Metro PCS 2009 Annual Report Download - page 62

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Royal Street owns certain licenses that we do not control and that may never be sold to us.
Our agreements with Royal Street Communications, which were reviewed and approved by the FCC, allow us to
actively participate in the development of the Royal Street licenses and networks, and we have the right to purchase,
on a wholesale basis, 85% of the engineered capacity provided by the Royal Street systems and to resell those
services on a retail basis under our brand. We, however, do not control Royal Street or the Royal Street licenses. C9,
an unaffiliated third party, has the ability through June 2012 to require us to purchase, or put, all or part of its
ownership interest in Royal Street Communications, but we have no corresponding right to require C9 to sell to us,
or call, its ownership interest in Royal Street Communications to us. C9 might not exercise its put rights or, if it
does, we do not know when such exercise may occur. Further, the FCC’s rules restrict our ability to acquire or
control Royal Street during the period that Royal Street must maintain its eligibility as a DE, which is currently
through December 2010. Thus, we cannot be certain that the Royal Street licenses will be developed in a manner
fully consistent with our business plan or our transition to our 4G platform or that C9 will act in ways that benefit us.
Spectrum for which we have been granted licenses as a result of AWS Auction 66 and Auction 73 is subject to
certain legal challenges, which may ultimately result in the FCC revoking our licenses.
We were required by the applicable FCC rules to pay the full purchase price of approximately $1.4 billion and
$313.3 million to the FCC for the licenses we were granted as a result of Auction 66 and Auction 73, respectively,
even though there are ongoing challenges to some aspects of the final auction rules as they relate to DE participation
in the auctions. Several interested parties are appealing these rules in the U.S. Courts and are seeking, among other
relief, to overturn the results of Auction 66 and Auction 73. We are unable at this time to predict with certainty the
likely outcome of these challenges. If the courts invalidate either auction, we could lose the licenses granted to us as
a result of the auctions and would have no assurance of being able to reacquire the licenses in a subsequent re-
auction. While we would likely receive a refund of the payments made to the FCC for the spectrum should either
auction be overturned, we would not be reimbursed for time, money and efforts spent to clear the spectrum,
expenses incurred to build systems operating on the spectrum, the interest expenses incurred by us prior to the
refund, the losses associated with launching the markets on this spectrum, or the loss of revenue and profits
associated with these markets. In addition, there could be a delay in us receiving a refund of our payments until the
appeal is final. If the results of either auction were overturned and we receive a refund, the delay in the return of our
money, the interest we would have incurred without reimbursement, the loss of any amounts spent to develop the
licenses in the interim, which could be substantial, and the loss of the ability to provide service in the metropolitan
areas covered by such licenses, may materially and adversely affect our business, financial condition and operating
results.
General Matters
Our stock price has historically been, and may continue to be, volatile and you may lose all or some of your
investment.
The trading prices of the securities of telecommunications companies generally have been highly volatile. In
particular, the trading price of our common stock has been, and is likely to be, subject to wide fluctuations. Our
stock price may fluctuate in reaction to a number of events and factors that may include, among other things:
• concentration of offered services and assets in the U.S., in particular limited major metropolitan areas;
• actual or anticipated fluctuations in our or our competitors’ operating and financial results;
• changes in, or our failure to meet, securities analysts' expectations;
• entry of new competitors into our markets or perceptions of increased price competition, including a price
war;
• changes in our credit rating or future prospects;
• disruptions of our operations or service providers necessary to our network operations;
• seasonal or other variations in our customer base;