Edgar Filing: T-Mobile US, Inc.

T-MOBILE US, INC.

November 5, 2015

/s/ J. Braxton Carter

J. Braxton Carter

Executive Vice President and Chief Financial Officer

8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): October 30, 2015

LOGO

T-MOBILE US, INC.

(Exact Name of Registrant as Specified in Charter)

DELAWARE

1-33409

20-0836269

(State or other jurisdiction

of incorporation or organization)

(Commission

File Number)

(I.R.S. Employer

Identification No.)

12920 SE 38th Street

Bellevue, Washington

98006-1350

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (425) 378-4000

(Former Name or Former Address, if Changed Since Last Report):

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 — Entry into a Material Definitive Agreement

Amendment to the Master Receivables Purchase Agreement

On February 26, 2014, T-Mobile US, Inc. (the “Company”) and certain subsidiaries entered into agreements pertaining to a wireless phone bill receivables securitization facility (the “Securitization Facility”) with Landesbank Hessen-Thüringen Girozentrale (“Helaba”) and The Bank of Tokyo Mitsubishi UFJ, Ltd., collectively as bank purchasers, including a Master Receivables Purchase Agreement among T-Mobile Airtime Funding LLC, a special purpose entity and wholly owned subsidiary of the Company (“T-Mobile Funding”), Billing Gate One LLC, a Delaware limited liability company (the “Purchaser”), Helaba, as bank purchasing agent, T-Mobile PCS Holdings LLC, a wholly owned subsidiary of the Company (the “Servicer”), and the Company (the “Master Receivables Purchase Agreement”). The Securitization Facility, which initially had a $500,000,000 maximum funding commitment and an accordion feature allowing T-Mobile Funding, subject to certain conditions precedent, to increase the maximum funding commitment up to $700,000,000. The Securitization Facility was subsequently amended in November 2014 to, among other things, increase the maximum funding commitment to $640,000,000 while maintaining the accordion feature to increase the maximum funding commitment up to $700,000,000.

On October 30, 2015, the Company, T-Mobile Funding, the Servicer, Helaba, as bank purchasing agent, and the Purchaser entered into the October 2015 Amendment to the Master Receivables Purchase Agreement (the “Amendment”) which, among other things, (i) extended the revolving period for the Securitization Facility, which was scheduled to end on March 14, 2016, to March 13, 2017 and (ii) increased the maximum funding commitment permitted through the exercise of the accordion feature up to $750,000,000.

In addition, the Amendment (i) decreased the minimum required Consolidated Equity Ratio of the Company and its consolidated subsidiaries from 20.0% to 17.5% and (ii) increased the maximum permitted Consolidated Leverage Ratio of the Company and its consolidated subsidiaries from 450% to 500%. These financial covenants apply as conditions to fundings and as facility termination events.

The foregoing description is not complete and is qualified in its entirety by reference to the full and complete terms of the amendment, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.

Credit Agreement Amendment

On November 2, 2015, T-Mobile USA, Inc. (“T-Mobile USA”), a direct, wholly-owned subsidiary of the Company entered into Amendment No. 3 to its Credit Agreement, dated as of May 1, 2013 (the “Credit Agreement Amendment”), with Deutsche Telekom AG and the other lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.

The Credit Agreement includes a financial covenant requiring that T-Mobile USA’s Debt to Cash Flow Ratio shall not exceed a maximum level, which applies as a condition to borrowing (tested at the time of the borrowing giving pro forma effect to borrowing) and at any time borrowings are outstanding (tested on a quarterly basis).

The Credit Agreement also includes a covenant restricting the ability of T-Mobile USA and its restricted subsidiaries to incur indebtedness, which includes certain exceptions, including an exception that permits T-Mobile USA and its restricted subsidiaries to incur indebtedness if, at the time of such incurrence, T-Mobile USA’s Debt to Cash Flow Ratio, determined giving pro forma effect to such incurrence, is no greater than the same maximum level.

