Sprint - Nextel 2008 Annual Report Download - page 18

acquisitions. Our ability to arrange additional financing will depend on, among other factors, our financial
performance, debt ratings, general economic conditions and prevailing market conditions. Some of these factors
are beyond our control, and we may not be able to arrange additional financing on terms acceptable to us, or at
all, including at the expiration of our current credit facility, which expires in December 2010. Failure to obtain
suitable financing when needed could, among other things, result in our inability to continue to expand our
businesses and meet competitive challenges. Our debt ratings could be downgraded if we incur significant
additional indebtedness, or if we do not generate sufficient cash from our operations, which would likely increase
our future borrowing costs and could affect our ability to access capital.
Our credit facility, which expires in December 2010, requires that we maintain a ratio of total
indebtedness to trailing four quarters earnings before interest, taxes, depreciation and amortization and other
non-cash gains or losses, such as goodwill impairment charges, of no more than 4.25 to 1.0, which as of
December 31, 2009, was 3.5 to 1.0. If we do not continue to satisfy this ratio, we will be in default under our
credit facility, which could trigger defaults under our other debt obligations, which in turn could result in the
maturities of certain debt obligations being accelerated. The indentures governing our notes limit, among other
things, our ability to incur additional debt, create liens and sell, transfer, lease or dispose of assets.
The trading price of our common stock has been and may continue to be volatile and may not reflect our
actual operations and performance.
The stock market, in general, and the market for communications and technology companies in
particular, have experienced price and volume fluctuations over the past year. These broad market and industry
factors may seriously harm the market price of our common stock, regardless of our actual operations and
performance. Stock price volatility and sustained decreases in our share price could subject our shareholders to
losses and us to takeover bids or lead to action by the NYSE. The trading price of our common stock has been,
and may continue to be, subject to fluctuations in price in response to various factors, some of which are beyond
our control, including, but not limited to:
‰quarterly announcements and variations in our results of operations or those of our competitors,
either alone or in comparison to analysts expectations, including announcements of continued
subscriber losses and rates of churn that would result in downward pressure on our stock price;
‰the availability or perceived availability of additional capital and market perceptions relating to our
access to this capital;
‰seasonality or other variations in our subscriber base, including our rate of churn;
‰announcements by us or our competitors of acquisitions, new products, significant contracts,
commercial relationships or capital commitments;
‰the performance of Clearwire and Clearwire’s Class A common stock or speculation about the
possibility of future actions we or other significant shareholders may take in connection with
Clearwire holdings;
‰disruption to our operations or those of other companies critical to our network operations;
‰announcements by us regarding the entering into, or termination of, material transactions;
‰our ability to develop and market new and enhanced products and services on a timely basis;
‰recommendations by securities analysts or changes in estimates concerning us;
‰the incurrence of additional debt, dilutive issuances of our stock, short sales, hedging and other
derivative transactions of our common stock;
‰any major change in our board of directors or management;
‰litigation;
‰changes in governmental regulations or approvals; and
‰perceptions of general market conditions in the technology and communications industries, the U.S.
economy and global market conditions.
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