CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF CCA AND SUBSIDIARIES

3 Months Ended

Mar. 31, 2013

CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF CCA AND SUBSIDIARIES

12. CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF THE COMPANY AND SUBSIDIARIES

The following condensed consolidating financial statements of the

 Company and subsidiaries have been prepared pursuant to Rule 3-10 of Regulation S-X. These condensed consolidating financial statements have been prepared from CCA’s financial information on the same basis of accounting as the consolidated financial statements. On December 31, 2012 CCA transferred certain real estate assets and contracts from certain of its subsidiaries to the Company (as the parent company). Accordingly, the Company (as the parent corporation to its subsidiaries) which heretofore had no independent assets or operations (as defined under Rule 3-10(f) of Regulation S-X) maintains its own independent assets as of March 31, 2013 and December 31, 2012. With respect to the periods prior to December 31, 2012, such internal legal restructuring has been reported in the following condensed consolidating financial statements as if it had occurred on January 1, 2012.

CONDENSED CONSOLIDATING BALANCE SHEET

As of March 31, 2013

(in thousands)

ASSETS	Parent		Combined Subsidiary Guarantors		Consolidating Adjustments and Other			Total Consolidated Amounts
Cash and cash equivalents	$	27,758	$	32,572	$	—		$	60,330
Accounts receivable, net of allowance		293,711		276,506		(337,354	)		232,863
Current deferred tax assets		4		5,356		—			5,360
Prepaid expenses and other current assets		2,672		26,836		(9,460	)		20,048
Total current assets		324,145		341,270		(346,814	)		318,601
Property and equipment, net		2,452,362		99,599		—			2,551,961
Restricted cash		—		5,023		—			5,023
Investment in direct financing lease		6,991		—		—			6,991
Goodwill		—		11,988		—			11,988
Other assets		198,110		18,880		(181,177	)		35,813
Non-current deferred tax assets		—		6,531		(533	)		5,998
Total assets	$	2,981,608	$	483,291	$	(528,524	)	$	2,936,375
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable and accrued expenses	$	301,885	$	261,174	$	(346,780	)	$	216,279
Income taxes payable		—		2,352		—			2,352
Current liabilities of discontinued operations		—		79		—			79
Total current liabilities		301,885		263,605		(346,780	)		218,710
Long-term debt		1,016,948		98,268		(98,268	)		1,016,948
Deferred tax liabilities		533		—		(533	)		—
Other liabilities		340		38,475		—			38,815
Total liabilities		1,319,706		400,348		(445,581	)		1,274,473
Total stockholders’ equity		1,661,902		82,943		(82,943	)		1,661,902
Total liabilities and stockholders’ equity	$	2,981,608	$	483,291	$	(528,524	)	$	2,936,375

CONDENSED CONSOLIDATING BALANCE SHEET

As of December 31, 2012

(in thousands)

ASSETS	Parent		Combined Subsidiary Guarantors		Consolidating Adjustments and Other			Total Consolidated Amounts
Cash and cash equivalents	$	—	$	62,897	$	—		$	62,897
Accounts receivable, net of allowance		136,128		255,192		(138,556	)		252,764
Deferred tax assets		137		7,885		—			8,022
Prepaid expenses and other current assets		1,766		35,175		(9,882	)		27,059
Total current assets		138,031		361,149		(148,438	)		350,742
Property and equipment, net		2,462,917		105,874		—			2,568,791
Restricted cash		—		5,022		—			5,022
Investment in direct financing lease		7,467		—		—			7,467
Goodwill		—		11,988		—			11,988
Other assets		191,502		114,953		(275,723	)		30,732
Total assets	$	2,799,917	$	598,986	$	(424,161	)	$	2,974,742
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable and accrued expenses	$	28,061	$	286,342	$	(148,403	)	$	166,000
Income taxes payable		—		102		—			102
Current liabilities of discontinued operations		—		356		—			356
Total current liabilities		28,061		286,800		(148,403	)		166,458
Long-term debt		1,111,545		100,000		(100,000	)		1,111,545
Deferred tax liabilities		138,691		835		—			139,526
Other liabilities		—		35,593		—			35,593
Total liabilities		1,278,297		423,228		(248,403	)		1,453,122
Total stockholders’ equity		1,521,620		175,758		(175,758	)		1,521,620
Total liabilities and stockholders’ equity	$	2,799,917	$	598,986	$	(424,161	)	$	2,974,742

