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Filed Pursuant to Rule 424(b)(5)
File No. 333-249079
CALCULATION OF REGISTRATION FEE
Title of each class of
securities to be registered
Amount
to be
registered
Maximum
offering price
per security
Maximum
aggregate
offering price
Amount of
registration
fee(1)
2.250% Notes due 2026
$1,000,000,000
100.000%
$1,000,000,000
$109,100.00
2.625% Notes due 2029
$1,000,000,000
100.000%
$1,000,000,000
$109,100.00
2.875% Notes due 2031
$1,000,000,000
100.000%
$1,000,000,000
$109,100.00
Total
$3,000,000,000
 
$3,000,000,000
$327,300.00
(1)
The filing fee of $327,300.00 is calculated in accordance with Rule 456(b) and Rule 457(r) of the Securities Act of 1933, as amended.

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PROSPECTUS SUPPLEMENT
(To Prospectus dated September 28, 2020)
$3,000,000,000

T-Mobile USA, Inc.
$1,000,000,000 2.250% Senior Notes due 2026
$1,000,000,000 2.625% Senior Notes due 2029
$1,000,000,000 2.875% Senior Notes due 2031
T-Mobile USA, Inc., a Delaware corporation (“T-Mobile USA” or the “Issuer”) and a direct wholly-owned subsidiary of T-Mobile US, Inc., a Delaware corporation (“T-Mobile US” or “Parent”) is offering $1,000,000,000 aggregate principal amount of its 2.250% Senior Notes due 2026 (the “2026 Notes”), $1,000,000,000 aggregate principal amount of its 2.625% Senior Notes due 2029 (the “2029 Notes”) and $1,000,000,000 aggregate principal amount of its 2.875% Senior Notes due 2031 (the “2031 Notes”). In this prospectus supplement, the term “Notes” collectively refers to the 2026 Notes, the 2029 Notes and the 2031 Notes.
We intend to use the net proceeds from this offering for general corporate purposes, which may include among other things, financing acquisitions of additional spectrum and refinancing existing indebtedness on an ongoing basis. See “Use of Proceeds.”
The 2026 Notes will bear interest at a rate of 2.250% per year and mature on February 15, 2026. The 2029 Notes will bear interest at a rate of 2.625% per year and mature on February 15, 2029. The 2031 Notes will bear interest at a rate of 2.875% per year and mature on February 15, 2031. Interest on the Notes will be paid on each February 15 and August 15, commencing August 15, 2021. See “Description of Notes—Brief Description of the Notes and the Note Guarantees—Principal, Maturity and Interest.” There is no sinking fund for the Notes.
The 2026 Notes will be redeemable, in whole or in part, at any time on or after February 15, 2023 at the redemption prices specified under “Description of Notes—Optional Redemption” plus accrued and unpaid interest to, but not including, the redemption date. The Issuer may redeem up to 40% of the aggregate principal amount of the 2026 Notes prior to February 15, 2023 with an amount equal to the net cash proceeds from certain equity offerings. The Issuer also may redeem the 2026 Notes prior to February 15, 2023 at a specified “make-whole” redemption price plus accrued and unpaid interest to, but not including, the redemption date.
The 2029 Notes will be redeemable, in whole or in part, at any time on or after February 15, 2024 at the redemption prices specified under “Description of Notes—Optional Redemption” plus accrued and unpaid interest to, but not including, the redemption date. The Issuer may redeem up to 40% of the aggregate principal amount of the 2029 Notes prior to February 15, 2024 with an amount equal to the net cash proceeds from certain equity offerings. The Issuer also may redeem the 2029 Notes prior to February 15, 2024 at a specified “make-whole” redemption price plus accrued and unpaid interest to, but not including, the redemption date.
The 2031 Notes will be redeemable, in whole or in part, at any time on or after February 15, 2026 at the redemption prices specified under “Description of Notes—Optional Redemption” plus accrued and unpaid interest to, but not including, the redemption date. The Issuer may redeem up to 40% of the aggregate principal amount of the 2031 Notes prior to February 15, 2024 with an amount equal to the net cash proceeds from certain equity offerings. The Issuer also may redeem the 2031 Notes prior to February 15, 2026 at a specified “make-whole” redemption price plus accrued and unpaid interest to, but not including, the redemption date.
If the Issuer experiences a Change of Control Triggering Event (as defined herein), the Issuer will be required to offer to repurchase the Notes at a repurchase price equal to 101% of the principal amount, plus accrued and unpaid interest to, but not including, the repurchase date. See “Description of Notes—Repurchase at the Option of Holders—Change of Control Triggering Event.”
The Issuer’s obligations under the Notes will be guaranteed (such guarantees, the “Guarantees”) by (x) T-Mobile US and each wholly-owned subsidiary of the Issuer that is not an Excluded Subsidiary (as defined herein) and either (i) is or becomes an obligor of the Credit Agreement (as defined herein) or (ii) issues or guarantees certain capital markets debt securities, and (y) any future direct or indirect subsidiary of T-Mobile US or any subsidiary thereof that owns capital stock of the Issuer.
The Notes and the Guarantees will be the Issuer’s and the guarantors’ unsubordinated unsecured obligations; will be senior in right of payment to any future indebtedness of the Issuer or any guarantor to the extent that such future indebtedness provides by its terms that it is subordinated in right of payment to the Notes and the Guarantees; will be equal in right of payment with any of the Issuer’s and the guarantors’ existing and future indebtedness and other liabilities that are not by their terms subordinated in right of payment to the Notes, including, without limitation, obligations under the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes, the Existing Sprint Unsecured Notes, the Credit Agreement and the Tower Obligations (each as defined herein); will be effectively subordinated to all existing and future secured indebtedness of the Issuer or any guarantor, including, without limitation, obligations under the Existing T-Mobile Secured Notes and the Credit Agreement, in each case to the extent of the value of the assets securing such indebtedness; and will be structurally subordinated to all of the liabilities and other obligations of the subsidiaries of T-Mobile US that are not obligors with respect to the Notes, including the Existing Sprint Spectrum-Backed Notes (as defined herein), factoring arrangements and Tower Obligations.
Investing in the Notes involves risks. See “Risk Factors” beginning on page S-17 of this prospectus supplement. You should also consider the risk factors described in the documents incorporated by reference in the accompanying prospectus.
 
Per 2026 Note
Per 2029 Note
Per 2031 Note
Public Offering Price
100.000%
100.000%
100.000%
Total
$1,000,000,000
$1,000,000,000
$1,000,000,000
Proceeds to T-Mobile USA, Inc.(1)
$995,000,000
$995,000,000
$995,000,000
(1)
Before expenses. The underwriting discount is 0.500% of the principal amount thereof, resulting in total underwriting discounts of (i) $5,000,000 for the 2026 Notes, (ii) $5,000,000 for the 2029 Notes and (iii) $5,000,000 for the 2031 Notes.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
Each series of Notes will be issued only in registered form in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof. The Issuer does not intend to apply for the Notes to be listed on any securities exchange or to arrange for the Notes to be quoted on any quotation system. Currently, there is no public market for the Notes.
The underwriters are offering the Notes as set forth under “Underwriting.” Delivery of the Notes is expected to be made on or about January 14, 2021 through the facilities of The Depository Trust Company.
Joint Book-Running Managers
Deutsche Bank Securities
Citigroup
Credit Suisse
Goldman Sachs & Co. LLC
Barclays
J.P. Morgan
Morgan Stanley
RBC Capital Markets
Co-Managers
Academy Securities
C.L. King & Associates
Great Pacific Securities
Mischler Financial Group, Inc.
The date of this prospectus supplement is January 11, 2021.