The amendment sets the maximum Debt to Cash Flow Ratio applicable to the financial covenant and the indebtedness covenant permissive exception referred to in the paragraph above at 5.00 to 1.00 (for fiscal periods ending on or prior to June 30, 2016), 4.75 to 1.00 (for fiscal periods ending after June 30, 2016 and on or prior to June 30, 2017) and 4.25 to 1.00 (for fiscal periods ending after June 30, 2017).

The foregoing description is not complete and is qualified in its entirety by reference to the full and complete terms of the amendment, which is filed as Exhibit 10.2 to this Current Report on Form 8-K and incorporated herein by reference.

Senior Notes Documents

On November 5, 2015, T-Mobile USA issued $2,000,000,000 principal amount of its 6.500% Senior Notes due 2026 (the “Notes”) pursuant to an Indenture (the “Base Indenture”), dated as of April 28, 2013, among T-Mobile USA, the guarantors party thereto and Deutsche Bank Trust Company Americas, as trustee, as amended and supplemented with respect to the Notes by the Twentieth Supplemental Indenture, dated as of November 5, 2015 (the “Twentieth Supplemental Indenture”), among T-Mobile USA, the Company, the other guarantors party thereto and Deutsche Bank Trust Company Americas, as trustee (the Base Indenture, as amended and supplemented with respect to the Notes by the Twentieth Supplemental Indenture, the

“Indenture”). The Notes will bear interest at a rate of 6.500% per year and mature on January 15, 2026. T-Mobile USA will pay interest on the notes semiannually in arrears on each January 15 and July 15, commencing January 15, 2016. The Notes will initially be guaranteed on a senior unsecured basis by the Company and all of T-Mobile USA’s wholly-owned domestic restricted subsidiaries (excluding certain designated special purpose entities, a certain reinsurance subsidiary and immaterial subsidiaries), all of T-Mobile USA’s restricted subsidiaries that guarantee certain of its indebtedness, and any future subsidiary of the Company that directly or indirectly owns all of T-Mobile USA’s equity interests (the “Guarantors”). The Notes and the guarantees will be T-Mobile USA’s and the Guarantors’ senior unsecured obligations and will rank equally in right of payment with all of T-Mobile USA’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 and the guarantees, and will rank senior in right of payment to any future indebtedness of T-Mobile USA or any Guarantor that provides by its terms that it is subordinated in right of payment to the Notes and the guarantees. The Notes and the guarantees will be effectively subordinated to all of T-Mobile USA’s and the Guarantors’ existing and future secured indebtedness to the extent of the assets securing such indebtedness, and will be structurally subordinated to all of the liabilities and preferred stock of any of T-Mobile USA’s subsidiaries that do not guarantee the Notes.

If T-Mobile USA experiences specific kinds of changes of control as set forth in the Indenture and any such change of control is accompanied or followed by rating downgrades during a specified period of time after the change of control, each holder of the Notes may require T-Mobile USA to repurchase all or a portion of the Notes so held at a price equal to 101% of the principal amount of such Notes, plus any accrued and unpaid interest on the Notes repurchased to, but not including, the date of repurchase.

The Indenture contains covenants that, among other things, restrict the ability of T-Mobile USA 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, and merge, consolidate or sell, or otherwise dispose of, substantially all of their assets. These limitations are subject to a number of important qualifications and exceptions.

The Indenture contains customary Events of Default (as defined in the Indenture), including:

•

default for 30 days in the payment when due of interest (including Additional Interest (as defined in the Indenture)) on the applicable series of Notes;

•

default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the applicable series of Notes;

•

failure by T-Mobile USA to comply with its other obligations under the Indenture, in certain cases subject to notice and grace periods;

•

payment defaults and accelerations with respect to other indebtedness of T-Mobile USA and certain of its restricted subsidiaries in the aggregate principal amount of $100.0 million or more;

•

specified events involving bankruptcy, insolvency or reorganization of T-Mobile USA or certain of its restricted subsidiaries; and

•

failure by T-Mobile USA or certain of its restricted subsidiaries to pay certain final judgments aggregating in excess of $100.0 million within 60 consecutive days of such final judgment.