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the three months ended March 31, 2013

(in thousands)

	Parent		Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	313,437	$	341,994		$	(229,707	)	$	425,724
EXPENSES:
Operating		234,660		302,577			(229,707	)		307,530
General and administrative		9,609		21,623			—			31,232
Depreciation and amortization		18,651		8,979			—			27,630
		262,920		333,179			(229,707	)		366,392
OPERATING INCOME		50,517		8,815			—			59,332
OTHER (INCOME) EXPENSE:
Interest expense, net		10,095		2,471			—			12,566
Expenses associated with debt refinancing transactions		177		48			—			225
Other (income) expense		321		(201	)		(19	)		101
		10,593		2,318			(19	)		12,892
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		39,924		6,497			19			46,440
Income tax (expense) benefit		138,211		(3,559	)		—			134,652
INCOME FROM CONTINUING OPERATIONS		178,135		2,938			19			181,092
Gain/Loss from equity in subsidiaries		2,957		—			(2,957	)		—
NET INCOME	$	181,092	$	2,938		$	(2,938	)	$	181,092

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the three months ended March 31, 2012

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	349,574		$	90,621		$	(4,890	)	$	435,305
EXPENSES:
Operating		237,531			82,893			(4,890	)		315,534
General and administrative		17,384			4,456			—			21,840
Depreciation and amortization		18,251			10,136			—			28,387
		273,166			97,485			(4,890	)		365,761
OPERATING INCOME (LOSS)		76,408			(6,864	)		—			69,544
OTHER (INCOME) EXPENSE:
Interest expense, net		16,594			296			—			16,890
Expenses associated with debt refinancing transactions		1,541			—			—			1,541
Other (income) expense		21			(29	)		20			12
		18,156			267			20			18,443
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		58,252			(7,131	)		(20	)		51,101
Income tax (expense) benefit		(20,796	)		1,737			—			(19,059	)
INCOME (LOSS) FROM CONTINUING OPERATIONS		37,456			(5,394	)		(20	)		32,042
Loss from equity in subsidiaries		(5,776	)		—			5,776			—
Loss from discontinued operations, net of taxes		—			(362	)					(362	)
NET INCOME (LOSS)	$	31,680		$	(5,756	)	$	5,756		$	31,680

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the three months ended March 31, 2013

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments And Other		Total Consolidated Amounts
Net cash provided by (used in) operating activities	$	(123,998	)	$	220,853		$	—	$	96,855
Net cash used in investing activities		(8,149	)		(3,506	)		—		(11,655	)
Net cash provided by (used in) financing activities		159,905			(247,672	)		—		(87,767	)
Net Increase (Decrease) in Cash and Cash Equivalents		27,758			(30,325	)		—		(2,567	)
CASH AND CASH EQUIVALENTS, beginning of year		—			62,897			—		62,897
CASH AND CASH EQUIVALENTS, end of year	$	27,758		$	32,572		$	—	$	60,330

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the three months ended March 31, 2012

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments And Other		Total Consolidated Amounts
Net cash provided by operating activities	$	64,631		$	3,676		$	—	$	68,307
Net cash used in investing activities		(10,713	)		(12,166	)		—		(22,879	)
Net cash used in financing activities		(53,918	)		(15,988	)		—		(69,906	)
Net Decrease in Cash and Cash Equivalents		—			(24,478	)		—		(24,478	)
CASH AND CASH EQUIVALENTS, beginning of year		—			55,832			—		55,832
CASH AND CASH EQUIVALENTS, end of year	$	—		$	31,354		$	—	$	31,354