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Prospectus Supplement
 
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3
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Neither we nor the underwriters named under “Underwriting” in this prospectus supplement (the “underwriters”) have authorized any other person to provide you with information different from that contained in or incorporated by reference in this prospectus supplement and the accompanying prospectus or in any related free writing prospectus that we may provide to you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give. We are offering to sell and are seeking offers to buy the Notes only in jurisdictions where offers and sales are permitted. The information contained in or incorporated by reference in this prospectus supplement, the accompanying prospectus and any related free writing prospectus is accurate only as of the respective dates of such documents regardless of the time of delivery of this prospectus supplement, the accompanying prospectus, any related free writing prospectus or any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date.
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ABOUT THIS PROSPECTUS SUPPLEMENT
This document is in two parts. The first part is this prospectus supplement, which describes the specific terms of this offering of the Notes and also adds to and updates information contained in the accompanying prospectus and the documents incorporated by reference in this prospectus supplement and the accompanying prospectus. The second part is the accompanying prospectus, which gives more general information. Generally, when we refer to this prospectus, we are referring to both parts of this document combined. To the extent there is a conflict between the information contained in the accompanying prospectus and this prospectus supplement, you should rely on the information in this prospectus supplement; provided that if any statement in one of these documents is inconsistent with a statement in another document having a later date—for example, a document incorporated by reference in the accompanying prospectus or this prospectus supplement—the statement in the document having the later date modifies or supersedes the earlier statement.
As permitted by the rules and regulations of the Securities and Exchange Commission (the “SEC”), the registration statement of which the accompanying prospectus forms a part includes additional information not contained in this prospectus supplement. You may read the registration statement and the other reports we file with the SEC at the SEC’s website described below under the heading “Where You Can Find More Information.”
You should read this prospectus supplement along with the accompanying prospectus, any related free writing prospectus and the documents incorporated by reference carefully before you decide whether to invest. These documents contain important information you should consider when making your investment decision. This prospectus supplement contains information about the securities offered in this offering and may add, update or change information in the accompanying prospectus.
In this prospectus supplement, unless stated otherwise or the context indicates otherwise, references to “T-Mobile,” the “Company,” “our Company,” “we,” “our,” “ours” and “us” refer to T-Mobile US, Inc. together with its direct and indirect domestic subsidiaries, including T-Mobile USA and its subsidiaries and, on and after April 1, 2020, Sprint Corporation, a Delaware corporation (“Sprint”) and its subsidiaries. References to “T-Mobile USA” and the “Issuer” refer to T-Mobile USA, Inc. only. T-Mobile USA’s corporate parent is T-Mobile US, Inc., which we refer to in this prospectus supplement on a stand-alone basis as “T-Mobile US” or “Parent.” T-Mobile US has no operations separate from its investment in T-Mobile USA. Accordingly, unless otherwise noted, all of the business and financial information in this prospectus supplement, including the factors identified under “Risk Factors” beginning on page S-17, is presented on a consolidated basis for T-Mobile.
On April 29, 2018, Parent entered into a Business Combination Agreement (as amended and supplemented, the “Business Combination Agreement”) with Sprint, Huron Merger Sub LLC, a Delaware limited liability company and a wholly owned subsidiary of Parent (“T-Mobile Merger Company”), Superior Merger Sub Corporation, a Delaware corporation and a wholly owned subsidiary of T-Mobile Merger Company (“Merger Sub”), Starburst I, Inc., a Delaware corporation (“Starburst”), Galaxy Investment Holdings, Inc., a Delaware corporation (“Galaxy,” and together with Starburst, the “SoftBank US HoldCos”), and for the limited purposes set forth therein, Deutsche Telekom AG, an Aktiengesellschaft organized and existing under the laws of the Federal Republic of Germany (“Deutsche Telekom”), Deutsche Telekom Holding B.V., a besloten vennootschap met beperkte aansprakelijkheid organized and existing under the laws of the Netherlands (“DT Holding”) and SoftBank Group Corp., a Japanese kabushiki kaisha (“SoftBank”). In this prospectus supplement, references to the “combined company” refer to the combined businesses of T-Mobile US and its subsidiaries and Sprint and its subsidiaries following consummation of the BCA Transactions. On April 1, 2020, pursuant to the Business Combination Agreement and upon the terms and subject to the conditions described therein: (a) each of Galaxy and Starburst merged with and into T-Mobile Merger Company, with T-Mobile Merger Company continuing as the surviving entity and as a wholly owned subsidiary of T-Mobile US (the “HoldCo Mergers”); and (b) Merger Sub merged with and into Sprint, with Sprint continuing as the surviving corporation and as a wholly owned indirect subsidiary of T-Mobile US (the “Merger” and collectively with the HoldCo Mergers, the “BCA Transactions”). Promptly following the consummation of the Merger, T-Mobile US contributed Sprint to T-Mobile USA, causing Sprint to become a wholly owned subsidiary of T-Mobile USA (the “Contribution”).
The T-Mobile Debt Repayments (as defined below) and the Sprint Debt Repayments (as defined below) were financed by borrowings under (x) the Bridge Term Loan Credit Agreement, dated as of April 1, 2020 (the “Bridge Credit Agreement”), by and among T-Mobile USA, as borrower, Goldman Sachs Bank USA, as administrative agent, and the lenders and other financial institutions party thereto, providing $19.0 billion of
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bridge loans, and (y) the Credit Agreement (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Credit Agreement”), providing a $4.0 billion Term Loan Facility (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Credit Agreement”), and a $4.0 billion revolving credit facility. In connection with the BCA Transactions, (i) (a) we repaid the outstanding amounts under and terminated our $4.0 billion secured term loan facility under the Term Loan Credit Agreement, dated November 9, 2015, among T-Mobile USA, as borrower, the Company, as a guarantor, the other guarantors party thereto, Deutsche Bank AG New York Branch (“DB”), as administrative agent, and Deutsche Telekom, as lender, as amended (the “2015 T-Mobile Secured Term Loan Facility”) with no prepayment premium or penalty and (b) we terminated our three-year $1.0 billion senior unsecured revolving credit agreement with Deutsche Telekom, as administrative agent and lender (the “2016 T-Mobile Unsecured Revolving Credit Facility”) and our three-year $1.5 billion senior secured revolving credit agreement with Deutsche Telekom, as administrative agent, collateral agent and lender (the “2016 T-Mobile Secured Revolving Credit Facility,” and together with the 2016 T-Mobile Unsecured Revolving Credit Facility, the “2016 T-Mobile Revolving Credit Facilities”) with no prepayment premium or penalty and (c) we repurchased, at par plus accrued and unpaid interest, our 5.300% Notes due 2021 and 6.000% Notes due 2024, the amounts outstanding under which facilities and notes were owed to Deutsche Telekom (the items in this clause (i) being referred to collectively as the “T-Mobile Debt Repayments”), (ii) (a) we repaid the outstanding amounts under the Credit Agreement, dated as of February 3, 2017, as amended, by and among Sprint Communications, Inc., as borrower, the guarantors party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto (the “Sprint Secured Term Loan Facility”), (b) we repaid the amounts outstanding under the Third Amended and Restated Receivables Purchase Agreement, dated as of June 29, 2018, as amended, by and among Sprint Spectrum L.P., as servicer, certain Sprint special purpose entities, as sellers, and financial institutions from time to time party thereto (the “Sprint Accounts Receivable Facility”), (c) we redeemed the 7.250% Guaranteed Notes due 2028 of Sprint and (d) we repaid certain other indebtedness of Sprint and its subsidiaries (the items in this clause (ii) being referred to collectively as the “Sprint Debt Repayments”) and (iii) the maturity dates applicable to our 5.125% Senior Notes due 2025-1 and 5.375% Senior Notes due 2027-1 were amended from April 15, 2025 to April 15, 2021 and from April 15, 2027 to April 15, 2022, respectively (the “T-Mobile Maturity Amendments”). As a result of the BCA Transactions, (i) T-Mobile US and T-Mobile USA have guaranteed on an unsecured basis the obligations under the Existing Sprint Unsecured Notes (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Existing Sprint Unsecured Notes” and such guarantees, collectively with the guarantees of the Existing Sprint Spectrum Lease (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Existing Sprint Spectrum Note Facility”), the “Sprint Debt Assumptions”), (ii) T-Mobile US and T-Mobile USA and the wholly-owned domestic subsidiaries of the Issuer that became obligors of the Credit Agreement have guaranteed on a secured basis (with such security capped at $3.5 billion) the lease payment obligations under the Existing Sprint Spectrum Lease and (iii) Sprint and its wholly-owned domestic subsidiaries that will guarantee the Notes have also guaranteed on an unsecured basis the obligations under the Existing T-Mobile Unsecured Notes (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Existing T-Mobile Unsecured Notes”).
On April 9, 2020, all $19.0 billion of borrowings outstanding under the Bridge Credit Agreement were repaid in full with the net proceeds of the offering of $19.0 billion of Existing T-Mobile Secured Notes (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Existing T-Mobile Secured Notes”), together with cash on hand (the entry into and borrowings under the Bridge Credit Agreement and the Credit Agreement, the issuance of $19.0 billion of Existing T-Mobile Secured Notes on April 9, 2020 and the repayment of outstanding amounts under the Bridge Credit Agreement with the proceeds of such Existing T-Mobile Secured Notes, the “T-Mobile Financing Transactions”). We refer to the Merger, the BCA Transactions, the Contribution, the T-Mobile Financing Transactions (including the issuance of $19.0 billion of Existing T-Mobile Secured Notes on April 9, 2020 and the repayment of amounts under the Bridge Credit Agreement in connection therewith), the T-Mobile Debt Repayments, the Sprint Debt Repayments, the Sprint Debt Assumptions, and the T-Mobile Maturity Amendments collectively as the “Transactions.”
On September 16, 2020, T-Mobile USA increased the aggregate commitment under the revolving credit facility to $5.5 billion through an amendment to the Credit Agreement, with proceeds from draws thereunder to be used for general corporate purposes including working capital needs. On October 9, 2020, all $4.0 billion of
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borrowings outstanding under the Term Loan Facility were repaid in full. See “Description of Other Indebtedness and Certain Financing Transactions—Existing T-Mobile Secured Notes” and “Description of Other Indebtedness and Certain Financing Transactions—Credit Agreement.”
MARKET AND OTHER DATA AND FORECASTS
Market data and other statistical information used in this prospectus supplement, the accompanying prospectus or any related free writing prospectus or incorporated by reference in this prospectus supplement, the accompanying prospectus or any related free writing prospectus are based on independent industry publications, government publications, reports by market research firms and other published independent sources. Some data is also based on our good faith estimates, which we derive from our review of internal surveys and independent sources. Although we believe these sources are reliable, we have not independently verified the information. We neither guarantee its accuracy nor undertake a duty to provide or update such data in the future.
TRADEMARKS, TRADE NAMES AND SERVICE MARKS
This prospectus supplement, the accompanying prospectus, any related free writing prospectus and the documents incorporated by reference in this prospectus supplement, the accompanying prospectus or any related free writing prospectus may include trademarks, trade names and service marks owned by us or other companies. All trademarks, trade names and service marks included or incorporated by reference in this prospectus supplement, the accompanying prospectus, any related free writing prospectus and the documents incorporated by reference in this prospectus supplement, the accompanying prospectus or any related free writing prospectus are the property of their respective owners.
ROUNDING
Certain numbers and percentages presented in this prospectus supplement may not sum to the totals presented due to rounding.
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements in this prospectus supplement, the accompanying prospectus, any related free writing prospectus, the documents incorporated by reference and our other public statements include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, including information concerning our future results of operations, are forward-looking statements. These forward-looking statements are generally identified by the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “could” or similar expressions. Forward-looking statements are based on current expectations and assumptions, which are subject to risks and uncertainties that may cause actual results to differ materially from the forward-looking statements. The following important factors, along with the factors identified under “Risk Factors” and the risk factors incorporated by reference herein, could affect future results and cause those results to differ materially from those expressed in the forward-looking statements:
failure to realize the expected benefits and synergies of the merger with Sprint, pursuant to the Business Combination Agreement and the other transactions contemplated by the Business Combination Agreement in the expected timeframes, in part or at all;
adverse economic, political or market conditions in the U.S. and international markets, including those caused by the COVID-19 pandemic, and the impact that any of the foregoing may have on us and our customers and other stakeholders;
costs of or difficulties in integrating Sprint’s network and operations into our network and operations, including intellectual property and communications systems, administrative and information technology infrastructure and accounting, financial reporting and internal control systems;
changes in key customers, suppliers, employees or other business relationships as a result of the consummation of the Transactions;
the risk that our business, investor confidence in our financial results and stock price may be adversely affected if our internal controls are not effective;
the risk of future material weaknesses resulting from the differences between T-Mobile’s and Sprint’s internal controls environments as we work to integrate and align policies and practices;
the impacts of the actions we have taken and conditions we have agreed to in connection with the regulatory proceedings and approvals of the Transactions including the prepaid transaction on July 1, 2020, the complaint and proposed final judgment agreed to by us, Deutsche Telekom, Sprint, SoftBank and DISH Network Corporation (“DISH”) with the U.S. District Court for the District of Columbia, which was approved by the Court on April 1, 2020, the proposed commitments filed with the Secretary of the Federal Communications Commission (“FCC”), which we announced on May 20, 2019, certain national security commitments and undertakings, and any other commitments or undertakings entered into, including but not limited to those we have made to certain states and nongovernmental organizations;
the ongoing commercial and transition services arrangements that we entered into with DISH in connection with the prepaid transaction, which we completed on July 1, 2020;
the assumption of significant liabilities, including the liabilities of Sprint in connection with, and significant costs, including financing costs, related to the Transactions;
our ability to make payments on debt or to repay existing or future indebtedness when due or to comply with the covenants contained therein;
adverse changes in the ratings of our debt securities or adverse conditions in the credit markets;
natural disasters, public health crises, including the COVID-19 pandemic, terrorist attacks or similar incidents;
competition, industry consolidation and changes in the market for wireless services, which could negatively affect our ability to attract and retain customers;
the effects of any future merger, investment, or acquisition involving us, as well as the effects of mergers, investments or acquisitions in the technology, media and telecommunications industry;
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breaches of our and/or our third-party vendors’ networks, information technology and data security, resulting in unauthorized access to customer confidential information;
inability to implement and maintain effective cybersecurity measures over critical business systems;
challenges in implementing our business strategies or funding our operations, including payment for additional spectrum or network upgrades;
the impact on our networks and business from major system and network failures;
difficulties in managing growth in wireless data services, including network quality;
material changes in available technology and the effects of such changes, including product substitutions and deployment costs and performance;
the timing, scope and financial impact of our deployment of advanced network and business technologies;
the occurrence of high fraud rates related to device financing, customer credit cards, dealers, subscriptions, or account take over fraud;
our inability to retain and hire key personnel;
any changes in the regulatory environments in which we operate, including any increase in restrictions on the ability to operate our networks and changes in data privacy laws;
unfavorable outcomes of existing or future litigation or regulatory actions, including litigation or regulatory actions related to the Transactions;
the possibility that we may be unable to adequately protect our intellectual property rights or be accused of infringing the intellectual property rights of others;
changes in tax laws, regulations and existing standards and the resolution of disputes with any taxing jurisdictions;
the possibility that we may be unable to renew our spectrum leases on attractive terms or acquire new spectrum licenses or leases at reasonable costs and terms;
any disruption or failure of third parties (including key suppliers) to provide products or services;
material adverse changes in labor matters, including labor campaigns, negotiations or additional organizing activity, and any resulting financial, operational and/or reputational impact;
changes in accounting assumptions that regulatory agencies, including the SEC, may require, which could result in an impact on earnings; and
interests of our significant stockholders that may differ from the interests of other stockholders.
Additional information concerning these and other risk factors is contained in the section titled “Risk Factors” in this prospectus supplement and the documents incorporated by reference.
Forward-looking statements in this prospectus supplement, the accompanying prospectus, any related free writing prospectus or the documents incorporated by reference speak only as of the date of this prospectus supplement or the applicable document incorporated by reference (or such earlier date as may be specified in the applicable document), as applicable, are based on assumptions and expectations as of such dates, and involve risks, uncertainties and assumptions, many of which are beyond our ability to control or predict, including the factors above. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. We undertake no obligation to revise or publicly release any revision to these forward-looking statements, except as required by law. For more information, see the section entitled “Where You Can Find More Information.” The results presented for any period may not be reflective of results for any subsequent period.
You should carefully read and consider the cautionary statements contained or referred to in this section in connection with any subsequent written or oral forward-looking statements that may be issued by us or persons acting on our behalf, and all future written and oral forward-looking statements attributable to us are expressly qualified in their entirety by the foregoing cautionary statements.
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SUMMARY
The following summary highlights selected information about us, Sprint and the combined company contained elsewhere or incorporated by reference in this prospectus supplement, the accompanying prospectus and any related free writing prospectus. This summary does not contain all of the information you should consider before deciding whether to invest in the Notes. You should review this entire prospectus supplement, the accompanying prospectus and any related free writing prospectus carefully, including the risks of investing in the Notes described under the heading “Risk Factors” beginning on page S-17 in this prospectus supplement, as well as our and Sprint’s consolidated financial statements and notes thereto and other information incorporated by reference in this prospectus supplement, the accompanying prospectus and any related free writing prospectus.
Combination of T-Mobile and Sprint
On April 1, 2020, T-Mobile US completed a merger transaction with Sprint, a communications company offering a comprehensive range of wireless and wireline communications products and services. As a combined company, we expect to be able to enhance the breadth and depth of our nationwide 5G network, accelerate innovation, increase competition in the U.S. wireless, video and broadband industries and achieve significant synergies and cost reductions by eliminating redundancies within the combined network as well as other business processes and operations. Among the expected synergies are reduction in redundant cell sites from combining networks, back office and information technology efficiencies and the evolution of our distribution and retail footprint including the combination of the Sprint and T-Mobile brand operations, which unified under the T-Mobile brand nationwide on August 2, 2020.
Our Company
We are the Un-carrier. Through our Un-carrier strategy, we have disrupted the wireless communications services industry by actively engaging with and listening to our customers and eliminating their existing pain points, including providing them with added value, an exceptional experience and implementing signature Un-carrier initiatives that have changed the wireless industry. We ended annual service contracts, overages, unpredictable international roaming fees, data buckets and much more. We are inspired by a relentless customer experience focus, consistently leading the wireless industry in customer care by delivering an excellent customer experience with our “Team of Experts,” which drives our record-high customer satisfaction levels while enabling operational efficiencies. We will continue to maintain our customer experience focus and are determined to bring the Un-carrier to every potential customer in the United States.
Our network is the foundation of our success. Everything we do is powered by our nationwide 4G Long-Term Evolution (“LTE”) network and our transformative nationwide 5G network. As of September 30, 2020, our 4G LTE network covered 327 million Americans (99% of the U.S. population) and our nationwide 5G network covered 270 million people. We continue to expand the footprint and improve the quality of our network, providing outstanding wireless experiences for customers who will not have to compromise on quality and value. Going forward, our network will allow us to deliver new, innovative products and services with the same customer experience focus and industry-disrupting mentality that has redefined the wireless communications services industry in the United States in the customers’ favor.
We provide wireless services to 100.4 million postpaid and prepaid customers as of September 30, 2020, and generate revenue by providing affordable wireless communication services to these customers, as well as a wide selection of wireless devices and accessories. Our most significant expenses relate to acquiring and retaining high-quality customers, providing a full range of devices, compensating employees and operating and expanding our network. We provide service, devices and accessories across our flagship brands, T-Mobile and Metro by T-Mobile, through our owned and operated retail stores, as well as through our websites (www.T-Mobile.com and www.metrobyt-mobile.com), T-Mobile app and customer care channels. In addition, we sell devices to dealers and other third-party distributors for resale through independent third-party retail outlets and a variety of third-party websites. The information on or accessible through our websites is not incorporated into or part of this prospectus supplement (except for our SEC reports expressly incorporated by reference herein).
Corporate Information
Our corporate headquarters and principal executive offices are located at 12920 SE 38th Street, Bellevue, Washington 98006. Our telephone number is (425) 378-4000. We maintain a website at www.T-Mobile.com
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where our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports are available without charge, as soon as reasonably practicable following the time they are filed with or furnished to the SEC. The information on or accessible through our website is not incorporated into or part of this prospectus supplement (except for our SEC reports expressly incorporated by reference herein).
Corporate Structure
The diagram below illustrates the corporate structure of the Company:

