Sprint - Nextel 2013 Annual Report Download - page 54

Table of Contents
The following graph depicts our future principal maturities of debt as of
December 31, 2013 :
* This table excludes (i) our unsecured revolving bank credit facility, which will expire in 2018 and has no outstanding balance, and under which $914 million in letters of credit are
outstanding, (ii) vendor financing notes assumed in the Clearwire Acquisition, and (iii) all capital leases and other financing obligations.
Liquidity and Capital Resource Requirements
To meet our short
- and long - term liquidity requirements, we look to a variety of funding sources. Our existing liquidity balance and cash generated
from operating activities is our primary source of funding. In addition to cash flows from operating activities, we rely on the ability to issue debt and equity
securities, the ability to issue other forms of financing, and the borrowing capacity available under our credit facilities to support our short
- and long - term
liquidity requirements. We believe our existing available liquidity and cash flows from operations will be sufficient to meet our funding requirements through the
next twelve months, including debt service requirements and other significant future contractual obligations. To maintain an adequate amount of available
liquidity and execute according to the timeline of our current business plan, which includes network deployment and maintenance, subscriber growth, data
usage capacity needs and the expected achievement of a cost structure intended to achieve more competitive margins, we may need to raise additional funds
from external resources. If we are unable to fund our remaining capital needs from external resources on terms acceptable to us, we would need to modify our
existing business plan, which could adversely affect our expectation of long
- term benefits to results from operations and cash flows from operations.
The terms and conditions of our revolving bank credit facility, which expires in February 2018, require that, at the end of each fiscal quarter, the ratio
(Leverage Ratio) of total indebtedness to trailing four quarters earnings before interest, taxes, depreciation and amortization and other non
- recurring items
(adjusted EBITDA each as defined in the applicable agreement), not exceed 6.25 to 1.0 at any quarter end through June 30, 2014. After June 30, 2014, the
Leverage Ratio declines on a scheduled basis, as determined by the credit agreement, until the ratio becomes fixed at 4.0 to 1.0 for the fiscal quarter ending
December 31, 2016 and each fiscal quarter ending thereafter. The unsecured EDC Agreement and secured equipment credit facility were amended on March 12,
2013 and June 24, 2013, respectively, to provide for terms similar to those of the amended revolving bank credit facility, except that under the terms of the EDC
Agreement and secured equipment credit facility, repayments of outstanding amounts cannot be re
- drawn. As of December 31, 2013 , our Leverage Ratio, as
defined by the amended revolving bank credit facility, EDC Agreement, and secured equipment credit facility was
5.9 to 1.0 . In addition, since our leverage ratio
exceeds
2.5 to 1.0 at quarter end, we were also restricted from paying cash dividends.
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