Cricket Wireless 2012 Annual Report Download - page 81

Additional information regarding our purchase agreements with Apple and Sprint and other significant contracts
and commitments we have entered into is set forth below under “— Capital Expenditures, Significant
Acquisitions and Other Transactions” and “— Contractual Obligations”.
We determine our future capital and operating requirements and liquidity based upon our current and
projected financial and operating performance, the scope of our investment initiatives and the extent of our
contractual commitments. There are a number of risks and uncertainties (including those set forth in “Part I —
Item 1A. Risk Factors” of this report) that could cause our financial and operating results and capital or liquidity
requirements to differ materially from our projections. If our future financial and operating performance is
materially less favorable than our current projections, or if our capital requirements materially increase, we will
likely be required to generate additional capital resources. In such an event, we would seek to increase our
liquidity through a number of actions, including refinancing our $250 million of 4.5% convertible senior notes
due 2014 prior to maturity; selling assets, including spectrum not currently utilized in our business operations or
other business assets; delaying or reducing operating and capital expenditures; or pursuing other capital markets
activities.
We had $3,302 million in senior indebtedness outstanding as of December 31, 2012, which was comprised
of $250 million in aggregate principal amount of 4.5% convertible senior notes due 2014, $1,100 million in
aggregate principal amount of 7.75% senior secured notes due 2016, $1,600 million in aggregate principal
amount of 7.75% unsecured senior notes due 2020, and $400 million in aggregate principal amount of term loan
borrowings outstanding under our Credit Agreement that mature in 2019, as more fully described below.
Although our significant outstanding indebtedness results in risks to our business that could materially affect
our financial condition and performance, we believe that these risks are manageable and that we are taking
appropriate actions to monitor and address them. For example, in connection with our financial planning process
and capital raising activities, we regularly review our business plans and forecasts to monitor our ability to
service our debt and to assess our capacity to incur additional debt under our Credit Agreement and the
indentures governing Cricket’s secured and unsecured senior notes. In addition, because borrowings under our
Credit Agreement bear interest at a floating rate, we review changes and trends in interest rates to evaluate
possible hedging activities we could implement. We also regularly monitor the capital and credit markets for
opportunities to refinance our existing indebtedness on favorable terms and extend the maturities of such
indebtedness. As a result of the actions described above, and our expected cash generated from operations and
other sources of liquidity, we believe we have the ability to effectively manage our levels of indebtedness and
address risks to our business and financial condition related to our indebtedness.
Cash Flows
The following table shows cash flow information for the three years ended December 31, 2012, 2011 and
2010 (in thousands):
Year Ended December 31,
2012 2011 2010
Net cash provided by operating activities .................... 182,445 387,509 312,278
Net cash used in investing activities ........................ (41,479) (779,975) (123,952)
Net cash provided by (used in) financing activities ............ 29,341 386,919 (12,535)
Operating Activities
Net cash provided by operating activities decreased $205.1 million, or 52.9%, for the year ended
December 31, 2012 compared to the corresponding period of the prior year. This decrease was primarily
attributable to changes in working capital.
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