(1)
See “Description of Other Indebtedness and Certain Financing Transactions.”
(2)
Certain subsidiaries of the Issuer will not provide guarantees of the Notes, the Existing T-Mobile Unsecured Notes and the Existing T-Mobile Secured Notes (such as certain designated special purpose entities, a reinsurance subsidiary and immaterial subsidiaries). See “Description of Notes—Brief Description of the Notes and the Note Guarantees—The Note Guarantees.” Assuming that on September 30, 2020, we had completed the Q4 Prepayment (as defined under “—Recent Developments—Notes Issuances”) and the Q4 Notes Issuances (as defined under “—Recent Developments—Notes Issuances”) and the issuance of the Notes and all the Guarantees were in place, subsidiaries that will not provide guarantees of the Notes that were included in Parent’s consolidated financial statements as of such date had approximately $10.2 billion of total assets and approximately $7.0 billion in indebtedness and Tower Obligations (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Existing T-Mobile Tower Transactions”) outstanding.
Recent Developments
Prepayment
On October 9, 2020, the Issuer prepaid in full the $4.0 billion of term loans outstanding, together with accrued and unpaid interest, under the Credit Agreement (the “Q4 Prepayment”).
Notes Issuances
On October 6, 2020, the Issuer issued $500 million in aggregate principal amount of its 2.050% Senior Secured Notes due 2028 (constituting an additional issuance of notes of such series issued in an aggregate principal amount of $1.25 billion on June 24, 2020), $750 million in aggregate principal amount of its 2.550% Senior Secured Notes due 2031 (constituting an additional issuance of notes of such series issued in an aggregate principal amount of $1.75 billion on June 24, 2020), $1.25 billion in aggregate principal amount of its 3.000% Senior Secured Notes due 2041 and $1.5 billion in aggregate principal amount of its 3.300% Senior Secured Notes due 2051. On October 28, 2020, the Issuer issued $1.0 billion in aggregate principal amount of its 2.250% Senior Secured Notes due 2031, $1.25 billion in aggregate principal amount of its 3.000% Senior Secured Notes due 2041 (constituting an additional issuance of notes of such series issued in an aggregate principal amount of $1.25 billion on October 6, 2020), $1.50 billion in aggregate principal amount of its 3.300% Senior Secured Notes due 2051 (constituting an additional issuance of notes of such series issued in an aggregate principal amount of $1.50 billion on October 6, 2020) and $1.0 billion in aggregate principal amount of its 3.600% Senior Secured Notes due 2060. Such issuances on October 6, 2020 and October 28, 2020 are referred to collectively as the “Q4 Notes Issuances”.
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The Offering
Issuer
T-Mobile USA, Inc.
Securities
$1,000,000,000 aggregate principal amount of 2.250% Senior Notes due 2026.
$1,000,000,000 aggregate principal amount of 2.625% Senior Notes due 2029.
$1,000,000,000 aggregate principal amount of 2.875% Senior Notes due 2031.
Issue Date
January 14, 2021.
Maturity
The 2026 Notes will mature on February 15, 2026.
The 2029 Notes will mature on February 15, 2029.
The 2031 Notes will mature on February 15, 2031.
Interest Payment Dates
Interest on the Notes will be paid on each February 15 and August 15, commencing August 15, 2021.
Optional Redemption
The Issuer may, at its option, redeem some or all of the 2026 Notes at any time on or after February 15, 2023 at the fixed redemption prices described in the section “Description of Notes—Optional Redemption,” plus accrued and unpaid interest, if any, to, but not including, the redemption date. Prior to February 15, 2023, the Issuer may, at its option, redeem some or all of the 2026 Notes at a make-whole price, plus accrued and unpaid interest, if any, to, but not including, the redemption date. In addition, prior to February 15, 2023, the Issuer may, at its option, redeem up to 40% of the aggregate principal amount of the 2026 Notes with an amount equal to the net cash proceeds of certain sales of equity securities or certain contributions to its equity at the redemption prices described in the section “Description of Notes—Optional Redemption,” plus accrued and unpaid interest, if any, to, but not including, the redemption date.
The Issuer may, at its option, redeem some or all of the 2029 Notes at any time on or after February 15, 2024 at the fixed redemption prices described in the section “Description of Notes—Optional Redemption,” plus accrued and unpaid interest, if any, to, but not including, the redemption date. Prior to February 15, 2024, the Issuer may, at its option, redeem some or all of the 2029 Notes at a make-whole price, plus accrued and unpaid interest, if any, to, but not including, the redemption date. In addition, prior to February 15, 2024, the Issuer may, at its option, redeem up to 40% of the aggregate principal amount of the 2029 Notes with an amount equal to the net cash proceeds of certain sales of equity securities or certain contributions to its equity at the redemption prices described in the section “Description of
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Notes—Optional Redemption,” plus accrued and unpaid interest, if any, to, but not including, the redemption date.
The Issuer may, at its option, redeem some or all of the 2031 Notes at any time on or after February 15, 2026 at the fixed redemption prices described in the section “Description of Notes—Optional Redemption,” plus accrued and unpaid interest, if any, to, but not including, the redemption date. Prior to February 15, 2026, the Issuer may, at its option, redeem some or all of the 2031 Notes at a make-whole price, plus accrued and unpaid interest, if any, to, but not including, the redemption date. In addition, prior to February 15, 2024, the Issuer may, at its option, redeem up to 40% of the aggregate principal amount of the 2031 Notes with an amount equal to the net cash proceeds of certain sales of equity securities or certain contributions to its equity at the redemption prices described in the section “Description of Notes—Optional Redemption,” plus accrued and unpaid interest, if any, to, but not including, the redemption date.
Ranking
The Notes:

will be general unsecured, unsubordinated obligations of the Issuer;

will be senior in right of payment to any future indebtedness of the Issuer to the extent that such future indebtedness provides by its terms that it is subordinated in right of payment to the Notes;

will rank equal in right of payment with any of the Issuer’s existing and future indebtedness and other liabilities that are not by their terms subordinated in right of payment to the Notes, including, without limitation, the obligations under the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes, the Existing Sprint Unsecured Notes, the Credit Agreement and the Tower Obligations;

will be effectively subordinated to all existing and future secured indebtedness of the Issuer, including, without limitation, obligations under the Existing T-Mobile Secured Notes and the Credit Agreement, in each case to the extent of the value of the Issuer’s assets securing such indebtedness;

will be structurally subordinated to all of the liabilities and other obligations of the Issuer’s subsidiaries that are not obligors
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with respect to the Notes, including the Existing Sprint Spectrum-Backed Notes, factoring arrangements and Tower Obligations; and

will be unconditionally guaranteed on a senior unsecured basis by Parent and the Subsidiary Guarantors (as defined under “Description of Notes—Certain Definitions”).
See “Risk Factors—Risks Related to this Offering and the Notes—The Notes and the Guarantees will be structurally subordinated to the indebtedness and other liabilities of the Issuer’s non-guarantor subsidiaries.”
Assuming that on September 30, 2020, we had completed the Q4 Prepayment and the Q4 Notes Issuances, and also completed this offering, we would have had approximately $80.0 billion of outstanding indebtedness and other obligations, excluding letter of credit obligations, including $36.6 billion of effectively senior outstanding secured indebtedness and $38.9 billion of pari passu outstanding unsecured indebtedness. Our effectively senior, secured indebtedness would consist of $31.8 billion of Existing T-Mobile Secured Notes and an aggregate principal amount of $4.8 billion of Existing Sprint Spectrum-Backed Notes outstanding, with up to $2.2 billion remaining available for issuance, under the Sprint Spectrum Note Facility (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Existing Sprint Spectrum Note Facility”). Our pari passu unsecured indebtedness would consist of $3.0 billion of Notes offered hereby, $13.1 billion of Existing T-Mobile Unsecured Notes, $19.8 billion of Existing Sprint Unsecured Notes and approximately $3.1 billion in unsecured Tower Obligations. We also would have had $5.5 billion of revolving borrowings available on an effectively senior, secured basis under the Credit Agreement.
Note Guarantees
The Notes will be guaranteed by (x) Parent and any wholly-owned subsidiary of the Issuer that is not an Excluded Subsidiary and either (i) is or becomes an obligor of the Credit Agreement or (ii) issues or guarantees certain capital markets debt securities, and (y) any future direct or indirect subsidiary of Parent or any subsidiary thereof that owns capital stock of the Issuer. See “Description of Notes—Brief Description of the Notes and the Note Guarantees—The Note Guarantees.” Each Guarantee of the Notes by a guarantor:

will be a general unsecured, unsubordinated obligation of such guarantor;
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will be senior in right of payment to any future indebtedness of that guarantor to the extent that such future indebtedness provides by its terms that it is subordinated in right of payment to such guarantor’s Guarantee;

will be equal in right of payment with any of that guarantor’s existing and future indebtedness and other liabilities that are not by their terms subordinated in right of payment to the Notes, including, without limitation, obligations under the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes, the Existing Sprint Unsecured Notes and the Credit Agreement;

will be effectively subordinated to any Subsidiary Guarantor’s existing and future secured indebtedness, including, without limitation, obligations under the Existing T-Mobile Secured Notes and the Credit Agreement, in each case to the extent of the value of the assets of such Subsidiary Guarantor securing such Indebtedness (as defined under “Description of Notes—Certain Definitions”); and

will be structurally subordinated to all of the indebtedness and other obligations of any subsidiaries of that guarantor that are not obligors with respect to the Notes.
See “Risk Factors—Risks Related to this Offering and the Notes—The Notes and the Guarantees will be unsecured and effectively subordinated to the Issuer’s and the guarantors’ existing and future secured indebtedness, including the Existing T-Mobile Secured Notes and borrowings under the Credit Agreement” and “Risk Factors—Risks Related to this Offering and the Notes—The Notes and the Guarantees will be structurally subordinated to the indebtedness and other liabilities of the Issuer’s non-guarantor subsidiaries.”
Assuming that on September 30, 2020, we had completed the Q4 Prepayment and the Q4 Notes Issuances and all the Guarantees were in place, subsidiaries that will not provide guarantees of the Notes that were included in Parent’s consolidated financial statements as of such date had approximately $10.2 billion of total assets and approximately $7.0 billion in indebtedness and Tower Obligations outstanding.
If Parent has achieved an investment grade corporate rating and the Notes would have an investment grade rating after giving effect to the proposed release of the subsidiary guarantees from two of the
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following: Standard & Poor’s Financial Services LLC, Moody’s Investors Service, Inc. and Fitch Ratings, Inc. and certain other conditions are met, the Issuer may elect to have the subsidiary guarantees permanently released. There can be no assurance that Parent or the Notes will ever have investment grade ratings, or that, if they do, Parent or the Notes will maintain these ratings. See “Description of Notes—Brief Description of the Notes and the Note Guarantees—The Note Guarantees.”
Certain Covenants
The indentures governing the Notes will contain covenants that, among other things, limit the ability of the Issuer and its restricted subsidiaries to:

incur more debt;

pay dividends and make distributions;

make certain investments;

repurchase stock;

create liens or other encumbrances;

enter into transactions with affiliates;

