Metro PCS 2009 Annual Report Download - page 65

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may ultimately result in a non-cash impairment charge related to our long-lived assets and/or our indefinite-lived
intangible assets. A significant impairment loss could have a material adverse effect on our operating results and on
the carrying value of our FCC licenses and/or our long-lived assets on our balance sheet, which could have a
material adverse effect on our business, financial condition and operating results.
Changes in interpretations of accounting requirements, changes in industry practice, the identification of
errors or changes in management assumptions could require amendments to or restatements of financial
information or disclosures included in this or prior filings with the SEC.
We prepare our consolidated financial statement in accordance with GAAP and file such financial statements with
the SEC in accordance with the SEC’s rules and regulations. The preparation of financial statements requires our
management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities as of the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. We base our estimates on historical experience, our perceptions
of historical trends, current conditions, expected future developments and other various assumptions and information
that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments
about the carrying values of assets and liabilities. Actual results may differ from estimates under different
assumptions or conditions. Changes in accounting requirements or in guidance or interpretations related to such
requirements, changes in industry practice, the identification of errors or changes in estimates or assumptions could
require restatements of financial information or amendments to disclosures included in this or prior filings with the
SEC.
Even with our current levels of indebtedness, we may incur additional indebtedness.
Although we have substantial indebtedness, we may still be able to incur significantly more debt under our senior
secured credit facility and our indentures governing our 9¼% senior notes as market conditions permit, which could
further reduce the cash we have available to invest in our operations, as a result of our increased debt service
obligations. The terms of the agreements governing our long-term indebtedness, subject to specified limitations,
allow for the incurrence of additional indebtedness by us and our subsidiaries. The more leveraged we become, the
more we, and in turn the holders of our securities, become exposed to the risks described above in the risk factor
entitled “Our operations require continued capital expenditures and a failure to access additional capital could
have a material adverse effect on our business, financial condition and operating results.”
In order to provide additional flexibility, especially in the current economic climate, we intend to file a universal
shelf registration statement with the SEC to register debt, equity and other securities, including common stock,
preferred stock, debt securities and guarantees of debt securities. The securities registered under this universal shelf
registration statement could be offered from time to time, separately or together, directly by us or through
underwriters, at amounts, prices, interest rates and other terms and conditions to be determined at the time of any
offering. There can be no assurance that sufficient funds will be available to us under our existing indebtedness or
otherwise. Further, should we need to raise additional capital, the foreign ownership restrictions mandated by the
FCC, and applicable to us, could limit our ability to attract additional equity financing outside the United States. If
we were able to obtain funds, it may not be on terms and conditions acceptable to us, which could limit or preclude
our ability to pursue new opportunities, expand our service, upgrade our networks, engage in acquisitions, or
purchase additional spectrum, thus limiting our ability to expand our business which could have a material adverse
effect on our business, financial condition and operating results.
To service our debt, we will require a significant amount of cash, which may not be available to us.
Our ability to meet our existing or future debt obligations and to reduce our indebtedness will depend on our
future performance and the other cash requirements of our business. Our performance, to a certain extent, is subject
to general economic conditions, financial, competitive, business, political, regulatory and other factors that are
beyond our control. In addition, our ability to borrow funds in the future to make payment on our debt will depend
on the satisfaction of covenants in our senior secured credit facility, the indentures governing our 9¼% senior notes,
other debt agreements and other agreements we may enter into in the future. Specifically, we will need to maintain
certain financial ratios and satisfy financial condition tests. We cannot assure you that we will continue to generate
sufficient cash flow from operations at or above current levels or that future borrowings will be available to us under
our senior secured credit facility or from other sources in an amount sufficient to enable us to repay all of our
indebtedness in a timely manner. If we are unable to satisfy our financial covenants or generate sufficient cash to
timely repay our debt, the lenders could accelerate the maturity of some or all of our outstanding indebtedness. As a