Upon an Event of Default, the trustee or the holders of at least 25% in aggregate principal amount of the applicable series of Notes then outstanding may declare all the Notes of that series to be due and payable immediately. In the case of Events of Default relating to bankruptcy, insolvency or reorganization, all outstanding Notes will become due and payable immediately without further action or notice.

This description of the Twentieth Supplemental Indenture is a summary only and is qualified in its entirety by the full and complete terms of the Twentieth Supplemental Indenture, which is filed as Exhibit 4.1 to this Current Report on Form 8-K and incorporated herein by reference.

Item 2.03 — Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The disclosure under Item 1.01 of this report regarding the Notes and the Credit Agreement Amendment is also responsive to Item 2.03 of this report and is incorporated herein by reference.

Item 8.01 — Other Events

On November 2, 2015, T-Mobile USA entered into an underwriting agreement (the “Underwriting Agreement”) with the several underwriters named in the Underwriting Agreement (the “Underwriters”), for which Deutsche Bank Securities Inc. is acting as representative, and the Guarantors, relating to an underwritten public offering of the Notes in an aggregate principal amount of $2,000,000,000. The Notes were offered to the public at a price equal to 100.0% of the principal amount thereof, and the Underwriters agreed to purchase the Notes from T-Mobile USA pursuant to the Underwriting Agreement at an aggregate price of $1,997,500,000.

The closing of the offering and delivery of the Notes took place on November 5, 2015. The Notes were issued pursuant to an automatic shelf registration statement on Form S-3 (the “Registration Statement”) that the Company and T-Mobile USA filed with the Securities and Exchange Commission (the “SEC”) on November 7, 2013, as amended (File No. 333-192178). A prospectus supplement relating to the offering has been filed with the SEC.

The Underwriting Agreement is filed as Exhibit 1.1 to this Current Report on Form 8-K and incorporated herein by reference. The foregoing is only a brief description of the material terms of the Underwriting Agreement, does not purport to be a complete description of the rights and obligations of the parties thereunder and is qualified in its entirety by reference to such Underwriting Agreement.

The legal opinion and consent of Gibson, Dunn & Crutcher LLP relating to the Notes is filed as Exhibit 5.1 to this Current Report on Form 8-K and incorporated herein by reference.

Item 9.01 — Financial Statements and Exhibits

The following exhibits are furnished as part of this report:

(d) Exhibits:


Exhibit		Description

1.1		Underwriting Agreement, dated November 2, 2015, among T-Mobile USA, Inc., the guarantors party thereto and the several Underwriters named in Schedule 1 thereto for which Deutsche Bank Securities Inc. is acting as representative.

4.1		Twentieth Supplemental Indenture, dated as of November 5, 2015, by and among T-Mobile USA, Inc., the guarantors party thereto and Deutsche Bank Trust Company Americas, as trustee, including the Form of 6.500% Senior Note due 2026.

5.1		Opinion of Gibson, Dunn & Crutcher LLP.

10.1		October 2015 Amendment to the Master Receivables Purchase Agreement, dated as of October 30, 2015, among T-Mobile Airtime Funding LLC, as funding seller, Billing Gate One LLC, as purchaser, Landesbank Hessen-Thüringen Girozentrale, as bank purchasing agent, T-Mobile PCS Holdings LLC, as servicer, and T-Mobile US, Inc., as performance guarantor.

10.2		Amendment No. 3, dated as of November 2, 2015, to the Credit Agreement, dated as of May 1, 2013, among T-Mobile USA, Inc., Deutsche Telekom and the other lenders party thereto from time to time, and JPMorgan Chase Bank, N.A., as Administrative Agent.

23.1		Consent of Gibson, Dunn & Crutcher LLP (included in Exhibit 5.1).

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.