enter into agreements that restrict dividends or distributions from subsidiaries;

merge, consolidate or sell, or otherwise dispose of, substantially all of their assets; and

grant a subsidiary guarantee of debt incurred under the Credit Agreement or certain capital markets debt without also providing a guarantee of the Notes.
These covenants will be subject to a number of important limitations and exceptions that are described later in this prospectus supplement under the caption “Description of Notes—Certain Covenants.” If the Notes are assigned an investment grade rating by at least two of Standard & Poor’s Financial Services LLC (“S&P”), Moody’s Investors Service, Inc. (“Moody’s”) and Fitch Ratings, Inc. (“Fitch”) and no default has occurred or is continuing, certain covenants will cease to apply and will not be later reinstated even if the rating of the notes should subsequently decline, and the Issuer may elect to have other covenants permanently changed. There can be no assurance that Parent or the Notes will ever have investment grade ratings, or that, if they do, Parent or the Notes will maintain these ratings. See “Description of Notes—Certain Covenants—Changes in Covenants When Notes Rated Investment Grade.”
Asset Sale Proceeds
If the Issuer or its restricted subsidiaries engage in certain types of asset sales, the Issuer generally must use the net cash proceeds from the sale either to make
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investments in its business (through capital expenditures, acquisitions or otherwise) or to repay permanently debt under credit facilities, including borrowings under the Credit Agreement, or secured by assets sold within a certain period of time after such sale or, prepay other senior debt and the notes on a pro rata basis or prepay debt of a non-guarantor restricted subsidiary (if the assets sold were the assets of a non-guarantor restricted subsidiary); otherwise the Issuer must make an offer to purchase, on a pro rata basis, a principal amount of the notes and other pari passu indebtedness equal to the excess net cash proceeds. The purchase price of the notes would be 100% of their principal amount, plus accrued and unpaid interest, if any, to, but not including, the repurchase date. See “Description of Notes—Repurchase at the Option of Holders—Asset Sales.”
Change of Control Triggering Event
If the Issuer experiences a Change of Control Triggering Event (as defined under “Description of Notes—Certain Definitions”), the Issuer must make an offer to each holder to repurchase the Notes at a price in cash equal to 101% of their principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. See “Description of Notes—Repurchase at the Option of Holders—Change of Control Triggering Event.”
Use of Proceeds
We intend to use the net proceeds from this offering for general corporate purposes, which may include among other things, financing acquisitions of additional spectrum and refinancing existing indebtedness on an ongoing basis.
Listing
The Issuer does not intend to apply for the Notes to be listed on any securities exchange or to arrange for the Notes to be quoted on any quotation system.
Denominations
The Notes will be issued in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.
Absence of Public Market for the Notes
The 2026 Notes, the 2029 Notes and the 2031 Notes will each be a new class of security and there is currently no established trading market for such Notes. The underwriters have advised us that certain underwriters intend to make a market in the Notes. However, they are not obligated to do so and they may discontinue any market making at any time in their sole discretion. As a result, a liquid market for the Notes may not be available if you wish to sell your Notes.
Trustee
The Trustee for the Notes will be Deutsche Bank Trust Company Americas.
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Governing Law
The Notes, the indentures governing the Notes and the Guarantees will be governed by the laws of the State of New York.
Risk Factors
You should consider carefully all of the information set forth in this prospectus supplement, the accompanying prospectus, any related free writing prospectus and the documents incorporated by reference herein and, in particular, you should carefully evaluate the specific factors under “Risk Factors” beginning on page S-17 of this prospectus supplement and those risk factors incorporated by reference herein.
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Summary Historical Financial and Operating Data of T-Mobile
The following table sets forth summary consolidated financial and operating data for T-Mobile. The summary consolidated financial data has been derived from T-Mobile’s audited consolidated financial statements and related notes as of December 31, 2019 and 2018 and for the three years ended December 31, 2019 contained in Parent’s Annual Report on Form 10-K filed on February 6, 2020, and Parent’s unaudited condensed consolidated financial statements and related notes as of and for the nine months ended September 30, 2020 and 2019 contained in Parent’s Quarterly Report on Form 10-Q filed on November 5, 2020. The summary consolidated balance sheet data as of December 31, 2017 is derived from T-Mobile’s audited consolidated financial statements which are not included or incorporated by reference in this prospectus supplement. T-Mobile’s unaudited consolidated financial statements have been prepared on the same basis as T-Mobile’s audited consolidated financial statements and, in the opinion of our management, reflect all adjustments, consisting of normal, recurring adjustments, necessary for a fair presentation of the results for those periods. The results for any interim period are not necessarily indicative of the results that may be expected for a full year. The summary financial data should be read in conjunction with the consolidated financial statements described above and the related notes. The summary operating data is not derived from the audited consolidated financial statements.
T-Mobile’s historical financial data may not be indicative of the results of operations or financial position to be expected in the future. In particular, on January 1, 2020, T-Mobile adopted Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” which requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectibility of the reported amount. T-Mobile adopted the new credit loss standard on January 1, 2020 by recognizing a cumulative effect of initially applying the new credit loss standard on its receivables portfolio. Additionally, on January 1, 2019, T-Mobile adopted ASU 2016-02 “Leases (Topic 842)”, which requires most lessees to report a right-of-use asset and a lease liability. T-Mobile adopted the new lease standard on January 1, 2019 by recognizing and measuring leases at the adoption date with a cumulative effect of initially applying the guidance recognized at the date of initial application. Comparative information has not been restated and continues to be reported under the standards in effect for those periods. Lastly, on January 1, 2018, T-Mobile adopted ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” which requires entities to recognize revenue through the application of a five-step model, which includes: identification of the contract; identification of the performance obligations; determination of the transaction price; allocation of the transaction price to the performance obligations; and recognition of revenue as the entity satisfies the performance obligations. T-Mobile adopted the new revenue standard on January 1, 2018, using the modified retrospective method with the cumulative effect of initially applying the guidance recognized at the date of initial application. Comparative information has not been restated and continues to be reported under the standards in effect for those periods.
 
Nine months ended
September 30,(1)
Year ended December 31,(1)
 
2020
2019
2019
2018
2017
 
(unaudited)
 
 
 
 
(in millions)
Revenues:
 
 
 
 
 
Total service revenues
$36,215
$25,650
$34,500
$32,441
$30,525
Equipment revenues
11,339
6,965
9,840
10,009
9,375
Other revenues
502
505
658
860
704
Total revenues
48,056
33,120
44,998
43,310
40,604
Operating expenses:
 
 
 
 
 
Cost of services, exclusive of depreciation and amortization shown separately below
8,051
4,928
6,622
6,307
6,100
Cost of equipment sales, exclusive of depreciation and amortization shown separately below
10,563
8,381
11,899
12,047
11,608
Selling, general and administrative
14,168
10,483
14,139
13,161
12,259
Impairment expense
418
Depreciation and amortization
9,932
4,840
6,616
6,486
5,984
Gains on disposal of spectrum licenses
(235)
Total operating expenses
43,132
28,632
39,276
38,001
35,716
Operating income
4,924
4,488
5,722
5,309
4,888
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Nine months ended
September 30,(1)
Year ended December 31,(1)
 
2020
2019
2019
2018
2017
 
(unaudited)
 
 
 
 
(in millions)
Other income (expense):
 
 
 
 
 
Interest expense
(1,726)
(545)
(727)
(835)
(1,111)
Interest expense to affiliates
(206)
(310)
(408)
(522)
(560)
Interest income
21
17
24
19
17
Other (expense) income, net
(304)
(12)
(8)
(54)
(73)
Total other expense, net
(2,215)
(850)
(1,119)
(1,392)
(1,727)
Income from continuing operations before income taxes
2,709
3,638
4,603
3,917
3,161
Income tax (expense) benefit
(715)
(921)
(1,135)
(1,029)
1,375
Income from continuing operations
1,994
2,717
3,468
2,888
4,536
Income from discontinued operations, net of tax
320
Net income
2,314
2,717
3,468
2,888
4,536
Dividends on preferred stock
(55)
Net income attributable to common stockholders
$2,314
$ 2,717
$3,468
$2,888
$4,481
 
Nine months ended
September 30,
Year ended December 31,
 
2020
2019
2019
2018
2017
Other Financial Data (in millions):
 
 
 
 
 
Net cash provided by operating activities
$5,166
$5,287
$6,824
$3,899
$3,831
Net cash used in investing activities
(9,068)
(3,238)
(4,125)
(579)
(6,745)
Net cash provided by (used in) financing activities
9,031
(1,599)
(2,374)
(3,336)
(1,367)
Consolidated Operating Data:
 
 
 
 
 
Total customers (at period end)(2) (in thousands)
100,362
66,503
67,894
63,656
58,715
Adjusted EBITDA(3) (in millions)
$17,811
$10,141
$13,383
$12,398
$11,213
Net income margin(4)
6%
11%
10%
9%
15%
Adjusted EBITDA margin(5)
49%
40%
39%
38%
37%
Postpaid phone churn(6)
0.85%
0.85%
0.89%
1.01%
1.18%
Prepaid churn(6)
3.07%
3.77%
3.82%
3.96%
4.04%
Postpaid phone ARPU(7)
$47.69
$46.13
$46.04
$46.40
$46.97
Prepaid ARPU(7)(8)
38.13
37.76
37.95
38.53
38.69
Postpaid ARPA(9)
131.27
130.44
130.43
128.86
130.05
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As of
September  30,(1)
2020
As of December 31,(1)
2019
2018
2017
 
(unaudited)
 
 
 
 
 
(in millions)
Balance Sheet Data:
 
 
 
 
Total current assets
$19,465
$9,305
$8,281
$8,915
Property and equipment, net
38,567
21,984
23,359
22,196
Operating lease right-of-use assets
27,999
10,933
Financing lease right-of-use assets
3,038
2,715
Goodwill, spectrum licenses and other intangible assets, net
99,457
38,510
37,658
37,266
Other assets and equipment installment plan receivables due after one year, net
3,917
3,474
3,170
2,186
Total assets
192,443
86,921
72,468
70,563
Total current liabilities
19,840
12,506
10,267
11,515
Long-term debt
58,345
10,958
12,124
12,121
Long-term debt to affiliates
4,711
13,986
14,582
14,586
Tower obligations
3,079
2,236
2,557
2,590
Operating lease liabilities
26,658
10,539
Financing lease liabilities
1,373
1,346
Other long-term liabilities, deferred rent expense and deferred tax liabilities
13,950
6,561
8,220
7,192
Total stockholders’ equity
64,487
28,789
24,718
22,559
(1)
On January 1, 2020, T-Mobile adopted ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” which requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectibility of the reported amount. T-Mobile adopted the new credit loss standard on January 1, 2020 by recognizing a cumulative effect of initially applying the new credit loss standard on its receivables portfolio. Additionally, on January 1, 2019, T-Mobile adopted ASU 2016-02 “Leases (Topic 842)”, which requires most lessees to report a right-of-use asset and a lease liability. T-Mobile adopted the new lease standard on January 1, 2019 by recognizing and measuring leases at the adoption date with a cumulative effect of initially applying the guidance recognized at the date of initial application. Comparative information has not been restated and continues to be reported under the standards in effect for those periods. For further information see Note 1—Summary of Significant Accounting Policies of the notes to T-Mobile’s Consolidated Financial Statements included in Part II, Item 8 of Parent’s Annual Report on Form 10-K for the year ended December 31, 2019 incorporated by reference in this prospectus supplement. Lastly, on January 1, 2018, T-Mobile adopted ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” and all the related amendments (collectively, the “new revenue standard”), using the modified retrospective method with the cumulative effect of initially applying the guidance recognized at the date of initial application. Comparative information has not been restated and continues to be reported under the standards in effect for those periods.
(2)
Total customers represents total postpaid and prepaid customers.
(3)
Adjusted EBITDA represents earnings before interest expense, net of interest income, income tax expense, depreciation and amortization, non-cash stock-based compensation and certain income and expenses not reflective of T-Mobile’s ongoing operating performance.
Adjusted EBITDA is a non-GAAP financial measure utilized by T-Mobile’s management to monitor the financial performance of T-Mobile’s operations. T-Mobile uses Adjusted EBITDA internally as a measure to evaluate and compensate personnel and management for their performance, and as a benchmark to evaluate operating performance in comparison to competitors. Management believes analysts and investors use Adjusted EBITDA as a supplemental measure to evaluate overall operating performance and facilitate comparisons with other wireless communications companies because it is indicative of T-Mobile’s ongoing operating performance and trends by excluding the impact of interest expense from financing, non-cash depreciation and amortization from capital investments, non-cash stock-based compensation, network decommissioning costs, costs related to the Merger, incremental costs directly attributable to COVID-19 and impairment expense, as they are not indicative of T-Mobile’s ongoing operating performance as well as certain other nonrecurring income and expenses. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or as a substitute for income from operations, net income or any other measure of financial performance reported in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”).

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The following table illustrates the calculation of Adjusted EBITDA and reconciles Adjusted EBITDA to Net income, which T-Mobile considers to be the most directly comparable GAAP financial measure.
 
