantto the requirements of the Securities Exchange Act of 1934, as amended,the registrant has duly caused this report to be signed on its behalfby the undersigned thereunto dulyauthorized.

|        |  |        |                                               |        |  |                                                                                                                                                                                                                                                                                         |  |  |  |  |
|--------|--|--------|-----------------------------------------------|--------|--|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|--|--|
|   |  |   |                                          |   |  | GlobalSignalInc.Registrant                                                                                                                                                                                                                                                              |
|   |  |   | By:        |   |  | /s/ Steven G.Osgood                            StevenG. Osgood, Duly Authorized Officer, Executive Vice Presidentand Chief FinancialOfficer |
|   |  |   | Dated:                                        |   |  | May10, 2006                                                                                                                                                                                                                                                                             |
|        |

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