Sprint - Nextel 2013 Annual Report Download - page 52

Table of Contents
Corporation Class A Common Stock and Clearwire Communications LLC Class B Interests from Eagle River for $100 million in December 2012.
Financing Activities
Net cash provided by financing activities was
$24.5 billion during the Successor period, which included proceeds from the issuance of common stock
and warrants of approximately $18.6 billion related to the SoftBank Merger. In addition, the Company issued $9.0 billion in unregistered debt with registration
rights consisting of a September 11, 2013 issuance of
$2.25 billion aggregate principal amount of 7.250% notes due 2021 and $4.25 billion aggregate principal
amount of
7.875% notes due 2023, and a December 12, 2013 issuance of $2.5 billion aggregate principal amount of 7.125% notes due 2024, each guaranteed by
Sprint Communications. We also incurred approximately $147 million of debt issuance costs. These increases, along with net borrowings under our secured
equipment credit facility of approximately $444 million, were offset by the retirement of approximately $3.3 billion principal amount of Clearwire debt.
Net cash provided by financing activities was $4.3 billion during
2012 . During 2012 , the Company issued senior notes, guaranteed notes, and a
convertible bond, as well as had drawdowns on the secured equipment credit facility totaling, in the aggregate, approximately $9.2 billion and redeemed the
remaining $4.8 billion of Nextel Communications, Inc. senior notes. In addition, we incurred $134 million of debt financing costs in
2012.
Net cash provided by financing activities was $26 million during
2011 . During 2011 , the Company repaid certain debt obligations, including $1.65
billion of Sprint Capital Corporation 7.625% senior notes, the early redemption of $2.0 billion of Sprint Capital Corporation 8.375% senior notes and repayment of
$250 million of the $750 million loan agreement with Export Development Canada (EDC Agreement). The reductions in debt obligations were offset by proceeds
from issuances of $1.0 billion of aggregate principal amount of 11.5% senior notes due 2021 and $3.0 billion of aggregate principal amount of 9% guaranteed
notes due 2018 in a private placement in November 2011. We also paid $86 million for debt financing costs associated with our November 2011 debt issuances
and fourth quarter credit facility amendments.
Working Capital
As of the Successor year ended
December 31, 2013 , we had working capital of $2.4 billion compared to $4.9 billion as of the Predecessor year ended
December 31, 2012 . Our working capital as of December 31, 2013 and December 31, 2012 includes accrued capital expenditures for unbilled services totaling
approximately $1.4 billion and $900 million, respectively, related to our network modernization. In addition to the increase in accrued capital expenditures, our
decline in working capital is also the result of increases of approximately $500 million in accrued severance and exit costs primarily associated with severance
actions taken in the fourth quarter 2013 and accrued exit costs related to the shut
- down of the Nextel platform and decreases of approximately $700 million in
short
- term investments. Also contributing to the decline in working capital was an increase in the current portion of long - term debt of approximately $600 million
which was primarily due to the Clearwire Communications, LLC and Clearwire Finance, Inc. 8.25% Exchangeable Notes due 2040 becoming exchangeable at any
time, at the holder
’ s option, as a result of the close of the Clearwire Acquisition for a fixed amount of cash. The balance is due to changes in other current assets
and liabilities.
Available Liquidity
As of
December 31, 2013 , our liquidity, including cash, cash equivalents, short - term investments and available borrowing capacity under our
revolving bank credit facility was
$9.6 billion . Our cash, cash equivalents and short - term investments totaled $7.5 billion as of the Successor year ended
December 31, 2013 compared to $8.2 billion as of the Predecessor year ended December 31, 2012 . As of December 31, 2013 , approximately $914 million in letters of
credit were outstanding under our
$3.0 billion revolving bank credit facility, including the letter of credit required by the 2004 FCC Report and Order to
reconfigure the 800 MHz band (the "Report and Order"). Certain indentures that govern our outstanding notes also require compliance with various covenants,
including covenants that limit the ability of the Company and its subsidiaries to sell all or substantially all of its assets, and limit the ability of the Company and
its subsidiaries to incur indebtedness and liens, each as defined by the terms of the indentures and supplemental indentures. As a result of the outstanding
letters of credit, which directly reduce the availability of the revolving bank credit facility, we had approximately
$2.1 billion of borrowing capacity available
under the revolving bank credit facility as of
December 31, 2013 . Our revolving bank credit facility expires in February 2018.
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