Nine months ended
September 30,
Year ended December 31,
 
2020
2019
2019
2018
2017
 
(unaudited)
 
 
 
 
 
 
(in millions)
Calculation of Adjusted EBITDA:
 
 
 
 
 
Net income
$2,314
$2,717
$3,468
$2,888
$4,536
Adjustments:
 
 
 
 
 
Income from discontinued operations, net of tax
(320)
Income from continuing operations
1,994
2,717
3,468
2,888
4,536
Interest expense
1,726
545
727
835
1,111
Interest expense to affiliates
206
310
408
522
560
Interest income
(21)
(17)
(24)
(19)
(17)
Other (income) expense, net
304
12
8
54
73
Income tax expense (benefit)
715
921
1,135
1,029
(1,375)
Operating income
4,924
4,488
5,722
5,309
4,888
Depreciation and amortization
9,932
4,840
6,616
6,486
5,984
Operating income from discontinued operations(a)
432
Stock-based compensation(b)
387
312
423
389
307
Merger-related costs
1,229
494
620
196
COVID-19-related costs(c)
458
Impairment expense
418
Other, net(d)
31
7
2
18
34
Adjusted EBITDA
$17,811
$10,141
$13,383
$12,398
$11,213
(a)
Following the prepaid transaction, starting on July 1, 2020, we provide Mobile Virtual Network Operator (“MVNO”) services to customers of the divested brands. We have included the operating income from discontinued operations from April 1, 2020 through June 30, 2020, in our determination of Adjusted EBITDA to reflect contributions of the prepaid business that will be replaced by the Master Network Services Agreement (the “MVNO Agreement”) beginning on July 1, 2020 in order to enable management, analysts and investors to better assess ongoing operating performance and trends.
(b)
Stock-based compensation includes payroll tax impacts and may not agree to stock-based compensation expense in T-Mobile’s consolidated financial statements incorporated by reference in this prospectus supplement. Additionally, certain stock-based compensation expenses associated with the Transactions have been included in Merger-related costs.
(c)
Supplemental employee payroll, third-party commissions and cleaning-related COVID-19 costs were not significant for the three months ended September 30, 2020.
(d)
Other, net may not agree to T-Mobile’s Consolidated Statements of Comprehensive Income incorporated by reference in this prospectus supplement primarily due to certain non-routine operating activities, such as other special items that would not be expected to reoccur or are not reflective of T-Mobile’s ongoing operating performance, and are therefore excluded in Adjusted EBITDA.
(4)
Net income margin represents net income divided by service revenues.
(5)
Adjusted EBITDA margin represents Adjusted EBITDA divided by service revenues.
(6)
Churn represents the number of customers whose service was disconnected as a percentage of the average number of customers during the specified period. The number of customers whose service was disconnected is presented net of customers that subsequently have their service restored within a certain period of time. T-Mobile believes that churn provides management, investors and analysts with useful information to evaluate customer retention and loyalty.
(7)
Average Revenue Per User (“ARPU”) represents the average monthly service revenue earned from customers. T-Mobile believes ARPU provides management, investors and analysts with useful information to assess and evaluate service revenue per customer and assist in forecasting future service revenues generated from the customer base. Postpaid phone ARPU excludes postpaid other customers and related revenues which includes wearables, DIGITS and connected devices such as tablets and SyncUp products.

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The following tables illustrate the calculation of T-Mobile’s operating measure ARPU and reconciles this measure to the related service revenues.
 
Nine months ended
September 30,
Year ended December 31,
 
2020
2019
2019
2018
2017
 
(unaudited)
 
 
 
 
(in millions, except average number of customers and ARPU)
Calculation of Postpaid Phone ARPU:
 
 
 
 
 
Postpaid service revenues
$26,055
$16,852
$22,673
$20,862
$19,448
Less: Postpaid other revenues
(1,605)
(982)
(1,344)
(1,117)
(1,077)
Postpaid phone service revenues
24,450
15,870
21,329
19,745
18,371
Divided by: Average number of postpaid phone customers (in thousands) and number of months in period
56,971
38,225
38,602
35,458
32,596
Postpaid phone ARPU
$47.69
$46.13
$46.04
$46.40
$46.97
 
Nine months ended
September 30,
Year ended December 31,
 
2020
2019
2019
2018
2017
 
(unaudited)
 
 
 
 
(in millions, except average number of customers and ARPU)
Calculation of Prepaid ARPU:
 
 
 
 
 
Prepaid service revenues
$7,067
$7,150
$9,543
$9,598
$9,380
Divided by: Average number of branded prepaid customers (in thousands) and number of months in period
20,591
21,043
20,955
20,761
20,204
Prepaid ARPU
$38.13
$37.76
$37.95
$38.53
$38.69
(8)
On July 18, 2019, T-Mobile entered into an agreement whereby certain T-Mobile prepaid products will be offered and distributed by a current MVNO partner. As a result, T-Mobile included a base adjustment in the third quarter of 2019 to reduce prepaid customers by 616,000.
(9)
Average Revenue Per Account (“ARPA”) represents the average monthly postpaid service revenue earned per account. T-Mobile believes Postpaid ARPA provides management, investors and analysts with useful information to assess and evaluate postpaid service revenue realization and assist in forecasting future post-paid service revenues on a per account basis. T-Mobile considers Postpaid ARPA to be indicative of revenue growth potential given the increase in the average number of postpaid phone customers per account and increases in postpaid other customers, including wearables, DIGITS or other connected devices which includes tablets and SyncUp products.
The following tables illustrate the calculation of T-Mobile’s operating measure Postpaid ARPA and reconciles this measure to the related service revenues.
 
Nine months ended
September 30,
Year ended December 31,
 
2020
2019
2019
2018
2017
 
(unaudited)
 
 
 
 
(in millions)
Calculation of Postpaid ARPA:
 
 
 
 
 
Postpaid service revenues
$26,055
$16,852
$22,673
$20,862
$19,448
Divided by: Average number of postpaid accounts (in thousands) and number of months in period
22,054
14,355
14,486
13,492
12,462
Postpaid ARPA
$131.27
$130.44
$130.43
$128.86
$130.05
Performance Measures
In managing T-Mobile’s business and assessing financial performance, T-Mobile supplements the information provided by the financial statements with other operating or statistical data and non-GAAP financial measures, including Adjusted EBITDA, Postpaid Phone Churn, Prepaid Churn, Postpaid Phone ARPU, Prepaid ARPU and Postpaid ARPA as disclosed above. These operating and financial measures are utilized by T-Mobile’s management to evaluate operating performance and, in certain cases, ability to meet liquidity requirements. Although companies in the wireless industry may not define each of these measures in precisely the same way, T-Mobile believes that these measures facilitate comparisons with other companies in the wireless industry on key operating and financial measures.
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Summary Historical Financial Data of Sprint
The following table sets forth summary consolidated financial data for Sprint. The summary consolidated financial data has been derived from Sprint’s audited consolidated financial statements and related notes for the three years ended March 31, 2020 contained in Exhibit 99.1 to Parent’s Current Report on Form 8-K filed on May 18, 2020. The summary financial data should be read in conjunction with the consolidated financial statements described above and the related notes. The summary operating data is not derived from the audited or unaudited consolidated financial statements.
On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act included changes in tax laws that had a material impact on Sprint’s financial statements. During the year ended March 31, 2018, Sprint recorded a $7.1 billion non-cash tax benefit through net income (loss) to re-measure the carrying values of deferred tax assets and liabilities. The re-measurement of deferred taxes had no impact on cash flows. See Note 12—Income Taxes in Notes to Sprint’s Consolidated Financial Statements filed as Exhibit 99.1 to Parent’s Current Report on Form 8-K filed on May 18, 2020 for additional information.
On April 1, 2018, Sprint adopted authoritative guidance regarding Revenue from Contracts with Customers. Sprint adopted this standard using the modified retrospective method, which requires that the cumulative effect of initially applying the standard be recognized at the date of application beginning April 1, 2018. Sprint recorded a pre-tax cumulative effect of $1.7 billion ($1.3 billion, net of tax) as a reduction to the April 1, 2018 opening balance of accumulated deficit.
On April 1, 2019, Sprint adopted ASU 2016-02 “Leases (Topic 842)” using the modified retrospective transition method. Results for reporting periods beginning after April 1, 2019 are presented under Topic 842, while amounts reported under prior periods have not been adjusted and continue to be reported under accounting standards in effect for those periods. See Note 2—Summary of Significant Accounting Policies and Other Information and Note 7—Leases in Notes to Sprint’s Consolidated Financial Statements filed as Exhibit 99.1 to Parent’s Current Report on Form 8-K filed on May 18, 2020 for additional information related to the adoption of this standard.
 
Year ended March 31,
 
2020
2019
2018
 
(in millions, except per share amounts)
Results of Operations
 
 
 
Service revenues
$21,604
$22,857
$23,834
Equipment sales
4,999
5,606
4,524
Equipment rentals
5,218
5,137
4,048
Net operating revenues
31,821
33,600
32,406
Depreciation—network and other
4,416
4,245
3,976
Depreciation—equipment rentals
4,166
4,538
3,792
Amortization
811
608
812
Goodwill impairment(1)
2,000
Operating income
931
398
2,727
Net (loss) income
(347)
(1,943)
7,377
Net (loss) income attributable to Sprint Corporation
(338)
(1,943)
7,389
(1)
During the year ended March 31, 2019, Sprint completed its annual impairment testing for goodwill assigned to the Wireless reporting unit and as a result, recorded a non-cash impairment charge of $2.0 billion. See Note 6—Intangible Assets in Sprint’s audited consolidated financial statements and related notes for the three years ended March 31, 2020 contained in Exhibit 99.1 to Parent’s Current Report on Form 8-K filed on May 18, 2020.
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Year ended March 31,
 
2020
2019
2018
 
(in millions)
Financial Position
 
 
 
Total assets
$84,559
$84,601
$85,459
Property, plant and equipment, net
20,113
21,201
19,925
Intangible assets, net
46,904
47,832
50,360
Total debt, finance lease and financing obligations (including equity unit notes)
36,092
39,923
40,892
Total stockholders’ equity
25,855
26,072
26,356
Noncontrolling interests
55
63
 
Year ended March 31,
 
2020
2019
2018
 
(in millions)
Cash Flow Data
 
 
 
