Sprint - Nextel 2012 Annual Report Download - page 23

Table of Contents
other debt obligations, which in turn could result in the maturities of certain debt obligations being accelerated. Additionally, although we expect to
remain in compliance with the covenants under our new revolving credit and secured equipment credit facilities through the next twelve months, our
Leverage Ratio under our unsecured loan agreement with Export Development Canada (EDC) is more restrictive. While we are currently in discussions
with the lender under our EDC facility to amend such agreement to reflect the Leverage Ratio permitted under our revolving bank credit facility, there
can be no assurance that Sprint can obtain such amendment. Further, if the Clearwire Acquisition is consummated, Sprint's consolidated debt would
increase by approximately $4.3 billion (based on Clearwire's debt as of December 31, 2012, excluding short - term debt expected to be paid by June 30,
2013). In addition to the covenants in Sprint's new revolving credit facility, Sprint's EDC facility and Sprint's secured equipment credit facility, certain
indentures governing Sprint's notes limit, among other things, Sprint's ability to incur additional debt, pay dividends, create liens and sell, transfer,
lease or dispose of assets. Such restrictions could adversely affect Sprint's ability to access the capital markets or engage in certain transactions.
Although these restrictions do not limit Sprint's ability to engage in the SoftBank Merger, under the terms of Sprint's EDC facility and
secured equipment credit facility, consummation of the SoftBank Merger would constitute a change of control that would enable the lenders
thereunder to require repayment of all outstanding balances thereunder. If the lenders exercised their rights as a consequence of the change of control,
amounts outstanding under the EDC facility and the secured equipment credit facility, which were approximately
$796 million in the aggregate at
December 31, 2012, would become due and payable at the time of closing. Sprint is currently in discussions with the existing lenders under the EDC
and secured equipment facilities and intends to amend these facilities to, among other things, exclude the SoftBank Merger from the change of control
provisions.
The trading price of Sprint's common stock has been and may continue to be volatile and may not reflect Sprint's actual operations and
performance. We expect that these factors will affect New Sprint and the New Sprint common stock following the effective time of the SoftBank
Merger.
Market and industry factors may seriously harm the market price of Sprint's common stock, regardless of Sprint's actual operations and
performance. Stock price volatility and sustained decreases in Sprint's share price could subject its stockholders to losses or lead to action by the
NYSE. The trading price of Sprint's common stock has been, and may continue to be, subject to fluctuations in price in response to various factors,
some of which are beyond Sprint's control, including, but not limited to:
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uncertainty related to Sprint's proposed transactions with SoftBank and Clearwire;
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market speculation or announcements by Sprint regarding the entering into, or termination of, material transactions, including the
SoftBank Merger and the Clearwire Acquisition;
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disruption to Sprint's operations or those of other companies critical to Sprint's network operations;
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the performance of SoftBank and SoftBank's ordinary shares or speculation about the possibility of future actions SoftBank may take
in connection with New Sprint;
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quarterly announcements and variations in Sprint's results of operations or those of its competitors, either alone or in comparison to
analysts' expectations or prior company estimates, including announcements of subscriber counts, rates of churn, and operating
margins that would result in downward pressure on Sprint's stock price;
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seasonality or other variations in Sprint's subscriber base, including its rate of churn;
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the cost and availability or perceived availability of additional capital and market perceptions relating to Sprint's access to this capital;
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announcements by Sprint or its competitors of acquisitions, new products, technologies, significant contracts, commercial
relationships or capital commitments;
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Sprint's ability to develop and market new and enhanced technologies, products and services on a timely and cost - effective basis,
including implementation of Network Vision and Sprint's networks;
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recommendations by securities analysts or changes in their estimates concerning Sprint;
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the incurrence of additional debt, dilutive issuances of Sprint's stock, short sales or hedging of, and other derivative transactions, in its
common stock;
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any significant change in Sprint's board of directors or management;
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litigation;