Clearwire 2008 Annual Report Download - page 44

We ma
y
sustain
f
inancia
ll
osses i
f
S
p
rint
f
ai
l
sto
f
u
lf
i
ll
its in
d
emni
f
ication o
bl
igations to us
.
Under the Transaction A
g
reement, Sprint must indemnif
y
us a
g
ainst certain losses relatin
g
to, amon
g
othe
r
t
hin
g
s, an
y
breach of certain of Sprint’s representations as to the Sprint WiMAX Business, an
y
pre-Closin
g
taxes
i
ncurre
db
yanyo
f
Spr
i
nt’s su
b
s
idi
ar
i
es,
li
t
i
gat
i
on re
l
ate
d
to certa
i
no
f
Spr
i
nt’s a
ffili
ates an
d
any
li
a
bili
t
i
es unre
l
ate
d
t
o the Sprint WiMAX Business. These indemnification obli
g
ations
g
enerall
y
continue until the statute of limitations
for the applicable claim has expired. The indemnification obligations regarding Sprint’s representations as to the
S
pr
i
nt W
i
MAX Bus
i
ness an
df
or
li
a
bili
t
i
es unre
l
ate
d
to t
h
e Spr
i
nt W
i
MAX Bus
i
ness,
h
owever, eac
h
surv
i
ve
f
or
th
ree
y
ears
f
rom C
l
os
i
n
g
. Spr
i
nt’s
i
n
d
emn
ifi
cat
i
on o
blig
at
i
ons are
g
enera
lly
un
li
m
i
te
d
,w
i
t
h
t
h
e except
i
on o
f
a
$25 million deductible for claims based on a breach of re
p
resentation that S
p
rint’s subsidiaries that hold the S
p
rin
t
W
iMAX Business have, subject to certain limited exceptions, a specific, limited set of liabilities at Closing
.
We cannot prov
id
ean
y
assurances t
h
at Spr
i
nt w
ill f
u
lfill i
ts
i
n
d
emn
ifi
cat
i
on o
blig
at
i
ons
i
n accor
d
ance w
i
t
h
t
h
e
Transaction A
g
reement. If it turns out that the representations made b
y
Sprint as to the Sprint WiMAX Business, for
w
hi
c
h
Spr
i
nt
i
so
bli
gate
d
to
i
n
d
emn
if
yusun
d
er t
h
e Transact
i
on Agreement, are
i
naccurate, we may susta
i
n
sig
n
ifi
cant
fi
nanc
i
a
ll
osses. I
f
Spr
i
nt
f
a
il
sto
f
u
lfill i
ts
i
n
d
emn
ifi
cat
i
on o
blig
at
i
ons un
d
er t
h
e Transact
i
on A
g
reement
t
o indemnif
y
and defend us for an
y
such financial loss or claim, as the case ma
y
be, it could adversel
y
affect our
financial condition, cash flows and results of operations. In addition, if the time period for any indemnification
cl
a
i
ms
h
as exp
i
re
dby
wa
y
o
f
t
h
e statue o
fli
m
i
tat
i
ons or
by
operat
i
on o
f
t
h
et
h
ree-
y
ear per
i
o
di
nt
h
e Transact
i
on
Ag
reement, our
b
us
i
ness, prospects, operat
i
n
g
resu
l
ts an
dfi
nanc
i
a
l
con
di
t
i
on ma
yb
ea
d
verse
ly
a
ff
ecte
d
.
Th
e integration o
f
O
ld
C
l
earwire’s
b
usiness an
d
t
h
eS
p
rint WiMAX Business wi
ll p
resent signi
f
icant c
h
a
l-
l
enges t
h
at ma
y
resu
l
tina
d
ec
l
ine in t
h
e antici
p
ate
db
ene
f
its o
f
t
h
e Transactions. Furt
h
er, t
h
e integratio
n
m
ay result in a less than effective system of internal controls and we may not be able to report our finan
-
c
ia
l
resu
l
ts accurate
ly
,
p
ro
p
er
ly
sa
f
eguar
d
our assets or
p
revent
f
rau
d.
We are
i
nt
h
e process o
fi
ntegrat
i
ng t
h
e Spr
i
nt W
i
MAX Bus
i
ness an
d
t
h
e
b
us
i
ness o
f
O
ld
C
l
earw
i
re t
h
a
t
p
reviousl
y
operated independentl
y
. The difficulties of combinin
g
these businesses include
:
• inte
g
ratin
g
successfull
y
each of their operations, technolo
g
ies, products and services
;
• coor
di
nat
i
ng mar
k
et
i
ng e
ff
orts to e
ff
ect
i
ve
l
y promote our serv
i
ces
;
•t
h
e necess
i
t
y
o
f
coor
di
nat
i
n
gg
eo
g
rap
hi
ca
lly
separate
d
or
g
an
i
zat
i
ons, s
y
stems an
df
ac
ili
t
i
es
;
• integrating personnel with diverse business backgrounds and business cultures;
• conso
lid
at
i
ng an
d
rat
i
ona
li
z
i
ng
i
n
f
ormat
i
on tec
h
no
l
ogy p
l
at
f
orms an
d
a
d
m
i
n
i
strat
i
ve
i
n
f
rastructures as we
ll
as accountin
g
s
y
stems and related financial reportin
g
activities; and
•ma
i
nta
i
n
i
ng an e
ff
ect
i
ve system o
fi
nterna
l
contro
l
s
d
ur
i
ng an
d
a
f
ter t
h
e process o
fi
ntegrat
i
on
i
s comp
l
ete
d.
Furt
h
ermore, as
i
t cont
i
nues, t
h
e
i
nte
g
rat
i
on process ma
y
resu
l
t
i
nt
h
e
l
oss o
fk
e
y
emp
l
o
y
ees, t
h
e
di
srupt
i
on o
f
O
ld Clearwire’s on
g
oin
g
businesses or the Sprint WiMAX Business, the incurrence of additional costs, incon-
s
istencies in standards, controls, procedures and policies that adversel
y
affect our abilit
y
to maintain relationships
w
i
t
h
c
li
ents, customers an
d
emp
l
oyees or to ac
hi
eve t
h
e ant
i
c
i
pate
db
ene
fi
ts o
f
t
h
e Transact
i
ons. T
h
e
l
oss o
fk
e
y
e
mplo
y
ees could adversel
y
affect our abilit
y
to successfull
y
conduct our business, which could have an advers
e
eff
ect on our
fi
nanc
i
a
l
resu
l
ts an
d
t
h
eva
l
ue o
f
our common stoc
k
. Furt
h
er, not ma
i
nta
i
n
i
ng an e
ff
ect
i
ve system o
f
i
nterna
l
contro
l
st
h
roug
h
out t
h
e
i
ntegrat
i
on process cou
ld i
mpact our a
bili
ty to report an
d fil
e our
fi
nanc
i
a
l
resu
l
ts
on an accurate and timel
y
manner.
T
he process of inte
g
ratin
g
operations could cause an interruption of, or loss of momentum in, the activities of
one or more o
f
our
b
us
i
nesses. I
f
we exper
i
ence
diffi
cu
l
t
i
es w
i
t
h
t
h
e
i
ntegrat
i
on process, t
h
e ant
i
c
i
pate
db
ene
fi
ts o
f
t
he Transactions ma
y
not be realized full
y
or at all, or ma
y
take lon
g
er to realize than expected. These inte
g
ratio
n
m
atters could have an adverse effect on our business and financial condition durin
g
this transition period and for an
un
d
eterm
i
ne
d
per
i
o
d
t
h
erea
f
ter
.
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