Net cash provided by operating activities
$9,292
$10,429
$10,062
Capital expenditures—network and other
(4,282)
(4,963)
(3,319)
Capital expenditures—leased devices
(6,865)
(7,441)
(7,461)
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RISK FACTORS
An investment in the Notes involves a high degree of risk. Prior to making a decision about investing in the Notes, you should carefully consider the following risks and uncertainties, as well as those discussed under the caption “Risk Factors” in Parent’s Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020 and September 30, 2020 filed with the SEC on May 6, 2020, August 6, 2020 (as amended by Amendment No. 1 to such Quarterly Report on Form 10-Q filed on August 10, 2020) and November 5, 2020, respectively. If any of the risks described in this prospectus supplement, the accompanying prospectus or any related free writing prospectus, or the risks described in any documents incorporated by reference in this prospectus supplement, the accompanying prospectus or any related free writing prospectus, actually occur, our business, prospects, financial condition or operating results could be harmed. In such case, the trading price of the Notes could decline, and you may lose all or part of your investment.
Risks Related to this Offering and the Notes
Our actual financial position and results of operations may differ materially from the unaudited pro forma financial information incorporated by reference in this prospectus supplement.
The pro forma financial information incorporated by reference in this prospectus supplement is presented for illustrative purposes only and may not be an accurate indication of what results of operations would have been had the BCA Transactions been completed on the dates assumed. The pro forma financial information has been derived from the audited and unaudited historical financial statements of T-Mobile and Sprint, and certain adjustments and assumptions have been made regarding T-Mobile after giving effect to the Transactions. The pro forma financial statements do not include, among other things, estimated cost or growth synergies, adjustments related to restructuring or integration activities, future acquisitions or disposals not yet known or probable, including those that may be required by regulatory or governmental authorities in connection with the BCA Transactions, impacts of merger-related change in control provisions that are currently not factually supportable and/or probable of occurring, or the issuance of the Notes. The preliminary allocation of the purchase price to the acquired assets and assumed liabilities of Sprint was based on the estimate of fair value. For the preliminary fair values of the assets acquired and liabilities assumed, we used the cost, income and market approaches, including market participant assumptions. The unaudited pro forma adjustments are based upon available information and certain assumptions that T-Mobile believes are reasonable under the circumstances. Actual results may differ materially from the assumptions within the accompanying unaudited pro forma condensed combined financial information. The purchase adjustments relating to the Sprint and T-Mobile combined financial information are preliminary and subject to change as additional analyses are performed and finalized.
In addition, the assumptions used in preparing the pro forma financial information may not prove to be accurate. Such assumptions can be adversely affected by known or unknown facts, risks and uncertainties, many of which are beyond our control. Other factors may also affect our financial condition or results of operations. In view of these uncertainties, the inclusion and incorporation by reference of pro forma financial information in this prospectus supplement is for illustrative purposes and does not purport to project the future consolidated results of operations or consolidated financial condition for any future period or as of any future date. See the unaudited pro forma condensed combined financial information and related notes filed as Exhibit 99.1 to Parent’s Current Report on Form 8-K filed on September 18, 2020.
Our significant indebtedness could adversely affect our business, financial condition and operating results, and senior creditors would have a secured claim to any collateral securing the debt owed to them.
We have, and we expect that we will continue to have, a significant amount of debt. Assuming that on September 30, 2020, we had completed the Q4 Prepayment and the Q4 Notes Issuances, and also completed this offering, we would have had approximately $80.0 billion of outstanding indebtedness and other obligations, excluding letter of credit obligations, including $36.6 billion of effectively senior outstanding secured indebtedness and $38.9 billion of pari passu outstanding unsecured indebtedness. Our effectively senior, secured indebtedness would consist of $31.8 billion of Existing T-Mobile Secured Notes and an aggregate principal amount of $4.8 billion of Existing Sprint Spectrum-Backed Notes outstanding, with up to $2.2 billion remaining available for issuance, under the Sprint Spectrum Note Facility. Our pari passu unsecured indebtedness would consist of $3.0 billion of Notes offered hereby, $13.1 billion of Existing T-Mobile Unsecured Notes, $19.8 billion
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of Existing Sprint Unsecured Notes, and approximately $3.1 billion in unsecured Tower Obligations. We also would have had $5.5 billion of revolving borrowings available on an effectively senior secured basis under the Credit Agreement.
Our ability to make payments on our debt, to repay our indebtedness when due and to fund our capital intensive business and operations and significant planned capital expenditures will depend on our ability to generate cash in the future. There can be no assurance that sufficient funds will be available to us under our borrowings or otherwise. Our ability to produce cash from operations is subject to a number of risks, including:
introduction of new products and services by us or our competitors or changes in service plans or pricing by us or our competitors;
customers’ acceptance of our service offerings;
our ability to control our costs and maintain our current cost structure; and
our ability to continue to grow our customer base and maintain projected levels of churn.
Our debt service obligations could have important material consequences to you, including the following:
limiting our ability to borrow money or sell stock to fund working capital, capital expenditures, debt service requirements, acquisitions, technological initiatives and other general corporate purposes;
making it more difficult for us to make payments on indebtedness and satisfy obligations under the Notes;
increasing our vulnerability to general economic downturns, including as a result of pandemics and other macroeconomic conditions, and industry conditions and limiting our ability to withstand competitive pressure;
limiting our flexibility in planning for, or reacting to, changes in our business or the communications industry or pursuing growth opportunities;
limiting our ability to increase our capital expenditures to roll out new services or to upgrade our networks to new technologies, such as LTE and 5G;
limiting our ability to purchase additional spectrum, expand existing service areas or develop new metropolitan areas in the future;
reducing the amount of cash available for working capital needs, capital expenditures for existing and new markets and other corporate purposes by requiring us to dedicate a substantial portion of cash flow from operations to the payment of principal of, and interest on, indebtedness; and
placing us at a competitive disadvantage to competitors who are less leveraged than we are.
Any of these risks could impair our ability to fund our operations or limit our ability to obtain additional spectrum, or expand our business as planned, which could have a material adverse effect on our business, financial condition and operating results. Any such risks could also have an adverse effect on the trading prices of the Notes.
To the extent we become party to any hedging arrangements, we may be exposed to credit-related losses in the event of nonperformance by counterparties to such hedging agreements. The primary credit exposure that we have with respect to such hedging agreements is that a counterparty will default on payments due, which could result in us having to acquire a replacement derivative from a different counterparty at a higher cost or we may be unable to find a suitable replacement. Although counterparties to any hedging agreements may be major financial institutions we would still be exposed to credit risk with these institutions. In addition, any netting and/or set off rights we may have through master netting arrangements with these counterparties may not apply to affiliates of a counterparty with whom we may have various other financial arrangements. If any financial institutions that are parties to any hedging agreements with us were to default on their payment obligations to us, declare bankruptcy or become insolvent, we may be unhedged against the underlying exposures. Any of these risks could have a material adverse effect on our business, financial condition and operating results. Additionally,
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if the counterparties’ and our obligations under any hedging agreements are required to be secured by cash or U.S. Treasury securities, any posting of collateral by us under such arrangements would negatively impact our liquidity. The modification or termination of any such hedging agreements could also negatively impact our liquidity or other financial metrics.
Some of our debt also has a floating rate of interest linked to various indices. If changes in the indices result in interest rate increases, debt service requirements will increase, which could adversely affect our cash flow and operating results.
In addition, any agreements we have and may continue to enter into to limit our exposure to interest rate increases may not offer complete protection from this risk, and any portion of our indebtedness not subject to such agreements would have full exposure to interest rate increases.
Any of these risks could have a material adverse effect on our business, financial condition and operating results.
Even with our current levels of indebtedness, we may incur additional indebtedness. This could further exacerbate the risks associated with our leverage.
Although we have substantial indebtedness, we may still be able to incur significantly more debt, including more secured debt, as market conditions and contractual obligations permit, which could further reduce the cash available to us to invest in operations, as a result of increased debt service obligations. The terms of the agreements governing our long-term indebtedness allow for the incurrence of additional indebtedness by us and our subsidiaries, subject to specified limitations. In particular, as of December 31, 2020, we had $5.5 billion available for borrowings under the Revolving Credit Facility (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Credit Agreement”). There can be no assurance that sufficient funds will be available to us under our existing indebtedness or otherwise. 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 significant indebtedness could adversely affect our business, financial condition and operating results, and senior creditors would have a secured claim to any collateral securing the debt owed to them.”
The Notes and the Guarantees will be unsecured and effectively subordinated to the Issuer’s and the guarantors’ existing and future secured indebtedness, including the Existing T-Mobile Secured Notes and borrowings under the Credit Agreement.
The Notes and the Guarantees will be general unsecured, unsubordinated obligations ranking effectively junior in right of payment to all existing and future secured debt of Parent, the Issuer and of each Subsidiary Guarantor, including the Existing T-Mobile Secured Notes and borrowings under the Credit Agreement, to the extent of the value of the collateral securing such debt. The Notes also will permit us to incur certain additional secured debt.
If the Issuer or a guarantor is declared bankrupt, becomes insolvent or is liquidated or reorganized, any secured debt of the Issuer or that guarantor, including under the Existing T-Mobile Secured Notes and the Credit Agreement, will be entitled to be paid in full from the assets of the Issuer or guarantor, as applicable, securing that debt before any payment may be made with respect to Notes or the Guarantees of such guarantor.
Holders of the Notes will participate ratably in any remaining assets with all other holders of the Issuer’s and the guarantors’ unsecured obligations that are not by their terms subordinated to the Notes, based upon the respective amounts owed. In any of the foregoing events, there may not be sufficient assets to pay the indebtedness and other obligations owed to secured creditors and the amounts due on the Notes. As a result, holders of the Notes would likely receive less, ratably, than holders of secured obligations of the Issuer and the guarantors. It is possible that with respect to the Guarantees, there will be no assets from which claims of holders of the Notes can be satisfied.
The Notes and the Guarantees will be structurally subordinated to the indebtedness and other liabilities of the Issuer’s non-guarantor subsidiaries.
The Notes and the Guarantees will be structurally subordinated to any existing or future liabilities and other obligations of the Issuer’s or the guarantors’ non-guarantor subsidiaries, including the Existing Sprint Spectrum-Backed Notes, factoring arrangements and tower obligations. Accordingly, creditors of current and
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future subsidiaries of the Issuer or the guarantors that are not obligors with respect to the Notes would have claims with respect to the assets of those subsidiaries that would rank structurally senior to the Notes and the Guarantees. In the event of any distribution or payment of assets of such subsidiaries in any dissolution, winding up, liquidation, reorganization or other bankruptcy proceeding, the claims of those creditors would have to be satisfied prior to making any such distribution or payment to the Issuer or the applicable guarantor in respect of direct or indirect equity interests in such subsidiaries. Certain subsidiaries of the Issuer that are prohibited from providing guarantees of the Notes (such as special purpose finance entities and a reinsurance subsidiary), as well as non-wholly owned and immaterial subsidiaries will not provide guarantees of the Notes. Assuming that on September 30, 2020, we had completed the Q4 Prepayment and the Q4 Notes Issuances and all the Guarantees were in place, subsidiaries that will not provide guarantees of the Notes that were included in Parent’s consolidated financial statements as of such date had approximately $10.2 billion of total assets and approximately $7.0 billion in indebtedness and Tower Obligations outstanding. See “Description of Notes—Brief Description of the Notes and the Note Guarantees—The Note Guarantees.”
In order to service our debt, we will require a significant amount of cash, which may not be available to us on attractive terms or at all.
Our ability to meet existing or future debt obligations and to reduce indebtedness will depend on future performance and the other cash requirements of our businesses. Our performance, to a certain extent, is subject to general economic conditions and financial, competitive, business, political, regulatory and other factors, including third party rating agency assessments, that are beyond our control. In addition, our ability to borrow funds in the future to make payments on debt will depend on the satisfaction of covenants in the indentures governing the Notes and the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes and the Existing Sprint Unsecured Notes, the Credit Agreement, other debt agreements and other agreements we may enter into in the future. Specifically, under the Revolving Credit Facility under our Credit Agreement, we will need to maintain certain financial ratios on a quarterly basis. We cannot assure you that we will continue to generate sufficient cash flow from operations or that future equity issuances or borrowings will be available to us in an amount sufficient to enable us to satisfy financial covenants under the Credit Agreement, service our debt or repay our indebtedness in a timely manner or on favorable or commercially reasonable terms, or at all. If we are unable to satisfy financial covenants or to generate sufficient cash to timely repay our debt, our lenders could accelerate the maturity of some or all of our outstanding indebtedness. As a result, we may need to refinance all or a portion of our remaining existing indebtedness prior to its maturity. We also expect to need to refinance certain indebtedness. Disruptions in the financial markets, unfavorable rating agency assessments, the general amount of debt being refinanced at the same time, and our financial position and performance could make it more difficult to obtain debt or equity financing on favorable or commercially reasonable terms or at all. In addition, instability in the global financial markets has from time to time resulted in volatility in the capital markets. This volatility could limit our access to the credit markets, leading to higher borrowing costs or, in some cases, the inability to obtain financing on terms that are acceptable to us, or at all. Any such failure to obtain additional financing could jeopardize our ability to repay, refinance or reduce debt obligations. 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.
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.
Upon certain events including a change of control triggering event, we may be required to offer to repurchase all of the Notes, all of the Existing T-Mobile Secured Notes, all of the Existing T-Mobile Unsecured Notes, all of the Existing Sprint Spectrum-Backed Notes and certain of the Existing Sprint Unsecured Notes and to repay amounts owing under the Credit Agreement, and we may not be able to finance such a repurchase or repayment. Not all significant transactions would constitute a change of control triggering event.
We have in the past been the subject of inquiries or offers related to potential strategic transactions (such as an acquisition of the Company), we may be the subject of such inquires or offers in the future, and we may engage in discussions or negotiations regarding such inquiries or offers that may ultimately lead to a transaction. The indentures governing the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes, the Existing Sprint Spectrum-Backed Notes and certain of the Existing Sprint Unsecured Notes, provide, and the
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indentures governing the Notes will provide, that, upon the occurrence of certain change of control triggering events, which change of control triggering events include a change of control combined with certain ratings downgrades or withdrawals as described further below, the Issuer will be required to offer to repurchase all outstanding Existing T-Mobile Secured Notes, Existing T-Mobile Unsecured Notes, all outstanding Existing Sprint Spectrum-Backed Notes, the applicable Existing Sprint Unsecured Notes and all outstanding Notes at 101% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of repurchase. See “Description of Notes—Repurchase at the Option of Holders—Change of Control Triggering Event” and “Description of Other Indebtedness and Certain Financing Transactions.” In addition, any such change of control triggering event is expected to cause an event of default under the Credit Agreement, entitling the lenders to declare all amounts outstanding thereunder to be immediately due and payable. Such a change of control would also trigger repayments with respect to our securitization transactions and capital leases. We may not have access to sufficient funds at the time of the change of control triggering event to make the required repurchases of the Notes, the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes, the Existing Sprint Spectrum-Backed Notes and the applicable Existing Sprint Unsecured Notes and to repay outstanding amounts under the Credit Agreement, or contractual restrictions may not allow such repurchases or repayments.
Not all change of control transactions would trigger these repurchase or repayment obligations. Specifically, these repurchase or repayment obligations would not be triggered unless both (i) such a transaction constitutes a “Change of Control” under the applicable indenture or credit agreement and (ii) such “Change of Control” is accompanied or followed by certain downgrades or withdrawals of the credit rating with respect to the applicable notes (in the case of any such indenture) or T-Mobile USA (in the case of the Credit Agreement). In the event that we undergo a significant corporate transaction that does not constitute a change of control triggering event, the Notes and such other obligations generally would be permitted to remain outstanding in accordance with their terms.
The failure to purchase the Notes, the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes, the Existing Sprint Spectrum-Backed Notes or the applicable Existing Sprint Unsecured Notes, as required under the respective indentures, would result in defaults under such indentures in addition to any events of default under the Credit Agreement resulting from a change of control triggering event thereunder, any of which could have material adverse consequences for us and the holders of the Notes. Any such event of default would likely trigger an event of default on other outstanding or future indebtedness.
The indentures governing the Notes, the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes and the Existing Sprint Unsecured Notes, the Credit Agreement and other financing arrangements include or will include restrictive covenants that limit our operating flexibility.
The indentures governing the Notes, the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes and the Existing Sprint Unsecured Notes, the Credit Agreement and other financing arrangements, impose (or, in the case of the indentures governing the Notes, will impose) significant operating and financial restrictions on us. These restrictions, subject in certain cases to customary baskets, exceptions and incurrence-based ratio tests, limit our and our subsidiaries’ ability to engage in some transactions. In particular, the Credit Agreement and the indentures governing the Existing T-Mobile Unsecured Notes include, and the indentures governing the Notes will include, restrictions limiting our and our subsidiaries’ ability to:
incur additional indebtedness and issue preferred stock;
pay dividends, redeem capital stock or make other restricted payments or investments (although we are able to make significant restricted payments under the Credit Agreement and the indentures governing the Existing T-Mobile Unsecured Notes);
sell or buy assets, properties or licenses including by participating in future FCC auctions of spectrum or private sales of spectrum;
develop assets, properties or licenses that we have or in the future may procure;
enter into transactions with affiliates; and
place restrictions on the ability of subsidiaries to pay dividends or make other payments.
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In addition, the indentures governing the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes and Existing Sprint Unsecured Notes and the Credit Agreement limit, and the indentures governing the Notes will limit, our and our subsidiaries’ ability to:
create liens or other encumbrances in respect of indebtedness for borrowed money; and
engage in mergers, business combinations or other transactions.
In addition, the Revolving Credit Facility (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Credit Agreement”) contains a financial maintenance covenant, requiring us to maintain a total first lien net leverage ratio at the end of each fiscal quarter of 3.30:1.00 or less. Any future debt that we incur may contain financial maintenance covenants as well. These restrictions could limit our ability to obtain debt financing, repurchase stock, refinance or pay principal on our outstanding debt, complete acquisitions for cash or debt or react to changes in our operating environment or the economy.
Any failure to comply with the restrictions of the indentures governing the Notes, the Existing T-Mobile Secured Notes, the Existing T-Mobile Unsecured Notes or the Existing Sprint Unsecured Notes, the Credit Agreement or other financing agreements may result in an event of default under these agreements, which in turn may result in defaults or acceleration of obligations under these agreements and other agreements, giving our lenders and other debt holders the right to terminate any commitments they had made to provide us with further funds and to require us to repay all amounts then outstanding. Any of these events would have a material adverse effect on our business, financial condition and operating results.
The Guarantees may be released upon the occurrence of certain events.
The Guarantee of a guarantor will be automatically and unconditionally released in respect of the Notes of any series:
only in the case of a Subsidiary Guarantor, at such time as such Subsidiary Guarantor (i) is not, (ii) is released or relieved as, or (iii) ceases (or substantially concurrently will cease) to be, a borrower or guarantor under the Credit Agreement and under the Existing T-Mobile Secured Notes, except by or as a result of payment under such guarantee or direct obligation;
only in the case of a Subsidiary Guarantor, in connection with any sale or other disposition of all or substantially all of the assets of that Subsidiary Guarantor (including by way of merger or consolidation) to a person that is not (either before or after giving effect to such transaction) the Issuer or a Restricted Subsidiary of the Issuer, if the sale or other disposition is not prohibited by the “Asset Sale” provisions of the Indenture;
only in the case of a Subsidiary Guarantor, if for any reason such Subsidiary Guarantor ceases to be a wholly-owned subsidiary of the Issuer; provided, that any Subsidiary Guarantor that ceases to constitute a Subsidiary Guarantor or becomes an Excluded Subsidiary solely by virtue of no longer being a wholly-owned subsidiary (a “Partially Disposed Subsidiary”) shall only be released from its Guarantee to the extent that the other person taking an equity interest in such Partially Disposed Subsidiary is not an affiliate of the Issuer that is controlled by Parent, Deutsche Telekom or any of their respective subsidiaries or an employee of any of the foregoing;
upon the legal defeasance, covenant defeasance, or satisfaction and discharge of the indentures governing the Notes as provided below under the captions “Description of Notes—Legal Defeasance and Covenant Defeasance” and “Description of Notes—Satisfaction and Discharge”;
upon the liquidation or dissolution of any Subsidiary Guarantor, provided that no event of default under the indentures governing the Notes has occurred that is continuing;
upon the merger or consolidation of any guarantor with and into the Issuer or another guarantor that is the surviving person in such merger or consolidation;
in the case of a Subsidiary Guarantor, at the time of an Investment Grade Event Election (as defined in “Description of Notes—Certain Definitions”); or
if the Issuer designates any restricted subsidiary that is a guarantor to be an unrestricted subsidiary in accordance with the applicable provisions of the indentures governing the Notes.
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If any such Guarantee is released, no holder of the Notes will have a claim as a creditor against the applicable guarantor, and the indebtedness and other liabilities of such former Subsidiary Guarantor will be structurally senior to the claim of any holder of the Notes. See “Description of Notes—Brief Description of the Notes and the Note Guarantees—The Note Guarantees.”
The Guarantees may be avoidable and therefore not be enforceable because of fraudulent conveyance or fraudulent transfer laws.
The Guarantees may be subject to review and potential avoidance under federal bankruptcy law or relevant state fraudulent conveyance laws if we or any guarantor file a petition for bankruptcy or our creditors file an involuntary petition for bankruptcy against us or any guarantor. Under these laws, if a court were to find that, at the time a guarantor incurred debt (including debt represented by the Guarantee), such guarantor:
incurred this debt with the intent of hindering, delaying or defrauding current or future creditors; or
received less than reasonably equivalent value or fair consideration for incurring this debt, and the guarantor:
was insolvent or was rendered insolvent by reason of the related financing transactions (including the issuance of the Guarantees);
was engaged in, or about to engage in, a business or transaction for which its remaining assets constituted unreasonably small capital to carry on its business as currently engaged in or contemplated; or
intended to incur, or believed that it would incur, debts beyond its ability to pay these debts as they mature, as all of the foregoing terms are defined in or interpreted under the relevant fraudulent transfer or conveyance statutes;
then the court could avoid the Guarantee or subordinate the amounts owing under the Guarantee to the guarantor’s presently existing or future debt or take other actions detrimental to you. In the event of a finding that a fraudulent transfer or conveyance occurred, you may not receive any repayment on the relevant Guarantee (and, consequently, the Notes), or may receive only a partial repayment.
The measure of insolvency for purposes of the foregoing considerations will vary depending upon the law of the jurisdiction that is being applied in any such proceeding, such that we cannot be certain as to the standards a court would use to determine whether or not the Issuer or the guarantors were insolvent at the relevant time or, regardless of the insolvency standard applied by the court, that such court would not determine (i) that the Issuer or a guarantor were indeed insolvent on that date, (ii) that any payments to the holders of the Notes (including under the Guarantees) did not constitute preferences, fraudulent transfers or conveyances on other grounds or (iii) whether the Notes or any Guarantees would be subordinated to the Issuer’s or any of the guarantors’ other debt. Generally, however, an entity would be considered insolvent if, at the time it incurred the debt or issued the Guarantee:
it could not pay its debts or contingent liabilities as they become due;
the sum of its debts, including contingent liabilities, is greater than its assets, at a fair valuation; or
the present fair saleable value of its assets is less than the amount required to pay the probable liability on its total existing debts and liabilities, including contingent liabilities, as they become absolute and mature.
As a general matter, value is given for a transfer or an obligation if, in exchange for the transfer or obligation, property is transferred or a valid antecedent debt is secured or satisfied. A court would likely find that a guarantor did not receive “reasonably equivalent value” (or fair consideration for) its Guarantee to the extent the guarantor did not obtain a reasonably equivalent benefit directly or indirectly from the issuance of the Notes. Thus, if the Guarantees were legally challenged, any Guarantee could be subject to the claim that, since the Guarantee was incurred for the benefit of the Issuer, and only indirectly for the benefit of the guarantor, the obligations of the applicable guarantor were incurred for less than “reasonably equivalent value” (or fair consideration). Therefore, if a court were to find that the applicable guarantor was insolvent or rendered insolvent
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by the incurrence of the Guarantee or one of the other conditions above (relating to the guarantor’s financial condition) were satisfied, the court could avoid the obligations under the Guarantees, subordinate them to the applicable guarantor’s other debt or take other action detrimental to the holders of the Notes.
If a Guarantee is avoided as a fraudulent conveyance, fraudulent transfer, or preference, or found to be unenforceable for any other reason, you will not have a claim against that obligor and will only be our creditor or that of any guarantor whose obligation was not set aside or found to be unenforceable. In addition, the loss of a Guarantee generally will constitute an event of default under the indentures governing the Notes, the Existing T-Mobile Secured Notes and the Existing T-Mobile Unsecured Notes and the Credit Agreement, which events of default would allow the relevant noteholders or lenders to accelerate the amounts due and payable thereunder, and we may not be able to pay any such amounts.
The indentures governing the Notes will contain a provision intended to limit each guarantor’s liability to the maximum amount that it could incur without causing the incurrence of obligations under its Guarantee to be a fraudulent transfer. This provision may not be effective (as a legal matter or otherwise) to protect the Guarantees from being avoided under fraudulent transfer law, or may eliminate the guarantor’s obligations or reduce the guarantor’s obligations to an amount that effectively makes the Guarantee worthless. In a Florida bankruptcy court decision (which was subsequently reversed by a district court on other grounds and then reinstated by the applicable circuit court of appeals), this kind of provision was found to be ineffective to protect the Guarantees.
In addition, any payment by us pursuant to the Notes or by a guarantor under a Guarantee made at a time we or such guarantor were found to be insolvent could be avoided as a preferential transfer under the U.S. Bankruptcy Code and required to be returned to us or such guarantor or to a fund for the benefit of our or such guarantor’s creditors if such payment is made to an insider within a one-year period prior to a bankruptcy filing or within 90 days for any non-insider party, and such payment would give such insider or non-insider party more than such party would have received in a distribution under the U.S. Bankruptcy Code in a hypothetical Chapter 7 case, subject to applicable defenses.
Finally, as a court of equity, the bankruptcy court may subordinate the claims in respect of the Notes or the Guarantees to other claims against us under the principle of equitable subordination if the court determines that (1) a holder of the Notes or the Guarantees engaged in some type of inequitable conduct, (2) the inequitable conduct resulted in injury to our other creditors or conferred an unfair advantage upon the holders of the Notes and (3) equitable subordination is not inconsistent with the provisions of the U.S. Bankruptcy Code.
The lenders under the Credit Agreement have the discretion to release any guarantors under the Credit Agreement in a variety of circumstances, which could cause those guarantors to be released from their guarantees of each series of the Notes
For so long as any obligations under the Credit Agreement remain outstanding, any guarantee of the Notes may be released without action by, or consent of, any holder of the Notes, if the related guarantor is no longer a guarantor of obligations under the Credit Agreement or certain other indebtedness of the Issuer or any other guarantor (except, in each case, by or as a result of payment under such guarantee or direct obligation). See “Description of Notes—Brief Description of the Notes and the Note Guarantees—The Note Guarantees.” The lenders under the Credit Agreement will have the discretion to release the guarantees under the Credit Agreement in a variety of circumstances. You will not have a claim as a creditor against any entity that is no longer a guarantor of the Notes, and the indebtedness and other liabilities, including trade payables, whether secured or unsecured, of former guarantor subsidiaries will be structurally senior to claims of holders of the Notes.
Many of the covenants in the indentures governing the Notes will not apply if the Notes are rated investment grade.
The indentures governing the Notes will provide that many of its covenants will cease to apply to us if the Notes are rated investment grade by at least two of Moody’s, S&P and Fitch, provided at such time no default or event of default has occurred and is continuing. The indentures will further provide that these covenants will not be later reinstated in the event that the ratings of the Notes subsequently decline. These covenants restrict, among other things, our ability to pay dividends, to incur debt and to enter into certain other transactions. There can be no assurance that the Notes will ever be rated investment grade. However, termination of these covenants would allow us to engage in certain transactions that would not be permitted while these covenants were in force. See
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“Description of Notes—Certain Covenants—Changes in Covenants When Notes Rated Investment Grade.” Although the indentures will continue to restrict the Issuer’s ability to create liens or other encumbrances after the Notes are rated investment grade by at least two of Moody’s, S&P and Fitch, such covenant may be modified at the Issuer’s election, following such a rating event, to restrict only the Issuer and Material Subsidiaries (as defined under “Description of the Notes—Certain Definitions”) from incurring liens on principal properties or upon capital stock or indebtedness of any Material Subsidiary that directly owns any principal property, subject to certain exceptions set forth in the indentures governing the Notes. See “Description of Notes—Certain Covenants—Liens.” In addition, at the Issuer’s election, following such a rating event, the Guarantees of the Subsidiary Guarantors may be released. See “—The Guarantees may be released upon the occurrence of certain events.”
If we or existing investors sell our debt securities after this offering, the market price of the Notes could decline.
The market price of the Notes could decline as a result of our, or existing investors’, sales of the Issuer’s debt securities in the market after this offering, or the perception that such sales could occur. These sales, or the possibility that these sales may occur, also might make it more difficult for the Issuer to sell other debt securities in the future at a time and on terms that it deems appropriate.
After giving effect to the issuance of the Notes, assuming that on September 30, 2020, we had completed the Q4 Prepayment and the Q4 Notes Issuances, we would have outstanding approximately $72.4 billion in aggregate principal amount of debt securities, maturing in 2021 through 2060, $36.6 billion of which would be senior secured debt securities and $35.8 billion of which would be senior unsecured debt securities. Deutsche Telekom, which currently controls approximately 52.4% of the common stock of Parent (on a fully diluted basis), holds approximately $4.8 billion of these debt securities, maturing in 2022 through 2028. We have on file an effective shelf registration statement with respect to these debt securities held by Deutsche Telekom and Deutsche Telekom could sell all or any portion of them at any time.
There is no guarantee that an active trading market for the Notes will exist or that you will be able to sell your Notes.
An active trading market may not exist for the Notes. Historically, the market for non-investment grade debt has been subject to disruptions that have caused substantial volatility in the prices of securities similar to the notes. The market, if any, for the notes may not be free from similar disruptions, and any such disruptions may adversely affect the prices at which you may sell your notes if at all. In addition, subsequent to their initial issuance, the Notes may trade at a discount from their initial offering price, depending upon prevailing interest rates, the market for similar notes, our operating performance and financial condition and other factors. The Issuer does not intend to apply for the Notes to be listed on any securities exchange or to arrange for the Notes to be quoted on any quotation system. Further, the Notes are each a new issue of securities for which there is no established trading market. An active trading market may not develop for such Notes or, if developed, may not continue. If an active public trading market for the Notes does not develop or ceases to exist, the market price and liquidity of the Notes may be adversely affected.
The trading prices for the Notes will be directly affected by many factors, including our credit rating.
Credit rating agencies continually revise their ratings for companies they follow, including us. Changes in our performance, leverage or industry, or changes in the credit ratings agencies’ ratings methodologies, could lead to ratings downgrades. Any ratings downgrade could adversely affect the trading price of the Notes, or the trading market for the Notes, to the extent a trading market for the Notes exists or develops. The condition of the financial and credit markets and prevailing interest rates have fluctuated in the past and are likely to fluctuate in the future, and any fluctuation may impact the trading price of the Notes.
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USE OF PROCEEDS
We estimate that the net proceeds from the sale of the Notes in this offering will be approximately $2.979 billion, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.
We intend to use the net proceeds from this offering for general corporate purposes, which may include among other things, financing acquisitions of additional spectrum and refinancing existing indebtedness on an ongoing basis.
Affiliates of certain of the underwriters have made commitments to provide us with secured bridge financing in an aggregate amount of up to $5.0 billion pursuant to that certain bridge commitment letter dated as of October 30, 2020, as amended on November 13, 2020. A portion of these commitments may be reduced by an amount equal to the aggregate gross proceeds of the Notes. See “Underwriting.”
See “Description of Other Indebtedness and Certain Financing Transactions” for information on our outstanding indebtedness, including as to interest rate and maturity. Certain of the underwriters and/or their respective affiliates may be lenders under, or holders of, such indebtedness and would therefore receive any portion of the net proceeds of this offering used to repay such indebtedness. See “Underwriting.”
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CAPITALIZATION
The table below sets forth our cash and cash equivalents and capitalization as of September 30, 2020:
on an actual basis;
on an as adjusted basis to give effect to the Q4 Prepayment and the Q4 Notes Issuances; and
on an as further adjusted basis to give effect to this offering prior to any use of the net proceeds of this offering.
You should read this table in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations of T-Mobile” and related notes thereto included in Parent’s Quarterly Report on Form 10-Q filed on November 5, 2020, which is incorporated by reference in this prospectus supplement.
 
As of September 30, 2020
 
Actual
As adjusted
As further
adjusted
 
(in millions)
Cash and cash equivalents
$6,571
$11,224
$14,203
Debt:
 
 
 
Unsecured T-Mobile debt
 
 
 
Existing T-Mobile Unsecured Notes
 
 
 
4.000% Senior Notes due 2022
500
500
500
4.000% Senior Notes due 2022-1 held by Deutsche Telekom
1,000
1,000
1,000
6.000% Senior Notes due 2023
1,300
1,300
1,300
6.000% Senior Notes due 2024
1,000
1,000
1,000
5.125% Senior Notes due 2025
500
500
500
4.500% Senior Notes due 2026
1,000
1,000
1,000
4.500% Senior Notes due 2026-1 held by Deutsche Telekom
1,000
1,000
1,000
6.500% Senior Notes due 2026
2,000
2,000
2,000
5.375% Senior Notes due 2027
500
500
500
5.375% Senior Notes due 2027-1 held by Deutsche Telekom(1)
1,250
1,250
1,250
4.750% Senior Notes due 2028
1,500
1,500
1,500
4.750% Senior Notes due 2028-1 held by Deutsche Telekom
1,500
1,500
1,500
Other Notes offered hereby
 
 
 
2.250% Senior Notes due 2026
1,000
2.625% Senior Notes due 2029
1,000
2.875% Senior Notes due 2031
1,000
Tower Obligations(2)
3,079
3,079
3,079
Secured T-Mobile debt
 
 
 
Existing T-Mobile Secured Notes
 
 
 
3.500% Senior Secured Notes due 2025
3,000
3,000
3,000
1.500% Senior Secured Notes due 2026
1,000
1,000
1,000
3.750% Senior Secured Notes due 2027
4,000
4,000
4,000
2.050% Senior Secured Notes due 2028(3)
1,250
1,750
1,750
3.875% Senior Secured Notes due 2030
7,000
7,000
7,000
2.550% Senior Secured Notes due 2031(3)
1,750
2,500
2,500
2.250% Senior Secured Notes due 2031(3)
1,000
1,000
4.375% Senior Secured Notes due 2040
2,000
2,000
2,000
3.000% Senior Secured Notes due 2041(3)
2,500
2,500
4.500% Senior Secured Notes due 2050
3,000
3,000
3,000
3.300% Senior Secured Notes due 2051(3)
3,000
3,000
3.600% Senior Secured Notes due 2060(3)
1,000
1,000
Credit Agreement(4)
3,990
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As of September 30, 2020
 
Actual
As adjusted
As further
adjusted
 
(in millions)
Unsecured Sprint debt
 
 
 
Sprint 7.250% senior notes due 2021
2,250
2,250
2,250
Sprint 7.875% senior notes due 2023
4,250
4,250
4,250
Sprint 7.125% senior notes due 2024
2,500
2,500
2,500
Sprint 7.625% senior notes due 2025
1,500
1,500
1,500
Sprint 7.625% senior notes due 2026
1,500
1,500
1,500
Sprint Communications, Inc. 11.500% senior notes due 2021
1,000
1,000
1,000
Sprint Communications, Inc. 6.000% senior notes due 2022
2,280
2,280
2,280
Sprint Capital Corporation 6.875% senior notes due 2028
2,475
2,475
2,475
Sprint Capital Corporation 8.750% senior notes due 2032
2,000
2,000
2,000
Secured Sprint debt
 
 
 
Sprint Spectrum 3.360% Series 2016-1 A-1 Notes due 2021
875
875
875
Sprint Spectrum 4.738% Series 2018-1 A-1 Notes due 2025
2,100
2,100
2,100
Sprint Spectrum 5.152% Series 2018-1 A-2 Notes due 2028
1,838
1,838
1,838
Other(5)
4,584
4,580
4,559
Total debt and financing lease liabilities(6)
$72,271
$77,027
$80,006
Stockholders’ equity
64,487
64,384
64,384
Total capitalization
$136,758
$141,411
$144,390
(1)
Upon the closing of the BCA Transactions, the maturity date applicable to the 5.375% Senior Notes due 2027-1 was amended from April 15, 2027 to April 15, 2022.
(2)
Represents financing obligations related to the Existing T-Mobile Tower Transactions (as defined under “Description of Other Indebtedness and Certain Financing Transactions—Existing T-Mobile Tower Transactions”).
(3)
The as adjusted and as further adjusted amounts include the Q4 Notes Issuances on October 6, 2020 and October 28, 2020.
(4)
The Credit Agreement also provides for revolving borrowings up to $5.5 billion.
(5)
Primarily consists of financing lease liabilities, other obligations, unamortized premiums, discounts, debt issuance costs, consent fees and commitment letter fees.
(6)
Amount does not include operating lease liabilities of $30.3 billion as of September 30, 2020.
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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF T-MOBILE
The following table sets forth selected consolidated financial data for the Company. The data should be read in conjunction with T-Mobile’s audited consolidated financial statements and related notes as of December 31, 2019 and 2018 and for the three years ended December 31, 2019 contained in Parent’s Annual Report on Form 10-K filed on February 6, 2020 and T-Mobile’s unaudited condensed consolidated financial statements and related notes as of and for the nine months ended September 30, 2020 and 2019 contained in Parent’s Quarterly Report on Form 10-Q filed on November 5, 2020. The consolidated balance sheet data as of December 31, 2017, 2016 and 2015 and the consolidated statement of operations data for the fiscal years ended December 31, 2016 and 2015 are derived from T-Mobile’s consolidated financial statements which are not included or incorporated by reference in this prospectus supplement. T-Mobile’s unaudited consolidated financial statements have been prepared on the same basis as T-Mobile’s audited consolidated financial statements and, in the opinion of our management, reflect all adjustments, consisting of normal, recurring adjustments, necessary for a fair presentation of the results for those periods. The results for any interim period are not necessarily indicative of the results that may be expected for a full year.
T-Mobile’s historical financial data may not be indicative of the results of operations or financial position to be expected in the future. In particular, on January 1, 2020, T-Mobile adopted ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” which requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectibility of the reported amount. T-Mobile adopted the new credit loss standard on January 1, 2020 by recognizing a cumulative effect of initially applying the new credit loss standard on its receivables portfolio. Additionally, on January 1, 2019, T-Mobile adopted ASU 2016-02 “Leases (Topic 842)”, which requires most lessees to report a right-of-use asset and a lease liability. T-Mobile adopted the new lease standard on January 1, 2019 by recognizing and measuring leases at the adoption date with a cumulative effect of initially applying the guidance recognized at the date of initial application. Comparative information has not been restated and continues to be reported under the standards in effect for those periods. Lastly, on January 1, 2018, T-Mobile adopted ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” which requires entities to recognize revenue through the application of a five-step model, which includes: identification of the contract; identification of the performance obligations; determination of the transaction price; allocation of the transaction price to the performance obligations; and recognition of revenue as the entity satisfies the performance obligations. T-Mobile adopted the new revenue standard on January 1, 2018, using the modified retrospective method with the cumulative effect of initially applying the guidance recognized at the date of initial application. Comparative information has not been restated and continues to be reported under the standards in effect for those periods.
 
Nine months ended
September 30,
Year ended December 31,
 
2020
2019
2019
2018
2017
2016
2015
 
(unaudited)
 
 
 
 
 
 
(in millions)
Consolidated Statements of Operations Data:
 
 
 
 
 
 
 
Revenues:
 
 
 
 
 
 
 
Total service revenues
$36,215
$25,650
$34,500
$32,441
$30,525
$28,085
$24,964
Equipment revenues
11,339
6,965
9,840
10,009
9,375
8,727
6,718
Other revenues
502
505
658
860
704
678
785
Total revenues
48,056
33,120
44,998
43,310
40,604
37,490
32,467
Operating expenses:
 
 
 
 
 
 
 
Cost of services, exclusive of depreciation and amortization shown separately below
8,051
4,928
6,622
6,307
6,100
5,731
5,554
Cost of equipment sales, exclusive of depreciation and amortization shown separately below
10,563
8,381
11,899
12,047
11,608
10,819
9,344
Selling, general and administrative
14,168
10,483
14,139
13,161
12,259
11,378
10,189
Impairment expense
418
Depreciation and amortization
9,932
4,840
6,616
6,486
5,984
6,243
4,688
Cost of MetroPCS business combination
104
376
Gains on disposal of spectrum licenses
(235)
(835)
(163)
Total operating expenses
43,132
28,632
39,276
38,001
35,716
33,440
29,988
Operating income
4,924
4,488
5,722
5,309
4,888
4,050
2,479
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Nine months ended
September 30,
Year ended December 31,
 
2020
2019
2019
2018
2017
2016
2015
 
(unaudited)
 
 
 
 
 
 
(in millions)
Other income (expense):
 
 
 
 
 
 
 
Interest expense
(1,726)
(545)
(727)
(835)
(1,111)
(1,418)
(1,085)
Interest expense to affiliates